Brooks-Scanlon Corp. v. United States

58 Ct. Cl. 274, 1923 U.S. Ct. Cl. LEXIS 327, 1923 WL 2173
CourtUnited States Court of Claims
DecidedApril 23, 1923
DocketNo. 34464
StatusPublished

This text of 58 Ct. Cl. 274 (Brooks-Scanlon Corp. v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brooks-Scanlon Corp. v. United States, 58 Ct. Cl. 274, 1923 U.S. Ct. Cl. LEXIS 327, 1923 WL 2173 (cc 1923).

Opinions

Hat, Judge,

delivered the opinion of the court:

This is a suit brought by the Brooks-Scanlon Corporation against the United States to recover the sum of $1,275,923.07, and claim is also made for interest on that amount at 6 per cent per annum from February 24,1920, to date of judgment.

On March 28,1916, a contract in writing was entered into between the New York Shipbuilding Corporation and the East Coast Transportation Co., whereby the shipbuilding company agreed to build in its yard at Camden, N. J., a certain steamship of about 8,100 tons d. w. t. according to plans, specifications, and conditions described, and the East Coast Transportation Co. agreed to pay the sum of $595,000 to the shipbuilding company in 'certain installments set forth in the contract. The ship was to be delivered to the East Coast Transportation Co. on or before February 1, [291]*2911918. Between July 5, 1916, and May 25, 1917, changes in the construction of the ship were agreed to increasing the d. w. t. to 8,597 tons and the price for said ship to $811,130.

On May 24, 1917, the East Coast Transportation Co., by instrument in writing, assigned and transferred all its right, title, and interest in and to the contract above referred to to the Carpenter-O’Brien Corporation, owner of all the stock of the East Coast Transportation Co., and the latter company was thereafter dissolved.

On October 20, 1917, Scanlon and his associates acquired an interest in the Carpenter-O’Brien Corporation, and on. December 8, 1917, the name of the Carpenter-O’Brien Corporation was changed to the Brooks-Scanlon Corporation.

On December 16, 1916, the New York Shipbuilding Co.. transferred all of its rights, property, and interest to the New York Shipbuilding Corporation, organized and existing under the laws of the State of New York, included in which transfer was the contract for the building of the ship for the East Coast Transportation Co., referred to above.

On July 11, 1917, the President, by virtue of authority vested in him by the act of Congress of June 15, 1917, 40 Stat. 182, 183, delegated his powers to the United States Shipping Board Emergency Fleet Corporation, and under the authority so conferred the Shipping Board on August 3, 1917, served on the New York Shipbuilding Corporation an order requisitioning “ all power-driven cargo-carrying and passenger ships above 2,500 tons d. w. capacity under construction in your yard, and certain materials, machinery, equipment, and outfit necessary for their completion are hereby requisitioned by the United States.” And by said order the shipbuilding company was required to complete the construction with all practical dispatch. Among the vessels under construction in the yard of the New York Shipbuilding Corporation and included in the requisition order was the ship known as hull 193, and was the same ship which the shipbuilding corporation had agreed to construct for the East Coast Transportation Co. The Shipping Board sent to the East Coast Transportation Co. a letter in which was incorporated a copy of the requisition order which it had sent to the New York Shipbuilding Corporation. [292]*292On August 28, 1917, the Shipping Board sent to the Carpenter-O’Brien Corporation its order of requisition to the New York Shipbuilding Corporation, and on the same day wrote a letter to the Carpenter-O’Brien Corporation. That letter set out that the Shipping Board had been advised by the New York Shipbuilding Corporation that the contract for the building of hull 198 had been entered into with it by the East Coast Transportation Co., and that the Carpenter-O’Brien Corporation on August 23, 1917, had advised the Shipping Board that the contract for the construction of the vessel had been assigned to the Carpenter-O’Brien Corporation. The letter of the board contained the following paragraphs, among others:

“ The corporation will consider payments to the contractor occurring since the date of requisition, upon the receipt of proper vouchers and adequate information to be forwarded through its district officers. You are requested as soon as possible to report to the corporation a statement in detail of the payments already made by you on each ship named above prior to the date of the requisitioning, August 3,1917. This statement should be accompanied by the original vouchers and receipts and should be verified under oath by the proper corporate officer of your company.
“It is the present intention of the corporation to reimburse you promptly, so far as funds are available, for the payments heretofore made to the shipbuilder. * * *
“At your further and early convenience you are requested to submit to the corporation a statement of such indirect expenditures as you have made on account of each vessel. * * *
“ It will be perceived that the corporation presumes it is addressing this letter to the owners, or responsible representatives of the owners, or persons entitled to receive compensation on account of the requisition of the vessels listed above. The corporation requests that there be included in your response to this letter all evidence of ownership which is necessary to establish the right of those who are entitled to receive the compensation provided by law.”

The Carpenter-O’Brien Corporation forwarded to the Shipping Board a list of payments which had been made by it to the shipbuilding corporation.

The title to the uncompleted ship (hull 193) and the materials which had been delivered or ordered for its completion was in the New York Shipbuilding Corporation on [293]*293August 3, 1917, the date of the requisition order. On that date the said ship was about 19 per cent completed, and was delivered completed to the United States on September 20, 1918.

On December 8, 1917, the Emergency Fleet Corporation made a contract in writing with the New York Shipbuilding Corporation for the completion and disposal of hull 193, and other hulls set forth in the said contract; hull 193 is the ship in controversy here. The provisions of this contract are set forth in the findings of fact in so far as they are pertinent to the issues in this case.

The plaintiff claims that the United States requisitioned and took its contract with the New York Shipbuilding Corporation, and that it is entitled to recover from the United States the value of that contract at the time of the taking. It claims that the value of the ship measures the value of the contract; and it is shown by the evidence that at the time of the alleged taking of the contract the value of such ships was $200 per dead-weight ton. The ship when completed was 8,597 tons. The value of the ship was therefore $1,719,400. In other words, the plaintiff claims that its contract was worth the value of the ship when completed.

The questions to be determined are: Was there a requisitioning or taking of the contract by the United States; and if there was, what was the value of such contract at the time of the taking ? In this case the President, through the Emergency Fleet Corporation, which acted by virtue of the authority vested in it by him, requisitioned certain ships under construction in the yard of the New York Shipbuilding Corporation. The power to make such requisition was given to the President by the act of Congress of June 15, 1917, while this country was engaged in war with Germany. That part of the act with which we are concerned in this case is as follows:

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Bluebook (online)
58 Ct. Cl. 274, 1923 U.S. Ct. Cl. LEXIS 327, 1923 WL 2173, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brooks-scanlon-corp-v-united-states-cc-1923.