The opinion
MADDEN, Judge
(dissenting).
The War Department Board of Contract Appeals in its decision which is quoted in Finding 31 said: “Under these circumstances, it is difficult to understand how it can now be reasonably contended that an item of cost is reimbursable under the terms of the subject contracts, when, at the time the contracts were negotiated appellant did not intend that the item should be reimbursable * * The essence of this case is contained in the above statement. Is the plaintiff entitled to be paid $2,286,819.95 for something which, when it made the contracts under which it claims the payment, it intended that it should be paid nothing at all?
The plaintiff says that the contract, as written, calls for the payment, and that therefore it is entitled to it even though it did not count upon it or expect to get it, when it made the contracts. To bring about such a result, the contracts would have to speak in the plainest and most unmistakable language. But they did not do so. They spoke the language of T. D. 5000 which is quoted in Finding 19. In its paragraph (d) it says: “For example, in case experimental and development costs have been properly deferred or capitalized and are amortized in accordance with a reasonably consistent plan, a proper portion of the current charge, determined by a ratable allocation which is reasonable in consideration of the pertinent facts, may be treated as a cost of performing the contract or subcontract.”
Before the cost-plus-fixed-fee contracts here in litigation were entered into, the plaintiff was following a method of amortization which would have completely written off these charges without attributing any of them to any future contract. After three of the four cost-plus-fixed-fee contracts were made, on August 14, 1941, September 10, 1941 and June 29, 1942, the plaintiff continued, down to the end of 1942, to1 pursue the same system of accounting, and by that time had completely amortized all of the costs claimed in this suit. On September 19, 1942, plaintiff’s treasurer wrote plaintiff’s comptroller that it would be improper accounting to charge any of these expenses against cost-plus-fixed-fee contracts since, to’ make them reimbursable costs under those contracts, such costs “would have to be included in the original negotiations of such contract. No provision is made for that on any of our cost-plus contracts in view of the position taken by the Government that prior to our entry into cost-plus contracts we have received sufficient fixed-price contracts to permit the amortization of deferred experimental expenses.” See Finding 22.
This statement of course referred to the position taken by the Government at the time the contracts were entered into. It certainly did not refer to the position taken currently by the Bureau of Internal Revenue of the Government, which was exactly the opposite. See Finding 21. And there is nothing in the record tending to indicate that there had been any discussion between the plaintiff and the contracting officers of the Government between the time that the contracts were negotiated and the time of the above-quoted communication, with regard to what should or should not be reimbursable. Finding 15 shows that the plaintiff set up its plan, limiting amortization to its fixed-price contracts because it understood that the charges here in question were not to be reimbursable under its cost-plus-fixed-fee contracts.
The quoted statement of the treasurer puts beyond question the intention of the *706 parties that the costs here sued for were not to be reimbursable. Their recovery is a complete and unexpected windfall of $2,-286,819.95.
I have not failed to consider any equity in the plaintiff’s favor which might arise from the fact that the change in the plaintiff’s accounting method resulted from pressure which the Bureau of Internal Revenue put upon the plaintiff, in the Bureau’s desire to establish a larger amount of excess profits made from the plaintiff’s fixed-price contracts. As it turned -out, the plaintiff’s taxes for the years 1941 through 1945, during which it performed both the fixed-price and the cost-plus-fixed-fee contracts, were increased only $32,056.17 over what they would have been if they had been computed on the basis of the plaintiff’s own method of accounting. As to the renegotiation of the plaintiff’s contracts, the arrangement made was only tentative, and the plaintiff would not be prejudiced in that regard by an adverse judgment in this case.
The opinion of the Court accords finality to the. Contracting Officer’s approval of vouchers in the amount of $1,299,856.02, which were, accordingly, paid, and which are here in suit because that amount was subsequently recouped by the Government from amounts admittedly due the plaintiff under its' contracts. I think the opinion of the Court is correct in not attributing to the plaintiff any failure to exhaust its administrative remedies in this regard. ■ I think that the contract did not provide any administrative procedure which had to be followed, at the peril of losing a valid claim. But, on the other hand, I think that the provisions of Article 3(b) of the contract, quoted in Finding 19, that “allowable items of cost will be determined by the Contracting Officer * * * ” did not confer upon that officer the powers of an agreed arbitrator such as are normally conferred upon that officer by Articles 4 and 15 of the usual Government contract. Article 3(b) says nothing about finality and I would not be willing to decide that a cost-plus-fixed-fee contractor who was entitled to be reimbursed for an expenditure could be irrevocably ’ denied reimbursement because the contracting officer, acting under Article 3 (b), had refused to approve the expenditure for reimbursement because he construed the contract erroneously. If such a question arose, and the contractor was" dissatisfied with the amount paid him, I think he would have the right to establish his claim in this or some other competent court, without being prejudiced by an administrative decision which the court thought was wrong. For the same reason I think that thé Government was not foreclosed by the erroneous decision of its Contracting Officer. He had no more power to give the plaintiff $1,299,856.02 which it had not contracted- for than he would have had to deny the plaintiff that sum if it had been entitled to it under its contract.
I would dismiss the plaintiff’s petition.