Barrett Co. v. United States
273 U.S. 227 (1927)

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U.S. Supreme Court

Barrett Co. v. United States, 273 U.S. 227 (1927)

Barrett Co. v. United States

No. 105

Submitted January 7, 1927

Decided February 21, 1927

273 U.S. 227

Syllabus

1. After cancellation of a contract under which supplies were to be manufactured for the government in a plant to be built with government funds and to belong to the government, the making of a supplemental agreement by which the contractor bought the plant for a price stated did not affect the contractor's claims growing out of the termination of the original contract when the later agreement was expressly without prejudice to them. P. 273 U. S. 232.

2. The just compensation to which a claimant is entitled upon cancellation of a contract by the government, under the Act of June 15, 1917, is not to be measured by the profit that would have accrued under the contract, but must embrace that value which was taken from the contractor by the termination of the contract. The contractor is to be credited with his outlays reasonably made for the fulfillment of the contract. P. 273 U. S. 235.

Page 273 U. S. 228

3. In this case, where the obligation of the contractor was to manufacture and furnish to the government a definite quantity of xylol monthly, up to a specified amount, in a plant which was to be erected by the contractor with government funds and belong to the government, just compensation, upon cancellation of the contract, must include what the contractor expended on the plant in excess of the cost as estimated and adopted in the contract and paid by the government, insofar as such additional expenditure was required to fit the plant for production of the xylol as the contract contemplated. P. 273 U. S. 234.

60 Ct.Cls. 343 reversed.

Appeal from a judgment of the Court of Claims in an action to recover under an agreement with the government for the manufacture of xylol.

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