Universal Fiberglass Corp. v. United States

• Decision Date: 25 September 1968
• Docket Number: No. 19054.,19054.
• Parties: UNIVERSAL FIBERGLASS CORP., Henry J. Rand, III, George H. Bookbinder, and James R. Matthews, Appellants, v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

400 F.2d 926 (1968)

UNIVERSAL FIBERGLASS CORP., Henry J. Rand, III, George H. Bookbinder, and James R. Matthews, Appellants, v. UNITED STATES of America, Appellee.

No. 19054.

United States Court of Appeals Eighth Circuit.

September 25, 1968.

Roger A. Peterson, of Helgesen, Peterson, Engberg & Spector, Minneapolis, Minn., for appellant and filed brief.

Carl Eardley, Atty., Dept. of Justice, Washington, D. C., for appellee; Edwin L. Weisl, Jr., Asst. Atty. Gen., and Alan S. Rosenthal and Howard J. Kashner, Attys., Dept. of Justice, Washington, D. C., and Patrick J. Foley, U. S. Atty., Minneapolis, Minn., were with Carl Eardley, Washington, D. C., on the brief.

Before VAN OOSTERHOUT, Chief Judge, BLACKMUN, Circuit Judge, and VAN PELT, District Judge.

VAN PELT, District Judge.

This is an action for declaratory judgment as to the provisions of a contract between the United States of America and the defendant, Universal Fiberglass Corp. Adopting the terminology of counsel in their respective briefs, this defendant will hereafter be referred to as UFC. Also named as defendants are Henry J. Rand, III, and George H. Bookbinder, who are president and vice-president, respectively, of UFC, and James R. Matthews, who was office manager and corporate bookkeeper and accountant for UFC. The complaint also asks for an injunction which would restrain the defendants and others from preventing the Administrator of the General Services Administration (GSA) from examining UFC's books and records.

The case grows out of a written contract awarded UFC, on January 27, 1965, by GSA for the production of 12,714 three-wheel mail delivery trucks at a contract price totalling $13,298,844. The unit price was $1046. Four amendments were made to this contract, the last of which increased the unit price of the vehicles to $1156.

Under the original contract, deliveries at the rate of 75 units per day were to be made commencing not later than July 27, 1965. By amendment the number of the units to be delivered daily was reduced for a stated period. There is a dispute as to the exact number of vehicles manufactured and tendered by UFC. Probably it was not less than 3271 and not more than 4222. GSA made progress payments to UFC totalling $5,454,424. Thus UFC drew approximately 41% of the contract price and produced between one-fourth and one-third of the units contracted.

As matters proceeded, a new pilot model was submitted by UFC under amendment 4 of the contract, and approved. In this interval a fire occurred in the UFC plant and the delivery schedule to be submitted was not furnished. During this time an audit was conducted by the Government which resulted in its questioning UFC's ability to complete the contract. On November 1, 1966 the Government requested that within two weeks UFC furnish detailed arrangements for completion of the contract stating that UFC had been overpaid. Further correspondence ensued, the details of which are not important here, with the result that on December 2, 1966 the Government terminated the contract for failure to make delivery and for failure to make progress. UFC denied its default and appealed to GSA's Board of Contract Appeals where at the time of the oral argument the matter was still pending.

This action was begun in January, 1967, after requests for inspection of UFC's books and records were denied. Thereafter, plaintiff's motion for a summary judgment and supporting affidavits were filed. After the suit was filed UFC granted the government a limited right of access to invoices, purchase orders, receiving reports, stock record cards and time cards. The Government claims that it needs the access requested in this suit

1) to defend itself on defendant UFC's appeal to GSA's Board of Contract Appeals;

2) to identify and value the inventory vested in it under the contract;

3) to ascertain the type and extent of any claims it might have against UFC;

4) to determine the amount of unliquidated progress payments.

The trial court granted plaintiff's motion for summary judgment and defendants have appealed.

The errors assigned relate to

1) the right of the district court to enter its order pending the appeal to the Board of Contract Appeals;

2) whether the contract gives the Government the right of access to UFC's books and records;

3) whether there was a material issue of fact that could not be resolved on a motion for summary judgment.

We consider the last claim first because we agree that summary judgment is not to be granted if there is a material issue of fact to be decided. See Ramsouer v. Midland Valley R. Co., 135 F.2d 101 (8 Cir. 1943). We also agree that UFC did not in its affidavits present to the trial court the claimed matters on which it now relies. Nevertheless, the trial court's ruling is correct. The issues which appellants present in their assignments of error have to do with the language of the contract, the construction of such language, and what the contract means or entails.

What is meant by "final payment under this contract", by "pertinent", by "reasonable opportunity", by "total profits realized", by "plans, drawings, information, and contract rights (hereinafter called `manufacturing materials')," by "administration" as they apply to the right of plaintiff hereafter discussed, to examine defendants' books and records, does not raise an issue of fact as such. All contracts are subject to interpretation by the courts. If we adopted appellants' argument, summary judgment could never be granted in contract actions because arguably some term in every contract is subject to interpretation. Declaratory judgment cases in which summary judgment has been granted although the parties were not in agreement as to the meaning of the contract or its interpretation, are: Motor Terminals v. National Car Co., 92 F. Supp. 155 (D.Del.1949), aff'd 182 F.2d 732 (3 Cir.); Keele v. Union Pacific R. Co., 78 F.Supp. 678 (S.D.Calif.1948); Northland Greyhound Lines v. Amalgamated Ass'n, etc., 66 F.Supp. 431 (D.Minn.1946).

One further comment may be material. After the...