472 Reporter's Statement of the Case The rejected garments had been inspected and improperly passed by the Government inspector at the plant. They were properly rejected by the receiving officer at Fort Sam Houston. 4. The contractor was informed and knew that the Government inspector at the factory had no authority to issue orders, or to accept or reject garments, and that his statements were advisory only. It was, however, the inspector's duty to advise the contractor, before shipment, of defects which he discovered in the garments. This advice took written form in a periodic "Report of Factory Inspection," by the Government inspector, in which the defects noted were set forth and which was countersigned by the factory representative of the contractor. This duty was performed by the Government inspector, but through incompetence he passed as satisfactory many garments which were defective, and did not note their defects. The contracting officer, learning that trouble had developed on the contract, investigated the situation, found the Government inspector to be incompetent, removed him from the factory, and substituted a competent inspector. Thereafter the work was turned out in a satisfactory manner and there was a minimum of rejections. The unsatisfactory condition of the garments rejected at Fort Sam Houston was for the most part caused by new workers. Their work was improperly supervised and the contractor's inspectors were lax in the performance of their duties. Except for the pockets, the patterns furnished by the Government were oversize, due to the fact that the measurements stated in the specifications were for shrunken garments, whereas the material specified was unshrunken denim. The contractor was mistakenly furnished patterns for shrunken pockets, and after the rejection of garments, the new Government inspector advised the contractor that the pockets would have to be enlarged. The contractor altered the garments in this respect, and the change delayed him in his work. In cutting for the garments the contractor governed himself by the patterns furnished by the Government. As to Reporter's Statement of the Case 92 C. Cls. the manner of putting the garment together he guided himself by the samples which were exhibited to him. The first Government inspector brought a sample garment with him from the Quartermaster Depot at Philadelphia, which the inspector represented as a garment conforming to contract specifications. The succeeding Government inspector brought with him from the Philadelphia depot samples which had been put together in a different manner. These samples were exhibited to the contractor by the second inspector and on his advice were followed by the contractor in altering the rejected garments and in putting together new garments. The change from one to the other style involved collars, pockets, sleeves, buttons, and fly. 5. August 5, 1935, the contracting officer made the following findings for the guidance of the Comptroller General of the United States in making settlement on the contract: I certify that in investigating the claim of H. W. Zweig Company, Dallas, Texas, for refund of liquidated damages, also for reimbursement of additional costs due to alleged increase in wages paid employees under Contract W 669 ECF 448, I have found the following facts: 1. That the contractor forwarded sample garments January 8, 1935, cut from patterns made in the Vaughn Manufacturing Company's plant in March 1934, applying to a former contract with the Government; and that wire from this depot was sent January 11, 1935, informing contractor of various defects in these garments; 2. That master patterns for both jumpers and trousers were sent via Air Mail in the same package January 8, 1935, and that the claimant wrote this depot January 11, 1935, that only jumper patterns were received; 3. That the second set of trouser patterns was mailed to the contractor January 14, 1935, the date of the contract, and that the claimant acknowledged receipt of same as of January 16, 1935; 4. That neither the contract nor the bid obligated the Government to forward patterns in advance of the contract; 5. That the delivery due dates as required by the contract were computed from the contract date; 6. That in the opinion of the writer no delay was caused the contractor by the Government in respect to receipt of the patterns as is alleged; 472 Reporter's Statement of the Case 7. That the contractor bid to furnish garments in accordance with the applicable specifications; 8. That the fact that a Government inspector was assigned to the place of manufacture, at the option of the Government, to make preliminary factory inspection, in nowise relieved the claimant of its responsibility to ship only garments in strict accordance with the specifications to the depot of delivery where final inspection took place; 9. That the notice of rejection to the contractor by the 8th Corps Area Depot covering the first shipments consisting of 3,600 jumpers, indicates these garments were rejected for the following reasons: buttonholes poorly stitched, edges rough, threads loose, buttons not securely fastened, poor workmanship, and the vent in the sleeve not in accordance with the specifications; 10. That subsequent notices to the contractor by the 8th Corps Area Depot indicate rejections for similar reasons; 11. That it is the opinion of the writer that the causes of delay as set forth in the contractor's letter of claim cannot be construed as unforeseeable causes beyond the control and without the fault or negligence of the contractor as covered by Article 15 of the contract; 12. That increase in wages incurred as a result of a code regulation cannot be construed as additional imposed charges within the meaning and intent of the provision found on page 13 of the bid under the caption of "FEDERAL TAXES." 6. The matter of final settlement on the contract was submitted by the administrative office to the Comptroller General, who, on April 2, 1936, stated the sum of $390.03 in favor of the contractor arrived at in part by deducting from an amount otherwise due the sum of $2,973.72, representing liquidated damages claimed to be due the United States for delay by the contractor not excusable under the terms of the contract, and the amount so withheld has never been paid to the contractor. The contractor was notified of the contracting officer's findings by the Comptroller General in his notice of settlement, in words as follows: The contracting officer has found that no evidence. has been submitted by the contractor establishing that the delays in delivery were caused by any of the ex Opinion of the Court 92 C. Cls. cusable reasons specified in the liquidated damage clause in the contract, nor by any act of the Government. There was no appeal made by the contractor to the Secretary of War. 7. The failure of the contractor to finish in contract time was due in part to the incompetency of the Government's first factory inspector, in part to the incorrect size of the patterns furnished by the Government for the pockets, in part to the variation in samples of garments exhibited to the contractor, and in part to acts of the contractor himself. The extent of the delay attributable to each factor cannot be ascertained from the evidence. The court decided that the plaintiff was entitled to recover. WHALEY, Chief Justice, delivered the opinion of the court: The plaintiff brings this suit to recover the amount of liquidated damages assessed and collected by the Comptroller General in the final settlement of its contract. There is no question that the plaintiff did not complete the contract on time. The sole question is whether the delay in completion justified the imposition of the liquidated damage clause in the contract. The plaintiff entered into the contract with the defendant to furnish certain articles of clothing at a stipulated price for each garment and to complete the contract within a specified time. Upon its failure to complete within the time provided in the contract, a certain percentage on each garment was to be assessed for each day's delay. Under the terms of the contract the Government had the right to place an inspector at the plant of plaintiff for the purpose of making a preliminary inspection. Plaintiff had taken over an idle plant and the employees which it had engaged were inexperienced in the work and it necessarily took some time to break them into their new duties. This occasioned a certain amount of delay. When the first batch of articles was completed at the factory, the inspector placed there by the Government made. a preliminary inspection and passed the garments. These 472 Opinion of the Court garments were shipped from Dallas, Texas, where the factory was located, to the 8th Corps Area General Depot, Fort Sam Houston, Texas, where they were subjected to final inspection and were rejected. Upon their rejection they were returned to the factory and the proper corrections were made as required under the terms of the contract. The facts in the case plainly show that a certain period of delay was caused by the incompetency of the inspector who made the preliminary inspection and permitted the garments to be sent to their destination where they were finally inspected. The incompetency of this inspector was glaring and wholesale. The contracting officer, Major Heller, in his testimony in this case states: Zweig's difficulties were not that he was not capable of performing, or that he did not have the plant to perform with. His difficulties, in the first place, were that the plant that he was using had been idle for practically a year and was being started up for this particular contract; his employees were practically all new, and not familiar with the work; and Zweig was placed under an unfortunate handicap-I will say that, anyway-by myself putting in an incompetent inspector in his plant. That was his difficulty, but yet with all that, it was Zweig's responsibility to meet the terms of the contract and to produce. The facts plainly show that the delays were mutual. There is no way of determining what proportion was caused by the plaintiff and what proportion was caused by the defendant. Plaintiff had every right to expect the Government to place a competent inspector at the plant. It was optional in the contract whether an inspector would be placed in the factory but, having been placed there, plaintiff had every reasonable expectation and justification to feel that he knew his business and would make a proper inspection before shipments were made. The law is well settled that where delays have been caused by both parties to a contract, and the completion of the contract has been thereby extended beyond the time fixed, the obligation for liquidated damages is annulled. The court has no fixed date from which the contract can be enforced, unless the court chooses to enter the domain of |