George A. Fuller Co. v. Commonwealth

• Citation: 303 Mass. 216,21 N.E.2d 529
• Parties: GEORGE A. FULLER COMPANY v. COMMONWEALTH.
• Decision Date: 24 May 1939
• Court: United States State Supreme Judicial Court of Massachusetts

303 Mass. 216

21 N.E.2d 529

GEORGE A. FULLER COMPANY v. COMMONWEALTH.

Supreme Judicial Court of Massachusetts, Suffolk.

May 24, 1939

April 3, 1939.

Present: FIELD, C.

J., DONAHUE, DOLAN & COX, JJ.

Department of Public Works. Commonwealth. Contract, Validity. The State department of public works had no authority to bind the

Commonwealth by a contract to pay money in compromise of a disputed claim for alleged breach by the Commonwealth of a contract, made through that department, for the construction of a portion of a State highway.

PETITION, filed in the Superior Court on February 10, 1937. The petition was heard by Good, J.

F. R. Mullin, (J.

A. Daly with him,) for the petitioner.

E. O. Proctor Assistant Attorney General, for the Commonwealth.

COX, J. This is a petition under the provisions of G.L. (Ter. Ed.) c. 258 which confers jurisdiction upon the Superior Court, except as otherwise expressly provided, of all claims at law or in equity against the Commonwealth. The case was referred to an auditor (c. 258, Section 2). It was thereafter heard by a judge of the Superior Court upon the auditor's report, no other evidence being introduced. The judge denied the petitioner's requests for rulings of law and allowed the respondent's motion for judgment. The petitioner excepted to the allowance of this motion, to the refusal to give its requests, and to other rulings of the judge. The petitioner also claimed an appeal from the order of the judge allowing the respondent's motion for judgment. The appeal is not before us and the case will be considered on the petitioner's exceptions.

The petitioner and the Commonwealth, through its department of public works entered into a contract on May 23, 1934, for the construction of a portion of a State highway. The work involved also a part of a Federal aid project, thirty per cent of the cost of which was to be borne by the Federal government, and seventy per cent by the Commonwealth. The project itself and the contract were approved by the emergency public works commission of the Commonwealth, acting under St. 1933, c. 365. The contract was a so called unit price contract based upon specifications made by the department of public works, according to which the estimated amount to be paid under the contract was $364,652.43. As the work progressed it developed that the estimates of quantities varied from the quantities which were in fact used, and the work actually done was greater than that which was originally estimated. Payments were made under the contract estimates, which were documents, prepared by the department of public works, purporting to show the work that had been done and which contained the certificate of the chief engineer and the department of public works. The work under the contract was certified as complete as of May 22, 1935. On the various estimates, including one of January 30, 1936, for the amount of $75,792.93, the petitioner was paid $465,130.74. At the time this estimate of January 30, 1936, was approved and paid to the petitioner it was claiming other and further amounts. Since early in 1935 it had had claims against the Commonwealth in addition to those that were approved for payment from time to time. These claims in substance were as follows: (1) Claims for extras and increased difficulties of performance consisting of thirty-five items totalling $201,210.94. (The amount of these claims was substantially reduced by the granting of additional allowances, and no question is raised as to these allowances.) (2) Claims for additional costs, resulting from the Commonwealth's engineers' requiring the work to proceed through the winter months instead of permitting a suspension according to an alleged agreement with the department of public works, amounting to $66,009.66. (The claims under (1) and (2) were reduced to formal statements and were filed with the department of public works about September, 1935.) (3) Claims for damages resulting from alleged faulty plans and specifications, and delay in executing the contract totalling, when they were first made up in January, 1935, $84,529, but later increased to about $100,000. (These claims were never presented as formal written claims, but were brought to the attention of the department of public works and were the subject of negotiations between the petitioner and that department.) There were negotiations for settlement between the petitioner and the department of public works, the petitioner claiming $221,742 on claims detailed under (1) and (2), and approximately $100,000 for increased costs and "other acts of omission and commission on the part of the department of public works," under claim (3). As a result of their negotiations "a bona fide compromise agreement was arrived at on November 10, 1936, and was reduced to writing." This agreement is contained in a letter to the petitioner dated November 10, 1936, signed by the department business agent, to which was attached a copy of the final estimate, covering work done under the contract and showing the total value of work done as $615,638.80; and a letter addressed to the department of public works and signed by the petitioner's "cashier," in which it is stated that the final estimate referred to in the letter of the business agent is correct and that the petitioner agrees to accept the amount shown thereon as a satisfactory settlement and as a final payment. The final estimate of November 10, 1936, called for the payment of $150,508.06, of which $15,508.06 was admittedly due, and the balance, $135,000, was "extra allowance." This estimate with the approval of the department of public works was sent to the comptroller. The emergency public works commission did not participate in the negotiations for settlement, and the settlement agreement was not brought to its attention until after November 10, 1936. Thereafter, the commission, on December 21, 1936, considered the petitioner's claim for the "extra allowance" of $135,000, and was of the opinion that it "ought not on its merits to be paid." The comptroller was notified of this action and he prepared and sent to the Governor and Council an uncertified warrant for the amount of the alleged settlement. On December 31, 1936, the petitioner, allegedly pursuant to the provisions of G.L. (Ter. Ed.) c. 30, Section 5, appealed to the Governor and Council from the decision of the emergency public works commission dated December 21, 1936, relative to the petitioner's claim for $135,000. On the same day the Governor and the Council voted that there was due and payable to the petitioner $135,000, and "we do hereby annul the vote or order of the emergency public works commission as of December 21, 1936." The commissioner of the department of public works wrote a letter to the Governor and Council on January 2, 1937, relative to the petitioner's claim and the alleged settlement, in which among other things he stated: "In view of the nature of this compromise settlement it is, of course, not possible to assign any definite amount of the settlement price to any particular item or detail of this claim." On January 6, 1937, the Governor and Council voted that the emergency public works commission had no jurisdiction or power in the matter of approval or nonapproval of the final pay estimate; that the jurisdiction and power to approve that estimate rested in the department of public works; that any order, rule or regulation to the contrary adopted by the commission, "if legally any there be, is hereby annulled"; and that "the decision of the emergency public works commission, dated December 21, 1936, . . . hereby is annulled." And it was voted also that the compromise and settlement of the claims of the petitioner made by the department of public works in the sum of $135,000 be approved. The Treasurer declined to make payment under the warrant for payment, and this petition was brought.

It is a fundamental principle of our form of government that the Legislature which is the appropriating branch, has sole power to authorize the payment of claims against the Commonwealth. Opinion of the Justices, 302 Mass. 605, 612. It is also a fundamental principle of our jurisprudence that the Commonwealth cannot be impleaded in its own courts except by its own consent clearly manifested by act of the Legislature. Troy & Greenfield Railroad v. Commonwealth, 127 Mass. 43 , 46. "The first general law by which jurisdiction was conferred upon the courts to adjudicate upon claims...