Reporter's Statement of the Case 107 C. Cls. 21. Definitions of the adjectives "waterproof" and "watertight" as given by Webster's New International Dictionary, Second Edition (1939), Unabridged, follow: Waterproof: Impervious to water; specif.: (a) Covered or coated with a material, as a solution of rubber, to prevent permeation by water. (b) Pert. to or characterizing a machine or structure so constructed that a stream of water may be directed on it under specified conditions without the water entering. Watertight: (a) So tight as to be impermeable by water. (b) Pertaining to or characterizing a machine or structure so constructed that a stream of water may be directed on it under specified conditions (more severe than required for the machine or structure to be waterproof) without leakage of water. 22. The terms "waterproof" and "watertight" were in use, at the time of and prior to the making of the contract in suit, in regulations promulgated by agencies and departments of the United States and in specifications for specific items and articles obtained through the procurement procedures thereof. The meaning of such terms as used in such specifications, insofar as such specifications are in evidence in this case, was defined with more or less particularity by descriptions of the tests to be applied to determine whether or not the article was waterproof or watertight. In one such description, degrees were defined for each of the terms "waterproof" and "watertight," and in one such degree a hose test was to be applied, while in another such degree a submergence test was to be applied, in determination of either "waterproof" or "watertight." As generally used, both terms signify imperviousness to water. The difference between them is one of degree, "waterproof" signifying the lesser degree, "watertight" the greater degree. The evidence does not satisfactorily establish usage of the terms interchangeably in marine matters. 23. The containers manufactured by plaintiff were neither waterproof nor watertight to the degree required to meet a submergence test. Plaintiff was not put on notice, at the time it entered into the contract with defendant, that the containers were re 606 Reporter's Statement of the Case quired or expected to be waterproof or watertight to the degree required to meet a submergence test. The soldered seams of the bodies of the containers were not watertight to the degree required to meet a submergence test. The evidence does not satisfactorily establish that the containers were or were not either waterproof or watertight to the degree required to meet a hose test. 24. On January 5, 1944, the Director, Procurement Division, United States Maritime Commission, sent the following telegram to plaintiff : Rephone conversation this date your right to proceed under contract MCc-22459 purchase order MC-44-3543 hereby terminated for failure meet requirements and delivery as shown on order. Formal notification follows. This telegram was confirmed by letter dated January 7, 1944, terminating plaintiff's right to proceed, "in accordance with Articles 14 and 15 of the General Provisions covering the purchase order." Article 15 of the General Provisions provided that the buyer may terminate the contract by written or telegraphic notice to vendor upon the occurrence of any of the events of default, which are defined by Article 14 as including failure of vendor in any respect to use due diligence in proceeding with the performance of the contract work, or failure to perform any of the covenants on its part to be performed, or breach of any warranty, provided the buyer in either instance shall give written notice to vendor as to such failure or breach. Defendant's counsel stipulated at the trial that the Government's cancellation of the contract on the ground that plaintiff was late in delivery meant only that plaintiff did not meet the specifications on time. 25. On January 13, 1944, a third inspection of the containers was made at plaintiff's plant. The inspector had been present at, but not in charge of, the tests made on December 23, 1943. Prior to the inspection of January 13, 1944, this inspector had asked the Materials Inspector in Charge for a statement of the difference between watertight and waterproof, and was instructed that on orders from Reporter's Statement of the Case 107 C. Cls. Washington, the containers had to be watertight. He accordingly used the submergence test on one container. Finding that it leaked, he floated two or three containers on the surface of the water, and found that they leaked from the bottom because of defective soldering. He also put water in two or three containers and found that they leaked at the bottom. Resoldering, done while the inspector was there, corrected the leaks at the bottom, but the same containers, when filled with water, closed, and inverted, leaked through the covers. Thereafter, on the same day, the inspector forwarded a rejection notice to plaintiff ("containers not watertight"), and filed a daily memorandum report with his office. 26. The following exchange of correspondence occurred after the inspection described in the previous finding: From plaintiff to defendant, January 19, 1944: We are in receipt of your cancellation of order MC 44-3543. This cancellation pertains to containers for life preserving equipment. As worded in the original order, the containers were to be fabricated as per our sketch and sample furnished. We followed these instructions throughout. We have a definite "waterproof" box as specified in the order. Only after we had completed the containers was the word "Watertight" stressed. Cancellation at this time with the containers completed means a tremendous loss to a company of our size. In trying to make these containers watertight, we reworked them three times * * * We believe we are entitled to some consideration in helping us sustain this loss. Any aid, suggestions or help granted, will be appreciated. From defendant to plaintiff, January 22, 1944: In reply to your letter to January 19, 1944, concerning the cancellation of the above purchase order calling for metal blanket containers, you are advised that prior to the cancellation of this contract your office was requested to make such corrections as to have this material watertight. Such corrections were not made, and apparently cannot be made; in view of which cancellation must stand. These metal blanket containers must not permit the entrance of water or moisture under any condition due 606 Opinion of the Court to the possibility of mildew and distruction (sic) of blankets contained therein. It is regretted that your company was unable to meet the requirements of the purchase order but in view of the services expected thereof, it is hoped that you will realize that our action in this instance is reasonable. 27. Thereafter, the 1,000 containers intended by plaintiff for delivery under defendant's Purchase Order No. MC-443543 were sold by plaintiff for $600, representing the best price obtainable therefor. The cost to plaintiff for manufacturing the 1,000 containers was $3,384, including materials, labor, and overhead. There was an additional cost to plaintiff of $20 for storage of the containers after the contract was cancelled by defendant and before the containers were sold by plaintiff. This item is not included in the cost of the containers. If plaintiff had manufactured the 1,000 containers specified in defendant's Addendum No. 1 to Purchase Order No. MC44-3543 at the same cost as the 1,000 containers that were manufactured, and if defendant had accepted and paid for such containers at the contract price, plaintiff's profit on the 1,000 containers would have been $216. Plaintiff did not in fact fabricate the 1,000 containers called for by the addendum. It did, however, incur certain costs on account of such supplemental order. Rubber for the gaskets for the 1,000 containers was obtained at a cost of $27 for the material, and was cut into strips for use in the containers at a cost of $23.40 for labor. There was also an expenditure of $30 for labor in handling the sheet metal to be used in the containers. The court decided that the plaintiff was not entitled to recover. LITTLETON, Judge, delivered the opinion of the court: Shortly prior to November 10, 1943, plaintiff, a manufacturer of sheet metal products, received information from two manufacturers' representatives, who had previously conferred with the Procurement Division of the Maritime Commission, that plaintiff might obtain a contract or purchase order from the Commission for a supply of a certain type of metal blanket container for use on life rafts on merchant Opinion of the Court 107 C. Cls. vessels (finding 2). Following this meeting at plaintiff's Newark, New Jersey, office, and after plaintiff had made and delivered to the manufacturers' representatives, for delivery to the Commission, a sample container (without the waterproofing rubber gasket) as representative of the product which plaintiff would undertake to provide and furnish, the plaintiff on November 10, 1943, prepared a sketch (described in findings 11 and 12) explaining the specification of the metal blanket container which it was prepared to manufacture, and sent the same to the Commission at Washington, with the following proposal: We hereby submit a rough sketch explaining the specification of the "special metal box," which is to hold two blankets. Production on said box can be started within two days of receiving the materials necessary to manufacture same. The price is as follows: 24 gauge galvanized iron, soldered on both ends, watertight, in lots of 1,000 to 5,000 $3.60 each. F. O. B. Plant. * The proof is uncertain as to whether the sample container reached the Commission. The evidence shows that the phrase "soldered on both ends, watertight" had a special meaning in established usage in the sheet metal trade, which was that the joints between sides, bottom, and ends would be soldered and thereby made watertight. Plaintiff intended this meaning in its proposal and in the sketch attached thereto as a specification, and there is no evidence to show that defendant otherwise understood the use of the phrase mentioned. Under this specification the removable top of the container, as shown, could not be soldered to the body, or top end, of the container. Therefore the phrase "soldered on both ends, watertight" could not have been interpreted to mean that plaintiff was proposing to furnish a “watertight” metal container. Plaintiff did not expressly propose or represent in its letter or specification that the described container would be "waterproof." Plaintiff's proof is to the effect that it intended by its sketch and proposal that the container would be watertight at the soldered seams and waterproof around the removable top. However, by the express terms of the contract entered into by the parties on November 29, 1943 (find |