
    REISS & WEINSIER, INC. v. THE UNITED STATES
    No. 49490.
    Decided December 1, 1953.
    
      
      Mr. David Mor gulas, for the plaintiff. Messrs. M. Carl Levine, Mor gulas <& Foremam, were on the briefs.
    
      Mr. Carl Eardley, with whom was Mr. Assistant Attorney Generad Warren E. Burger, for the defendant.
   Whitaker, Judge,

delivered the opinion of the court:

In December 1945 the defendant, through the instrumentality of the Housing Authority, embarked on a program to furnish emergency housing for veterans of World War IL The general plan was to demount and separate into their component parts, called panelizing, the housing units constructed for war workers, and to transport them to various locations where there was a shortage of private housing facilities for veterans, and there to erect them as temporary houses for their use. On December 28,1945, plaintiff entered into such a contract with the defendant, under which the plaintiff was to demount and panelize 1500 housing units "as shall be assigned from time to time by the contracting officer” at various military posts and to transport and to erect them as family dwelling units in various other locations.

Proceed orders were issued for 1049 of these units. The work on 515 of the units was completed. The proceed orders as to 211 of the units were canceled before any work was done. Further work on 205 of the units was canceled after these units had been demounted and panelized. The work on 85 of the units was suspended for a time and then later canceled.

The following table sets out the action taken with respect to each proceed order:

Plaintiff’s suit is for damages for the failure to issue proceed orders as to the 451 units not covered by proceed orders, and for damages for the cancellation of the proceed orders, which were issued, and for cancellation of further work on some of the uncompleted units, and the suspension of work.and final termination of the contract as to others.

Its first cause of action is for the suspension of the work on 85 units prior to completion, and for the final cancellation of plaintiff’s contract as to them.

The contract provided that the consideration to be received by the contractor was reimbursement for its costs and a fixed fee plus a fixed overhead.

The principal issue in the case is whether the defendant is liable for damages resulting from suspending operations on the contract and the subsequent cancellation of the contract.

In December 1946 defendant notified plaintiff and other contractors that it might be necessary to stop the program, of which plaintiff’s contract was a part, on account of the shortage of funds, until the passage of a deficiency bill by Congress, and then on January 14, 1947, defendant sent the plaintiff the following telegram:

PENDING READJUSTMENT OF FUNDS REQUIRED TO COMPLETE OUR TEMPORARY HOUSING PROGRAM FOR VETERANS YOU ARE INSTRUCTED TO SUSPEND WORK IMMEDIATELY ON 15 DWELLING UNITS NJV-28232-2 NEW BRUNSWICK; 7 DWELLING UNITS NJV — 28217—1 HIGHLAND PARK; 16 DWELLING UNITS NJV — 28231—2—3 KEARNY; 46 DWELLING UNITS NJV-28171-7-8-9 NEWARK. EXPECT THIS SUSPENSION WILL BE TEMPORARY.

Plaintiff stopped work as directed.

On March 18, 1947, the defendant sent plaintiff another telegram, which reads as follows:

* * * THE FUNDS PROVIDED FOR COST INCURRED ON SUSPENDED UNITS PRIOR TO SUSPENSION TAKE INTO CONSIDERATION PROBABLE CREDITS ON SUBCONTRACTS WHICH WOULD BE EFFECTED IF NO FURTHER WORK WAS PERFORMED. IT IS NOT INTENDED AT THIS TIME THAT YOU SHOULD CANCEL SUBCONTRACTS AND EFFECT THESE CREDITS. IT IS DESIRED THAT THESE UNITS BE HELD IN SUSPENSION AND NOT CANCELED PENDING THE OUTCOME OF PROPOSED LEGISLATION TO PROVIDE ADDITIONAL FUNDS FOR THEIR COMPLETION.

And on April 16, 1947, defendant telegraphed plaintiff again as follows:

REGRET UNABLE RETURN YOUR TELEPHONE CALL YESTERDAY. ADDITIONAL FUNDS TO YOUR CONCERN FOR VETERANS EMERGENCY PROJECTS MUST AWAIT PASSAGE DEFICIENCY APPROPRIATION BILL. WE HAVE REASON TO BELIEVE THIS BILL WILL BE APPROVED SOON.

On July 29, 1947, Congress passed a deficiency appropriation bill which permitted the Housing Authority to continue with the program. However, prior to its passage defendant decided, and so notified plaintiff and other contractors, that it would not continue with the program on the basis previously contracted for, but would let lump-sum contracts for the completion of the work on a competitive basis. Plaintiff was not interested in bidding on such a contract and declined the defendant’s invitation of September 15, 1947, to do so. Accordingly, on October 23, 1947, plaintiff’s contract for the 85 units was canceled and a lump-sum contract for the completion of these buildings was let to another company.

Until April 25,1947, plaintiff was engaged in the completion of other units, work on which was not canceled or suspended, but after that time it did no further work on any of the 1,500 units involved. It alleges, however, that it kept a number of employees on its payroll thereafter and until formal cancellation of its contract as to these 85 units, in anticipation of resumption of work on the uncompleted buildings, and it sues for their salaries and for a portion of its home office overhead.

The suspension of the work on these 85 units was of course a breach of contract, and it was a breach of contract for which defendant is not to be excused, although the reason for the suspension was a shortage of funds. A man cannot be excused from performance of his contract because he runs short of the money necessary to perform it. The other party enters into it on the promise that the money will be paid. If it is not paid, the promise is broken. So it is with the Government. See Joplin v. United States, 89 C. Cls. 345, 359-361; Johnson v. City of New York, 191 Appls. Div. 205, affirmed 231 N. Y. 564. Defendant does not seriously dispute this.

Plaintiff is entitled to recover whatever damages it may have suffered by reason of this breach.

Plaintiff says that during the period that the work was in suspension it kept a number of employees on its payroll in anticipation of resumption of the work, and it sues to recover their wages, together with a portion of its home office overhead.

We think defendant’s conduct was a sufficient inducement for plaintiff to keep some, if not all, of these employees on its payroll, and that it was justified in doing so. Its initial telegram of January 14, 1947, suspending the work, concluded with this statement: “Expect this suspension will be temporary.” Then, about two months later, on March 18, 1947, it wired plaintiff in part:

* * * It is not intended at this time that you should cancel subcontracts and effect these credits [that is, credits on the subcontracts]. It is desired that these units be held in suspension and not canceled pending the outcome of proposed legislation to provide additional funds for their completion.

Again, a month later, on April 16, 1947, defendant said:

Additional funds to your concern for Veterans’ emergency projects must await passage deficiency appropriation bill. We have reason to believe this bül will be approved soon. [Italics ours.]

In short, defendant held out to plaintiff the hope that at almost any time it would have the money to go ahead with the contract. In view of this, it seems to us that plaintiff could not have been expected to disrupt its organization but was justified in holding it intact pending resumption of the work, which defendant represented would be done as soon as the necessary money could be obtained. We do not think, however, that plaintiff is entitled to reimbursement of its costs for the entire period it claims.

Although the work on these 85 units was suspended, plaintiff was engaged until April 25,1947, in work on 723 of the units, and the testimony shows that its employees were fully occupied on this work until 515 of these units were completed on April 25,1947. From that time on plaintiff had no further work to do until work was resumed on the 85 units, except such work as was necessary to wind up the paper work in connection with the units already completed, or on which some work had been done prior to cancellation. The Commissioner has found that about four weeks would have been necessary to wind up this paper work. From this time (May 25,1947) we think plaintiff is entitled to recover the wages it was required to pay such of its employees as it was justified in retaining on its payroll in anticipation of resumption of work on the 85 units.

For how long thereafter was plaintiff justified in keeping them on its payroll? On September 15, 1947, plaintiff, among others, was invited to submit a lump-sum bid for the completion of the work on these 85 units, but it declined to do so. Later, a contract was let for the completion of them on this basis. Although defendant asked for lump-sum bids for the completion of the work on September 15, it did not formally cancel plaintiff’s contract until October 23, 1947. However, Edward O. Roberts, who was the Chief of Construction in the New York Field Office of the Public Housing Administration, testified that he told plaintiff, as well as other contractors, some time prior to the passage of the deficiency appropriation bill on July 29, 1947, that the defendant had decided that it would not complete any uncompleted units on the basis of the contracts already made, but would invite lump-sum bids for their completion.

This testimony is disputed, but we accept it as true, and have so found as a fact.

Mr. Roberts was unable to fix the exact date that he so notified plaintiff and the other contractors, but we assume that this was just shortly prior to the passage of the deficiency appropriation bill on July 29,1947.

As stated, plaintiff was never willing to complete the work on these 85 units on a lump-sum basis, and so, when defendant notified it that it was going to do so on this basis, it was no longer justified in maintaining employees on its payroll. It no longer had reason to anticipate resumption of work on these 85 units.

We conclude, therefore, that plaintiff is entitled to recover the wages of at least some of the employees it maintained on its payroll, in anticipation of resumption of the work on these 85 units, from May 26 to and including July 28, 1947. This is a period of nine weeks. These employees were the construction manager, five accountants, a purchasing agent, and two stenographers. Two of the accountants were on the payroll the entire time, and the others only part time. These accountants had been engaged on the work on all of the units as to which proceed orders had been issued and had not been canceled prior to the beginning of the work, a total of 805 units. Since the work after April 25 had been reduced to a maximum of 85 units, we think it was unreasonable for plaintiff to have kept on its payroll, at the most, more than two of these accountants. We assume that it was probably necessary to keep on the payroll the two stenographers.

The wages of the construction manager, two accountants, and two stenographers, were $600.00 a week. For nine weeks their wages would be $5,400.00. This amount we think plaintiff is entitled to recover.

It also claims tbe right to recover a portion of its home office overhead. However, the Commissioner has found, and in this finding we concur, that there is no basis shown in the proof to definitely allocate this home office overhead between plaintiff’s contract with the defendant and whatever other business it may have had. The extent of its other business is not shown by the proof, but it seems to have been confined to only one other contract.

Uncertainty as to the amount of damage, however, does not preclude recovery where the fact of damage is clearly established (Story Parchment Co. v. Paterson Parchment Paper Co., 282 U. S. 555), as it is here, if a reasonable basis of computation is afforded, although the result be only approximate, Eastman Kodak Co. v. Southern Photo Co., 273 U. S. 359, or if there is a basis for a reasoned conclusion. Palmer v. Connecticut Ry. Co., 311 U. S. 544.

We think it is not unreasonable to assume that the time of the home office would have been spent about equally on defendant’s job and plaintiff’s other job. The home office overhead amounted to $629.00 per week. For nine weeks this amounts to $5,661,00, one-half of which is $2,830.50. Plaintiff is entitled to recover this amount on account of its home office overhead. It is entitled to recover the total sum of $8,230.50 as damages suffered on account of the suspension of the work.

Had plaintiff been permitted to complete the work on these 85 units after the suspension, it would have been entitled to recover its damages as above stated, and, in addition, it would have been entitled to recover the agreed overhead and the agreed fee on the completed units. However, defendant did not permit plaintiff to complete work on these 85 units, but, instead, let a lump-sum contract for their completion; but defendant had a right to do this under paragraph 13 of the General Conditions. This paragraph reads:

The Contracting Officer may, at any time, by a written order, * * * direct the omission of portions of the work covered by the contract. Subject to Article-3 of the contract, if such action causes a material increase or decrease in the amount or character of .the work to be done under the contract, an adjustment of the amount of the'Contractor’s fee shall be made and the contract shall be modified in writing accordingly. * * *

When further work on the 85 units was canceled, the plaintiff was paid overhead and fee on the basis of the percentage of completion of the work. The contracting officer found that 46 of the units were 61 percent complete, 8 were 84 percent complete, 16 were 66.4 percent complete, and 15 were 82 percent complete, or an average completion for the 85 units of 66.7 percent. This was in accordance with the contract. Plaintiff was paid its overhead in full as it did the work, and in proportion to the percentage completed. This was also true of its fee, less a reduction of 10 percent, which has since been paid it. Apparently, therefore, plaintiff has been paid all it is due under the contract.

CLAIM TWO

After 205 of the units had been demounted and panelized, the contract as to the rest of the work on them was canceled. Plaintiff has been paid its overhead and fee in proportion to the work done. For the reason stated as to the 85 units, this is all that is due it. Since the contracting officer had the right to direct the omission of any portion of the work covered by the contract, he had the right to cancel further work on these 205 units, and since all of the overhead and fee that had been earned has been paid, plaintiff is not entitled to recover on this claim.

CLAIM; THREE

As to 211 of the units proceed orders were issued, but before any work had been done or any expenses had been incurred, the contract was canceled as to them. This, defendant had a right to do, and, since no costs had been incurred, plaintiff is not entitled to recover.

CLAIM FOUR

From May 1947 through March 1, 1948, defendant, with plaintiff’s permission, stored surplus materials on plaintiff’s equipment and material yard. The original contract did not give defendant the right to do this. Defendant has paid all the expenses of the operation of the yard, amounting to $40,702.19. Plaintiff claims a fee of $5,000 in addition.

The contracting officer allowed plaintiff $1,937.79. The head of the department increased this to $2,400.00, which is 6 percent of the amount of the expenses incurred. The Commissioner has found this to be a reasonable fee, and plaintiff took no exception to the finding. We are not convinced that this fee was unreasonable.

CLAIM FIVE

This claim is clearly without merit. It is a claim for insurance which plaintiff was required to take out to-protect the person from whom plaintiff had rented equipment. Such insurance was not included in the insurance for the premiums on which the contractor was to be reimbursed. As to insurance, other than that specifically mentioned, the contract provided in section 87 of the General Conditions:

* * * In the event additional insurance coverages are determined to be necessary by the Contractor, detailed information setting forth the reasons and conditions re-, quiring additional coverages must be furnished to the Contracting Officer for consideration and approval before the Contractor shall obtain the same.

The contracting officer’s approval of the purchase of this additional insurance was never obtained; and, hence, plaintiff is not entitled to reimbursement therefor.

claim six

This claim is for $4,394.16 for expenses in expediting the procurement of labor. The contract expressly denied reimbursement of such costs. Section 6 (b) of the General Conditions provides in part:

(b) * * * none of the following overhead expenditures directly attributable to the performance of the Contract and for which the Contrator agrees as provided in Article 3 (c) to furnish for the sum provided in the schedule set forth in Article 3 of the Contract, may be included in production cost:
Clerical help and expenses
Expediting employees and expenses
Communication expenses, including postage, telegraph, telephone or by other means
Traveling expenses
Cost accounting expenses as required in Paragraph 12 hereof.
All office expenses, including office rent.
‡ 9¡i sfc # sjí
CLAIM SEVEN

This claim has been withdrawn.

On the whole case, plaintiff is entitled to recover $8,230.50. Judgment for this amount will be entered.

Madden, Judge/ Littleton, Judge/ and Jones, Chief Judge, concur.

FINDINGS OF FACT

The Court having considered the evidence, the report of Commissioner Marion T. Bennett, and the briefs and argument of counsel, makes findings of fact as follows:

1. The plaintiff at all times mentioned herein was a corporation organized and doing business under the laws of the State of New York, but was formally dissolved in December 1947.

2. A program was launched about December 1945 designed to furnish emergency housing for veterans of World War II. The general plan was to demount and panelize the war housing units constructed for war workers, and to transport them to various locations where there was a shortage of private housing facilities for veterans. However, when the defendant attempted to remove units constructed in various municipalities, said municipalities, acutely aware of their own shortages, sometimes took action to prevent their removal. As a result, the major source of supply narrowed to temporary barracks in Army and Navy camps, which were closing or had been abandoned prior to the inception of the program.

This program was a new departure in the housing field, as a mass movement of multiple dwelling units from one locality to another had never been undertaken before. Letters were sent to various universities, colleges, and municipalities stating that if they were interested in securing housing they should file applications. Advice was given that under the plan it was the obligation of the applicants to provide the sites, plus all the utilities, and the defendant was obligated to provide the foundations and erect the structures.

While the many applications were being screened, and the contracts with the respective local bodies were being entered into, the Washington office of the Housing Authority was assembling a list of camps and barracks suitable to be taken down, transported and re-erected. When the details of the plan became public, sometimes there were protests by local citizens who were opposed to the construction of temporary housing facilities near their property. Frequently the opposition was successful and a new site bad to be located. As a result of the many difficulties inherent in the nature of this type of operation, many notices to proceed had to be canceled and substitutions determined.

Before the contractors selected to do this work were given contracts, they were briefed on the objectives and difficulties inherent in the program, and it was customary to give the contractor an opportunity to accept or reject the work which was available.

3. On December 28, 1945, the plaintiff entered into a contract, No. HA(CO)vph~7, with the defendant whereby the plaintiff was to demount 1,500 housing units at various military establishments, and to transport and to erect the same as family dwelling units in various other locations, the contractor to be reimbursed on a cost basis, plus a fixed overhead and a fixed fee.

' 4. Pertinent contract provisions were as follows:

ARTICLE i: statement of work.
(a) The Contractor shall, in the shortest possible time, furnish all labor, materials (other than those furnished by the Government), tools, machinery, equipment, supplies and services and do all things necessary for the completion of the following work * * *.
1. The Contractor shall demount, panelize or alter (at their present or several locations) 1500 dwelling units (subject to subparagraph (f) of this Article) * * * as shall be assigned by Notices to Proceed to the Contractor from time to time by the Contracting Officer, and restore the site from which the houses are demounted to the satisfaction of the Contracting Officer.
2. The Contractor, if directed by the Contracting Officer, shall proceed with the demounting or the paneliz-ing of units before the new site is ready, and shall safely store such demounted units or panels on the original site until they can be moved to and erected on new sites.
3. Transport the panelized houses, community and service buildings to a new site or several sites or building lots in one or several cities or locations.
4. Prepare foundations and re-erect the dwelling unit buildings, community and service buildings on the new site, sites, or lots including connecting the houses and buildings to utilities furnished by others, * * * all ready for occupancy.
(f) Notices to Proceed shall be issued as soon as practical and no such Notice shall be issued later than six months from the date hereof without the consent of the Contractor. Termination of the Contractor’s right to proceed for the convenience of the Government after issuance of Notice to Proceed shall be subject to Section 27 of the General Conditions except as follows: If no work has been done at the site or sites and no obligations to subcontractors or materialmen incurred the maximum amount payable to the Contractor shall be based on reimbursable costs and shall not in any event exceed including the fixed fee $15.00 per unit for first 100 units, $10.00 per unit for the next 400 units, $7.50 per unit for the next 500 units and $5.00 per unit for all units in excess of 1,000. * * * If Notices to Proceed covering the total number of finished dwelling units stated in article 1 (a) 1. is not issued within 6 months, the Government or the Contractor may by written Notice to the other, cancel this Contract as to all Projects for which Notices to Proceed have not been issued and such cancellation shall be without liability on the part of the Government or the Contractor.
(g) * * * The Contractor shall not proceed with any work in connection with any project until a Notice to Proceed therefor is issued to him by the Contracting Officer and any expenditures or commitments made by the Contractor in connection with such project prior to Notice to Proceed shall be at his risk.
»}« }{í J|e ♦
Artigue 3: CONSIDERATION.
* * * (b) In consideration of the covenants herein contained the Government agrees to pay the Contractor the total approved cost of performing the work, plus a fixed fee in the amount provided in the Notice to Proceed, plus the fixed amount for overhead expenses as provided in subsection (c) of this Article and Paragraph 6 (b) of the General Conditions.
Schedule of Prices per Finished Dwelling TJnit
(c) The Contractor agrees that the Contractor’s overhead should approximate the amounts of overhead per finished dwelling unit as set forth in Article 3 to the proper category of finished dwelling units assigned the Contractor and agrees to make no claim against the Government or submit any voucher for reimbursement of overhead expenses beyond those amounts per finished dwelling units assigned the Contractor.
$ $ $ $
(e) The Contractor shall proceed with the work economically and efficiently and in the best interests of the Government. * * * The buildings must be moved in panels or sections. * * *
$ ijí ifc #
ARTICLE 5 : SUBCONTRACTING.
When in the opinion of the Contracting Officer, it is in the best interests of the Government, the Contractor when so ordered or authorized, shall subcontract any items of work of the following classifications: Mechanical Trades, Excavation, Roofing, Painting and Trucking; to subcontractors who must be approved by the Contracting Officer. Such subcontracting of work, with the prior written approval of the Contracting Officer, shall entail no adjustment in the fixed fee which has been determined in the light of the fact that parts of the work may be subcontracted, * * *
% sH ifc ‡
GENERAL CONDITIONS GOVERNING COST-FLUS-A-FIXED-FEE CONTRACT FOR CONSTRUCTION
$ $ & ‡ *
6. Contractor’s construction cost.
(b) * * * none of the following overhead expenditures directly attributable to the performance of the Contract and for which the Contractor agrees as provided in Article 3 (c) to furnish for the sum provided in the schedule set forth in Article 3 of the Contract, may be included in production cost:
Clerical help and expenses
Expediting employees and expenses
Communication expenses, including postage, telegraph, telephone or by other means
Traveling expenses
Cost accounting expenses as required in Paragraph 12 hereof.
All office expenses, including office rent.
10. PROGRESS PAYMENTS TO CONTRACTOR
(e) Partial payments on account of the fixed fee and for overhead expenses as provided in Articles 1 and 3 (c) and Paragraph 6 (b) of the General Conditions, shall be made at the same time as progress payments to the Contractor on account of his production cost. Said partial payments shall be based upon and be in proportion to the percentage of physical completion of the work under the Notice to Proceed less 10% of that portion of the payment which represents payment on account of the Contractor’s fixed fee, exclusive of the overhead expense provided in Articles 1 and 3 (c) and Paragraph 6 (b) of the General Conditions, which 10% will be retained by the Government and paid to the contractor upon final acceptance of the work on each project by the Government in accordance with Section 11 hereof. *****
13.. Adjustment op pee
The Contracting Officer may, at any time, by a written order, make changes in the drawings or specifications for the work, issue additional instructions, require additional work, or direct the omission of portions of the work covered by the contract. Subject to Article 3 of the Contract, if such action causes a material increase or decrease in the amount or character of the work to be done under the contract, an adjustment of the amount of the Contractor’s fee shall be made and the contract shall be modified in writing accordingly. Any claim for adjustment under this paragraph must be asserted in writing to the Contracting Officer within ten days from the date the change is ordered: Provided, however, that the Contracting Officer, if he determines that the facts justify such action, may receive, consider, and adjust any such claim asserted at any time prior to the date of final settlement of the contract. If the parties fail to agree upon the adjustment to be made the dispute shall be determined as provided in paragraph 38 hereof, but nothing provided in this paragraph shall excuse the Contractor from proceeding with the prosecution of the work so changed.
$ $ # $ ft
27. Termination op contract
*****
(c) * * *
(4) If the contract is terminated for the convenience of the Government, the Government shall pay to the ■ Contractor in lieu of the fee stated in the Contract, a fee, less fee payments, previously made, computed from the table entitled “Maximum Percentages Allowable for Cost-Plus-A-Fixed-Fee Contracts”, (An NHA, FPHA, publication, numbered LD-308, dated June 2, 1042, copies of which are obtainable in FPHA Regional Offices) on the basis of the total amount due under sub-paragraphs 1, 2 and 3, above; but in no event shall the amount of the fee exceed the amount of the fixed fee stipulated in the contract.
* * * # *
37. Insurance
* * * The Contractor shall provide workmen’s compensation (or in jurisdictions not having compensation laws, employers’ liability), comprehensive public liability, automobile bodily injury liability, and automobile property damage liability coverages. In the event the Contractor, or any of his subcontractors, already has in effect blanket insurance covering automobiles, such automobile insurance need not be canceled, and vehicles so covered need not be included under the plan referred to below. The Contractor will be reimbursed on a pro rata basis for automobile insurance so provided. These coverages shall be in such form and in such amounts and for such periods of time as the Contracting Officer may require or approve. * * * In the event additional insurance coverages are determined to be necessary by the Contractor, detailed information setting forth the reasons and conditions requiring additional coverages must be furnished to the Contracting Officer for consideration and approval before the Contractor shall obtain the same.
38. Disputes
All disputes concerning questions of fact arising under the contract shall be decided by the Contracting Officer subject to written appeal within 30 days by the Contractor to the head of the department concerned or his duly authorized representative, whose decision shall be final and conclusive upon the respective parties at interest. Pending the settlement of disputes, the Contractor shall diligently proceed with the prosecution of the work except and to such extent as the Contracting Officer shall otherwise direct.

5. In the period February 19, 1946, to December 9, 1946, proceed orders were issued to the plaintiff, some of which were canceled and suspended as indicated in the following table:

CLAIM ONE

As noted in the table, the defendant suspended operations on 85 units. The plaintiff contends that it is entitled to recover nonreimbursable overhead costs incurred during the suspension period. The facts with respect to this claim are included in findings 6 to 18.

6. The plaintiff commenced the work of demounting, moving and erecting the dwelling units in early 1946. About December 1946 the funds for the program were so short that the plaintiff and other contractors were informally advised that it might be necessary to stop the program until the passage of a deficiency bill by Congress. On January 14, 1947, the defendant sent the plaintiff the following telegram:

PENDING READJUSTMENT OP EUNDS REQUIRED TO COMPLETE OUR TEMPORARY HOUSING PROGRAM EOR VETERANS YOU ARE INSTRUCTED TO SUSPEND WORK IMMEDIATELY ON 15 DWELLING UNITS NJV-28232-2 NEW BRUNSWICK: 7 DWELLING ■UNITS NJV-28217-1 HIGHLAND PARK; 16 DWELLING UNITS NJV-28231-2-3 KEARNY; 46 DWELLING UNITS NJV-28171-7-8-9 NEWARK. EXPECT THIS SUSPENSION WILL BE TEMPORARY.
JOHN A. KERVICK, DIRECTOR REGION H FEDERAL PUBLIC HOUSING AUTHORITY

7. Under date of March. 18,1947, John A. Kervick, Director of Kegion II, advised the plaintiff as follows with respect to the total of 85 units suspended by telegram dated January 14,1947.

* * * The funds provided for cost incurred on suspended, units prior to suspension take into consideration probable credits on subcontracts which would be effected if no further work was performed. It is not intended at this time that you should cancel subcontracts and effect these credits. It is desired that these units be held in suspension and not canceled pending the outcome of proposed legislation to provide additional funds for their completion.

8. Under date of April 16, 1947, the defendant sent the following telegram to the plaintiff:

Kegret unable return your telephone call yesterday. ADDITIONAL FUNDS TO YOUR CONCERN FOR VETERANS EMERGENCY PROJECTS MUST AWAIT PASSAGE DEFICIENCY APPROPRIATION BILL. WE HAVE REASON TO BELIEVE THIS BILL WILL BE APPROVED SOON.

• • 9. .Upon receipt of the telegram of January 14, 1947, the plaintiff took no further action with respect to the demounting, panelizing and moving of the 85 units affected. However, the plaintiff was engaged in the completion of other units, not covered by the suspension order, and this work continued until April 25, 1947, at which time all physical contract operations of the plaintiff ended.

On May 1,1947, the plaintiff was advised as follows:

BASED ON ESTIMATES SUPPLIED THIS OFFICE YOUR PROJECTS HAVE EITHER BEEN COMPLETED OR WILL BE SUBSTANTIALLY COMPLETED BY 5-16 WHICH IS DEADLINE FOR RECORDING OBLIGATIONS AGAINST PROJECTS. ALL OBLIGATIONS AND COMMITMENTS MUST BE SUBMITTED TO PROJECT ENGINEER FOR REVIEW AND APPROVAL NOT LATER THAN 5-15. AFTER THIS DATE FUNDS ALLOTTED WILL BE REDUCED ACCORDANCE WITH OBLIGATIONS RECORDED. * * *

10. Before the passage of the deficiency appropriation bill on July 29,1947, the defendant considered and decided, and so notified plaintiff, that, in the event of passage, the 85 units should not be completed upon a cost-plus basis but by competitive bidding on a lump-sum basis and was gathering information to use in determining what it would cost to reactivate on a lump-sum basis. On or about September 15,1947, the plaintiff, among others, was invited to submit a lump-sum bid-but declined for reasons stated in finding 12. Formal notice of cancellation of the 85 units was not served on the plaintiff until October 23,1947. A contract for completion of the 85 units was let to the Mutual Construction Company thereafter.

11. At the time the plaintiff was awarded the contract for 1,500 units, it made plans for an organization capable of handling the entire 1,500 units. Its organization was expanded or contracted as the work required.

The plaintiff was the first of a group of eight or nine contractors in the Eastern Area given contracts of the instant type, and after the plaintiff was given its contract, approximately 88 other contracts were given to others.

12. The plaintiff decided to go out of business, and in April 1947 conducted a sale of machinery and equipment at one of its storage yards. In 1947 the plaintiff was not interested in, and made no attempt to secure new business. As a result of this determination to liquidate and dissolve and because of an unfavorable view of lump-sum contracts, the plaintiff, although offered the opportunity, did not enter a bid for completion of the 85 units.

13. During the period from April through October 1947, the plaintiff kept a number of employees on its payroll who were principally occupied in completing the paper work resulting from previous contract operations, and in preparing data to be submitted in connection with the claim now pending before this Court. This did not, however, occupy their full time, the balance being spent playing “Hearts” and reading. Employees, however, were dismissed from time to time for want of any work to assign them. The employees referred to in this paragraph were not kept on the payroll at the request of the defendant.

14. In the period from April 26,1947, to October 23,1947, less four weeks’ allowance to wind up contract paper work, the plaintiff’s job expenses of operating the Newark office were $15,629.71. Home office overhead was $629 per week, including the salary for Eeiss, the president, and Weinsier, the secretary and treasurer. Exclusive of these salaries, .home office overhead was $110.00 a week.

15. The plaintiff was paid fixed overhead and a fixed fee based upon the percentage of work completed on the 85 units, or approximately 67 percent of the total allowable overhead and fee.

16. On December 10, 1947, the plaintiff filed a claim for damages in the amount of $35,374 based upon the defendant’s ' alleged breach of contract in suspending operations and later canceling the 85 units. The claim was denied by the contracting officer on February 6, 1948. The plaintiff on . February 25, 1948, appealed to the head of the Department who on December 13, 1948, affirmed the decision of the contracting officer in denying the claim, and stated in part as follows:

There is no showing in the record that the Government instructed you to maintain personnel and incur any extra expense because of the suspension of 85 units, nor that it agreed to modify the contract terms so that you would be reimbursed in case you did so. * *. * There is no record that you sought further information in this interval, nor asked that the contract be modified even in the balance of the period down to October when you received official notice of the final disposition. * * * The record shows that you completed all authorized construction near the end of April 1947 and that thereafter the only contract activities in which this personnel could have been continued was the normal liquidating operations attributable to the completed construction * * *. The Government did not authorize retention of these employees. There was no work to be done by them in connection with the 85 units. Under these circumstances if you chose to retain them and to incur expenses which appear neither reasonable nor necessary, it was entirely at your own risk and the Government cannot be held responsible for any loss or damage you may have suffered thereby. * * *
Under your cost-plus-a-fixed fee contract the Government in consideration for services rendered, agreed to compensate you for fixed overhead expenses and pay you a fixed fee on the basis of finished d/wellincp units -produced, and you agreed to accept payment on this basis. You did not finish any of these units but you did bring them, on the average, to an equivalent stage of about 67 percent completion, and the Regional Office, supported by the provisions of Section 10 of the General Conditions, made allowances for overhead and fee accordingly. * * *

17. Had plaintiff been permitted to complete the work on the 85 unite its fee would have been approximately $10,000 therefor, whereas the plaintiff’s nonreimbursable expenses for the period were approximately $30,000. It is found further that while the cancellation of plaintiff’s contract as to the 85 unite was long in coming to the plaintiff and perhaps unnecessarily delayed, the plaintiff’s employees, as noted in finding 13, had other work to do, that the plaintiff had in mind dissolving as a corporation, as noted in finding 12, and that the overhead at the home office cannot, on the basis of the evidence, be properly allocated between plaintiff’s contract with the defendant and its other business.

CLAIM TWO

Two hundred five units were canceled after demounting; The plaintiff contends that it is entitled to recover 100 percent of the fixed overhead for such unite rather than a proportionate share based upon percentage of actual completion, because (a) it had entered into subcontracts, which fact the defendant did not take into consideration, and (b) it had panelized the units, a task alleged to be normally a part of erection at the erection site, to which fact the defendant gave no consideration. Findings 18 to 23 bear on this claim.

18. The schedule in finding 5 shows that work on 205 units was canceled in 1946, after the unite had been demounted, and the plaintiff did nothing further on these unite. The plaintiff was paid overhead and a fixed fee based upon the actual percentage of physical completion of the work, receiving $5,043.39 overhead for approximately 11 percent completion. Had the plaintiff completed work on the units the total earned overhead would have been $41,403.61.

19. The plaintiff had already made subcontracts and contracted for the purchase of material for the subsequent erection of the 205 units which were canceled by the defendant after the plaintiff had demounted the same at the demounting site, but there is no evidence that the.plaintiff suffered any losses as a result of these actions.

20. The plaintiff would have been able to procure the erection of the 205 units which had been canceled, at the same time it was erecting other units, with no additional nonreimbursable organization, and without the expenditure of any significant additional nonreimbursable overhead.

21. Under date of December 9,1947, the plaintiff presented its claim for breach of contract to the contracting officer in the amount of $46,678.50 for the cancellation of the aforesaid 205 dwelling units which had been demounted and which had been canceled after demounting.

On April 15,1948, the contracting officer denied the plaintiff’s claim.

22. The plaintiff appealed to the head of the department from the decision of the contracting officer disallowing its claim for $46,678.50 for the 205 canceled units. The head of the department affirmed the decision of the contracting officer denying the claim, and stated in part as follows:

There is no basis for your contention that you are entitled to the full amount of fixed overhead set forth in the Notices to Proceed irrespective of the fact that none of the units involved in the claim were completed. Under the Contract you agreed to do all things necessary for completion of the work (Am?. I-a) which consisted generally of demounting, panelizing, and altering the units (ART. I-a-1) and preparing them at the new site all ready for occupancy (Art. I-a — 4). The work to be done was further defined to include all demounting, panelization, alteration, site restoration, reerection and other work as provided in the Contract (Art. 8-a). For this complete performance the Government agreed to pay you a fixed amount for overhead expenses (Art. 3-b) in direct proportion to the number of fmished dwelling units produced as computed from the Schedule of Prices in Article 3. These prices are stated “per finished dwelling unit”. Under the provisions of Section 10 (a) and (e) of the General Conditions this overhead was payable to you in increments, as earned, in direct proportion to physical completion of the work. You could not be entitled to payment in full until you had earned it by complete performance.
The Contracting Officer’s determinations of 10% and 11% for physical completion are considered reasonable and equitable in view of the fact that there still would have had to be done the loading, shipping, unloading, repairing, reerecting on new foundations, altering, installation of utilities, etc. We do not accept your attorneys’ statement in their letter of August 20,1948, that paneliz-ing normally was an operation done on the erection sites. Article 3 (e) of the Contract emphatically stipulates that “The buildings must be moved in panels or sections.” This provision is exhibited in the Notice to Proceed * * * where you were informed the units would be “demounted, panelized, stacked and stored on the site at Camp Shanks by others.” * * * The Contracting Officer’s determinations of the stages of physical completion do not appear to be in dispute.
$ $ $ #
In the light of the facts presented to me I find and determine that the allowances totaling $5,043.39 for your fixed overhead for the 205 units involved in the instant claim are proper and fitting under the terms of the contract, and that there is no justification for any additional allowances for this purpose.
Accordingly, therefore, your claim is denied.
This decision is rendered in accordance with the provisions of Section 38 of the General Conditions * * *.

CLAIM THREE

23. As indicated in the schedule contained in finding 5, the defendant in 1946 canceled 211 units after the notice to proceed had been issued to the plaintiff, but before the plaintiff had undertaken to do any work with respect thereto, and before any reimbursable expenses had been incurred. The plaintiff contends it is entitled to recover 100% of the fixed overhead. The overhead for the 211 units, had they been completed, would have totaled $45,021. There is no evidence that the plaintiff incurred any overhead whatsoever in connection with these particular units. On the contrary, the evidence shows that the plaintiff’s nonreimbursable overhead expenses varied as the work expanded or contracted and that the plaintiff’s employees were fully occupied in 1946 when these units were scheduled for completion.

24. On December 9, 1947, the plaintiff filed a claim to recover damages for the alleged breach of contract on canceling the 211 units. The contracting officer denied the claim on April 15,1948, and the plaintiff appealed his decision. The head of the department on December 21, 1948, affirmed the decision of the contracting officer denying the claim, and stated in part as follows:

* * * You apparently ignore the purpose, intent and provisions of your contract which had for its objective the production of finished dwelling units ready for occupancy, and based compensation thereunder accordingly. Compensation in full for anything less than full performance was neither contemplated nor to be expected. You appear to discard pertinent facts and deal only with numbers.
Under the provisions of Section 13 of the General Conditions the Contracting Officer could, and did order reductions and cancellations which resulted in the omission of portions of the work covered by your contract. * * *. You were allowed compensation for fixed overhead in accordance with the contract terms for all of the finished dwelling units produced and also on a proportionate basis for all which were started but remained unfinished when operations ceased. There is no provision in the contract documents which would entitle a contractor to receive full fixed overhead compensation based upon work which was not performed.
$ $ $ $ *
While it may be a fact that you processed 211 dwelling units less than were originally programmed and ordered for these three projects, nevertheless they vanished from the program under written orders issued by the Contracting Officer, sanctioned by the contract, before any work was done toward producing them, and they thereby lost any identity they may have once possessed. • In rudimentary form they were Army barracks earmarked to be moved and converted; as dwelling units they were merely figures on pieces of paper.
This was not a situation where an overhead group was formed at a. site or sites in anticipation of work to be done there, and then disbanded without work being done. Your established production lines continued to operate on active units after the reduction orders were issued, and these reductions came at times in your contract progress when adjustments in overhead facilities, provided any were necessary, could have been made without injury. The last decrease ordered by the Contracting Officer was in his telegram of November 21, 1946, some five months before you concluded the construction covered by your contract, in April 1947 with the paper work still to be completed.

25. There is no record that the plaintiff ever protested either verbally or in writing against the cancellation of a proceed order and the issuance of new instructions. Nor did the plaintiff file a claim in connection therewith until December 1947. This is true, also, as to Claims One and Two.

CLAIM FOUR

26. The plaintiff in 1946 and 1947 was engaged in the opertion of an equipment and materials yard. The defendant requested permission to store surplus materials at the yard, and was permitted to do so from about May 1947 through March 1948. The defendant paid all expenses in connection with the yard operation, amounting to $40,702.19.

27. The plaintiff on December 8, 1947, filed a claim with the contracting officer for a fixed fee of $5,000 in connection with its operation of the storage yard. The contracting officer on May 5,1948, after reviewing the facts, held that the plaintiff was “equitably entitled to an increase in the fixed fee in the amount of $1,937.79, but is not entitled to an increase in the fixed overhead * *

The plaintiff appealed this decision on May 28,1948. The head of the department on January 6,1949, increased the fee from that allowed by the contracting officer to a total of $2,400. In denying the balance of the claim, the head of the .department stated, in part, as follows :

* * * At the informal hearing of August 17,1948, held in this office, you informed us, in effect, that this yard personnel ably processed the paper work incident to this operation so that no appreciable extra overhead burden fell upon your main office.
* * *
There is no provision in Section 13 or elsewhere in the contract documents for an allowance of additional fixed overhead in this case. Such overhead is considered an expense item, not a profit, and since it appears, as stated in the informal hearing on August 17, 1948, that you experienced little, if any, direct overhead costs in your main office attributable to the operation of the yard for the Government account, no justification for allowing you additional fixed overhead is found.
There is no set formula in the contract for determining additional fee for extra work. It lies within the discretion of the administrative official making, the determination to use any reasonable means of arriving at an equitable adjustment based upon giving due consideration to the character of the extra work and the conditions under which it was performed. The method used by the Contracting Officer is considered reasonable and conforms to established practice. The 6% rate, in this instance, appears very reasonable. In fact, it is the maximum allowable under Section 27 (c) (4) of the General Conditions where, under other circumstances, the fee is to be computed from a sliding scale.
* * * * *
On the basis of an expenditure of some $40,000 odd for yard facilities operated for the exclusive use of the Government at 100 Roanoke Avenue, Newark, New Jersey, for which you were reimbursed, I find and determine that you are entitled in accordance with the provisions of Section 13 of the General Conditions to your Contract to an additional fixed fee of $2,400 because of this operation being beyond the scope of your Contract, and such adjustment of your fixed fee is considered reasonable and equitable in view of the services rendered which were at little or no risk to you.
_ This decision is rendered under the provisions of Section 38 of the General Conditions to your Contract and is final and conclusive upon the parties at interest insofar as this agency is concerned.

28. There was no agreement to pay a $5,000 fee and the evidence does not support a conclusion that such would be a reasonable fee for this work. On the contrary it is found that the allowed fee, 6 percent of reimbursable expenses, was reasonable in view of the nature of the operation.

CLAIM FIVE

29. The plaintiff expended $656.90 on insurance premiums covering rental equipment, the insurance being taken out to protect the lessor from public liability and property damage claims. The plaintiff contends this is a proper item of expense for which it should be reimbursed. It appears from the record that some equipment rental firms require the lessors to take out such insurance and that other firms do not. In this case the plaintiff was compelled to pay the premiums to get the vehicles it required.

30. The plaintiff on September 26, 1947, made a claim for the insurance premiums which was denied by the contracting officer on April 15,1948. The plaintiff appealed on April 22, 1948. The head of the department affirmed the decision of the contracting officer on January 5 and February 28, 1949, pointing out that Section 37 of the General Conditions did not classify such an expenditure as reimbursable, and stating:

The photostatic copies of the two Curley rental agreements submitted by you show that they were not drawn up on FPHA forms. * * *. More important is the fact that Clause 5 of these agreements required the lessee to take out and pay for public liability insurance protecting the lessor with limits of $100,000-$300,000, and the photostats do not show, nor is there any other evidence to show that these two agreements, * * * received the approval of the Contracting Officer, either prior to or subsequent to execution. * * *
A study of the contract documents indicates that you were to furnish insurance to protect the Government, yourself, and your subcontractors from claims *■ * *. It does not appear that the contract contemplated coverage for the lessor of such equipment. The cost of such coverage was presumed to rest in the rental price, or if demanded in addition thereto, it became additional insurance coverage which, in accordance with Section 37 of the General Conditions, should have been discussed with the Contracting Officer and his approval obtained before you were committed. * * *

CLAIM SIX

31. During the war years it was difficult for contractors to secure skilled help! As a result, the plaintiff expended moneys to expedite the procurement of labor for the performance of its contract with défendant.

The plaintiff expended with respect to this item the following:

Advertising expenses, May 1 to November 14,1946_$2,251.32
Wages of labor scout, September 18,1946 to December 8, 1946_ 1,120.00
Taxes on labor scout’s wages at 4%_ 44.80
Expenses of labor scout_ 978.04
4,394.16

32. The plaintiff on August 8,1947, filed a claim for the expediting expenses referred to herein, which claim was denied by the contracting officer on August 15, 1947. The plaintiff appealed on August 28, 1947, and the head of the department in affirming the decision of the contracting officer stated in part as follows:

Examination of the contract documents shows repeated references to the consideration to be given to the expeditious handling of the work. This is reflected in such phrases as “desires to avoid delay”, “initiation of construction work ... at the fastest rate”, “in the shortest possible time”, “to avoid any delays”, “so .that delays in planning and execution of the work will be avoided”, and “exert every effort to construct the projects economically and as expeditiously as possible”. In view of such reiteration, the importance attached by the Government to advancement of the work is inescapable.
Section 6 (b) of the General Conditions recognizes the probability of employment of expediting employees. You contend that this reference is limited to material expediting only, and not to securing labor. We are unable to find support in the contract documents for such distinction. _ Article 1 of the Contract places equal stress on your obligation to furnish labor as well as material “in the shortest possible time”. It is' elementary that the progress of the work would suffer if there were shortage of either labor or material. Under these circumstances, it was your obligation to expedite either labor or material as might be necessary to accomplish the work in the shortest possible time.
The contract documents provide for reimbursement to you of certain costs for labor and material. However, Section 6 (b) of the General Conditions is explicit in providing that no overhead expenditure covering “expediting employees and expenses” may be included in production cost.
In view of the foregoing considerations, it is determined that reimbursement of your expenditure in the sum of $4,394.16 for employment of a labor scout, his travel expenses, and newspaper advertising to recruit skilled mechanics is not allowable. Your appeal is accordingly denied.

CLAIM SEVEN

33. Although the contract contemplated the demounting and erection of 1,500 units by the plaintiff, notices to proceed were issued on only 1,049 units, leaving a balance of 451 units on which no notice to proceed was ever issued by the defendant, and on which no reimbursable expenses were incurred by the plaintiff. The plaintiff seeks to recover overhead for the units on which no notice to proceed was ever given. There is no adequate evidence to show how or to what extent, if any, the plaintiff’s expenses were affected by reason of the nonissuance of the notices. The contract provided in Article I, paragraph (f), as follows:

* * * If Notices to Proceed covering the total number of finished dwelling units stated in article I (a) 1 is not issued within 6 months, the Government or the Contractor may by written Notice to the other, cancel this Contract as to all Projects for which Notices to Proceed have not been issued and such cancellation shall be without liability on the part of the Government or the Contractor.

Article I, paragraph (g) provided, in part, as follows:

* * * The Contractor shall not proceed with any work in connection with any project until a Notice, to Proceed therefor is issued to him by the Contracting Officer and any expenditures or commitments made by the Contractor in connection with such project prior to Notice to Proceed shall be at his risk.

34. The plaintiff did not file any claim by reason of the nonactivation of the 451 units. The releases signed by the plaintiff contained the following provision:

The undersigned hereby releases all claims whatsoever arising out of the above designated notice to proceed under the above designated contract, as amended by duly approved change orders and modifications, except the following: * * *

The plaintiff did not list the present claim for nonactivation in its list of exceptions.

conclusion oe law

Upon the foregoing findings of fact, which are made a part of the judgment herein, the court concludes that as a matter of law the plaintiff is entitled to recover,, and it is therefore adjudged and ordered that it recover of and from the United States eight thousand two hundred thirty dollars and fifty cents ($8,230.50). 
      
       Article 3 (b) of the contract reads in part as follows:
      ''In consideration of the covenants herein contained the Government agrees to pay the Contractor the total approved cost of performing the work, plus a fixed fee in the amount provided in the Notice to Proceed, plus the fixed ámount for overhead expenses as provided in subsection (c) of this Article and Paragraph 6 (b) of the General Conditions.”
      
        
      
      * * * * *
      Article 3 (c) reads as follows:
      “The Contractor agrees that the Contractor’s overhead should approximate the amounts of overhead per finished dwelling unit as set forth in Article 3 to the proper category of finished dwelling units assigned the Contractor and agrees to make no claim against the Government or submit any voucher for reimbursement of overhead expenses beyond those amounts per finished dwelling units assigned the Contractor.”
      Section 6 (b) of the General Conditions reads in part as follows:
      
        “Production Cost
      
      “* * * none of the following overhead expenditures directly attributable to the performance of the Contract and for which the Contractor agrees as provided in Article 3 (c) to furnish for the sum provided in the schedule set forth in Article 3 of the Contract, may be included in production cost:
      “Clerical help and expenses;
      “Expediting employees and expenses;
      “Communication expenses, including postage, telegraph, telephone or by other means;
      “Traveling expenses;
      “Cost accounting expenses as required in Paragraph 12 hereof;
      “All office expenses, including office rent.”
      Subject to the above specific exclusions of expenses from production costs, the Items for which the Contractor shall be entitled to reimbursement as production cost, shall be as follows:
      *****
      For this consideration the contractor was required to do the following .work, as set out, In part, in Article I (a) 1-4, (f) and (g) of the contract:
      “1. The Contractor shall demount, panelize or alter (at their present or several locations) 1500 dwelling units (subject to subparagraph (f) of this Article) * * * as shall be assigned by Notices to Proceed to the Contractor from time to time by the Contracting Officer, and restore the site from which the houses are demounted to the satisfaction of the Contracting Officer.
      “2. The Contractor, if directed by the Contracting Officer, shall proceed with the demounting or the panelizing of units before the new site is ready, and shall safely store such demounted units or panels on the original site untU they can be moved to and erected on new sites.
      "3. Transport the panelized houses, community and service buildings to a new site or several sites or building lots in one or several cities or locations.
      “4. Prepare foundations and re-erect the dwelling unit buildings, comr munity and service buildings on the new site, sites, or lots including connecting the houses and buildings to utilities furnished by others, * * * all ready for occupancy.
      * * * * *
      "(f) Notices to Proceed shall be issued as soon as practical and no such Notice shall be issued later than six months from the date hereof without the consent of the Contractor. Termination of the Contractor’s right to proceed for the convenience of the Government after issuance of Notice to ■Proceed shall be subject to Section 27 of the General Conditions except as follows: If no work has been done at the site or sites and no obligations to subcontractors or materialmen incurred the maximum amount payable to the Contractor shall be based on reimbursable costs and shall not in any event exceed including the fixed fee $15.00 per unit for first 100 units, $10.00 per unit for the next 400 units, $7.50 per unit for the next 500 units and $5.00 per unit for all units in excess of 1,000. * * * If Notices to Proceed covering the total number of finished dwelling units stated in article 1 (a) 1. is not issued within 6 months, the Government or the Contractor may by written Notice to the other, cancel this Contract as to all Projects for which Notices to Proceed have not been issued and such cancellation shall be without liability on the part of the Government or the Contractor.
      “(g) * * * The Contractor shall not proceed with any work in connection with any project until a Notice to Proceed therefor is issued to him by the Contracting Officer and any expenditures or commitments made by the Contractor in connection with such project prior to Notice to Proceed shall be> at his risk.” ■ ■
      