UNITED STATES DISTRICT COURT WESTERN DISTRICT OF PENNSYLVANIA
April 11, 1956
UNITED STATES of America
Charles ZUBIK and Manufacturers Casualty Insurance Company
The opinion of the court was delivered by: GOURLEY
This is an action by the United States of America to recover damages allegedly occasioned by a forced delay in the sale of a barge.
It is contended that Charles Zubik, in an unsuccessful appeal to the United States Court of Appeals for the Third Circuit, 190 F.2d 278; 202 F.2d 599, petitioning for possession of said barge, caused damages to the United States of America for the following:
1. Difference between previous high bid submitted by National Barge Company and the subsequent lower sale price following appeal.
2. Custodial charges.
3. Cost of re-advertising.
4. Court costs.
The Manufacturers Casualty Company, having posted the supersedeas bond for the appeal, is an additional defendant to the proceeding.
Upon complete and exhaustive nonjury trial, it appeared to be not in dispute that subsequent to the receipt of the firm bid of National Barge Company, the Corps of Engineers, upon knowledge of the pendency of the appeal enjoining the sale, afforded an opportunity to the bidders, including National Barge Company to withdraw. Those who chose not to withdraw their bids were advised that the determination of the award and sale must await disposition of the appeal.
The National Barge Company failed to withdraw its bid after being notified of the modifications of the invitation for bids and thereby permitted its bid to be opened subject to such modifications.
Since the National Barge Company permitted its bid to be opened subject to the proffered modification, I must conclude that it could not thereafter be withdrawn, and the United States of America could have required the National Barge Company to abide by its firm offer. United States v. Lipman, D.C., 122 F.Supp. 284.
I must find, therefore, that any damages which arose to the United States of America resulting from the sale of the barge after the appeal for a lower bid than that proffered by the National Barge Company was due to the failure of the United States of America to give effect to the bid of the National Barge Company.
Since the damages in failing to hold National Barge Company to its bid arose through the fault and judgment of the United States of America, the damages, which naturally flowed therefrom, should not be imposed upon the defendants.
It is my judgment, however, that defendants should be required to assume the custodial charges which, consequent to the appeal, would have resulted even though the United States had invoked the bid of the National Barge Company.
The Court makes the following Findings of Fact and Conclusions of Law:
Findings of Fact
1. On November 27, 1950, an ironladen steel barge belonging to American Barge Lines Company broke loose from its moorings, struck a pier and sank to the bottom of the navigable channel of the Allegheny River at Pittsburgh, Pennsylvania.
2. The Corps of Engineers, United States Army, at Pittsburgh directed the American Barge Lines to remove the sunken barge by March 5, 1951.
3. On March 7, 1951, while the barge was still on the bottom of the river, American Barge Lines Company sold the barge to Zubik and notified the Corps of Engineers.
4. On March 10, 1951, and pursuant to Federal Statute, 33 U.S.C.A. § 414, the Corps of Engineers raised the barge from the bottom of the river and took possession of it.
5. On April 3, 1951, the barge was offered for sale by the Corps of Engineers by Invitation No. Civeng-S-36-058-51-18.
6. On April 5, 1951, Zubik filed a libel in personam under the Suits an Admiralty Acts, 46 U.S.C.A. § 741 et seq., against the United States in the District Court for the Western District of Pennsylvania, seeking return of the barge upon payment of the removal expenses.
7. On April 10, 1951, five days after the filing of the libel and before any responsive pleading had been filed, Zubik presented to the District Court a petition seeking a rule on the Corps of Engineers to show cause why the barge should not be returned to Zubik and an order restraining the proposed sale until determination of the proceedings upon its merits. The petition was denied by the District Court and Zubik appealed.
8. On April 13, 1951, the Honorable Austin L. Staley, Circuit Judge, United States Court of Appeals for the Third Circuit, signed an order restraining the sale and a supersedeas and cost bond in the amount of $ 2,000 was filed. The restraining order was served on the Corps of Engineers at 10:30 A.M. on April 13, 1951. The order provided that the Corps of Engineers 'be restrained from proceeding with the sale of the barge.'
9. At 11:00 A.M., April 13, 1951, the following public announcement was made by Colonel Conrad P. Hardy immediately prior to opening the bids submitted in response to Invitation No. Civeng-S-36-058-51-18:
'Subsequent to the issuance of the Invitation for Bids, litigation has arisen enjoining the sale of the Barge which is advertised for sale. Any bidder who wishes to withdraw his bid by reason of that litigation is free to do so at this time. Those who choose not to withdraw their bid are advised that determination of award and sale must await settlement of the litigation.'
10. No one requested withdrawal of his bid and the following bids were received and opened:
Bid No. Name Amount
Bid No. 1 Charles Zubik $14,200.00
Bid No. 2 Phil C. Helsey 8,200.00
Bid No. 3 National Barge
Bid No. 4 C. Peters 5,000.00
Bid No. 5 Monongahela
Metal & Iron
Bid No. 6 Wheeling Steel
Bid No. 7 Hillman Trans-
portation Co. 12,600.00
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