Wunderlich Contracting Company v. United States

• Decision Date: 15 October 1965
• Docket Number: No. 286-58.,286-58.
• Citation: 351 F.2d 956
• Parties: WUNDERLICH CONTRACTING COMPANY, a Nebraska Corporation, Curlett Construction Company, a California Corporation, and Chas. H. Thompkins Company, a District of Columbia Corporation v. The UNITED STATES.
• Court: U.S. Claims Court

351 F.2d 956 (1965)

WUNDERLICH CONTRACTING COMPANY, a Nebraska Corporation, Curlett Construction Company, a California Corporation, and Chas. H. Thompkins Company,¹ a District of Columbia Corporation v. The UNITED STATES.

No. 286-58.

United States Court of Claims.

October 15, 1965.

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COPYRIGHT MATERIAL OMITTED

Elliott Lee Pratt, Salt Lake City, Utah, for plaintiffs. Allan E. Mecham, Clyde, Mecham & Pratt, Salt Lake City, Utah, and Harold A. Slane, Los Angeles, Cal., of counsel.

James F. Merow, Washington, D. C., with whom was Asst. Atty. Gen. John W. Douglas, for defendant. Edwin J. Reis, Washington, D. C., of counsel.

Before COWEN, Chief Judge, and LARAMORE, DURFEE, DAVIS and COLLINS, Judges.

COWEN, Chief Judge.

Plaintiffs, Wunderlich, Curlett & Tompkins, a joint venture, bring this action in their own behalf as general contractor, and on behalf of several of their subcontractors, to recover certain sums alleged to have been lost in constructing a hospital project for the Veterans Administration. On March 13, 1950, plaintiffs entered into a contract with defendant to erect a 500-bed neuro-psychiatric-tubercular hospital complex in Salt Lake City, Utah, in accordance with detailed and highly technical plans, specifications, and drawings, for a consideration of $7,898,000. Under the terms of the agreement, plaintiffs were required to complete performance of the project within 540 days after receipt of notice to proceed, and the completion date was originally fixed as October 20, 1951. In fact, though, the work was delayed for various reasons, and performance was not actually finished until September 2, 1952, some 318 days in arrears. Plaintiffs were not assessed liquidated damages by defendant for the delays, as they had been granted extensions of time sufficient to cover the entire period by which the actual performance time exceeded the original contract time.

Plaintiffs' claims for relief here are predicated upon three major, alternative theories: (1) damages for breach of contract — based upon the allegation that defendant knowingly furnished plaintiffs with defective plans and specifications which were substantially incomplete, ambiguous, and impossible of performance; (2) quantum meruit, to reimburse plaintiffs for their reasonable costs incurred in performing the work — based upon the contention that defendant ordered an unreasonable number of changes and modifications in the plans and specifications after the work had begun, the cumulative effect of which resulted in a fundamental alteration of the scope of the contract and the construction of a hospital substantially different from that originally contemplated by the parties, and (3) equitable adjustment under the Suspension of Work article of the contract, to compensate plaintiffs for the costs of actual delays incurred — based upon the assertion that the plans and specifications were allegedly so inherently ambiguous and inadequate and the changes ordered so extensive, that defendant should in all fairness have stopped the work in order to make corrections and prevent unnecessary delay and expense in the contractor's performance.

On December 16, 1946, defendant (by and through the Army Corps of Engineers) engaged an experienced Salt Lake City architectural firm to prepare necessary reports, designs, drawings, and specifications incident to the construction of the proposed 14-building hospital complex for the Veterans Administration. Because the anticipated project was to be the largest high-class construction venture ever undertaken in Salt Lake City, and because no prototype of the proposed facility existed anywhere in the United States, the architectural firm encountered serious difficulties in the performance of the design contract. Months were spent in studying various hospital designs and modern hospital techniques, and a great deal of cooperative effort was necessitated among the Veterans Administration, the Corps of Engineers, and the architects in order to produce a coordinated set of plans that would satisfactorily fulfill the requirements of the Administration. Work on the drawings was further complicated by the fact that the quality of design in the early post-war years was not as high as is now expected. During World War II, qualified draftsmen and engineers had been absorbed in great numbers into the armed services, and in the post-war years a severe shortage of personnel continued, due to the necessity of having to retrain previously qualified servicemen and to the great competitive demand for skilled technicians by both industry and government.

During the preparation of the pertinent plans and specifications, defendant, through the offices of the District Engineer, Division Engineer, Chief of Engineers, and the Veterans Administration, repeatedly reviewed submissions and resubmissions of the architect, making numerous and detailed comments, criticisms, corrections, and changes in design. Serious conflicts arose at times among the different personnel involved over various aspects and details in the plans, and conferences were arranged with the Chief of Engineers in Washington, D. C., to resolve points of difference.

When the final working drawings, as amended and modified, were eventually submitted, on May 25, 1949, the architectural firm realized that a substantial number of discrepancies remained which had not been satisfactorily resolved by corrections on the relevant documents. The Corps of Engineers, too, was cognizant of certain inadequacies and discrepancies in the final drawings, but because of the great need of the Veterans Administration for the hospital, did not require further corrections to be made prior to bidding. It decided rather to leave such outstanding matters for handling as field problems in the subsequent construction of the project.

The hospital project was then advertised for bids on December 16, 1949, and the date for submission and opening of bids scheduled for February 16, 1950. On January 24 and 25, 1950, a pre-bid conference was held in Salt Lake City, with the District Engineer of the Corps of Engineers presiding and two partners of the architectural firm in attendance. Several prospective bidders and material suppliers attended and were invited to make comments and criticisms on the plans. The existence of many errors, omissions, and discrepancies in the plans and drawings for the project would have been obvious to any competent person who examined them, and in the course of the proceedings several mistakes were brought to the attention of defendant and were later corrected by addenda. Although plaintiffs were present at this meeting, they did not comment at the time on any of the apparent deficiencies and errors in the documents.

The trial commissioner to whom this case was referred has fouud that performance of the project within the 540 days specified in the contract could only have been accomplished under ideal conditions. Under Rule 66 of this court the findings of the commissioner are presumptively correct and can be overcome only by a strong affirmative showing by plaintiffs to the contrary. Dodge Street Building Corp. v. United States, Ct.Cl.1965, 341 F.2d 641, 644-645; Wilson v. United States, 151 Ct.Cl. 271 (1960); Robert E. Davis et al. v. United States, No. 179-59, Ct.Cl., February 14, 1964. Upon a review of the record in the case we are satisfied that the commissioner's finding is amply supported by the evidence. The local manager of the Associated General Contractors, acting upon information received from interested contractors, strongly urged defendant to increase the contract performance time from 540 to 800 days. Plaintiffs themselves, moreover, had requested defendant prior to bidding to fix the contract time at 730 days, based on their own estimates of performance requirements. Because of the size and technical nature of the project, the existence of certain unresolved discrepancies in the plans and drawings, and the pressing need of the Veterans Administration for the facility, a provision was inserted in the invitation for bids permitting individual contractors to submit bids based upon a performance time in excess of 540 days by adding to their bid a certain fixed sum per excess day. In fact, of the nine bids that were eventually submitted and opened at the appointed time, six were computed on the basis of a performance time of more than 540 days. Plaintiffs, however, elected to risk completing performance within the 540-day period, and submitted an offer of $7,898,000, which, being the lowest of those received, was accepted by defendant.²

In March of 1950, after the award had been made and the contract signed, plaintiffs commenced performance on the project, subcontracting approximately 80 percent of the work to some 57 different firms, seven of which have claims presented in this case. Plaintiffs were all experienced and qualified construction contractors, although they had never worked together before as a joint venture, nor individually, in the Salt Lake City area. The various subcontractors were also experienced and qualified in their respective fields, though most of them were California firms without previous experience of Salt Lake City.

During the course of performance, plaintiffs encountered difficulties of various sorts which seriously hindered and delayed their progress. Some of these problems were attributable to inadequacies and ambiguities in the plans and drawings, and others to factors beyond the control of either plaintiffs or defendant. As is conceded by defendant, the plans furnished to plaintiffs contained numerous errors, omissions and discrepancies. Although the majority of these defects were discovered through advance review and in the preparation of shop drawings, many of the errors were not uncovered until work on the pertinent phases of the project was actually in progress. Through close and continuous...