Austin Company v. United States
| Decision Date | 06 March 1963 |
| Docket Number | No. 177-61.,177-61. |
| Parties | The AUSTIN COMPANY v. The UNITED STATES. |
| Court | U.S. Claims Court |
Leward C. Wykoff, Cleveland, Ohio, for plaintiff. Thomas V. Koykka, Edward C. Adkins and Arter, Hadden, Wykoff & Van Duzer, Cleveland, Ohio, were on the briefs.
Alfred H. O. Boudreau, Jr., Washington, D. C., with whom was Acting Asst. Atty. Gen. Joseph D. Guilfoyle, for defendant.
Before JONES, Chief Judge, and WHITAKER, LARAMORE, DURFEE and DAVIS, Judges.
This case is being heard on plaintiff's motion and defendant's cross-motion for summary judgment, and involves interpretation of a contract which plaintiff says was later found to be impossible of performance.
The Austin Company, plaintiff, entered into a contract with the United States on August 11, 1954, to design, manufacture, test and deliver a Digital Data Recording and Transcribing System, for the contract price of $177,500. This was to be a system, incorporating the use of a servo-mechanism, to gather data from remote locations aboard a ship, amplify the information so gathered, and transmit it to a central point where it was to be converted to digital form suitable for use in a computer and finally recorded on magnetic tape. No system of this kind had ever been previously manufactured or developed.
Before execution of the contract, the plaintiff reviewed the defendant's specifications and determined that the system as so described could not be manufactured with the required precision set forth in the specifications because of the inherent time lag involved in the operation of the servo-mechanism. The plaintiff then studied the problem, and on June 1, 1954 submitted a technical proposal embodying modifications of the defendant's specifications, including an implementation designed to compensate for the characteristic error of the servomechanism. The plaintiff's proposal also contemplated a system having greater accuracy than that outlined in the defendant's specifications. After conferring with the defendant's representatives, the plaintiff further supplemented and revised its proposal. Both the defendant and the plaintiff believed the plaintiff's proposal sound and workable and would result in a more precise system. Therefore, the plaintiff's proposal was incorporated into the specifications of the contract which was then signed on August 11, 1954.
The plaintiff diligently proceeded to attempt to develop and manufacture the contracted-for system, and incurred expenditures of $290,000 to this end. However, due to a phenomenon called "jitter", which is noise of electrical or mechanical origin caused by vibrations and other disturbances, and which sometimes occurs in highly sensitive electronic systems, it was discovered that it was impossible for plaintiff to manufacture the called-for system, as specified, with the desired precision. After granting plaintiff several extensions of time to produce the system, the defendant finally terminated the contract when it became apparent that plaintiff could not make the system as required.
The main question before the court is whether, under the termination provisions of the contract, the plaintiff is entitled to recover the expenditures, not in excess of the contract price, which it incurred in its effort to manufacture the contracted-for system. Plaintiff's primary claim is that it is entitled to recover such expenditures because its nonperformance was, in the words of the contract, "due to causes beyond the control and without the fault or negligence of the Contractor."
The aforementioned clause is further implemented by another provision of the contract, which reads as follows:
Other termination provisions of the contract provide that when the contractor's failure to perform is due to causes beyond the control of the contractor, as determined in the above-quoted provision, the contract shall be considered terminated for the convenience of the Government and the contractor may recover its costs, not in excess of the contract price, incurred while attempting to perform.
The facts here indicate that plaintiff's failure to perform was solely...
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