George H. Whike Construction Co. v. United States, 290-52.

• Decision Date: 01 May 1956
• Docket Number: No. 290-52.,290-52.
• Citation: 135 Ct. Cl. 126,140 F. Supp. 560
• Parties: GEORGE H. WHIKE CONSTRUCTION COMPANY v. The UNITED STATES.
• Court: U.S. Claims Court

140 F. Supp. 560

135 Ct. Cl. 126

GEORGE H. WHIKE CONSTRUCTION COMPANY v. The UNITED STATES.

No. 290-52.

United States Court of Claims.

May 1, 1956.

Earl W. Shinn, Chevy Chase, Md., for plaintiff.

Francis X. Daly, Washington, D. C., with whom was Warren E. Burger, Asst. Atty. Gen., for defendant.

Before JONES, Chief Judge, and LITTLETON, WHITAKER, MADDEN and LARAMORE, Judges.

JONES, Chief Judge.

Plaintiff sues to recover certain moneys which it claims are due it under a construction contract with the Federal Public Housing Authority (FPHA).

On February 9, 1943, the President issued Executive Order 9301, U.S.Code Cong.Service 1943, p. 5.9, which required a minimum workweek of 48 hours in all places of employment. This order was not made applicable to the area of Canton, Ohio, where the contract in controversy was performed, until August 9, 1943. On February 11, 1943, FPHA issued an invitation to bid for the construction of certain war housing in Canton, Ohio. Plaintiff was the low bidder among the three who submitted bids. Plaintiff's bid was based on the assumption that it would work a 40-hour week. It attached a note to its bid in the following terms:

"This bid is based on 40 hour week. If it becomes necessary to work more than 40 hours, by Executive Order, we are to be reimbursed for the extra cost of such overtime, plus taxes and insurance."

Plaintiff's president and secretary came to the regional office of the FPHA in Cleveland, Ohio, on the afternoon of February 26, 1943, for the purpose of executing the contract on which plaintiff had bid. The contracting officer, Mr. C. F. Sharpe, the Regional Director, was not in at that time and the FPHA was represented by two men in the legal department of the regional office of the Authority. The contract presented to plaintiff's officers for execution contained the following proviso which had not been in the form contract furnished the bidders:

"This contract is subject to Executive Order 9301, Establishing a Minimum War Time Workweek of Forty-Eight Hours, and to the regulations and directives, if any, issued under said Executive Order by the War Manpower Commission or by the Chairman thereof."

Plaintiff's officers objected to the inclusion of this proviso in the contract and refused to sign it on that account. The FPHA lawyers told plaintiff that this provision could not be removed because the Washington office would not approve, but that plaintiff was protected by the provision in the bid which it had submitted.

When the FPHA representatives refused to delete the objectionable language in the contract, plaintiff's representatives asked for a letter from Mr. Sharpe. They had heard of another Canton contractor who had signed a contract with FPHA about a week before and had received a letter from the Government protecting it against the effects of Executive Order 9301. The letter in question was one written by Mr. Sharpe to Mr. H. S. Melbourne, Melbourne Bros. Construction Co., Canton, Ohio, on February 25, 1943, the day before the date of execution of the contract involved here. This letter contained the following language:

"I understand that you feel that the standard language with respect to Executive Order 9301, incorporated in the contract between you and the Government, dated February 24, 1943, for the construction of the War Housing Project located at Canton, Ohio (OHIO-33036), will not completely protect you in the event that the Canton area is placed, by the War Manpower Commission or the Chairman thereof, in the category of areas requiring the establishment and maintenance of a minimum war time workweek of forty-eight hours.

"This is to advise you that the intent of the contract documents and the understanding of the parties thereto is that, if the Canton area is placed in the category of areas requiring the establishment and maintenance of the minimum war time workweek of forty-eight hours, the Government will reimburse you, by Change Order or otherwise, for the actual expenditures (including necessary insurance) made for the actual overtime required to establish and maintain such a forty-eight hour minimum workweek."

It does not appear, however, whether plaintiff's officers had seen the letter or knew its exact content.

Plaintiff's representatives were told that they could not get a letter from Mr. Sharpe since he was not in at that time. The Government lawyers assured them, however, that the qualifications in plaintiff's bid would protect it if Executive Order 9301 were to become effective in the Canton area, and plaintiff's president signed the contract on these assurances. The assurances were given in lieu of the letter. Mr. Sharpe executed the contract for the Government later that same afternoon. Plaintiff began work under the contract on March 1, 1943.

Due to a great shortage of labor in the Canton area, plaintiff was delayed in the performance of its contract. Prior to August plaintiff repeatedly raised the possibility of working its men more than 40 hours in order to more fully utilize the labor force available and thus speed the completion of the job. Plaintiff was not willing to order overtime, however, unless the Government would authorize reimbursement for the additional expense. The Government never gave such an authorization but it did grant plaintiff time extensions.

Executive Order 9301 was made effective in the Canton area on August 9, 1943. On August 13 defendant's project manager notified plaintiff that the job was to be put on a 48-hour week basis. Plaintiff placed the job on that basis the following day. The project manager did not tell the Whike brothers that they would be reimbursed for the premium time incident to Saturday work performed by plaintiff's employees as a result of compliance with Executive Order 9301. However, plaintiff was told by the project manager to record the overtime separately on the usual payroll reporting forms which had been furnished to the plaintiff previously.

It has been stipulated between the parties that if the plaintiff is entitled to recover, as a matter of law, by reason of putting its job on a 48-hour week on August 14, 1943, as a result of Executive Order 9301, its damages are $8,165.56.

We have a situation in which plaintiff's president was induced to sign a contract on the representations of the lawyers of the...