Kenneth Reed Construction Corp. v. United States

• Decision Date: 16 March 1973
• Docket Number: No. 144-70.,144-70.
• Citation: 201 Ct. Cl. 282,475 F.2d 583
• Parties: KENNETH REED CONSTRUCTION CORPORATION v. The UNITED STATES.
• Court: U.S. Claims Court

201 Ct. Cl. 282, 475 F.2d 583 (1973)

KENNETH REED CONSTRUCTION CORPORATION v. The UNITED STATES.

No. 144-70.

United States Court of Claims.

March 16, 1973.

V. Keith Young, Orlando, Fla., Atty. of record, for plaintiff.

Michael J. Rubin, Washington, D. C., with whom was Asst. Atty. Gen. Harlington Wood, Jr., for defendant.

Before COWEN, Chief Judge, and DAVIS, SKELTON, NICHOLS, KASHIWA, KUNZIG and BENNETT, Judges.

ON PLAINTIFF'S MOTION AND DEFENDANT'S CROSS-MOTION FOR SUMMARY JUDGMENT

PER CURIAM:

This case was referred to Trial Commissioner H. D. Cooper with directions to prepare and file his opinion on the issues of plaintiff's motion and defendant's cross-motion for summary judgment under Rule 166(c). The commissioner has done so in an opinion and report filed on December 4, 1972, wherein such facts as are necessary to the opinion are set forth. On February 16, 1973, the parties hereto filed a joint motion requesting that the court adopt the report of the commissioner and enter judgment in accordance therewith.

Since the court agrees with the opinion and recommended conclusion of the trial commissioner, it hereby adopts the same as the basis for its judgment in this case, as hereinafter set forth, without oral argument. Therefore, plaintiff's motion for summary judgment is granted as to Count I and denied as to Count III, and that part of the petition is dismissed. Defendant's cross-motion for summary judgment is denied as to Count I and is granted as to Count III. The case is remanded to the Corps of Engineers Board of Contract Appeals pursuant to Public Law 92-415 and General Order No. 3 for a period not to exceed 6 months, to afford the parties an opportunity to obtain an administrative resolution of the equitable adjustment to which plaintiff is entitled under Count I of its petition.

OPINION OF COMMISSIONER

COOPER, Commissioner:

This action, in three counts, seeks review, in accordance with the standards prescribed in the Wunderlich Act,¹ of a decision² of the Corps of E of the Corps of Engineers Board of Contract Appeals (hereinafter referred to as ENG BCA) denying plaintiff's claims for an equitable adjustment. The case is before the court on cross-motions for summary judgment pursuant to Rule 163(b).

The subject contract (No. DA-08-123-CIVENG-63-57) was for the construction of a four-bay reinforced concrete spillway structure with four vertical steel lift gates, and other work. The structure, designated 65C, was to be constructed on Canal 38 (Kissimmee River), a phase of the central and southern Florida flood control project.

Count I of the petition seeks an equitable adjustment for additional work performed in constructing certain wooden forms used in pouring concrete under the subject contract. Count II is presented as an alternative to Count I and seeks further discovery and a de novo proceeding either in this court or on remand to the ENG BCA as to plaintiff's entitlement to an equitable adjustment for the additional work performed on the wooden forms. In Count III, plaintiff seeks an equitable adjustment for additional work required to repair admittedly defective vertical steel lift gates.

For the reasons stated hereinafter, plaintiff's motion as to Count I is granted and defendant's cross-motion is denied; and plaintiff's motion as to Count III is denied and defendant's cross-motion is granted. Since Count I is disposed of favorably to plaintiff, it is unnecessary to rule on the motions as to Count II.

Count I

Much of the work under this contract involved the construction of forms and the pouring of mass concrete. It is with respect to the construction of the forms that plaintiff seeks an equitable adjustment. The essence of the claim under Count I is plaintiff's contention that it was required to construct the forms to tolerances that were not set out in the contract specifications and that were more restrictive than necessary to meet specified tolerances for the finished concrete.

Paragraph 4-16 of the specifications is entitled "Forms and Formed Surfaces." Subparagraph 4-16(a) provides:

a. General: Forms shall be true to line and grade, mortar-tight and sufficiently rigid to prevent objectionable deformation under load. That portion of the form in contact with the concrete shall not be of a material which interferes with the setting of the concrete. Where forms for continuous surfaces are placed in successive units, care shall be taken to fit the forms over the completed surface so as to obtain accurate alinement of the surface and to prevent leakage of mortar. Responsibility for their adequacy shall rest with the Contractor; however, the type, shape, size, quality, and strength of all materials of which the forms are made shall be subject to specific approval. Bolts and rods used for internal ties shall be so arranged, that when the forms are removed, metal will be not less than 2 inches from any concrete surface. Wire ties will not be permitted. All forms shall be so constructed that they can be removed without damaging the concrete. All exposed joints, edges, and external corners shall be chamfered and dummy chamfers and false joints shall be used to provide a neat and uniform appearance, unless otherwise directed or indicated on the drawings.

The issue presented is whether the statement that "forms shall be true to line and grade" was intended to establish a standard of no deviations or zero tolerances for the forms.³ If not, a second issue is what tolerances for the forms were to be allowed under the specifications?

The facts relevant to this count are undisputed. According to the testimony of plaintiff's president, prior to bidding on this project, he read the specifications, including ¶ 4-16(a), and was aware of the statement that the forms were to be "true to line and grade." But, according to his testimony, since "you cannot build anything in construction to a true line and grade," he considered that statement only from the standpoint of reading on to see what the rest of the paragraph specified. Finding no stated tolerances in the specifications for the wooden forms, but noting the tolerances in subparagraphs 4-16(b) and (c) for the finished concrete,⁴ plaintiff's president testified that he selected tolerances for the forms that would "meet comfortably and flexibly the end products requirements" and priced the contract on that basis. The tolerances selected were plus or minus one-eighth of an inch or a maximum of one-fourth inch. According to the uncontroverted testimony in this record, these tolerances for the forms would have enabled plaintiff to produce finished mass concrete within the specified tolerances.

Plaintiff undertook construction of forms within the tolerances it had unilaterally selected. However, prior even to the first pour, the Government resident engineer inspected the forms and required plaintiff to make further adjustments in their plumbness and alignment. This practice continued throughout the entire contract, with the resident engineer inspecting each form prior to each pour and, in the vast majority of cases, requiring further adjustments in the forms. Although plaintiff contends that the resident engineer required the forms to be built to a tolerance of one-sixteenth of an inch, or closer, the ENG BCA found that plaintiff was never required to build its forms to any specific tolerance. The ENG BCA accepted the testimony of the resident engineer who testified that he accepted each form only when, in his judgment, it was "on the money" or when it appeared to him "that the contractor had exercised reasonable effort to get the form plumb and straight and further effort by him would damage the form rather than further improve it." The resident engineer's assistant testified he was not aware of any permissible tolerances for the forms and, when asked what standard he used to accept or reject the forms, he replied that he "used the line and grade standard of plumb."

At no time was plaintiff allowed to pour concrete with forms constructed to its own selected tolerances.⁵

Plaintiff contends that the statement "forms shall be true to line and grade" was not intended to be taken literally and did not purport to establish the tolerances for the forms. Plaintiff further argues that since ¶ 4-16(a) did not establish tolerances for the forms, it was reasonable to look to subparagraphs 4-16(b) and (c) in which the tolerances for the finished concrete were set forth to establish reasonable tolerances for the forms.

In opposition to this interpretation, defendant asserts that ¶ 4-16(a) calls out a specific unambiguous technical requirement, viz, "forms shall be true to line and grade" and that the mandatory nature of this requirement did not permit the contractor to look to any other portion of the specifications to establish tolerances for the forms.

In resolving this conflict in interpretation, it is a "fundamental precept of common law that the intention of the parties to a contract control its interpretation." Firestone Tire & Rubber Co. v. United States, 444 F.2d 547, 551, 195 Ct.Cl. 21, 30 (1971). The parties' intent must be gathered from the instrument as a whole. AMP Inc. v. United States, 389 F.2d 448, 182 Ct.Cl. 86 (1968), cert. denied, 391 U.S. 964, 88 S. Ct. 2033, 20 L.Ed.2d 878; International Arms & Fuze Co. v. United States, 73 Ct.Cl. 231 (1931). To arrive at the meaning to be attributed to a provision, the language of a contract must be given that meaning that would be derived from the contract by a reasonably intelligent person acquainted with the contemporaneous circumstances. Firestone Tire & Rubber Co., supra; Hol-Gar Mfg. Corp. v. United States, 351 F.2d 972, 169 Ct.Cl. 384 (1965). Trade usage and custom in the business community within which the agreement was framed is a factor to be considered in ascertaining the meaning intended for a contractual provision. Gholson, Byars & Holmes Constr. Co. v. United States, 351 F.2d...