Northern Helex Co. v. United States

NICHOLS, Judge,

concurring:

Since I dissented in “Northern Helex II”, 207 Ct. Cl. at 898, 524 F.2d at 726, and since my obstinacy in adhering to error is well known, it might have been expected that I would dissent this time around also. I do indeed still believe that I was correct in not wanting to deduct from the award the $43,067,413 figure stipulated as the anticipated cost of performance. But I join in the Chief Judge’s opinion.

In Three Affiliated Tribes of the Fort Berthold Reservation v. United States, 204 Ct. Cl. 831 , 833, cert denied, 419 U.S. 901 (1974), I was persuaded, after argument, that our previous decision on the same claim, reported 182 Ct. Cl. 543 , 390 F.2d 686 (1968), though correct in its main point, was incorrect in one of lesser importance. I desired to withdraw my adherence to the prior opinion on that point and did so, but I said that because of the law of the case *206 doctrine, my change of view should be without practical consequences in the litigation at hand. I said the doctrine did not compel us to adhere to "obvious wrong or manifest injustice committed in the course of passing on an interlocutory appeal.” But I went on that “our error as to the school lands, though plain, is not sufficiently gross and flagrant to justify breaching the law of the case doctrine * * *.” Evidently I was of the view that error simpliciter was entitled to law of the case protection but error characterizable by some kind of opprobrious epithet was not. I need not examine whether any real difference exists between the exception the Chief Judge would allow and mine, because by either test the prior decision, Northern Helex II, does not qualify for reconsideration. I was on the panel and joined in the opinion in United States v. Turtle Mountain Band of Chippewa Indians, 222 Ct. Cl. 1 , 612 F.2d 517 (1979). My concurrence deals with issues other than law of the case. Northern Helex II is, in my view, in serious error, but not of the degree of obnoxiousness I would look for to breach the law of the case constraints. There is no basis whatever for the charge that the majority in Northern Helex II misread Northern Helex I or made any of the fact mistakes the trial judge imputes to them. Right or wrong, they knew perfectly what they were doing. The matter was obviously debatable since it was debated among us, and I have no doubt the startling size of the award the trial judge would have made even then exerted its silent influence towards the choice the majority made among defensable alternatives. If there was "manifest injustice” it arguably was in the award that proper application of the rules of damage admeasurement seemingly would have required.

Judge Skelton, who wrote the majority opinion in Northern Helex II, Chief Judge Cowen, who wrote separately in concurrence, and the other judges, were of course well aware of my dissent when they voted as they did. They preferred to adhere to the old fiction that the opinion for the court is delivered in ignorance of what the dissent is going to say. The practice of making some specific response to dissents in prevailing opinions has become more general since then. It is in my view a salutary change, not only in assuaging the inaudibility syndrome of the dissenter, but *207 also in avoiding misconceptions such as the trial judge indulged in here about the suppositions and assumptions of the majority opinion. For example, perhaps a footnote somewhere would have explained how it was the court found certain facts contrary to fact findings of the trial judge that defendant has not excepted to. The explanation I could have written myself: the court felt justified in disregarding certain facts it would not have denied were true in the real world, because it felt the contract relations of the parties postulated the constructive existence of different facts. The court felt the contractor had acquired by its contract no right to require defendant, in deciding on a breach, to consider that plaintiff would go on producing . helium for reasons other than its government contract and therefore would not save the stipulated $43,067,413. The decision really went off on the Holmesian theory that a party to a contract has a legal right to breach it, unless the special conditions warranting specific performance exist, as here they did not. Thus the task of the court in assessing damages for a breach is not really to ascertain the full consequences of the breach as they are in the real world, and as it would in a tort case. This theory is not absurd and frequently influences our decisions. Judge Skelton cited some of them.

I do not see how our judicial system could continue to function if the proceedings of our trial judge here should become common. The comments of the Chief Judge I deem restrained in the circumstances. I certainly hope my dissent did not contribute to subsequent events; that nothing I ever write or say, dissenting, causes any future case to take the unfortunate course this one has followed. If I thought it had or would, I would be constrained to chill the freedom of comment I have hitherto indulged in when I have been unable to go along with the majority, a freedom my colleagues have been patient with and have enjoyed in their turn. None of us are obliged to praise the decisions that bind us, but we are obliged to follow them or else get off the bench.

This is one case where, in my speculation, the law as pronounced by the court might have been different if all the monetary figures had been divided by ten. A gut feeling *208 that an award is too large or too small is not to be disregarded just because it is difficult to say why. It appears to me now that the majority’s instinct might have been better implemented by a holding that, given a contract that had almost 13 years left to run at the time of breach, it was not reasonable to measure damages wholly by anticipated revenues whether offset or not offset by anticipated costs. This assumes either way a certainty in the prediction of future events that we do not rely on in managing our own affairs. Those contracting with the government have uncertainties about their prospects additional to those that may cause anxiety to holders of the contracts of private firms. The government may become involved in wars or civil disorders. It may as a result pass laws allowing modification of its deals that it comes to consider ill advised. It may revoke its consent to suit and repudiate its debts. The contingencies for which defendant reserved the right to terminate might occur. For all these reasons, and wholly apart from the desire of the Nixon administration to get out of the contracts and stop stockpiling helium, the fair market value of that or any other government contract having nearly 13 years to run would not normally equal the capitalized value of all expected contractor revenues, net or gross. The government could have passed a law for the expropriation or taking by eminent domain of Northern Helex’s contract rights, and if it had done so, the just compensation would not necessarily have equalled the anticipated revenues, net or gross, capitalized. Cf. Lord Manufacturing Co. v. United States 114 Ct. Cl. 199 (1949), cert. denied, 339 U.S. 956 , rehearing denied, 340 U.S. 846 (1950). Thus the theory a contracting party has a legal right to breach his contract has special application to the government. It appears to me, therefore, that an adjustment to the anticipated contract revenues in the nature of a jury verdict would have been appropriate, and would have had a support in the facts and the law that is sadly lacking in the arbitrary offset of costs of performance that were not saved but still in fact incurred.