United States v. Anthony Grace & Sons, Inc.

PETITIONER:United States
RESPONDENT:Anthony Grace & Sons, Inc.
LOCATION:General Petroleum Corporation

DOCKET NO.: 439
DECIDED BY: Warren Court (1965-1967)
LOWER COURT:

CITATION: 384 US 424 (1966)
ARGUED: Mar 23, 1966
DECIDED: Jun 06, 1966

Facts of the case

Question

Audio Transcription for Oral Argument – March 23, 1966 in United States v. Anthony Grace & Sons, Inc.

Earl Warren:

Number 439, United States, Petitioner versus Anthony Grace & Sons, Incorporated.

Mr. Claiborne.

Louis F. Claiborne:

Mr. Chief Justice, and may it please the Court.

This and case that follows come here from the Court of Claims.

They both involve an application of this Court’s decision three terms ago in Bianchi versus United States.

In that case, the basic thrust of that decision was that the determination of disputes arising out of government contract is primarily for the administrative boards from the various procuring agencies subject only to the same limited judicial review as is appropriate in other cases.

The Court of Claims, it seems to us, has been knowing a way at that rule ever since it was enacted and it is for that reason that we ask the Court to take these cases.

The precise issue in my case is a very narrow one.

It is whether factual issues arising under a government procurement contract or a construction contract in this case which concededly should have been resolved administratively, maybe decided in the first instance by the Court of Claims merely because the administrative board believing that the appeal to it was untimely, did not reach those issues.

The case arises under the following facts.

Back in August of 1958, the Air Force issued invitation for bids to construct military housing in air force base in the Maine.

The successful bidder was the respondent, Anthony Grace & Sons.

Under the — they were issued a letter of acceptability which is the formal way in which the agreement between the parties was made.

Under the agreement then entered into, it was provided that wage determinations would be made by the Secretary of Labor and this construction was to be governed by the Davis-Becon Act because the wage determination though they’re included in the documents might not be up to date, it was provided that new determinations would be sought by the contractor from the Secretary of Labor and that if there was a substantial variance in the new wage determination, an appropriate adjustment in the contract price would be made.

It’s also provided that the contractor make a deposit of $25,000 together with the [Inaudible] which respondent did and that, he should be ready to set a closing date that is to enter into the formal construction contract at a time specified.

It was further provided pursuant to what we label a disputes clause that in the event, the contractor defaulted in his obligations and failed to close, the government would be entitled to retain the $25,000 deposit and likewise recover actual damages over and above that amount he paid, and that this matter should be determined in the first instance by the contracting officer and then by the administrative board of the agency involved, in this case the Air Force which jointly with the other services has what is known as the Armed Services Board of Contract Appeals.

After the new wage determinations were made by the Secretary of Labor which did include an increase in wage rates for some of the construction —

[Inaudible]

Louis F. Claiborne:

Labor involved in a construction.

It was raised to the position that there was not only a change in rates, but also a change in the area to which these higher rates were applicable.

That disagreement was aired between the parties in correspondence to some time.

Ultimately, the Air Force contracting officer took the position that there had not been such a variance in the area to which the new higher rates were applicable and that accordingly the contractor was not entitled to an increase in the contract price on that account.

He therefore demanded Grace that it comply with the closing date and enter into the contract.

Grace did not do so whereupon the contracting officer notified Grace that the agreement was canceled.

20 days later, the contracting officer in response to a letter from Grace asking for a return of its deposit, informed Grace that the deposit was forfeit since the failure — since the default was to be laid at the door of Grace.

At this point, Grace appealed to the Board of Contract Appeals, seeking a return of its deposit.

The Board, however, viewed the appeal as untimely.

We needn’t discuss the reasons for that decision because it is no longer here.

Upon the ruling of the Board of Contract Appeals, Grace then sued out its claim in the Court of Claims.

The Court of Claims held that the appeal was timely, that the Board should have had the case on merits, that the government’s motion for summary judgment predicated on the theory that in no event was the default justified even if the adjustment in the bid price might have been erroneously denied, was at least tentatively denied and the Court of Claims remanded the case to its trial commissioner, for trail.

Louis F. Claiborne:

Now, it’s maybe helpful to isolate the questions as they were presented to the Court of Claims even though those questions were not here.

The government’s first position was that Grace’s claim in the court was barred because it did fail to exhaust his administrative remedies in that it had not timely appealed to the Board of Contract Appeals.

As I have said, that position of the government was flatly rejected by the Court of Claims and we do not challenge the decision of the Court of Claims on that point.

The Government’s second position was that the claim stated no cause of action on which relief could be granted because in the circumstances, even if the failure to allow an increased price was unjustified, nevertheless Grace’s proper recourse was to go to the Board not to default as it did.

Again, the Court of Claims at least tentatively moved against the Government on this issue to deny the Government’s motion for summary judgment which was in part predicated on that theory and again we did not petition from that decision of the Court of Claims and therefore do not challenge it here.

Now finally, and this is the only issue that is still in the case as it appears here.

Again, this issue is not a resolution by this Court is whether the contractor was in fact justified, the assumption that there might some justifications, in defaulting rather than awaiting a resolution of his dispute about whether or not, he was entitled to an increased price in light of the new determinations of wages by the Secretary of Labor.

Because the Court of Claims impliedly ruled at least that this question was an open one and because it ruled clearly that the question should be determined in light of the underlying facts that a factual record should be made before the question would be decided.

It held that a trial was necessary.

Now the resolution of that issue will determine whether the contractor was excused from the normal penalty of default which is forfeiture of this deposit and conceivably whether the Government’s action was so unwarranted to entitle him to additional damages.

Now the issue in this Court, as I’ve said, does not relate to the denial of the motion for summary judgment.

We did not petition on that issue.

We accept the ruling of the Court of Claims that there are factual issues that must be determined somewhere, that a factual record must be made before the ultimate legal issue is decided.

Our only quarrel is with respect to where that factual finding should be made, where the record should be made in the first instance.

We say that it must be made before the administrative board and not in the Court itself.

Now it seems to us that the Bianchi case squarely controls this question.

The thrust of that decision is clearly that factual disputes arising out of a contract of this kind should, in the first instance, be resolved administratively.

The only question here is whether the rule is any different because the Board had once erroneously refused to entertain the dispute.

Now again Bianchi, it seems to us, answers that question.

The Court said in that case that if the administrative record is inadequate or if the Board has committed some error, still the Court should stay its hand, correct the error, and while it had no power to remand, it should stay the proceedings in the Court awaiting a correction of that error by the Board or a completion of the record in further board proceedings.

That rule it seems to us is fully appropriate in this case.

It’s important to stress I think that the Board here has not refused to decide the underlying dispute because it thought it lacked jurisdiction to do so.

It’s simply erroneously thought the appeal was untimely and for that reason and that reason alone, it did not resolved it.

Accordingly, there’s no reason to believe that it will not resolve the dispute if given an opportunity to do so.

Indeed, the Board’s opinion gives a rather clear indication in that direction.

It says with apparent approval and I’m reading from page 36 of the record, at the bottom of the page, “The parties are in complete agreement that it was and is their mutual interpretation that in the event of a timely appeal — in the event a timely appeal is taken thereunder, the disputes paragraph’ of the Letter of Acceptability confers jurisdiction on the Board to review a decision relating to cancellation of commitments, withholding of bid security, and itemization and determination of actual damages.”

In light of that, there is certainly no reason to suppose, the Board will fail to determine the controversy if given the chance to do so.

What would happen if it did?

Louis F. Claiborne:

Under the Bianchi decision itself, there is a suggestion that the contractor’s remedy is to obtain a default judgment.

However, we cannot suppose the government agency would put itself in the position of forbidding the government to that penalty by refusing to adjudicate the contrary.

Louis F. Claiborne:

Notice the —

Abe Fortas:

Mr. Claiborne, I suppose one theoretical question or theory is whether this is a matter of the Bianchi is based on the idea that one must exhaust the administrative remedy by having a trial of having the evidence to use there and then the appellate courts or the reviewing courts will review of it will confine themselves to that record or whether there’s some other theory underlying Bianchi.

Louis F. Claiborne:

Mr. Justice Fortas, Bianchi began on the premise of the earlier decisions in this Court which very clearly required the parties when they had agreed to do so through a disputes clause that these parties did to first exhaust their administrative remedies.

That much was taken as given, I think, in the Bianchi decision.

Abe Fortas:

Yes.

Louis F. Claiborne:

The only question there was whether having exhausted the administrative remedies, the contractor was entitled to a trial de novo —

Abe Fortas:

I understand that but here there was, in the sense there was an exhaustion of administrative remedies by — and that’s the bothersome feature of this case to me analytically, that is to say that the contractor did go through the procedures and the door was closed to him and everything else that he could do and he emerged from that with zero, he did not emerge from that administrative record upon which the Court could act and what happens thereafter to me is analytically and theoretically difficult.

Louis F. Claiborne:

Well if I may, Mr. Justice Fortas, answer the question in this way.

The Court of Claims in its decision here seem to find three basis for escaping the rule of Bianchi, escaping the rule that normally the decision that factual disputes is in the first instance for the administrative board —

Earl Warren:

Mr. Claiborne, could you speak up a little louder please?

Louis F. Claiborne:

I’m sorry.

The first was the self-evident proposition that having in one sense exhausted its administrative remedy because it found the door to the Board closed by the ruling that the appeal was untimely.

Of course, the contractor was entitled at that point to come into court, but it doesn’t fall off from that.

The Court having once corrected the error held that the appeal was timely should then proceed ahead to decide the merits of a controversy.

That is not the normal rule in reviewing courts when they are faced with the administrative decisions which either are incomplete in that the findings are insufficient or which because of an erroneous ruling as a matter of law never reached the issues which the Court finds relevant.

Abe Fortas:

But that’s error.

What you’re — what you’re in effect proposing and maybe this is right, I don’t know, is that ruling under the Board of Contract Appeals was under a disputes clause in the contract, which can affect jurisdiction or whatever that means in these circumstances is vested in that Board because — really because of the disputes clause.

Would that be treated as if it were a ruling of an administrative agency of the usual kind?

Louis F. Claiborne:

Well the —

Abe Fortas:

Is that so?

Louis F. Claiborne:

Again, the Bianchi decision I think answers that question.

The argument was there made that because the Court of Claims was not in the technical sense a reviewing court and furthermore because it, and the District Courts some cases involving claims of under $10,000 and trial courts did not suffer the same disadvantage as Courts of Appeal who more commonly have the function of reviewing administrative orders.

But for these reasons, the Court of Claims should not be treated as a mere reviewing court.

The opinion of the Court in Bianchi recognizes and rejects both of those suggestions pointing out that there are cases where trial courts do have this reviewing function and pointing out that the legislative history of the Wunderlich Act was intended to put the Court of Claims with respect to these type of cases in precisely the same position as the Court of Appeal on review of a normal — of another kind of administrative decision.

So that, I think that the Bianchi decision adverted and resolved that question whether the Court of Claims may be viewed as any other reviewing courts.

[Inaudible]

Louis F. Claiborne:

There maybe, Your Honor.

I’m not aware of it, but I might not be aware of it.

Finally, the Court of Claims in the decision below suggests a further reason why in these circumstances it would be inappropriate to remand the case to the Board and that is because of the delays inherent in a remand.

It reads this Court’s opinion in Bianchi as stating that speed of adjudication is the central consideration.

Louis F. Claiborne:

Now there are really two answers to that suggestion.

The first is that there is a remand in any event when the Court remands the case to its trial commissioner although it is in one sense within the same Court, there are delays attendant in that procedure and as our brief attempts to show, those delays maybe greater or at least as great as the delays that might be involved if the case was sent back to the Board.

But in any event, this Court’s decision in Bianchi did not say that speed was a virtue at all costs.

They were and or other reasons underlying the Bianchi rule which lets the administrative boards decide factual issues arising under government contracts to be decided administratively in the first instance rather than judicially.

It would be — it would seem unnecessary to rehearse all those considerations here, but it’s worth mentioning three of them.

One is that the parties themselves have agreed to have these matters resolved within the agency.

And the proper respect for that agreement, for that stipulation of the parties otherwise that in all permissible circumstances, the decision be at the administrative level.

The second is that these boards do have a special familiarity, a special competence, one might even say an expertise in these matters.

And for that reason, it’s appropriate that whenever possible, they be permitted in the first instance to decide especially the factual questions involved.

And finally, the boards of these agencies, in one sense the agencies themselves, should be afforded an opportunity to correct the errors of their subordinates.

That is certainly a healthy policy.

It confines in some cases the matters to the administrative level and spares needless work for the courts.

Abe Fortas:

Where does this go?

Suppose the agency wants to adhere that those — that the Court of Claims are remanding on — remand from this Court or otherwise decides that nothing should be heard in the first instance by the administrative agency.

Where does it go?

Where this case go then, in the Board of Contract Appeals or to the contracting officer or where?

Louis F. Claiborne:

To the Board of Contract Appeals.

Abe Fortas:

Then go back any further than that?

Louis F. Claiborne:

No, no —

Abe Fortas:

Does Board of Contract Appeals conduct the hearing or is it the Board just below that that conducted it?

Louis F. Claiborne:

No, there are only two at the administrative level that the contracting officer who simply makes a decision after entertaining the positions of the parties but not necessarily with any hearing certainly no formal hearing of any kind from his decision adverse to the contractor.

The contractor may appeal and there is, in most agencies, a rather formal proceeding provided for before what is known as the Board of Contract Appeals.

In this instance, it’s the Armed Services Board of Contract Appeals which serves all three of the military establishments and it is that agency, that Board, which would, if the Court stayed its hand, reconsider.

It is the Board which made the error of finding the appeal untimely.

It has now been told that the appeal was timely that it should have entertained it and we have every reason to believe that it will do so as it indicated in its own opinion.

Abe Fortas:

If I correctly understood you, you suggested that the Court of Claims should retain jurisdiction across which could merely stay its hand and tell a record is made — is that your thought about it?

Louis F. Claiborne:

Yes, and that — that is a suggestion made in the Bianchi opinion itself.

The reason for that is that the Court of Claims has no technical power to remand the case and therefore this is the way in which it goes about remanding.

And of course it’s a procedure that’s familiar in the interstate commerce area when there is a question of — within the primary jurisdiction of the ICC, the Court — the District Court is directed to stay its hand pending this administrative decision.

For these reasons as we say, we believe that the Court of Claims should have stayed its hand and that insofar as the judgment below, remand the case of the trial commissioner rather than awaiting further proceedings, timely proceedings, in the Board of Contract Appeals, the judgment should be reversed.

Earl Warren:

Mr. Fromson.

David Fromson:

Mr. Chief Justice, and may it please the Court.

At the outset, may I respectfully decline the invitation of the government to be considered as a companion case to the succeeding matter?

It is our position, although we would appreciate being in that high company, that our case is totally unrelated in the Maine to the succeeding Utah case.

I want to emphasize that at the outset because it’s very important that that fact be acknowledge by all.

The issue in this case as submitted by the Government is confined to the single matter namely, whether this Court should remand the present action in the Court of Claims to a lower administrative body for factual resolution and I am pleased to hear for the first time today that the Government is permitting the Court of Claims to retain some jurisdiction since I had always understood their position to be that they wish to complete divestiture.

We, however, have three issues.

[Inaudible]

David Fromson:

A complete divestiture of their case.

I understood their position to be that it should be remanded to an administrative body for all purposes and thereafter relief will be taken subsequently as may be determined by the administrative body.

[Inaudible]

David Fromson:

Yes sir.

We have three issues.

Our position is firstly that our facts are so unique that we are beyond the Bianchi holding.

Secondly, and independent of that fact, we have exhausted our administrative remedy.

And thirdly, independent of these two, we are properly before the Court of Claims because the interpretation of the documents before the Court constituted matters of the law and I — and its well settled now that once having established this jurisdiction and it’s right to hear the case on matters affecting law, it may in a correlative coordinate way, determine all related factual issues in connection therewith.

The government in the Maine correctly summarized the facts in this case.

I would not spend the time to review them in depth other than to remind this Court most respectfully that at some eight years ago that Grace first came in to touch with its invitation forbid.

It has reposed uncomfortably for five years in the Court of Claims that the Government waited two and a half years before making its motion for summary judgment in the Court of Claims, and in that motion, never offered the relief which it — which it offers today.

In connection with the dispute clause which is a part of the papers, and if I may revert for a moment, the typical Kay part situation is set forth in Anthony Miller and that reference is in page 4 of my brief.

So I will not burden the Court with the detail procedure for a Kay part other than to say that the procedure is complicated and comprehensive.

And there is unquestionably here a dispute as to whether or not the government exceeded the original work and scope of the work and which wage determination would apply to which portion of the work.

[Inaudible]

David Fromson:

There is no dispute in that, sir.

[Inaudible]

David Fromson:

That is correct, sir.

We would have been content to have remained within the board level for that purposes under the contract.

Potter Stewart:

[Inaudible] in that as well as perhaps in other respects but in that respect, certainly, this case is quite different from the one that follow as you began by telling us.

David Fromson:

I believe so, sir.

Potter Stewart:

Yes.

David Fromson:

Without attempting however to interpret the rights of the case.

When the series of disagreements arose and there was this dispute and the government denied that the request of Grace for the return of its deposit and as they subsequently found it was an erroneous decision, but nevertheless on that issue, Grace went before the Board of Contract Appeals.

After protracted hearing there which was not on the merits, the trial examiner concluded “beyond per adventure of doubt” that Grace is not here timely.

This is an important point to remember because we are operating under a unique dispute clause.

Now in Bianchi, we had what might approach at that time a standard dispute clause, but our clause is so radically different from that clause that there is another compelling reason why we should not be considered within the framework of Bianchi.

However, when we went before the Board of Contract Appeals and the Board Commissioner determined we were not timely, we were barred from any further administrative remedy, and our only recourse was to assume and take on the jurisdiction of the Court of Claims which we did.

I will have occasion in a moment to advert to the fact as to whether at the refusal to consider the case was in fact denying to the Board that it had jurisdiction because the Court of Claims as a fact, found that such denial of an opportunity to be heard constitutes a denial of jurisdiction.

So in effect, the Board told us at the lower level, we are sorry.

We just don’t have jurisdiction in this matter because you’re not timely.

As a result of the failure to receive in the Board, Grace then petitioned in the Court of Claims which petition was answered in due course and after some two and a half years, after issue joined the government made its motion for summary judgment which was denied and the majority felt that it should be denied for all purposes there was also this dissent all of which is a matter of record.

What was the reason for that [Inaudible]

David Fromson:

As to why the government waited sir?

Yes.

David Fromson:

I don’t know.

Byron R. White:

[Inaudible]

David Fromson:

Yes sir.

Byron R. White:

Well I certainly agree with you but reading it, you wouldn’t think it was limited to factual determinations at all.

David Fromson:

As I — I’m — I appreciate the Court of noticing that (Voice Overlap).

Byron R. White:

Even the breaches of contract.

David Fromson:

It included everything because it did not — it was not delimited by the standards raised which as to facts.

Byron R. White:

Well then why wouldn’t the — why wouldn’t the contracting officer have power to face up to claims of breach of contract?

David Fromson:

Sir, I believe the Board under their decisions had been reluctant to assume that we should not have a (Voice Overlap)

Byron R. White:

— disputes clause, isn’t it?

David Fromson:

That’s right sir and I — I —

Byron R. White:

Well this isn’t one of them.

This isn’t the standards disputes clause.

David Fromson:

We would have welcomed the opportunity for the contract also to assume jurisdiction.

Byron R. White:

Well he’s going to get the chance if the Court of Claims is wrong.

David Fromson:

I beg your pardon.

Byron R. White:

If the dissent in the Court of Claims is right, you’ll get your chance.

David Fromson:

We — we make it our chance belatedly but I don’t think the Court of Claims is wrong.

Byron R. White:

But where — where did you get along faster and more quickly, the Court of Claims or before the contracting officer? (Voice Overlap)

How long did it take to get through the Court of Claims, five years?

David Fromson:

No sir.

The hearing, as I recall, and I did not handle the case at that time.

Byron R. White:

Well I know but when the time you filed your case in the Court of Claims until you got out, how long was it?

It’s quite a while anyway.

David Fromson:

The — in December of 1959, Grace filed its appeal with the Board of Contract Claims, and in June of 1960, there was a decision.

The important thing to remember in connection with the disputes clause and — is that it promised, it promised an opportunity to be heard.

And in that sense, they did not live up to their promise even independent of timeliness and in that respect, the clause radically differs in Bianchi Clause.

Now we, as I’ve said, take the position that there are three valid reasons why this Court should permit the Court of Claims to retain jurisdiction.

The first that we are outside of Bianchi and the second that we have exhaust this rate of remedy, and the third that there was an interpretation of the contract and therefore a matter of law.

After the first point, I have alluded to the fact that we are not here dealing with the standard provision.

In Bianchi, the Court in most excellent fashion reviewed the history of the Court of Claims activity in this field, including a summary of the Wunderlich statute and then made its most important decision affecting government procurement as reflected in Bianchi.

Just briefly to again recapitulate the difference between the two clauses.

In the standard clause, you have a limitation on facts whereas in the Grace clause, there were no limitations.

In the standard clause, there is a requirement that the contractor proceed with the work whereas in the Grace, there was no such requirement.

We would deny that opportunity as the record will show and in the standards clause, there is no promise of an opportunity to present evidence at a hearing.

Whereas in our case, there was that promise in the last sentence of the clause.

I beg your pardon.

Abe Fortas:

What page is that?

David Fromson:

Page 16 of the record.

William J. Brennan, Jr.:

On page 3 of the brief.

David Fromson:

That’s right, sir, page 3 of the brief.

And the sentence I have eluded too, sir, is “In connection with any appeal under this paragraph, you will be afforded an opportunity to be heard and to offer evidence in support of your appeal.

This was denied to Grace at the administrative level.

So there are serious distinguishing characteristics which in our judgment lead us to the conclusion that this may very well be unrelated to Bianchi and not within its strict interpretation or rationale.

There are other reasons why there are differences here.

In Bianchi, there was a hearing on the merits, in our case, no hearing on the merits.

In Bianchi, you had a valid decision.

David Fromson:

In our case, what proof to be an invalid decision?

Our controversy is beyond the disputes clause whereas Bianchi was clearly within it.

The Government has carefully omitted to mention that our clause is not standard and they have indifferently assumed that the Board will accept a remand.

I know of no law or regulation or any power compelling the Board of Contract Appeals to accept this case in the first instance and secondly, if it were to, that it could not, for a second time, claim that we were untimely or for any other reason, disqualify this contractor.

At page 13 of the Government’s brief, the Government cites four cases suggesting in those cases that remand was feasible and accomplished.

But as respectfully suggested that an examination of those four cases will reveal that they are completely irrelevant, they did not involve any disputes clause, Wunderlich or Bianchi but were on a general proposition totally unrelated to the subject matter at hand.

So before proceeding with the second point, may I again remind the Court that through no point of Grace, he was denied what was rightfully his under contract and it was the Government who broke their agreement.

I believe a part of the disputes provision is the requirement that the Government give a correct decision or else suffer the consequences.

To permit the Government to have made the error and then require us to return before the same person who committed the error, I respectfully submit is most unfair and even deeper works a great injustice to the defense industry contractor who all of us know have too many square corners now to turn and who should, if anything be given the opportunity for speedy resolution of their problems.

Hugo L. Black:

Are you arguing in a constitutional basis or statutory?

David Fromson:

Statutory sir.

On this first point, when we claim we are beyond Bianchi, we are saying also sir that we are beyond Wunderlich.

Our second point is that we have exhausted our administrative remedy and we just had no place else to go, but to the Court of Claims and this through no fault of our own.

Now the Government at page 14 in its brief states the general proposition that neither the Court of Claims nor any District Court can consider these disputes unless the contractor has first exhausted its administrative remedies and we have no quarrel because that actually is the rule.

It is our contention that the failure of the Government to render a correct decision and to give this case and to hear the case on the merits, constituted such exhaustion.

The Government has not suggested in its brief nor does it cite any authority as to what may happen if Grace is denied an opportunity before the Board.

As I mentioned earlier, I know of no rule requiring this Board to take the case.

As a practical matter and as a matter of realism, look what chaos can happen and occur when a contracting officer makes a mistake, and it’s compounded by a local administrative board and the contractor thereafter sticks its remedy in the Court and it is later found that this were an error, should that contractor be penalized and the case remanded?

This may happen a number of times, not just once or isn’t the federal rule that the Government should just have one bite at the apple and that we shouldn’t attempt to unring the bell.

Once they’ve made their decision, should the innocent contractor suffer therefore?

It would appear to me that it’d be quite important, and again, I speak on behalf of an industry that deserves the consideration of this highest court, that they not be penalized.

The Court of Claims found, the full Court of Claims found there was no dissent on this point that under the present state of the law, a contractor may seek and find relief from the error of either a contracting officer or the administrative agency by appeal to that court.

In Langenfelder, in Zachry, in both cases, in both cases, the Court of Claims held that the contractor was relieved and he need not pursue any further futile remedies.

We agree that in the general rule, the contractor must first exhaust his administrative remedies before proceeding with the Court, but as had been established by this Court in both Blair and Holpuch, exceptions to that rule are pertinent.

We believe we come within that exception, namely, that we’ve exhausted our administrative remedy and that we are properly within the realm of the Court of Claims.

It would seem just right to require a contractor to revert only once as I mentioned earlier to hold otherwise, would just be chaotic.

The Government in its brief at page 16, states, speaking of the Board below, the Board merely dismissed an untimely — as untimely — I beg your pardon, the Board merely dismissed as untimely an administrative appeal which the Court of Claims believed timely.

The Board’s action was at most a prejudicial error not a denial of jurisdiction over the subject matter and it is respectfully submitted that that is directly contrary to the holding of the Court of Claims for the full court determined that this was a recognition by the Board that it had no jurisdiction to take the case for any purpose.

As a matter of fact, under the decisions affecting the operations of the Board of Contract Appeals, once the appeal period has expired, I believe there is no authority in anyone to extend that 30-day period.

I do not know whether the Board will be willing to do that which under its prior decisions hasn’t found to be impossible.

David Fromson:

The third point and concluding point concerns the fact that the administrative record before the Court of Claims involves a question of law thereby permitting said court to retain general jurisdiction and to resolve de novo, all or related factual issues.

As the record reveals, Grace was perfectly willing to continue with its performance and to construct the required buildings, but was denied that opportunity because in the fact, two contrary at wage administrations were issued and each of them changed the scope of the work as set forth in the prior invitation for bid and the interpretation of these matters properly was determined by the Court of Claims to be interpretations involving or conclusion — involving conclusions of law.

Having so determined it, they may properly retain and resolve all factual issues.

It would appear only just proper and fair that Grace not require a fragmentation of its remedy because it is well established that certain of the issues might very well require resolution in the Court of Claims and on this point, I believe the full court below was unanimous and the government concedes.

Since the Board of Contract Appeals, the Board of Contract Appeals will not resolve matters touching upon wage determinations and similar matters.

Abe Fortas:

Are you telling us that the Government agrees if there are issues of law that would have to be settled here by the Court of Claims?

David Fromson:

Sir, I’m sorry.

Abe Fortas:

Are you telling us that the government agrees that there are issues of law and have to be settled by the Court of Claims ultimately?

David Fromson:

Sir, if I may read as I understand their point at page 17 in their brief and it is also true that the administrative board like the Court of Claims itself will not review or construe the wage determinations of the Secretary of Labor.

For the foregoing reasons, sir, namely because of the unique factual pattern in this case, we are without and beyond and outside of the scriptures of the Bianchi decision.

Secondly, having exhausted our administrative remedy, we are entitled to speedy relief within the Court of Claims.

And thirdly, since the ultimate issue involved the question of law, this Court should not impose the hardship of fragmentation of remedy.

It should not delimit the properly acquired jurisdiction of the Court of Claims.

For these reasons, we respectfully request confirmation and concurrence of the powers here to for assume by the Court to hear and determine all matters before it.

Thank you.

Earl Warren:

Mr. Claiborne.

Louis F. Claiborne:

We’ll waive rebuttal, Your Honor.

Earl Warren:

Very well.