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Opinion of the Court

It is contended by the plaintiff that, in arriving at just compensation, an offer to rent the fleet made years after the fleet had been seized and the rental value of similar vessels on the Mississippi River should be taken into consideration. These contentions cannot be sustained. Sharp v. United States, 191 U. S. 341, 348, 349; Clarke v. Hot Springs Electric Light & Power Co., 55 Fed. (2d) 612; and Sommers v. Commissioner of Internal Revenue, 63 Fed. (2d) 551.

There were no other towboats and barges on the Mississippi River at that time which could have been rented. There was no market value for the lease and option to purchase. Reproduction less depreciation or cost less depreciation are not fair bases on which to place valuation. Plaintiff is entitled to have taken into consideration what he spent in inaugurating the service and the cost of repairs and changes made to the towboats and the supplies furnished by him. Prospective profits can not be considered. No profits were made by the plaintiff during the time he had possession of the fleet from September 1924, to July 1926. This was primarily due to the fact that all shippers on the Mississippi River realized that the fleet was tied up in litigation and possession was being sought through the courts by the defendant.

As was said by Justice Butler in Standard Oil Co. v. So. Pacific Co., 268 U. S. 146, 156:

It is to be borne in mind that value is the thing to be found and that neither cost of reproduction new, nor that less depreciation, is the measure or sole guide. The ascertainment of value is not controlled by artificial rules. It is not a matter of formulas, but there must be a reasonable judgment having its basis in a proper consideration of all relevant facts.

As the plaintiff only possessed a lease with an option to purchase and there being no market value, it is necessary for the Court, in arriving at an amount sufficient to compensate him for injuries sustained, to take into consideration all outlays made by him including the rental value of his land, and make reasonable deduction for the less time engaged and for release from care, trouble, risk, and responsibility attending a full execution of the contract. United States v. Speed, 75 U. S. 77.

Opinion of the Court

In Hetzel v. Baltimore & Ohio Railroad Co., 169 U. S. 26, 37, 38, 39, the court said:

in such inquiries, absolute certainty as to the damages sustained is in many cases impossible. All that the law requires is that such damages be allowed as, in the judgment of fair men, directly and naturally resulted from the injury for which suit is brought. This is the rule which obtains in civil actions for damages. They have their foundation in the idea of just compensation for wrongs done.

The court quoted with approval from Baker v. Drake, 53 N. Y. 211, 220, as follows:

The proof may sometimes be rather difficult upon the question whether the damage was the just or proximate result of the breach of the covenant. In such case it does not come with very good grace from the defendant to insist upon the most specific and certain proof as to the cause and the amount of the damage when he has himself been guilty of a most inexcusable violation of the covenants which were inserted for the very purpose of preventing the result which has come about.

In Hoffer Oil Corporation v. Carpenter, 34 Fed. (2d) 589, 592, the court said:

A person who has violated his contract will not be permitted to reap advantage from his own wrong, by insisting upon proof which, by reason of his breach, cannot be furnished. * * *

A party, who has broken his contract, will not be permitted to escape liability because of the lack of a perfect measure of the damages caused by his breach.

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A reasonable basis for computation, and the best evidence which is obtainable under the circumstances of the case and which will enable the jury to arrive at an approximate estimate of the loss, is sufficient. See Eastman Kodak Co. of New York v. Southern Photo Materials Company, 273 U. S. 359.

Taking all the relevant facts into consideration and after allowing the counterclaims, in making a jury award, the Court concludes that the sum of $350,000.00 is just compensation for the vessels and unloading apparatus and all

Syllabus

other claims, legal or equitable, arising out of the transactions.

Judgment is entered for the plaintiffs in the sum of $350,000.00, with interest at six percent per annum, not as interest but as a part of just compensation, from March 25, 1923, to the date of payment. Virginia Engineering Company v. United States, 89 C. Cls. 457.

It is so ordered.

LITTLETON, Judge; and GREEN, Judge, concur. WHITAKER, Judge; and WILLIAMS, Judge, took no part in the decision of this case.

COWDEN MANUFACTURING COMPANY v. THE UNITED STATES

[No. 44307. Decided April 1, 1940]*

On the Proofs

Processing taxes under Agricultural Adjustment Act; effective date; Government contract. Where plaintiff on June 24, 1933, entered into a contract with the Government to supply certain articles of clothing, and on July 5, 1933, pursuant to a change order agreed to supply additional articles, and did supply such articles in accordance with said contract and change order; and where said contract contained a provision that the price agreed upon therein should be increased, or decreased, in accordance with any taxes, including processing taxes, upon the materials or supplies used in the manufacture of said articles, imposed by Congress after the date set for the opening of the bids, it is held that the processing taxes provided for in the Agricultural Adjustment Act, approved May 12, 1933, but not prescribed and proclaimed by the Secretary of Agriculture, in accordance with the authority conferred by the Act, until July 14, 1933, in a proclamation making said processing taxes effective August 1, 1933, were not taxes "heretofore imposed by the Congress," within the meaning and intent of said contract.

Same. The Agricultural Adjustment Act, enacted prior to the date of the contract, did not definitely provide for any tax on the processing of cotton, nor did it specify the amount thereof, if such tax should be imposed, nor when such tax should become effective.

*Certiorari granted.

Reporter's Statement of the Case

Same. The action of Congress in imposing the processing tax under the Agricultural Adjustment Act was not complete until action by its delegate, the Secretary of Agriculture.

Same; "Federal Taxes provision" of contract.-The purpose of the "Federal Taxes provision" of the contract was to reimburse the contractor for its additional costs brought about by the defendant's act in levying additional taxes.

The Reporter's statement of the case:

Mr. Phil D. Morelock for the plaintiff. Mr. George P. Lamb was on the brief.

Mr. Guy Patten, with whom was Mr. Assistant Attorney General Samuel O. Clark, Jr., for the defendant. Messrs. Robert N. Anderson and Fred K. Dyar were on the brief.

The court made special findings of fact as follows, upon the basis of a stipulation of facts entered into between the parties:

1. Plaintiff is a corporation organized and existing under the laws of the State of Missouri, with its principal offices and place of business at 412 West 8th Street, Kansas City, Missouri.

2. Plaintiff entered into a contract, No. W-669-qm-4800 (O. I. 2538), with the United States through the proper purchasing officer of the Quartermaster Corps, at Philadelphia, Pennsylvania, on June 24, 1933, in which the plaintiff agreed to sell to the United States and deliver at the Quartermaster Depot in Philadelphia, Pennsylvania, 23,496 suits, mechanics type B-1 @ $1.90, for which the United States agreed to pay $44,642.40. Pursuant to a change order dated July 5, 1933, under and by virtue of the provisions of Article 7 of said contract, the total was increased upon written order from the contracting officer of the War Department, and the plaintiff was required to and did supply 11,724 additional suits, mechanics type B-1 @ $1.90, for which the United States agreed to pay $22,275.60. The total number of suits furnished under the contract was 35,220 at an aggregate price of $66,918, which suits were accepted and approved by defendant and said sum of $66,918 has heretofore been paid to plaintiff as by said contract provided.

Reporter's Statement of the Case

3. The contract of June 24, 1933, was made pursuant to a bid submitted to the War Department by the plaintiff June 6, 1933. Both the bid and the contract contained the following provision:

Prices set forth herein include any Federal Tax heretofore imposed by the Congress which is applicable to the material purchased under this contract. If any sales tax, processing tax, adjustment charge, or other taxes or charges are imposed or changed by the Congress after the date set for the opening of the bid upon which this contract is based and made applicable directly upon the production, manufacture, or sale of the supplies covered by this contract and are paid by the contractor on the articles or supplies herein contracted for, then the prices named in this contract will be increased or decreased accordingly and any amount due the contractor as a result of such change will be charged to the government and entered on vouchers (or invoices) as separate items.

4. Plaintiff manufactured the suits involved in the aforesaid contract, and in the manufacture thereof it used 213,12734 yards of cotton cloth which it purchased from McCampbell and Company, 320 Broadway, New York, selling agent for Graniteville Manufacturing Company of South Carolina, a first domestic processor of cotton.

The confirmation by McCampbell and Company of plaintiff's order, dated June 23, 1933, for the aforesaid cotton cloth contained the following provision:

The prices stated herein are based upon present manufacturing conditions and cost thereunder. If such cost is increased by any Federal taxes or by the administration of the Industrial Recovery Act, the Agricultural Adjustment Act or by any Federal regulations or Federally approved codes and practices, affecting costs, not now in force, the amount of such increased cost shall be added to the prices stated and delivery shall be extended in proportion to any limitation of production caused thereby.

Pursuant to the above provision, McCampbell and Company billed plaintiff, as a separate item in its invoices for the above-mentioned cotton cloth, for the amount of tax applicable to the processing of the cotton from which said

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