Maryland Steel Co. v. United States - 235 U.S. 451 (1915)
U.S. Supreme Court
Maryland Steel Co. v. United States, 235 U.S. 451 (1915)
Maryland Steel Co. v. United States
Argued December 8, 1914
Decided January 5, 1915
235 U.S. 451
Although parties to a contract may agree that time is of the essence and may stipulate for liquidated damages, they may subsequently so modify the requirements as to completion that performance within the stipulated time becomes unimportant. Flynn v. Des Moines Railway, 63 Ia. 490, approved.
As the record in this case does not show that there was any culpable delinquency in completion of a contract for the building of a vessel, or any detriment to the government, but that the vessel was delivered, tested, approved, and paid for without protest on the part of the government on account of delay, and, as it does appear, the Quartermaster General had, in his discretion, orally waived the time limit in the contract, held that:
In a case of contract authorized by law necessarily entered into and conducted by officers of the government, they must necessarily have the power to make it effective in its progress as well as in its beginning, and the oral agreement of the Quartermaster General was within the scope of his official authority, and amounted to a modification of the contract. Salomon v. United States, 19 Wall. 17, followed. United States v. Bethlehem Steel Co., 205 U. S. 105, distinguished.
48 Ct.Cl. 50 reversed.
The facts, which involve the right of the government to deduct from final payment on a contract an amount
alleged to be due as liquidated damages for noncompletion on a former contract with the claimant, and also the question of whether such liquidated damages had been waived by the government, are stated in the opinion.