United States v. Fidelity and Deposit Co. of Maryland
| Decision Date | 22 August 1956 |
| Docket Number | Civ. A. No. 4150. |
| Citation | 144 F. Supp. 322 |
| Parties | UNITED STATES of America ex rel. J. W. CROWDER et al. v. FIDELITY AND DEPOSIT COMPANY OF MARYLAND, W. R. Miller, W. L. Long, and Miller & Long. |
| Court | U.S. District Court — Western District of Louisiana |
Trotter, Morris & Cornish, Houston, Tex., Watson & Williams, Natchitoches, La., for plaintiffs.
Fulbright, Crooker, Freeman & Bates, Houston, Tex., Plauche & Plauche, Lake Charles, La., for defendants.
Plaintiffs brought this action under the provisions of the Miller Act, 40 U.S. C.A. § 270a et seq., in the name of the United States and against the contracting firm of Miller & Long, and Fidelity and Deposit Company of Maryland, the surety on the bond of Miller & Long, to recover for work performed for and equipment supplied to Miller & Long in connection with the performance of its contract with the United States, dated September 27, 1951, for the re-location of the Missouri Pacific Railroad Company railroad lines around the Lake Charles Air Force Base.
There is no question here of loss of anticipated profits. Both the subcontractor and the contractor last money. Plaintiffs argue that Miller & Long either wrongfully terminated the subcontract or else the subcontract was terminated by mutual agreement. In brief, they itemize their claim as follows:
Defendants put at issue the material allegations of the complaint, and also filed a counter-claim, wherein it was alleged that the contractor was compelled to terminate the contract because of plaintiffs' refusal to perform it and demanded damages for its breach against plaintiffs. Defendants further say that if the Court should find that the contract was terminated by mutual agreement, that then the evidence, when viewed most favorably to the plaintiffs, would reveal that the following accounting is proper:
Total Proven and
Items Claimed by Plaintiffs Claimed Recoverable
1. 92,000 cubic yards of
borrow, 3,192 yards of
channel $ 59,717.20 $22,079.00
2. Trenching 1,500.00 000.00
3. Equipment rental 8,723.00 5,000.00
4. Poor engineering 15,000.00 000.00
5. Delay 16,000.00 000.00
6. Erection of fences 2,500.00 000.00
___________ ___________
Total $103,440.20 $27,079.00
Credits Due Defendants by Plaintiffs
1. Payments made on estimates $24,480.30
2. Pay roll advances (stipulation 9) 17,300.31
3. Equipment rental (stipulation 10) 1,835.80
4. Equipment rental (stipulation 12) 4,500.00
5. Equipment rental (stipulation 11) 1,777.83
6. Equipment repairs (stipulation 14) 971.36
7. Fuel bills (stipulation 13) 5,226.17
___________
Total $56,091.79
Balance of Accounts
Credits Due Defendants $56,091.79
Amount Due Plaintiffs 27,079.00
___________
Balance Due Defendants $29,012.79
The case was tried to the Court. We have carefully considered the evidence, the respective briefs, authorities cited, and our clear recollection of the trial proceedings. The Court makes the following findings of fact:
(1) Subsequent to the original contract and on or about October 24, 1951, Miller & Long entered into a written subcontract with J. W. Crowder and Associates, plaintiffs, wherein plaintiffs agreed to do all borrow excavation at a price of Fifty (.50) Cents per cubic yard, and all channel excavation at a price of Thirty-Five (.35) Cents per cubic yard.
(2) All the excavation was to be done in strict accordance with the Plans and Specifications furnished by the United States Corps of Engineers.
(3) Subsequent to execution of the subcontract and before work was begun, plaintiffs advised Miller & Long in writing that they were going to cancel the subcontract. However, this never came to pass, and on or about December 15, 1951, plaintiffs commenced work in accordance with the provisions of the original subcontract.
(4) On March 21, 1952, a supplemental contract was entered into between plaintiffs and Miller & Long, increasing from Fifty (.50) Cents per cubic yard to Eighty-Five (.85) Cents per cubic yard the compensation for all borrow excavation in excess of 46,000 cubic yards.
(5) At the beginning of the subcontract, plaintiffs sent their bookkeeper, Mr. Myers, to act as superintendent for their portion of the job, and shortly thereafter Mr. Harp, an equipment operator, took over and continued to act in a supervisory capacity until June of 1952.
(6) In June of 1952 it became apparent that plaintiffs were in financial difficulty and Mr. Crowder personally took charge of the subcontract and informed Miller & Long that plaintiffs were unable to proceed further with the work unless they received financial assistance from someone. Miller & Long offered such financial assistance at the request of the plaintiffs and undertook the financing of plaintiffs' operating expenses, including payrolls, fuel bills, equipment rentals, and equipment repairs. In this capacity they advanced to plaintiffs the sum of $17,300.31 for plaintiffs' payroll (stipulation 9), $8,113.63 as rental for equipment used by plaintiffs (stipulations 10, 11 and 12), $5,226.17 for fuel (stipulation 13) and $971.36 for repairs to plaintiffs' equipment. In addition to these sums paid to and on behalf of plaintiffs, Miller & Long, as of June 1, 1952, had paid plaintiffs in accordance with partial pay estimates furnished by the Corps of Engineers the sum of $24,480.32.
(7) By August 13, 1952, it had become apparent that plaintiffs were not getting the work done, and on or about that date, Miller & Long, with the knowledge and consent of plaintiffs, entered into a contract with W. R. Aldrich and Company to assist plaintiffs by starting at the West end of the contract job and do the borrow excavation East to Station 26,050. For this portion of the subcontract, Miller & Long agreed to pay W. R. Aldrich & Company One ($1.00) Dollar per cubic yard, based upon quantities measured and allowed by the Corps of Engineers. Subsequently, Aldrich was allowed a net yardage of 44,177 cubic yards, for which Miller & Long paid W. R. Aldrich & Company $44,177.
(8) The Plans and Specifications on the job called for ballast or sub-ballast (gravel and rock) to be placed in a trench cut in top of the embankment. The cutting of the trench turned out to be rather a costly operation. Crowder did 1,500 feet of it, which cost him approximately $1.00 per foot.
(9) On or about September 8, 1952, plaintiffs and Miller disagreed regarding whether or not the trenching called for by the plans and specifications was part of the work to be done by plaintiffs under the subcontract. Miller insisted that plaintiff and his associates had the duty to do the trenching under the contract, and Crowder refused to dig it unless he was paid the cost on it. There appears in the record considerable testimony as to whether or not Miller actually ran them off, or whether Crowder and Associates simply left the job. Be this as it may, there can be no question but that as of September 8, 1952, the subcontract was terminated, and this Court finds as a fact that it was terminated by mutual consent.
(10) Miller & Long retained plaintiffs' equipment for a period of some fifteen (15) days and continued with the borrow excavation until an agreement was made with W. R. Aldrich and Company to complete the unfinished borrow excavation (except for the trenching) for a lump sum price of $42,000.
(11) After the entire contract had been completed, the Corps of Engineers cross-sectioned the right-of-way and found that 132,810 cubic yards of borrow excavation was involved in the entire job, and after deductions for non-pay items, such as strippings and road crossings, allowed a net total of 110,302 cubic yards, for which the general contractor was paid $126,847.30 (stipulation 22).
(12) Plaintiffs contend that Crowder and Associates completed 92,000 cubic yards of borrow excavation. They rely upon the testimony of their engineer, Earl E. Reynolds, whose deposition was taken by agreement in Houston, Texas, and which was filed in evidence as Exhibit P-20. Mr. Reynolds stated that he computed the dirt moved by Crowder and Associates as of approximately September 1, 1952. The testimony of Mr. Reynolds is to the effect that the dirt moved by Crowder and Associates was in excess of 92,000 cubic yards (Tr. pp. 20-21). Mr. Reynolds' estimate was based upon calculations made from field notes and cross-sections which were not introduced into evidence. Crowder testified under cross-examination that when he left the job the dirt work was seventy-five (75%) per cent complete (Tr. p. 121). Mr. Riddle, another partner...
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