He stated that he would be glad to cooperate in every way in the matter and his sole idea was to assist me in making a success of the whole shipyard project. I told him this action had nothing to do with the major problem which had been under discussion with him and which I would discuss later. He afterward brought the matter up with Admiral DuBose and questioned the significance of the action which I had taken. Admiral DuBose referred him back to me. That was June 30, 1941. Then it says: Tuesday, July 1. I told Commander Weyerbacher that the major matter which had been under discussion with him, Mr. Ripley, Admiral DuBose, had been placed on a strictly probationary basis, without any named time limit. In other words, it was from now on. I also told him that I wanted him to concentrate his attention on the completion of all facilities work, as well as getting the shipbuilding construction under way and pushed forward in every possible channel. He assured me of his desire to do so and regrets that anything had occurred either as a result of omission or error. In turn, I assured him that this was, so far as I was concerned, nothing but a cold-blooded business proposition, into which no personalities would be permitted to enter, but that the decision made would be based on the facts and upon merit, entirely from the standpoint of the welfare of this company and not that of any individual. He expressed his understanding and agreement with the thoughts which I had expressed. I afterward advised Admiral DuBose and Mr. Ripley, both of whom signified their approval. Signed, James Reed. Mr. FLAHERTY. Was that letter transmitted to somebody after your investigators went in there? Mr. TOLAND. It is an interdepartmental correspondence, Congressman, and it doesn't say to whom. Mr. FLAHERTY. Was it prepared after your investigators went in? Mr. TOLAND. Prepared on July 1, 1941, by the president of the company at that time, who later died. The ACTING CHAIRMAN. Who died before our investigators went in there, I believe. Mr. TOLAND. That is it. The ACTING CHAIRMAN. That was written prior to the investigators going in? Mr. TOLAND. It was obtained from Mr. Reed's personal file. As a matter of fact, Commander, did Mr. Reed put you on probation on that date? Commander WEYERBACHER. Yes, sir. Mr. TOLAND. Why? Commander WEYERBACHER. He apparently got the idea I was not cooperating with him. Mr. TOLAND. In what respect? Commander WEYERBACHER. He explains there; it is well explained. Mr. TOLAND. What else did he say to you that isn't in this memorandum? Commander WEYERBACHER. Nothing more than I know of. Mr. TOLAND. You have no recollection of anything else he said? Commander WEYERBACHER. No; other than what is recited here. In substance that is the same thing. Mr. TOLAND. As a matter of fact, way back in June didn't Mr. Ripley suggest to you that it would be unwise for you to settle yourself permanently in the city of Philadelphia? Commander WEYERBACHER. Yes. Mr. Ripley suggested that. Mr. TOLAND. In fact, he wrote you on the 19th day of June, didn't he? Commander WEYERBACHER. Yes. Mr. TOLAND. Did you receive the original of that letter? Commander WEYERBACHER. Yes. Mr. TOLAND. I offer it in evidence. I will read it, Mr. Chair man. (The letter was received in evidence, and marked "Exhibit No. 270.") Mr. TOLAND. Are we about to recess, Mr. Chairman? The ACTING CHAIRMAN. We will recess in a minute. Mr. TOLAND. I don't mean right now. I mean for lunch. The ACTING CHAIRMAN. Will you have some further questions for Commander Weyerbacher? Mr. TOLAND. Oh, I have hours. Let me read this. The ACTING CHAIRMAN. Read that letter, and then we will recess. Mr. TOLAND. I will read exhibit 270. Commander R. D. WEYERBACHER, Warwick Hotel, Philadelphia, Pa. JUNE 19, 1941. DEAR TOMMY: I gathered the impression from Mrs. Weyerbacher, if I understood her rightly, that you are thinking of committing yourselves during the coming week end to a home somewhere around Philadelphia. I suggest that you do not do this until you and I have had a chance to discuss the Cramp executive managerial situation in general. In brief, I am not entirely satisfied with the way the relationships are working out; and I think that before you go to the extent of committing yourself to some real estate we should, at our mutual convenience, have a chat about the matter. Yours sincerely, Copies to J. R., Wm. G. DuB. Then it has in writing: "J. P. R. Talk to Chantry." J. P. RIPLEY. Did you have a talk with Mr. Ripley after you got that letter? Commander WEYERBACHER. What is added on to that? Mr. TOLAND. That is in Mr. Ripley's handwriting, I assume. Do you want to look at it, Mr. Ripley? It is Mr. Reed's handwriting, I think. Is that Mr. Reed's handwriting, that note at the bottom? Mr. RIPLEY. That is Mr. Reed's handwriting. Mr. TOLAND. Mr. Reed's handwriting, not yours. Did you have a talk with Mr. Ripley after you received that? Commander WEYERBACHER. Yes, sir. Mr. TOLAND. What was that talk about? Commander WEYERBACHER. In general he said that he heard I was not getting along with Reed and for me to go back and talk to the Admiral and Mr. Reed. Mr. TOLAND. What was it that you were not getting along with him about? Commander WEYERBACHER. Well, he thought that I had too much to do, that some of my duties should be eliminated so that I could devote all of my attention getting the plant ready to build ships. Mr. TOLAND. That was the only thing that Mr. Reed was concerned about? Commander WEYERBACHER. As far as I know. Mr. TOLAND. He never said anything to you, or Mr. Ripley never said anything to you about anything else except the fact that you had too much to do? Commander WEYERBACHER. That is what Mr. Reed told me. Commander WEYERBACHER. I don't recall the conversation. Mr. Ripley can answer that. Mr. TOLAND. You have no recollection of what Mr. Ripley said to you? Commander WEYERBACHER. Except that he had been informed that I was not getting along so well with Reed and he suggested that I go back and talk to the admiral and to Mr. Reed. Mr. TOLAND. As a matter of fact, have there been any meetings of the board of directors which you have been at or executive committee meetings in the last 6 months at which the question of your duties and qualifications was discussed? Commander WEYERBACHER. At no directors meeting, because I have attended them all. Mr. TOLAND. Was there any meeting at all while the members of the staff of this committee were present at which the question of your tenure was concerned or discussed? Commander WEYERBACHER. Not to my knowledge, at the meeting. Mr. TOLAND. Not at the meeting? Commander WEYERBACHER. No. Mr. TOLAND. Wasn't there a general dissatisfaction on the part of Mr. Reed and Mr. Ripley as to the way you were conducting yourself in your department? Commander WEYERBACHER. There may have been to Mr. Reed, but not as far as I know to Mr. Ripley at that time. Mr. TOLAND. I would like to offer this in evidence, Mr. Chairman. This is another letter of Mr. Reed, taken from his file, dated the 3d of July. The ACTING CHAIRMAN. Is that very lengthy, Mr. Toland? Mr. TOLAND. It is one page. The ACTING CHAIRMAN. Do you want to withhold that? Mr. TOLAND. May I? Because I have a request The ACTING CHAIRMAN (interposing). Withhold that, and you can put that in the record and read it when we reconvene at 2 o'clock. Mr. TOLAND. Two o'clock. The ACTING CHAIRMAN. The committee will recess until 2 o'clock. (Whereupon, at 12:15 p. m., the committee recessed until 2 p. m. the same day.) AFTERNOON SESSION Following the noon recess, the committee hearing reconvened at 2: 10 p. m., Representative Michael J. Bradley, Pennsylvania, acting chairman. The ACTING CHAIRMAN. The committee will resume its sitting. Mr. Toland. Mr. TOLAND. Yes, Mr. Chairman. Commander Weyerbacher. Commander, this morning, before lunch, I put in the record a letter of the supervisor of ships, Commander Hanson, in which he stated that you had written a letter recommending Admiral Harris be awarded the contract, and my recollection is that you said you never wrote such a letter. Commander WEYERBACHER. To the best of my knowledge and belief, I have written no letter. Mr. TOLAND. I show you a copy of a letter dated September 24, 1941, from you to Admiral DuBose, and ask you if you didn't dictate and send to the admiral the original of that letter? Commander WEYERBACHER (examining paper). Yes; I remember that now. Mr. TOLAND. So you do recall it? Mr. TOLAND. I offer it in evidence. (The letter was received in evidence and marked "Exhibit No. 271.") Mr. TOLAND. And the letter does contain a recommendation on your part? Commander WEYERBACHER. Yes. The ACTING CHAIRMAN. Will you read it, Mr. Toland? R. D. Weyerbacher W. G. DUBOSE, Repair Yard, Engineering Service. [Reading:] Recommendation for NOd-2247. September 24, 1941. Enclosed is a summary of the proposals received for engineering services in connection with the repair yard. The three proposals are from reputable and experienced firms of engineers, any one of whom are qualified to design and supervise the construction of the repair yard, particularly the proposed dry dock. Frederic R. Harris has a large organization and we believe he has more engineers experienced in this type of work than either of the other two firms. Both a floating drydock and a graving dock are to be considered, and each type will require some preliminary study. If a floating drydock is to be built, Frederic R. Harris asks a fee of $142,500, and the corresponding fees asked by the other two firms are considerably higher. If a graving dock is to be built, Frederic R. Harris asks a fee of $182,000, and Crandall Dry Dock Engineers, Inc., asks a fee of $181,000, a difference of only $1,000. The fee of the third firm is very much higher. The Frederic R. Harris proposal for floating dry dock is much the lower fee, but if a graving dock is to be installed there is only a very small difference between his and the Crandall Dry Dock Engineers' fee. It is recommended that the proposal of Frederic R. Harris for engineering services in connection with the repair yard be accepted. The amount of the fee to be either $142,500 or $182,000, depending on the type of drydock to be installed. The difference is entirely in division C, covering work of assistants in letting contracts, approval of contractors' drawings, and field inspection. It is important that a contract be made for these engineering services as soon as possible, and before a decision is reached as to the type of drydock to be built. Frederic R. Harris is now engaged by the Navy Department on work of a similar character, and it is believed that he would prepare a more economical design and in quicker time than either of the other two firms. What kind of a dock was built? R. D. WEYERBACHER. Commander WEYERBACHER. The contract, the letter of intent directing the contractor to proceed, was issued this week. Construction will start in the near future. Mr. TOLAND. For what kind of dock? Commander WEYERBACHER. A graving dock. Mr. TOLAND. And the fee of Admiral Harris to build the graving dock was not the lowest bidder. Is that right? Commander WEYERBACHER. It is $1,000 more than the Crandall bid. Mr. TOLAND. It was not the low bid? Commander WEYERBACHER. No; it was not the low bid. The ACTING CHAIRMAN. What were the two bids, Mr. Toland? Mr. TOLAND. The bid of Admiral Harris was $182,000; the bid of the Crandall Dry Dock Engineering, Inc., was $181,000, so that in that instance the low bidder did not receive the bid. Is that right? Commander WEYERBACHER. In our judgment the lowest responsible bidder for that work.. Mr. TOLAND. Well, let me see that exhibit. Didn't you say they were all responsible? Didn't you make the statement in here that any one of them was qualified to design this construction? Commander WEYERBACHER. There is another paragraph there. Mr. TOLAND. Didn't you say that "the three proposals are from reputable and experienced firms of engineers"? Commander WEYERBACHER. Yes. Mr. TOLAND. "Any one of whom are qualified to design and supervise the construction of the repair yard, particularly the proposed drydock"? Commander WEYERBACHER. Yes. Mr. TOLAND. Didn't you make that statement? Commander WEYERBACHER. But there is another statement there about the speed and economy of design. Mr. TOLAND. The point is, is it your testimony, then, that the Crandall Co. is not qualified to do this work? Commander WEYERBACHER. No; I did not say that. Mr. BATES. Mr. Chairman, let me interject at this moment, Mr. Toland, to get a little background to this hearing. Have you stated to the committee just what your object is in the cross-examination of this witness, and what you are trying to prove? Mr. TOLAND. I did that in executive session. I don't think you were there that day. Mr. BATES. No. The only point is, I note in this examination now the difference of $1,000 in a $180,000 contract. Mr. TOLAND. Yes. Mr. BATES. Unless you have some other real objective behind it, I think it is quite picayunish to lay too great emphasis on that point. Mr. TOLAND. Well, the record speaks for itself, Congressman, on the whole thing. Mr. BATES. I am speaking of this one question. This committee is just struggling for time to give to this meeting, and I think we ought to go into larger spheres of activity if we have them available and not quibble over a $1,000 job. If we have something really worth while I am just willing to give any time to it, unless you can find a conclusion. Mr. TOLAND. Is it your position, then, Mr. Congressman, that the question of the amount is determining as to whether there has been a violation of the law or regulations? Mr. BATES. Questions of violation are involved, but I understand this is a private organization which has entered into a contract for any reasonable sum of money to carry out a specific kind of work. From what I know, from long experience myself in construction work, there is a wide variation of opinion as to whether or not you should pay a higher price for a given job if you can do it more efficiently and have more confidence in the organization that is going to do the work. If there is violation of the law, that is another matter. Is there a question of violation of law involved? |