Wood v. United States
Headline: Heating contractor’s claim for delay damages denied; Court affirmed that a contract bar on Government-caused delay damages prevents recovery, leaving contractor paid only for extra work.
Holding: The Court affirmed the lower court’s ruling: because the contract expressly barred claims for damages from Government-caused delay, the heating contractor cannot recover delay damages and only received pay for extra work.
- Contractors cannot recover delay damages when contract explicitly bars such claims.
- Federal agencies can suspend work and deny damage claims if contract language allows it.
- Contractors should protest suspensions promptly to preserve potential damage claims.
Summary
Background
A private heating contractor agreed with the federal government on April 5, 1897, to install the boiler and heating system in a Washington post-office building for $111,373. The job was to be finished in 250 working days with a $100 daily forfeiture for late completion. The contract said the contractor would get one extra day for each day the Government caused delay but also stated that no claim for damages from any Government-caused delay would be allowed. After work began, the Treasury asked the contractor to suspend parts of the job while it made big plan changes. Parts of the work were suspended for ten months and there were later suspensions; the whole project finished about eighteen months after the contract time expired.
Reasoning
The Court looked to the contract’s plain terms and the contractor’s actions. The lower court paid the contractor for extra work but denied money for losses from the long suspensions, following an earlier similar decision. The contractor had not protested the prolonged suspensions when they began and only asked for extra time, not damages, until this lawsuit. The Supreme Court affirmed, explaining that suspension is one cause of delay but the explicit contract clause barring claims for damages from Government-caused delay prevents recovery here.
Real world impact
The ruling means a contractor who agrees to a contract that bars damage claims for Government-caused delay cannot recover those delay losses in court, even when the Government orders long suspensions. The contractor did receive payment for extra work. The decision also underscores the practical importance of promptly objecting or preserving a claim when the Government orders suspensions.
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