Steffen v. United States
Decision Date | 25 May 1954 |
Docket Number | No. 11889.,11889. |
Parties | STEFFEN v. UNITED STATES. |
Court | U.S. Court of Appeals — Sixth Circuit |
Frank V. Benton, Jr., Newport, Ky. (Frank V. Benton, Jr., Benton, Benton & Luedeke, Newport, Ky., on the brief), for appellant.
Kit C. Elswick, Asst. U. S. Atty., Lexington, Ky. (Claude P. Stephens, U. S. Atty., Lexington, Ky., on the brief), for appellee.
Before SIMONS, Chief Judge, and ALLEN and MILLER, Circuit Judges.
The United States of America, appellee herein, brought this action against the appellant, M. J. Steffan, doing business as Campbell Wrecking Company, for damages in the sum of $5,873.90 with interest, for failure of the appellant to perform a contract calling for the demolition and removal of a building, by reason of which failure the United States was required to have the work performed by another contractor at an increased cost. The District Judge sustained appellee's motion for summary judgment in the amount prayed for.
On November 24, 1942, the appellant was the successful bidder and was awarded contract No. VAm 17242 for the purchase of building No. 6A at the Veterans Administration Hospital, Dayton, Ohio, for the sum of $1,111.00 and the agreement to demolish and remove the structure within 180 days after date of the notice of award. Paragraphs 12, 14 and 15 of this contract provided as follows:
Paragraph f of the Detailed Specifications read as follows:
Appellant was unable to complete the contract within the stipulated time, and, after obtaining extensions of time, on November 16, 1943, made a contract with John R. Gaiser to complete the contract for the sum of $850. Gaiser performed considerable work but failed to complete the contract because he was drafted into military service.
On August 19, 1944, the United States entered into a contract with C. D. Webb and Son to complete the wrecking of Building 6A for the sum of $7,086.50, subject to 3% discount for prompt payment. This contract contained the following provision:
The Detailed Specifications contained a paragraph dealing with fills which was almost identical in wording with Paragraph f of the Detailed Specifications of the first contract.
Webb completed his work under the contract promptly and satisfactorily and was paid the net contract price of $6,873.90. The Bonding Company later paid the $1,000 called for by its performance bond, which amount the United States credited against the $6,873.90 paid to Webb. This action was thereafter filed on February 21, 1951 to recover the remainder of the amount paid to Webb, namely, $5,873.90, with interest from June 6, 1949, which was the date of the certificate of settlement by the General Accounting Office.
At the close of all the evidence the District Judge submitted the case to the jury under instructions which permitted the United States to recover from the appellant the amount of money it was required to pay to get its contract with appellant completed. The jury found for the plaintiff in the amount of $500.00. He thereafter, on May 29, 1952, overruled appellant's motion for judgment notwithstanding the verdict, sustained appellee's motion for a new trial and assigned the case for trial for September 24, 1952. On September 22, 1952, appellee filed a motion for summary judgment which the Court sustained on February 10, 1953, followed by the entry of a judgment on February 16, 1953 in the amount of $5,873.90 with interest at 4% from October 7, 1944, from which the present appeal was taken.
We agree with the ruling of the District Judge in rejecting appellant's contention that the action was barred by the six-year statute of limitations contained in Sec. 2401(a), Title 28, U.S.Code. That section is limited to actions against the United States. We cannot by analogy make it apply to actions brought by the United States. In the absence of an applicable federal statute the state statute of limitations controls. Cope v. Anderson, 331 U.S. 461, 463, 67 S.Ct. 1340, 91 L.Ed. 1602; Hutto v. Benson, 6 Cir., 212 F.2d 349. The applicable Kentucky statute is Sec. 413.090, Kentucky Revised Statutes, which provides for a fifteen-year period for actions for breach of a written contract.
Appellant also contends that the trial Judge erred in receiving in evidence over objections of appellant unauthenticated photostats of the two contracts. Rule 44, Rules of Civil Procedure, 28 U.S.C.A. The Judge had previously sustained appellant's motion to require the Government to file these documents, which ruling had not been complied with. The photostats in their unauthenticated conditions were not technically admissible and the District Judge would have been justified in refusing to admit them. But apparently they were conditionally received subject to being duly certified at a later time. Properly certified photostatic copies were thereafter filed on January 3, 1952, which was prior to the order of May 29, 1952 overruling appellant's motion for judgment notwithstanding the verdict and the ruling of February 10, 1953 sustaining appellee's motion for summary judgment. Accordingly, they were in the record for consideration by the District Judge several months before he made the rulings which are being reviewed on this appeal. Appellant makes no claim that the unauthenticated photostats were not bona fide, exact copies of the originals, and makes no showing of having been prejudiced by the rulings. The rulings obviously did not affect the substantial rights of the appellant, and will be disregarded on this review. Sec. 2111, Title 28, U.S.Code; Sivert v. Pennsylvania R. Co., 7 Cir., 197 F.2d 371, 377. Compare: Ohl & Co. v. A. L. Smith Iron Works, 288 U.S. 170, 53 S.Ct. 340, 77 L.Ed. 681.
Appellant's contract, under "Terms of Sale," required that a deposit of 10 per cent of the total amount of the bid accompany the bid, and provided: Paragraph 15 is the requirement of a performance bond. Appellant contends that under this provision of the contract the damages were liquidated and limited to $1,000, the amount provided by the performance bond.
A provision in a contract providing for liquidated damages will be enforced by the Court, provided it is in reality liquidated damages and not a penalty. If such provision is in fact a penalty it will not be enforced and the injured party will be entitled to recover the actual damages suffered. Restatement, Contracts, Sec. 339; Fidelity & Deposit Co. of Maryland v. Jones, 256 Ky. 181, 186-192, 75 S.W.2d 1057.
As a general rule, whether the stipulated sum is liquidated damages or a penalty depends upon the intention of the parties, to be determined by a consideration of the...
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