College Point Boat Corp. v. United States - 267 U.S. 12 (1925)
U.S. Supreme Court
College Point Boat Corp. v. United States, 267 U.S. 12 (1925)
College Point Boat Corp. v. United States
Argued November 17, 1924
Decided January 19, 1925
267 U.S. 12
1. Claimant's preparations to perform its contract for furnishing supplies to the Navy were stopped as the result of steps taken by the Navy Department for the purpose of avoiding useless production, without manifested intention to cancel the contract and without giving the notice requisite to the exercise of the unconditional right of cancellation existing under the Act of June 15, 1917 (Russell Motor Car Co. v. United States, 261 U. S. 514), pursuant to which the contract was made. Held, that there was no cancellation as a matter of law, and that the stoppage of performance was an anticipatory breach. P. 267 U. S. 15.
2. The government's right of cancellation, under the above statute, is continuing, and not lost by delay in exercising it. P. 267 U. S. 16.
3. This continuing right of cancellation, limiting the value of the other party's right to require performance, curtails his damages for an anticipatory breach by the government, so that prospective profits are not recoverable. Id.
4. There is no general rule that a party cannot exercise a right to cancel a contract when himself in default. Id.
5. Held that a default on the part of the government was insubstantial, and did not render inequitable delayed exercise of its right to cancel the contract. Id.
6. The right to cancel conferred by the Act of June 15, 1917, is not made dependent on a tender of 75% of the amount offered by the government in settlement. P. 267 U. S. 17.
58 Ct.Clms. 380 affirmed.
Appeal from a judgment of the Court of Claims rejecting a claim for loss of profits anticipated under a contract with the United States, performance of which was stopped by the government.