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L. W. FOSTER SPORTSWEAR CO. v. UNITED STATES

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF PENNSYLVANIA


September 10, 1956

L. W. FOSTER SPORTSWEAR CO., Inc.
v.
UNITED STATES of America

The opinion of the court was delivered by: LORD

The plaintiff has brought this action to recover the sum of $ 2,800, alleged to represent excess costs incurred by the plaintiff in the manufacture of a quantity of Women's Army Corps exercise suits for the defendant under contract QM 11280. The defendant filed a counterclaim for the recovery of $ 6,164,53 from the plaintiff for the cost of excess property which the defendant forwarded to the plaintiff under contract QM 15617 for the manufacture of a quantity of Army field jackets. The plaintiff defends against the defendant's counterclaim by way of recoupment.

Plaintiff's claim was adjudicated before the Armed Services Board of Contract Appeals. Its contention before the Board was that while contract QM 11280 provided that the exercise suits should conform in all respects to 'Pattern date November, 1948', the pattern was never made available by the defendant until after the bids were submitted. It further contended that its bid was made on the basis of a sample garment shown to it by an employee of defendant which was shorter in length than the pattern, and which resulted in the excess costs. Further, it argued there was actually a change in the written contract and, if not, there was a mutual mistake of fact. On the other hand, the defendant contended that the contract meant what it said; was clear and precise; that plaintiff had no authority to bid on any article not in accordance with the contract; and that when it estimated the amount of material that would be required by the pattern, it assumed the risk of any loss suffered by a mistake of judgment. In a written opinion, the Board denied the claim.

 Plaintiff claims that the decision of the Armed Services Board of Contract Appeals was not supported by substantial evidence, and that the decision was arbitrary and capricious.

 The statute governing the finality of a reviewing Board's decision on a contract entered into by the United States is Section 321 of Title 41, U.S.C.A. which reads:

 'No provision of any contract entered into by the United States, relating to the finality or conclusiveness of any decision of the head of any department or agency or his duly authorized representative or board in a dispute involving a question arising under such contract, shall be pleaded in any suit now filed or to be filed as limiting judicial review of any such decision to cases where fraud by such official or his said representative or board is alleged: Provided, however, That any such decision shall be final and conclusive unless the same is fraudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or is not supported by substantial evidence. * * *' (Emphasis supplied.)

 In order to determine whether or not the decision of the Armed Services Board of Contract Appeals was supported by substantial evidence, a definition of 'substantial evidence' is required. In Consolidated Edison Co. v. National Labor Relations Board, 1938, 305 U.S. 197, at page 229, 59 S. Ct. 206, at page 217, 83 L. Ed. 126, cited with approval in Universal Camera Corp. v. National Labor Relations Board, 1951, 340 U.S. 474, 477, 71 S. Ct. 456, 95 L. Ed. 456, the Supreme Court stated:

 '* * * Substantial evidence is more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Appalachian Electric Power Co. v. National Labor Relations Board, 4 Cir., 93 F.2d 985, 989; National Labor Relations Board v. Thompson Products, 6 Cir., 97 F.2d 13, 15; Ballston-Stillwater Knitting Co. v. National Labor Relations Board, 2 Cir., 98 F.2d 758, 760. * * *'

 This Court, applying the above test, after careful consideration of the evidence before the Board and after a careful reading of the Board's opinion, feels that its decision was supported by substantial evidence; was not arbitrary or capricious; and that plaintiff's claim was properly denied. We next consider the merits of defendant's counterclaim. It proved that under contract QM 15617, it furnished to the plaintiff, for the manufacture of 15,000 field jackets, the following 'Government furnished property', which was in excess of the applicable contract unit allowances, and which was never returned: Excess over "Material Unit Allowances Cloth, Cotton, Drill, 41 inch 16,034 6/8 yds. 5,718 yds. Cloth, Cotton, Silesia, 36 inch 4,755 1/8 yds. 984 1/8 yds. Webbing, Type 1, 3/4 inch 51,700 5/8 yds. 23,117 2/8 yds."

19560910

© 1992-2004 VersusLaw Inc.



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