Opinion
No. 45455.
October 1, 1945.
Joseph J. Cotter, of Washington, D.C. (Arthur J. Phelan and Hogan Harston, of Washington, D.C., on the brief), for plaintiff.
William A. Stern, II, of Washington, D.C., and Francis M. Shea, Asst. Atty. Gen., for defendant.
Before WHALEY, Chief Justice, and LITTLETON, WHITAKER, JONES and MADDEN, Judges.
Action by George F. Driscoll Company against the United States to recover expense incurred in making repairs to a water main damaged by the driving of a pile during the course of certain construction.
Petition dismissed.
Plaintiff sues to recover $7,787.12, representing expenses which it incurred in making repairs to a water main damaged by the driving of a pile during its construction operations under a contract with the Treasury Department for the erection of buildings at Ellis Island, New York.
Special Findings of Fact.
1. Plaintiff is a New York corporation. and was at all times mentioned herein engaged in the general construction business as a general contractor.
2. Bids were opened October 8, 1934, for certain construction work to be done at the U.S. Immigration Station at Ellis Island, New York, consisting of the building of a ferry house, a reception building, several covered passageways connecting these buildings with the buildings that were already there, an addition to the laundry building, and a number of alterations of different kinds in several of the other buildings.
3. Plaintiff was awarded a contract by the Public Works Branch of the office of the Director of Procurement, Treasury Department, a written contract being executed by the parties on October 22, 1934.
4. The two contract items directly involved in the present issue are pile work and plumbing.
The pile work consisted principally of wood piling for the foundations of the covered passageways and the laundry building. With respect to the driving of the piles, the specifications provided as follows:
"108. Driving. — Piles shall not be driven until after the excavation is completed. Piles shall be driven to the required bearing value or values as determined by the formula for bearing values specified herein. All piles shall be driven in the presence of the construction engineer. The driving shall be continuous for each pile from the time of starting until the required bearing value has been reached. Caps, collars or bands shall be provided and used as necessary to protect the piles against splitting and brooming."
5. A substantial amount of new plumbing, including connections to existing pipe lines and new pipe lines, was to be installed by plaintiff under the contract, and as the buildings on the site were to be occupied during the carrying out of the contract it was necessary to maintain the water, sewer, steam and electrical supply to these buildings during the performance of the contract. The contract required plaintiff to install and connect a riser to an already existing 8-inch underground water main from New Jersey, the riser to be in turn connected to new service pipes furnishing water both to the existing building and the buildings to be erected.
The following portions of the specifications relate more particularly to the plumbing and water supply system:
"987. Present Service Pipes, Etc. — All the buildings now on the site will be occupied during the construction of the buildings, etc., under this contract and this contractor must maintain the cold water, hot water, sewers, steam supply, electric services, and all other services not mentioned herein, supplying these buildings.
"988. Especial attention is called to the fact that piping, conduits, and traps, etc., in place in present covered walks, etc., are not shown on drawings, and bidders should visit site to fully inform themselves of the conditions.
"989. Where services are encountered in excavations, etc. (including excavations for buildings) they must be offset and reconnected by this contractor so as to furnish uninterrupted services to the occupied buildings. Any abandoned or dead service pipes encountered must be removed to outside of excavation and be plugged tight as directed."
"1003. Scope of Work. — This section of the specification includes the furnishing of all labor and materials required for the installation complete of the changes in the extensions to the plumbing, sanitary drainage and water supply inside the buildings, covered walkways, the water supply and sewer systems outside the buildings including connections to the present water mains and sewers, etc., all as indicated on drawings hereinafter specified or as may be necessary for the fulfillment of this contract. Contractor is to make changes, etc., in connection with present services as hereinbefore specified, under `Mechanical Equipment,' and as may be necessary, so that same will operate in a first class manner. Attention is called to the fact that methods of connecting to present services are not indicated on drawings, and this contractor must make the necessary connections subject to approval of construction engineer."
"1051. Wrought Iron or Steel Water Supply Pipe Fittings and Connections. — (See p. 12 and Federal Specification, F.S.B. Specification Nos. WW-P-431 and WW-P-441). — Contractor is to furnish and install in the covered passages a wrought iton [iron] or steel fresh water supply main as indicated on drawing.
"1052. New piping is to be connected to the present services complete."
"1055. Cast Iron Water Supply Fittings and Connections. — Contractor is to furnish and install complete the 8-inch underground cast iron fresh water supply main, and the cast iron salt water fire lines in the covered walks and the new buildings, all as indicated on drawings and necessary for complete system.
"1056. The new underground main is to be connected to the present supply piping complete where indicated on drawing."
"1075. Water Supply System. — Contractor must furnish all labor and material necessary to extend the present water supply system and the fire protection in place to the new buildings, all as indicated on drawings and hereinafter specified. The new mains are to be connected to the present mains where indicated on drawings. Run branches to each building new and old where shown and necessary; underground main to be run at elevations shown and where elevation is not shown must be not less than 3 feet below existing grade."
6. Paragraph 1 under the heading "General Requirements" of the specifications lists by number the contract drawings, one of which relates to plumbing and heating and is largely diagrammatic in character.
At the top central portion of this drawing was shown a vertical line bearing the legend "8-inch water pipe in place from New Jersey."
A conventional symbol indicating a new vertical riser was shown on this pipe just outside of the wall of a covered passageway to be constructed. The drawing indicated as new construction a horizontal pipe leading from the vertical riser and extending through the wall of the passageway and to a location inside, where it was connected to service pipes for the fresh-water supply.
This diagrammatic drawing gave no dimensional data which would indicate the location of the existing underground water main with reference to the wall of the passageway, the depth of the same underground, or the height of the new riser to be installed.
7. Another contract drawing, No. 5-401, shows the foundation details of the covered passageways. In the portion of the passageway wall, which crossed the fresh water main, it specified the piles as located on 6-foot centers.
This drawing disclosed in no way either the supposed or actual location of the underground water main with reference to the wall of the passageway and the required pile work therefor.
8. Paragraph 2 under the title "General Requirements" of the specifications referred to a second set of drawings by number. This paragraph made reference to these drawings as relating to conditions of the site and stated with reference to them that they — "are not to become contract drawings. They are furnished bidders only for such use as they may choose to make of them. The accuracy of data given on these drawings is not guaranteed."
Two of these drawings disclose details where the 8" fresh-water pipe passed through the seawall. These drawings also indicate that at this point this pipe was located below ground at an elevation of about minus 23'. The seawall was approximately 100 or 125 feet distant from the line of piles to be driven for the foundation of the passageway wall, and a paint mark had been placed on the wall in connection with a prior contract to indicate the location at which the fresh-water pipe passed through the seawall. At a point approximately 5 feet the other side of the line of piles a riser which was connected to the 8" fresh-water main projected above the ground.
9. After the pile driver had driven several piles on 6-foot centers for the foundation wall of the covered passageway, it approached a point where it became apparent that the next pile to be driven would be very close to the supposed location of the underground water main. This location was determined by sighting from the riser from the 8-inch water main to the place on the seawall where it was known the water main entered the Island. As it later developed, however, the water main did not follow a straight course from the seawall to the riser, but, instead, followed an irregular course to the west of a straight line between the riser and the mark on the seawall. This fact was not known to either of the parties; but since, sighting along the ground, it appeared that the main was below the point designated for the driving of the pile, plaintiff before driving the pile asked the defendant's superintendent of construction for instructions.
Accordingly, a conference was held between the Government engineers and representatives of the contractor to determine what should be done in connection with the pile in question. Present at the conference were plaintiff's construction engineer and plaintiff's superintendent, and defendant's construction engineer and assistant construction engineer. At this conference defendant's construction engineer suggested to plaintiff that it dig down into the ground at a place near where the pile was to be driven and locate the water main, and at this place make a connection to the water main for the other pipes which plaintiff was required to install under its contract. Plaintiff, however, protested against this, on the ground that its contract only required the laying of the pipe 3 feet under the ground and that this provision of the contract could be complied with by connecting to the vertical riser from the water main projecting above the surface of the ground. Defendant's construction engineer did not insist upon this suggestion, and he then indicated a place on the ground where he desired the pile to be driven, which was 2 feet and 6 inches from the place designated on the plans; but before driving the pile at this place plaintiff was instructed to probe into the ground at this point with a rod in order to determine whether or not the main was below the point designated.
10. There was also present at the above-mentioned conference a Mr. Booth, who was the assistant superintendent in charge of Ellis Island. At this conference Mr. Booth stated that he thought that the water main would be found at an elevation of about minus 10 feet. This was the only information available as to the depth of the main. Following the instructions given, plaintiff's workmen or representatives then took a 12-foot reinforcing rod for probing operations and drove the rod in the bottom of a trench 5 feet deep at various points approximately 4 inches apart over the place tentatively selected for the driving of the pile. The rod could not be fully driven into the ground as it was necessary to leave 6 inches or a foot projecting so that the rod could be withdrawn. The rod was driven to a total depth of 16 feet and 6 inches below the surface of the ground.
Defendant's assistant construction engineer authorized plaintiff to drive the pile at the point indicated by the stake. Thereupon, plaintiff drove the pile, the point of which, upon reaching an elevation subsequently determined to have been minus 16.75 feet, broke the water main. This was on May 1, 1935.
11. The break in the water main was not at once apparent. Plaintiff's office in Brooklyn was informed late that afternoon over the telephone by its superintendent at the job that the water pressure on Ellis Island was dropping and that it looked as though the water main was broken.
The next morning there was absolutely no water supply and there were many buildings on the Island that were in urgent need of water and the supply in their tanks would last only a short time. At that time the Government construction engineer orally instructed the contractor's superintendent to proceed to repair the pipe. Plaintiff never received any specific order in writing to make the repairs, but the oral instructions were confirmed by letter of May 11, in reply to plaintiff's letter of May 3.
12. Plaintiff, in view of the emergency situation, immediately made arrangements to haul water by tugboats to the Island, and as soon as possible procured over 1,000 feet of fire hose, extended it from the Island under the water to a point on the New Jersey shore, where connection was made to a water main, and supplied water in that manner.
Plaintiff immediately set to work to repair the break as quickly as possible. It took approximately one week working twenty-four hours a day to repair the broken main.
After working the first day and digging a pit 12 feet square, the plaintiff encountered sea water. It was then found necessary to sheet-pile and timber the pit and to drive the sheeting down a sufficient depth to hold the water and to permit further excavation.
During the course of the repair work the water broke through the walls at the bottom of the pit and it was necessary to employ a diver to complete the repair.
The break occurred on May 1, 1935. The emergency repair work started on May 2, 1935. On May 7, 1935, the water main was reconnected. Clean-up work was done at various times up to May 29, 1935.
13. On May 3, 1935, and while the repair work was in progress, the plaintiff addressed a communication to the construction engineer in charge of the Ellis Island project reading as follows:
"On Wednesday May 1st, in the driving of wood piles for the North wall of the passageway of Pavilion A, it appears that a water main at this point was struck and broken.
"Due to this, we were forced to proceed immediately with men and equipment to make repairs to the main. In addition to this, it was necessary to supply water by boat to the Buildings in use at Ellis Island.
"The extent of the damage has not yet been determined. We do not believe that the water main which we may have struck is located at the point indicated on the drawings, as the piles were driven in the presence of the Assistant Construction Engineer.
"If it is established that the main is not as indicated on the drawings, and because of this the damage occurred, we shall expect to be reimbursed for all costs of repairs made necessary by the break, in accordance with paragraph 88 of the specifications."
May 11, 1935, defendant, through its Chief Engineer, replied to plaintiff's communication by a letter in which reference was specifically made to paragraphs 987, 988, 989 and 1003 of the specifications, which were quoted in the letter (see Finding 5). The letter further stated:
"If all the above-mentioned paragraphs of the specifications had been followed, the damage to the water main would not have occurred, and it is the writer's opinion that there can be no possible claim for additional compensation for the repair of this damage."
14. June 5, 1935, plaintiff wrote to the Procurement Division, Public Works Branch, submitting a detailed statement of costs with a change proposal and requesting payment for the actual cost of the extra work in connection with the breakage of the water main in the sum of $7,006.62 which, together with overhead of 10 percent and profit of 10 percent, aggregated the sum of $8,478.00.
On September 16, 1935, the Procurement Division, through the Acting Assistant Director of Procurement, notified plaintiff in writing, after an investigation and consideration of the merits of plaintiff's claim, that the additional expense incurred in the repair of the broken water main would have to be assumed by plaintiff, and that plaintiff's proposal of June 5, 1935, was rejected. The letter from the Procurement Division further stated —
"This office will interpose no objection, in the event you desire to present an appeal from this decision to the office of the Comptroller General of the United States."
15. The contract between plaintiff and defendant contained the following with respect to disputes:
"Art. 15. Disputes. — All labor issues arising under this contract which cannot be satisfactorily adjusted by the contracting officer shall be submitted to the Board of Labor Review. Except as otherwise specifically provided in this contract, all other disputes concerning questions arising under this contract shall be decided by the contracting officer or his duly authorized representative, subject to written appeal by the contractor within 30 days to the head of the department concerned or his duly authorized representative, whose decision shall be final and conclusive upon the parties thereto as to such questions. In the meantime the contractor shall diligently proceed with the work as directed."
Plaintiff did not appeal to the Secretary of the Treasury from the action of the Procurement Division.
Plaintiff subsequently submitted the matter to the Comptroller General, who on May 12, 1939, denied the claim.
16. As the result of the work done under the instructions of defendant and because of the emergency that developed in connection with the breaking of the water main, plaintiff incurred and paid the following expenses or used its own equipment at reasonable rental rates:
32 hours Superintendent @ $1.75 ............... $ 56.00 98½ hours Timekeeper @ $0.625 ................. 61.56 16 hours Labor Foreman @ $1.00 ................ 16.00 43 hours Skilled Laborer @ $1.00 .............. 43.00 53 hours Common Laborer @ $0.50 ............... 26.50 178 hours Hoisting Engineer @ $1.65 ........... 293.70 109½ hours Fireman @ $1.125 ................... 123.18 128 hours Carpenter Foreman @ $1.50 ........... 192.00 190 hours Carpenters @ $1.40 .................. 266.00 429½ hours Concrete Laborers @ $0.9375 ........ 402.64 74 hours Excavating Laborers @ $0.825 ......... 61.05 75 hours Dock Builder @ $1.40 ................. 105.00 12 hours Diver @ $1.875 ....................... 22.50 Compensation Insurance on $1,649.13 @ $17.7562 ..................................... 292.82 550 gallons gasoline @ $0.135 ................. 74.25 118 hours Crane rental @ $5.00 ................ 590.00 1 week 4-in. Centrifugal pump @ $35.00 ........ 35.00 90 Feet 4-in. Suction Hose rental @ $0.30 ..... 27.00 Trucking ...................................... 15.00 Endres Plumbing Corporation — Repairs to broken water line and reconnecting same 810.27 Berkshire Electric Co. — Temporary lighting installation ................................. 11.42 Goodall Rubber Company — 2½" fire hose and couplings .................................... 606.90 Tisdale Lumber Company — Timber for sheathing .................................... 337.23 Dalzell Towing Company — Water supplied to Ellis Island .............................. 1,017.50 Central Railroad Company of New Jersey — Water supplied to Ellis Island .............. 316.21 A.M. Hazell, Inc., Equipment rental ........... 213.13 Edward Ehrbar, Inc., Equipment rental ......... 318.43 Miscellaneous — Telegraph and telephone .................... 3.80 Meals ...................................... 11.55 Demurrage on scow — 7 days @ $12.00 ........ 84.00 Petty cash ................................. 2.00 ________ 6,435.64
17. The reasonable addition of 10 per cent for overhead and 10 percent profit to the sum of $6,435.64 given in the previous finding results in a total amount of $7,787.12.
Plaintiff and defendant entered into a contract for the erection by plaintiff of certain buildings on Ellis Island. One building was to be erected upon piles. The provision of the specifications relating to driving of the piles is set forth in finding 4. It provides that "All piles shall be driven in the presence of the construction engineer." The contract drawings furnished by defendant designated the places at which these piles were to be driven. After plaintiff had driven certain piles in accordance with the drawings and was ready to drive another, it discovered that, if driven at the place designated on the drawings, this pile would probably strike an 8-inch underground water main which supplied the Island with water.
Defendant had a construction engineer, Paul H. Heimer, in charge of the work as the representative of the contracting officer. The contracting officer was the Director of Procurement of the Treasury Department. The construction engineer had an assistant, R.S. Eyres, in charge of the work at the site. Plaintiff called the attention of the construction engineer to the fact that if the next pile should be driven as shown on the drawings it might strike the underground water main. Thereupon a conference was held, at which plaintiff's construction engineer and its superintendent and the defendant's construction engineer and his assistant construction engineer were present, the results of which are set forth in findings 9 to 14, inclusive.
After probing for the water main, as stated in the findings, at a point indicated by the construction engineer, but different from the point at which the drawings showed this pile should be driven, plaintiff, with the approval of the assistant construction engineer in charge of the work, drove the pile at that point. When the pile was so driven it struck the water main and broke it. The break in the water main was not at once apparent. By the next morning, May 2, there was no water supply and many Government buildings on Ellis Island were in urgent need of water; the supply in their tanks would last only a short time. The construction engineer ordered plaintiff to make necessary repairs to the water main. Plaintiff at once, in view of the emergency situation and the orders of defendant's construction engineer, set to work to repair the break as quickly as possible and, also, under like orders, made arrangements to haul water by tugboats to Ellis Island; in addition it procured over one thousand feet of fire hose, extending it from the Island, under the water, to a point on the New Jersey shore, where connection was made to a water main. In this manner water was supplied to Ellis Island until the broken main had been repaired. It required approximately one week, working 24 hours a day, to repair the broken main. Plaintiff at all times denied responsibility for the breaking of the water main and, on May 3, plaintiff made claim, as set forth in finding 13, for reimbursement of all costs of repairs made necessary by the break in the water main. On May 11, the construction engineer, as set forth in finding 13, denied its claim for reimbursement, and confirmed the directions previously given to plaintiff to furnish water and repair damage to the water main.
On June 5, after this work had been completed, plaintiff submitted to the contracting officer an itemized claim for the costs incurred and this claim was denied by the contracting officer, from which no appeal was taken by plaintiff to the head of the Department.
Article 15 of the contract, quoted in finding 15, made the decision of the contracting officer, subject to appeal to the head of the Department, final and conclusive as to "All disputes concerning questions arising under this contract."
The contracting officer upon consideration of plaintiff's claims of May 3 and June 5 and all the facts submitted by plaintiff, and those obtained as a result of his own investigation, decided that plaintiff, and not the Government, was responsible for locating the water main before driving the pile which resulted in its being broken, and that under all the facts and circumstances plaintiff was responsible for the cost of making necessary repairs and for furnishing the Government with fresh water until the repairs had been completed.
Plaintiff does not claim and has submitted no proof to show that the decision of the contracting officer was so grossly erroneous as to imply bad faith, and it is clear that such a claim could not be made. Plaintiff argues that the contracting officer's decision was conclusive only as to matters of fact and that the decision which was made consisted merely of conclusions of law. It is contended that the decision was not final as to matters of law relating to the interpretation of the contract. Under article 15 this contention cannot be sustained. The decision of the contracting officer consisted of a decision on matters of fact, as well as matters relating to the proper interpretation of the contract, drawings, and specifications, and his authority to decide the dispute included both questions.
We think the claim which plaintiff made to the contracting officer, and which it makes here, involves a dispute which arose under the contract which the contracting officer was not only authorized but was required to decide under the provisions of article 15. Except for this, plaintiff would be entitled under the findings to recover $7,787.12, as set forth in findings 16 and 17. However, we are of the opinion that the decision of the contracting officer, from which plaintiff took no appeal, was final.
The contracting officer under the contract provisions and on the facts, as he interpreted them, decided the dispute against plaintiff and, even if the decision had been grossly erroneous, we could not set it aside unless we were justified from the evidence in finding that it was so grossly erroneous as to imply bad faith. Plaintiff submitted a claim and complete statement of facts and argument in support thereof. The contracting officer secured a report from the construction engineer, after which he had a further investigation made of the facts and circumstances by holding a hearing with plaintiff on its claim at the site of the work, and, subsequently, appointed a committee to consider and make recommendation upon the claim before he rendered his decision. Upon the record thus made he honestly and in good faith reached the conclusion that upon the facts and under the terms and conditions of the contract the plaintiff, rather than the Government, was responsible for the break in the water main and for the cost of repairing the damage thereto. In his decision sent to plaintiff he stated as follows:
"* * *. Supplementing your proposal of June 5, wherein you submitted statement for $8,474.00 for this work, on July 17, you submitted further information and asked favorable consideration for reimbursement.
"Subsequent to the conference between the representatives of this Office and yourself at the site, the committee of Government representatives reviewed the terms of your contract in the light of the evidence presented and finds the responsibility for the additional expense, which was incurred by you in the repair of this broken water main, is for your assumption, and your proposal that the Government compensate you therefore is hereby rejected."
The petition must therefore be dismissed. It is so ordered.
WHALEY, Chief Justice, concurs.
I concur in the result on the ground that plaintiff was at fault in not driving a rod or otherwise exploring to the full depth that it intended ultimately to drive the pile. It knew the water main was in that area and, in view of the obligations of the contract, should have exercised this precaution.
The majority say that plaintiff would be entitled to recover the sum of $7,787.12, except for the adverse ruling of the contracting officer and plaintiff's failure to appeal therefrom. I think it is entitled to recover this amount and I do not think the ruling of the contracting officer bars it from doing so.
The work of repairing this broken main was not a part of the contract and, hence, is not governed by its terms. The provisions of article 15 have no application to the dispute as to who should pay for the cost of repairing it. This article gave to the contracting officer authority to decide only those disputes that arose under the contract. This work was not a part of the contract and, therefore, the dispute over who should pay for it does not arise under the contract.
The most that can be said is that this work was made necessary by the manner in which the contract was carried out. If the plaintiff was negligent in its performance and thereby broke the main and made necessary this work, it should pay for it; on the other hand, if the defendant was responsible for its breakage, then it should pay for the cost of its repair. This is a dispute over whether the plaintiff or the contracting officer was responsible for an act that caused damage to defendant's property. I do not think the parties intended to leave to the contracting officer the settlement of such a dispute.
It is almost impossible for a party charged with wrongdoing to be wholly impartial in deciding whether or not it or the other party was guilty of the wrong. The breaking of this main was the fault of either the contracting officer or of the plaintiff. The contracting officer would be a most unusual man if he could decide, wholly without bias, whether he or the plaintiff was at fault. I do not think the plaintiff intended to give him such authority.
The Act of Congress, Jud. Code § 136 et seq., 28 U.S.C.A. § 241 et seq., establishing this court gave the plaintiff the right to come to it for a settlement of such a dispute. I cannot believe that when it agreed to article 15 of the contract the plaintiff meant to forego this right and give to the other party final and conclusive authority to decide such a dispute.
I do not believe the defendant intended to ask it to forego this right; nor do I believe that it had a right to do so. Can it be that an agent of the executive branch of the Government has a right to take away from a plaintiff a right given him by Congress? Has he the right to say, we will award you this contract only if you agree to forego this right Congress has given you of resorting to the Court of Claims for a redress of your grievances?
In Beuttas et al. v. United States, 101 Ct. Cl. 748, the issue was whether or not the defendant had paid plaintiffs all it had agreed to pay under the contract. The contracting officer decided it had. This was said to be final and conclusive. A majority of the court held that it was not. We said, upon the authority of a number of cases there cited, that an agreement made in advance of the controversy that deprived a party of recourse to a court having jurisdiction of the controversy, over whether or not the defendant had breached its contract by not paying all it had agreed to pay, is contrary to public policy and void. See 101 Ct.Cl. at pages 767-770. The decision of the majority in the instant case is, I think, in direct contradiction to our holding in the Beuttas case. If the decision of the majority in that case was right, it is wrong in this. Also compare Langevin v. United States, 100 Ct.Cl. 15.
I do not believe the contracting officer had the right to decide the dispute over whether he or the plaintiff was responsible for breaking this main. In my opinion his decision does not foreclose the plaintiff and it is entitled to recover.
I agree that the plaintiff should recover. The determining fact, in my view, is that the pile was driven with the concurrence of both parties. If, in view of the probing that had been done, the driving of the pile was not a careless act, then the plaintiff was not careless, and the loss was due to an accident. If, on the other hand, it was careless conduct to drive the pile where it was driven, the Government, through its Assistant Superintendent of Construction, joined in the conduct, and could not have sued the plaintiff for the consequences of that conduct. At that point, then, the loss lay on the Government. When it ordered the plaintiff to repair the damage, it ordered it to do something which the plaintiff was under no duty to do. The Government should, therefore, pay for the doing of it.
It is urged that the contracting officer's decision adverse to the plaintiff prevents any recovery here, under Article 15 of the contract. The issues between the parties should have been whether the plaintiff's breaking of the Government's water pipe was negligent, i.e., tortious and, if so, whether the concurrence of the Government's agent in the plaintiff's conduct was such as to prevent the Government from recovering its loss from the plaintiff. These issues, in a trial, might be left to a jury, but only after the jury had been carefully instructed by a judge as to the standards of conduct required by the law before it imposed a liability or sanctioned a defense. There is no indication in the record that the contracting officer ever thought of these issues, or was competent to resolve them if he had thought of them. Instead he read the contract literally, concluded that it required the plaintiff to keep the water running through the pipe, and therefore decided that the plaintiff had not done more than was required of it by the contract when it repaired the break in the pipe. It is said that he applied himself earnestly and diligently to the resolution of the dispute, but that hardly makes up for the fact that he did not know what the issue was.
I agree that this is not a "dispute concerning a question arising under this contract" within the meaning of article 15. The contract provision concerning the maintenance of the water service had nothing to do with the question. Only the fact that the plaintiff, when it broke the Government's pipe, was engaged in the performance of a contract, created any appearance of a relation between the breaking and the contract. To so interpret article 15 as to encompass this dispute seems to me to stretch it beyond its expressed intent, and far beyond any actual intent which could reasonably be imputed to the contracting parties. It is orthodox doctrine that arbitrators may make decisions only within the authority granted them in the agreement to arbitrate, and that the question whether a subject matter is within their authority is not for the arbitrators to decide, but for the court, even though the arbitration agreement purports to cover "all disputes." B. Fernandez Hnos., S. En C., v. Rickert Rice Mills, Inc., 1 Cir., 119 F.2d 809, 136 A.L.R. 351, with annotation on the construction of arbitration contracts; Williston on Contracts, § 1929. Where, as in Government contracts, the nonjudicial decision is to be made, not by a board of neutral persons, but by an agent of one of the contracting parties, the rule of construction should be at least as strict as in arbitration cases.
I think, therefore, that we have authority to decide whether the dispute which arose here was, under the contract, one for the decision of the contracting officer. I agree that it was not. On the merits I would, for the reasons I have given, decide the dispute for the plaintiff.