Ingram-Day Lumber Co. v. McLouth
Opinion of the Court
(after stating the facts as above). It is claimed on the part of the plaintiff in error that the court erred to its prejudice in permitting the defendant to file its amended plea and in admitting evidence in reference to MeLouth’s contracts with the government, and their subsequent cancellation. A court has discretion to permit amendment to pleadings upon such con
The substantial question involved in this case is whether under the provision of the Act of June 15, 1917 (40 Stat. 182), and the “emergency shipping fund” provision of the Urgency Deficiency Appropriation Act of October 6, 1917 (40 Stat. 345), and subsequent amendments and acts in reference thereto, the plaintiff’s contract with McLouth is affected by the cancellation of McLouth’s contract with the government. This act authorized the President to exercise the power vested in him and expend the funds thereby and thereafter to be appropriated through such agency or agencies as he from time to time determined. In pursuance of this authority the President, by the executive orders of July 11, 1917, and December 3, 1918, directed that this power should be exercised by and through the United States Shipping Board Emergency Fleet Corporation. The Fleet Corporation therefore had the power to make this contract with McLouth and to suspend and cancel the same, upon making just compensation.
It is clear from this provision that it was not the intent or purpose of Congress that just compensation should be based upon loss of profits that might be earned in the completion of the contract. Duesenberg Motors Corp. v. U. S., 260 U. S. 115, 43 S. Ct. 19, 67 L. Ed. 162.
The plaintiff relies largely upon the decision in the ease of American Chain Co. v. Interstate Iron & Steel Co., 291 F. 1006; but the facts of that case are wholly different from the facts involved in this litigation. In that ease the Chain Company had purchased from the Steel Company 4,800 tons of round iron bars from one to three inches in diameter of “standard sizes, shapes, and sections, as are within sellers’ regular range of practice.” The Chain Company at that time had a contract with the Fleet Corporation to furnish 140 anchor chains, 2% inches in diameter, and of the total 4,800 tons less than 150 tons would be suitable for the manufacture of these anchor chains, and none were manufactured for the specific purposes, but were sold from the regular stock in trade of the Steel Company.
In that case the court specifically found that the seller was not a subcontractor, but a,n independent seller of its standard product which it was offering generally in the market. While there may be some things said in thaf opinion tending to support the elaim of the plaintiff, nevertheless the language used must bo construed in connection with the facts of that case.
In the ease at bar the plaintiff agreed to manufacture lumber of specified sizes and kinds as required by the American Bureau of Shipping to be used in the construction of these tug boats, which sizes were not standard and could not be sold upon the general market, but were of quality and size suitable for that particular purpose and none other. From this it appears that the plaintiff was a subcontractor, who had undertaken to manufacture and supply the specific materials necessary for the construction of the tugs which McLouth had contracted to construct for the Fleet Corporation.
In Todd Dry Dock & Construction Corporation v. Iron Works (C. C. A.) 289 F. 217, it was held that the provision of the Act of June 5, 1917, authorizing the Fleet Corporation to modify, suspend, or cancel any existing contract, is without limitation, and applies to contracts made by the government or its agents for ships and material, and extends, not only to the principal contracts, but to all subcontracts for material and labor, the performance of which would impose further obligation on the government, and that this provision of the act was read into every contract, and was notice to and binding on all contractors and subcontractors, and precludes recovery of anticipated profits from any contract or subcontracts so canceled. That case and American Chain Co. v. Interstate Iron & Steel Co., supra, were both pending in the Supreme Court at the same time, upon petitions for writs of certiorari, which petitions wore denied, on October 8 and October 22, .1923, respectively. 263 U. S. 700, 44 S. Ct. 5, 68 L. Ed. 513; 263 U. S. 709, 44 S. Ct. 36, 68 L. Ed. 518.
This, we think, is the correct construction of these acts. They were passed to meet the exigencies of war, and because of the impossibility of knowing when the war would end, Congress wisely provided for the cancellation of these contracts to prevent the needless ex
Judgment affirmed.
Reference
- Full Case Name
- INGRAM-DAY LUMBER CO. v. McLOUTH
- Cited By
- 1 case
- Status
- Published