United States v. Behan

• Decision Date: 04 February 1884
• Parties: UNITED STATES v. BEHAN
• Court: U.S. Supreme Court

110 U.S. 338

4 S.Ct. 81

28 L.Ed. 168

UNITED STATES v. BEHAN.

February 4, 1884.

Sol. Gen. Phillips and John. S. Blair, for appellant.

J. W. Douglass, for appellee.

BRADLEY, J.

Behan, the appellee and claimant, filed a petition in the court below, setting forth that on the twenty-sixth of December, 1879, one John Roy entered into a contract with C. W. Howell, major of engineers of the United States army, to make certain improvements in the harbor of New Orleans, (describing the same,) and that the claimant and two other persons named became bondsmen for the faithful performance of the work; that on February 10, 1881, the contract with Roy was annulled by the engineer office, and the bondsmen were notified that they had a right to continue the work under the contract if they desired to do so, and that the claimant complied with this suggestion and undertook the work; that he went to great expense in providing the requisite machinery, materials, and labor for fulfilling the contract, but that in September, 1881, it being found, by the report of a board of engineers, that the plan of improve- ment was a failure, without any fault of the claimant, the work was ordered to cease; that thereupon the claimant stopped all operations, and disposed of the machinery and materials on hand upon the best terms possible, and sent to the war department an account of his outlay and expenses, and the value of his own time, claiming as due to him, after all just credits and offsets, the sum of $36,347.94, for which sum he prayed judgment. The claimant afterwards filed an amended petition, in which the various transactions and his operations under the contract were set forth in greater detail, showing, among other things, that the amount of his expenses for machinery and tools, for materials, and for labor and operations carried on, after deducting the proceeds realized from the sale of the plant remaining when the work was suspended, amounted to the sum of $33,192.90. The petition further alleged that the claimant could have completed the work contemplated by the contract by a further expense of $10,000, and that the amount which would then have been due therefor would have been $52,000, leaving a profit to him of $8,807.10. The petition concluded as follows: 'Your petitioner therefore respectfully shows that his reasonable and necessary expenditures upon the work above described amounted to $33,195.92, which sum represents the losses actually sustained by petitioner by reason of the defendants' breach of the contract. And petitioner further sets forth that the reasonable and legitimate profits which he might have obtained but for the said breach of contract may be properly computed at $8,807.10, assuming $52,000 as the amount to be paid for the completed work. And petitioner further shows that he has not received one dollar from the defendants on account of said work, but that his claim and accompaning accounts, presented to the engineer department, have been transmitted to this court by the secretary of war. Your petitioner therefore alleges that he is entitled to receive from the United States the sum of forty-two thousand dollars ($42,000) over and above all just credits and offsets. Wherefore he prays judgment for that amount.'

The court of claims found the material facts to be substan- tially as stated in the petition. The contract of Roy is set forth in full in the findings, from which it appears that the contracting party was required to furnish and lay down an artificial covering of cane-mats over the sloping portion of the riverbed of the Mississippi in front of the third district of New Orleans, to extend outwards to a depth in the river not exceeding 100 feet, and to be paid therefor at the rate of 65 cents per square yard. The court finds that Roy prosecuted the work under the contract during the year 1880, but his progress not being satisfactory to the engineer officers, the contract was formally annualled and the bondsmen notified, as stated in the petition. In March, 1881, Behan, the claimant, gave notice to Maj. Howell that he would undertake the work, and at his request the major gave him a description of the work to be done, estimated as not exceeding 77,000 or 80,000 square yards, which, at the contract price, would amount to from $50,000 to $52,000.

The court further finds as follows: 'The contract was of such a character as to require extensive preparations and a large initial expenditure. The claimant made the necessary preparations for carrying on the work to completion, and in procuring boats, tools, materials, and apparatus for its prosecution. He engaged actively in carrying out the contract on his part, incurred large expenditure for labor and materials, and had for some time proceeded with the work when the undertaking was abandoned by the defendants and the work stopped, without fault of the claimant, as set forth in the following letters:' Then follows a copy of correspondence between the officers and the department of engineers, showing that a board of engineer officers was appointed to examine and report upon the plan of improvement under which the work of the claimant was being carried on, and that this board, on the twenty-third of September, 1881, reported their uanimous opinion that the object sought to be accomplished by the improvement had not been attained, and that under the then existing plan of operations it could not be attained. On the twenty-ninth of September, 1881, the claimant received notice to discontinue the work, which he did at once, and gave Maj. Howell notice to that effect, and called his attention to the exposed situation of the machinery, materials, and other property on hand, and requested instructions respecting the same. No instructions appear to have been given.

The court then finds as follows: 'The claimant thereupon closed up his work and sold the materials which he had on hand. Nothing has been paid to him for work, materials, or losses. The actual and reasonable expenditures by the claimant in the prosecution of his work, together with his unavoidable losses on the materials on hand at the time of the stoppage by the defendants, were equal to the full amount claimed therefor in his petition—$33,192.20. It does not appear from the evidence thereon on the one side and the other whether or not the claimant would have made any actual profit over and above expenditures, or would have incurred actual loss had he continued the work to the end and been paid the full contract price therefor.

'CONCLUSION OF LAW.

'Upon the foregoing findings of facts the court decides as a conclusion of law that the claimant is entitled to recover the sum of $33,192.20.'

The government has appealed from this decree, and complains of the rule of damages adopted by the court below. Counsel contend that, by making a claim for profits, the claimant asserts the existence of the contract as opposed to its rescission; and that in such case the rule of damages, as settled is Speed's Case, 8 Wall. 77, is 'the difference between the cost of doing the work and what claimants were to receive for it, making reasonable deduction for the less time engaged, and for release from the care, trouble, risk, and responsibility attending a full execution of the contract.' And when such a claim is made, they contend that the burden of proof is on the claimant to show what the profits would have been; and as the court of claims expressly finds that it does not appear from the evidence whether or not the claimant would have made any profits, or would have incurred loss, therefore the laimant was not entitled to judgment for any amount whatever.

The manner in which the subject was viewed by the court of claims is shown by the following extract from its opinion: 'Whatever rule may be adopted in calculating the damages to a contractor when, without his fault, the other party, during its progress, puts an end to the contract before completion, the object is to indemnify him for his losses sustained and his gains prevented by the action of ...