Petition for Writ of Certiorari — Rau Construction Co. v. Phillips Petroleum Co.

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Supreme Court of the United States a |

OCTOBER TERM, 1942.

503

DS cauccarstrns

RAU CONSTRUCTION COMPANY, A CORPORATION,

PETITIONER AND APPELLEE BELOW,

VS.

PHILLIPS PETROLEUM COMPANY, A CORPORATION,

RESPONDENT AND APPELLANT BELOW.

PETITION FOR WRIT OF CERTIORARI TO THE UNITED

STATES CIRCUIT COURT OF APPEALS FOR

THE EIGHTH CIRCUIT, AND BRIEF IN

SUPPORT THEREOF.

Maurice J. O’SULLIVAN,

700 Gloyd Building,

Kansas City, Missouri, —

Attorney for Petitioner.

INDEX

Petition for Writ of Certiorari

Summary and Statement of the Matter Involved.

Statement of the Basis of Jurisdiction

Questions Presented for Decision... DRS TLS

Reasons Relied On for Allowance of the Writ—

I. The decision on appeal fundamentally erred

in basic questions of substance and of special im-

portance in the permanent public interests and

in the public interests particularly affected in

the present emergency.

The opinion contravenes good morals, public

policy and Engineering ethics. It rewards the

authorized deceit of Phillips Petroleum Com-

pany, but denies the simple arithmetic and

common sense clearly demonstrated in trial

Findings.

The errors gravely affect the Construction

Industry and the Engineering Profession. Every

concept of ‘‘unit price” construction contracts is

nullitied. That important type of engineering

contract is designed to avoid delay to wait for

detailed plans.

The Construction Industry is endangered by

the approval of fraud, where it may readily be

perpetrated, as the facts here illustrate. The

Engineering Profession is bewildered by the de-

cision.

The District Courts of the Eighth Circuit

are obliged to grant others the fruits of deceit

in inducing ‘“‘unit price” construction contracts.

The decision erred in ignoring lawful trial

Findings and in refusing to apply the controlling

‘Missouri law and the same law declared at the

same Term, to govern other litigants. Justice

and equal protection of laws was thereby denied,

contrary to the accepted course of judicial pro-

a and to the law repeatedly declared

ere.

II INDEX

There is a firm faith in this Court to decide

the questions and to correct the basic errors

made on appeal or, otherwise, the now vital

Construction Industry would be paralyzed and

an unfavorable reflection of the United States

Courts would follow, contrary to the public in-

terests and the interests of the Judicial System

A. Basic errors on appeal

B. The engineering purpose and design of

“unit price” type of contracts and their

vital importance now i

C. The denial of equal protection of laws and

other errors on appeal

Prayer for Writ

Brief in Support of Petition

I. Opinion Below____--

Il. Jurisdiction ——

III. Statement of the Case

IV. Specifications of Error___...-----

V. Summary of Argument.

Argument) —__$_____-_—

Conclusion

TABLE OF CASES

Aero Spark Plug Co. vs. B. G. Corporation, 130 F. 2d

290, 295

American Insurance Co. vs. Scheufler, 129 F. 2d 143__

Armstrong vs. Winfrey, 61 Mo. 354, 357

Brown vs. Worthington, 142 S. W. 1082, 1. c. 1084,

Subds. 1, 2, 162 Mo. App. 508

Chicago Mill & Lumber Co. vs. Tully, 130 F. 2d 268,

274, 275

Collins vs. Lindsay, 25 S. W. 2d 84, 1. c, 90 (Mo. Sup.)

Dale vs. Pierson-Brewen, 142 S. W. 745, 1. c. 747, 160

Mo. App. 314

DeLange vs. Ogden, (Tex.) 106 S. W. 2d 385, 391,

Subd. 10 ieeae

INDEX Ir

Deputy vs. DuPont, 308 U. S. 488, 497, 84 L. Ed. 416,

423, Subd. 6

Dubinsky vs. Lortz, 129 F. 2d 669, 673 23

Erie R. R. Co. vs. Tompkins 14

Fidelity Union Trust Co. vs. Field, 311 U. S. 169, 85

L. Ed. 109

Fitzgerald vs. Barker, 85 Mo. 13, a c. 22 ae

Fuhler vs. Gohman & Levine Const. Co., 346 Mo. 588,

142 S. W. 2d 482, 1. c. 484, Subd. 4.00 5, 29

Gillioz vs. State Highway Commission, 153 S. W. 2d 18,

oe, Dunes. 3. 4 (aes; Bb.) ee

Goodrum vs. State, 158 S. W. 2d 81, 1. c. 85, Subds. 1-5

st) 27

Griffin vs. McCoach, 313 U. S. 498, 85 L. Ed. 1481. 11, 21

Grigsby vs. Stapleton, 94 Mo. 423, 7S. W. 421, 423 30

Guerini Stone Co. vs. P. J. Carlin Const. Co., 248 U. S.

334, 343, 63 L. Ed. 275, 284__. ie 12, 27

Horwitz vs. Schaper, 119 S. Ww. od 474, 1. c. 480, 482

(Mo. App.)

Jesse vs. Roloff, 74 S. W. 2d 890, 1. c. 893 (Mo. App.)_..._ 29

— : Mills vs. Bell, 37 S. W. 2d 680, 1. c. 684 (Mo.

pp.

Judd vs. Walker, 114 S. W. 979, Subds. 5-6, 215 Mo. 312 28

Klaxon vs. Stentor Elect. Mfg. Co., 313 U. S. 487, 85

L. Ed. 1477, 1480 12, 21

Law vs. U. S., 266 U. S. 494, 496, 69 L. Ed. 401, 402___ 11

Layne & Bowler Co. vs. Western Well Works, 261

U. S. 387, 392, 67 L. Ed. 712 11

Luikart vs. Miller, 48 S. W. 2d 867, 1. c. 868, 869 (Mo.

Sup.) 28

Magnum Import Co. vs. Coty, 262 U. S. 159, 163, 67

L. Ed. 922_... 11

McClintock vs. Skelly Oil Co., 114 S. W. 2d 181, l.c.

189, Subds. 6-12, 232 Mo. App. 1204 29

Metropolitan Paving Co. vs. Brown-Crummer Inv.

Co., 274 S. W. 815, 309 Mo. 638 (En Banc)... 28

National Theatre Supply Co. vs. Rigney, 130 S. W. 2d .

258 (Mo. App.) 28

Osler vs. Joplin Life Ins. Co., (Mo.) 164 S. W. 2d 295,

Subd. 7 28

Pecheur Lozenge Co. vs. Nat. Candy Co., 315 U. S. 666,

86 L. Ed. (adv.) 739 12

IV INDEX

Phillips & Colby Const. Co. vs. Seymour, 91 U. S. 646,

23 L. Ed. 341 12, 27

Picard vs. United Aircraft Co., 128 F. 2d 1. c. 641. 19

Pope vs. Allis, 115 U. S. 363, 1. c. 371, 29 L. Ed. 393,

1. c. 398 ae

Progressive Finance Co. vs. Stempel, 95 S. W. 2d 834,

836 (Mo. App.) Subds. 4-6 28

Rabenau vs. Harrell, 278 Mo. 247, 213 S. W. 92. 1. c. 93,

94, Subd. 7_ sae <a

Redlands Orange G. “Assn. - vs. . Gorman, 161 Mo. 203,

5 8 2 PE OL’. RS enn east ee 29

Rexford vs. Philippi, 84S. W. 2d 628, 1. c. 631, Subds. 3,

4, 337 Mo. 389... 29

Rice vs. Lammers, 65 S. W. 2d 151, Subds. 3-5 (Mo.

App.) 28

Roosevelt vs. Mo. State Life Ins. Co... 14, 23

Schaefer vs. Fulton Iron Works, 158 S. W. 2d 452, 1. c.

455, Subds. 1-3 (Mo. App.) 27

Spitscaufsky vs. State Highway Commission, (Mo.

Sup.) 159 S. W. 2d 647, 654, Subd. 5, 656, Subds. 10,

12, 651, ie Ae Sevens 29, 30

State ex rel, Cary vs. Trimble, 43 &. W. 2d 1050, 1. c.

1054 28

State Farm Mutual Auto Ins. Co. vs. Coughran, 303

U. S. 485, 487, 82 L. Ed. 970, 972, Subd. 1... 11

State ex rel. Hughes, 152 S. W. 2d 193, 1. c. 196, Col. 1,

and Subds. 4-7, 1. c. 198 (Mo. Sup.) 29

Stone vs. White, 301 U. S. 532, 534, 81 L. Ed. 1265,

p | SOAR OTERO Rt SoS NTRS T 12; 27

Taggart vs. School District, 96 S. W. 2d 335, 337, 339

Mo. 223 28

United Const. Co. vs. City of St. Louis, (Mo.) 69 S. Ww.

2d 647, Subd. 9 19

United States vs. Bethlehem Steel Corp., 315 U.S. 289,

86 L. Ed. (Adv.) 521, 1. c. 540-543 27

United States vs. Butler, 297 U.S. 1, l. c. 71, 80 L. Ed.

477, 1. c. 490 27

United States vs. McMullen 23

Wentzel vs. Lake Lotawana Dev. Co., 48 S. W. 2d 185,

Subds. 4, 12, to 51 and 33 30

Wright vs. Fuel Oil Co., 114 S. W. 2d 959, 1. c. 961,

962, 342 Mo. 173

INDEX

TEXTBOOKS

Annotation, 76 A. L. R. 269

Annotation, 112 A. L. R. 1224, 1236, 1238, 1239, 1240__

9 C. J. 695, n. 32; 697, n. 64, 68, 69.

17 C. J. S. 502, Sec. 147__.

17 C. J. S. 762, Sec. 325, n. 37; page 366, n. 78; page 367,

n. 92; page 369, n. 1; page 455, n. 85

17 C. J. S. 772, n. 61, 58...

Federa! Rules of Civil Procedure, Rule 52 (a)...

Secs. 216-218; 340-341. Engr. & Arch. Juris., J. C.

Wait, M.C.E. Cornell, LL.B. Harvard, 1st Ed...

Vol. 7, Encyc. Americana 469-70 (1941), Concrete Con-

struction

STATUTES

U.S. C., Title 28, §§347 (a) and 377

U.S. C., Title 28, §§773 and 875

Court RULES

Supreme Court Rules, Rule 38

Supreme Court of the United States

OCTOBER TERM, 1942.

I widiinabidorenannaine

RAU CONSTRUCTION COMPANY, A CORPORATION, |

PETITIONER AND APPELLEE BELOW,

. WB.

PHILLIPS PETROLEUM COMPANY, A CORPORATION,

RESPONDENT AND APPELLANT BELOW.

PETITION FOR WRIT OF CERTIORARI.

To the Honorable the Chief Justice of the United States

and the Associate Justices of the Supreme Court of

the United States:

Your Petitioner, Rau Construction Company, a cor-

poration, respectfully shows to this Honorable Court:

SUMMARY AND STATEMENT OF THE MATTER

INVOLVED.

1. An Eighth Circuit opinion of August 19, 194. (R.

1987; 130 F. 2d 499), reversed judgment of $140,582.53 al-

lowed petitioner, as quantum meruit value of concrete

construction work, accepted November 14, 1939, by Phil-

lips Petroleum Company, as a small part of a seven million

dollar refinery extension and polymerization “program,” at

Borger, Texas (R. 94). Petitioner’s loss on reversal ex-

ceeds $150,000. The grave errors of substance and of spe-

cial importance in the public interests, and in the interests

of the Construction Industry and Engineering Profes-

sion, which outweigh in importance even the loss affect-

ing petitioner’s solvency, are summarized, with the opin-

ion, in “Reasons Relied Upon,” infra, p. 18, and are not

here repeated.

2. An April 10, 1939, “unit price’”’ construction con-

tract was induced, before structure plans were completed,

by false engineering information and a false “cross sec-

tion,” supplied by Phillips’ Engineer, acting in the scope

of his employment. All information given was solely

within Phillips’ knowledge. That it was given, but was

“not accurate” and “not intended to be accurate,” and

that the “cross section” was not “intended to consti-

tute a true and representative ‘cross section’ of the work

to be done” is affirmed by Paragraphs 4 to 23 (R. 61, 66)

of Phillips’ prolix trial Answer. Part of the information

was supplied in Oklahoma (Par. 13). The April “con-

tract” was signed by Mr. Gus Rau and delivered in Mis-

souri (Par. 17, R. 65). Paragraph 20 and Exhibits to

Answer, pages 72, 74, concede that before the Missouri

contract was delivered, plaintiff assumed all of the liabil-

ities of Phillips’ project. Paragraph 15, R. 45, of the orig-

inal Answer admits performance by plaintiff and accept-

ance by Phillips. Findings 12, 15 and 19 (R. 1905, 1909)

establish that the assumption of liabilities was made vol-

untarily, to save Phillips a bond premium (about $4,000).

In assuming the liabilities and in taking over the work on

May 18, 1939, under its assumption of liabilities, at the

request of Mr. Rau and with Phillips’ consent, plaintiff

relied, and was entitled to rely, on the truth of the rep-

resentations made to Mr. Rau (plaintiff's officer and a

director). The financial statement (R. 73), attached to

Phi'lips’ Answer, discloses the inevitable effect of the re-

versal. Reliance by plaintiff or Mr. Rau on the “infor-

1From Annotation, 76 A. L. R. 269:

“It may be further observed that apparently, as to con-

tracts undertaken upon the unit basis, as distinguished from

contracts in gross, special importance is generally attached to

the work being other than as defined; for in many of such

cases the contract may be readily interpreted as one to per-

form only work of the indicated character.”

From “Concrete Construction,” Vol. 7, Encye. Americana 469-

70 (1941):

“The cost of concrete depends on the cost of cement, sand

and stone, upon conditions of work and size of work. Where

forms are simple, costs range from $5 to $10 per yard. Thin

sections with expensive forms and handling may bring this

up to $25 per yard. A reliable estimate must take account

of all of the circumstances.”

Italics where used throughout, are ours.

mation” is denied, but on that narrow fact issue, the trial

court, of long and expert experience in engineering and

construction cases, determined by Finding 15 (R. 1906):

“From all of the evidence and inferences properly

drawn therefrom, the only possible logical finding is

that defendant furnished information substantially as

claimed by plaintiff, without determining or knowing

that it was true, and after undertaking to furnish in-

formation failed to make full disclosure of the facts;

that Gus Rau, Jr., and plaintiff relied thereon and

were entitled so to do, and that the information given

and withheld substantially deceived Mr. Rau and

plaintiff and misrepresented the nature, size and kind

of work done, and damages resulted therefrom to

plaintiff. Mr. Gus Rau, Jr., in signing the ‘form of

contract,’ and plaintiff, in assuming liability to de-

fendant and when it did the work, both relied on the

representations made” (No. 15, R. 1906; cf. 1938-45).

Finding 8, R. 1904, determined (omitting immaterial

words):

“Defendant knew that the information was

sought as a basis to propose ‘unit prices.’ The ex-

pected average cubic yards of concrete, with the other

information given, intimately and directly affected the

costs of doing the proposed work and the amounts to

be bid therefor. Materiality was known to defend-

ant. Mr. Hubbell testified (that) the size of items

was a factor affecting costs. If he read further from

the ‘cost estimate’ the later figures would disclose

smaller units, as most of the items read represented

larger ones. Full disclosure of all facts available to

and known by defendant was not made. Amended

Answer, Third Defense (R. 62) speaks for itself,

and need not be repeated.”

Finding 7 (R. 1903) and Mo. 19 (R. 1909) establish

that correct engineering computations made on the

information given were used for the “unit prices” in the

April “contract.”

*Mr. Rau (R. 1938-45) testified that an engineering “cross-

section” should uniformly apply throughout a job. Phillips’ En-

4. The Conclusions of Law establishing invalidity

of the April “contract” and of a June 17th price mem-

orandum, are not mentioned on appeal (R. 1931, 1932;

R. 1922). All reference to Findings establishing compul-

sion and duress of goods are omitted. The reason there-

for can only be the inevitable felo de se, following any

mention of either. Finding 20 and Finding 24 (R. 1910

and 1917) (omitting immaterial words) read:

“About June 16th, 17th and 18th, 1939, meetings

were held at the work site. Defendant threatened to

‘take over the job’ and hold all money until comple-

tion if the work was not speeded up.

Plaintiff had set up a central ready mix concrete

plant, and assembled a quantity of material, tools

and equipment, all located in defendant’s fenced-in

premises to which access was had only when passed

by a gate watchman. Commitments were made for

other material. Part of the work was incomplete. It

was impractical for plaintiff to discontinue the work,

gineer Hubbell said that the figures which he had read represented

approximately 2,500 yards and “we could consider the rest of the

concrete to be the same” average size.

The “cross section” and engineering information was relied on

to compute the average unit sizes, nature and conditions (which

are the “cost factors”) of the project as it was thus represented.

The prices computed are specified in the April “contract” (R. 14).

The computations are detailed, R. 231-33, 261-268, and appear in

Exhibits 2 and 3, R. 239, 257. The number of concrete pours for

about 2/3 of the items was discussed with Phillips (R. 1498, 1499,

1501). Finding 7, R. 1903, determines that the computations were

made correctly and Nos. 15 and 19, R. 1506-09, that they were

properly relied on. The average size of structures determines the

number of work operations. Finding 26, R. 1918, details the 9,485

excess work operations required to build the actual project, over

and above the number needed for the represented project. Finding

27 shows the added, required hand excavating. Cf. Phillips’ evi-

dence in substantial support (R. 1666-9).

“Section” is defined as “a representation, picture or drawing,

showing something, as a building, machine or geological formation

as it would appear if it were cut by an intersecting plane and the

portion between the observer and the cutting plane removed;

sometimes, also the thing itself, if so treated and viewed.” ‘“Repre-

sent” is defined as “To bring before the mind; portray, whether

by language, pictorial art, or in some other way.” Standard Dic-

tionary (1941).

then or later, because of requirements insisted upon

by defendant, or its failure to pay, or for differences

between the work required and the original repre-

sentations.

“Conferences were held on June 20th and July

Ist. Defendant again threatened to ‘take over the job’

and demanded that plaintiff pour approximately 2,200

cubic yards of concrete in the next 15-day period,

and insisted that plaintiff go on with the work.* Pay-

ments were still considerably in arrears. Plaintiff

was obliged by the situation to proceed regardless of

the lack of justification of defendant’s demands, and

additional expense caused thereby” (1,789 cubic yards

per month represented orderly progress. No. 23, R.

1915).

5. Answer (R. 68) affirms that when Phillips

“threatened, as it did,” etc., that plaintiff “speeded up”

the work. The conclusion is pleaded that plaintiff is

thereby estopped; that it thereby waived fraud and rati-

fied the April “contract.” Proof of fraud and compulsion

came even from Phillips’ Chief Engineer (R. 1861, 1862), who

naively testified: ‘I don’t know whether you call it

threatening. I just told them. Q. Twice on June 15 and

June 30? A. That is right”—and he continued: that it

was a true statement, that a simple order to the gate watch-

man would put plaintiff outside of Phillips’ fence (R.

1862). Finding 5 (R. 1901) confirms his knowledge of

the facts, when the “cross section” differences and an in-

The opinion says (R. 1992):

“The evidence shows that appellant, instead of abandon-

ing the contract, insisted always upon its performance.”

This is the one place where the opinion agrees with any part of

any Finding. Cf. R. 1862. It overlooks Finding 33, R. 1921, which

clearly establishes abandonment or breach of a construction con-

tract, both under Missouri and general law. The opinion says

“it is difficult to attribute importance to (the) finding that

the parties abandoned the contract or that the appellant

breached it” (3). R. 1991.

Finding 33 expressly states that it is made in the alternative,

that “even if it could be held that the ‘form of contract’ was or

ever could have become a valid obligation, nevertheless, the

evidence establishes that it was in fact abandoned by the parties.”

Cf. Fuhler v. Gohman & Levine Const. Co., 346 Mo. 588, 142 S. W.

2d 482, 1. c. 484, subd. 4.

voice therefor was presented to him and Engineer Hub-

bell, who supplied the “cross section.” He exclaimed,

“Gus, if what you tell me is true, then we have no con-

tract” (R. 153, 176, 1811, 1812, 1820, 1858). However, he

“didn’t put any importance to the matter,” and Mr. Hub-

bell was never asked until after suit about what informa-

tion he gave (R. 1858).

6. Phillips paid less than $15,000 when plaintiff had

in excess of $150,000 in cash and commitments invested

(No. 21, R. 1910). Over 100 concrete form carpenters

were recruited from distant points because of the ‘“‘speed

up,” but soon not even ten could keep busy (No. 23, R.

1915). No independent Engineer was designated to pre-

pare plans. Phillips supplied them, but in peaks and

valleys, for 10,735 cubic yards of concrete, of the 12,000

originally approximated (No. 23, R. 1915). An aggregate

of 215 changes in about 500 plans were made after issue,

although field orders to build accompanied the plans (No.

17, No. 23, R. 1909, 1915; R. 1848; 1629; Ex. 5, R. 271).

Numerous “hold work for revision” orders increased plain-

tiff’s costs. These destroyed orderly progress of the work for

plaintiff,‘ while Phillips “made up its mind” about “the sub-

ject matter of the work to be done” (No. 16 to 18; R.

1906-1909). Some plans followed manufacturer’s advice,

obtained later when machinery was purchased (No. 9, R.

1904). The work ended November 14, 1939, instead of

September Ist, or 15th, as represented. Phillips then ran

out of plans and released plaintiff. Plaintiff sought its

release before September (No. 23, R. 1916), but from early

June Phillips exerted duress. A project of different na-

ture, conditions and unit sizes was thus procured (No.

33, R. 1921). Large concrete units were built during the

job and after it ended, by others. The April “contract”

supplied no method to determine inclusions or exclusions.

There was no possible “meeting of minds” on “the sub-

ject matter of the work to be done,” and such Finding is

made as a fact (Nos. 16, 17, No. 9, R. 906, 904).

4Phillips’ Engineer Wise (R. 1635) explained:

Q. “Well, Phillips consulted its own convenience in ordering

out the progress of the work to be done?”

A. “It was our job and Rau was working for us.”

(That attitude may be proper under a “cost plus” contract,

which is the cnly type Phillips could have procured, if a true dis-

ciosure of the facts had been made.)

—

7. Differences between the work and the represented

“program” could not be determined until completion,

because of promises of plans for numerous large (and

more profitable) items shortly to be issued (No. 25, R.

1917). The work completed averaged less than 3 instead

of 19 cubic yards per concrete pour; less than 110 instead

of 700 square feet per form set-up. The ratio of hand to

machine excavating was 109:98 instead of 20:80. Com-

pleted unit sizes were smaller; the required methods dif-

fered. Additional expensive hand excavating was re-

quired. A total of 9,485 separate, additional work opera-

tions, with added hand excavating, all aggregating $88,-

481.50 in value, directly resulted because of differences

between the completed and the represented job (No. 23

to 27, R. 1915-1919). Exhibit 46 (R. 1467) details the

value of additional work of $124,093.84, with overtime and

admitted items excluded. The completed project required

plaintiff to perform over six times the number of costly

work operations, above the number correctly computed for

the falsely depicted job (No. 26, R. 1919).°

8. Unnecessary overtime of $4,392.20 was ordered by

Phillips, for its convenience, knowing of the added costs

(No. 23, R. 1914). Nothing was paid therefor. Only

$230.60 for overtime is included in Phillips’ judgment con-

sent (No. 1, R. 1898). $230.16 for fine grading, etc., caused

by changes in plans (No. 28, R. 1919), and $152.98 for

tooled edging, not shown on the plans, and ordered after

Phillips was advised of the cost (No. 29, R. 1920), were

allowed. All are outside of any express contract term.

They are not mentioned on appeal, but are reversed. Re-

lief was denied on prayer for rehearing (R. 2001).

9. Trial was of the simple quantum meruit issues in

assumpsit. The trial court twice stated the issues, at R.

89, and in Memorandum Opinion (R. 1871). After profert

and oyer, Phillips asked terminer of the April Missouri

contract, and of a June 17, 1939, Texas memorandum, with

19 price paragraphs, but none of its paragraphs were directly

in issue. That memorandum was written by Phillips’ Chief

Engineer and was signed at the mid-June meetings where

5Cf. R. 265-9; Ex. 7, 297; Ex. 5, 271; 369-372; Ex. 11, Vol. 4:

793-829; 1449-1458; Ex. 16, 831; Ex. 20, 835; Ex. 21, 851; Ex. 22,

855.

ars

LESAN INS ED I

the threats were made. It was invalid for duress and for

the fraudulent promises made and not intended to be per-

formed (Findings 21 to 25, R. 1910). Plaintiff asked no

_ determination of its invalidity but used it, with other evi-

dence, to show reasonable value of concrete forms and

panels, which plaintiff built but never got to use (and

did not get paid for), because of Phillips’ 215 changes in

plans. Finding 22 (R. 1911) allowed $35,597.16 therefor.

See Questions Presented No. 5, infra, p. 15. Because

Phillips asserted a defense under June Paragraph 4

(which was denied by Finding 22), it exactly followed

the common law rules designed to require express con-

tracts (when fully performed on one side) to be filed in

court, so that the determination of their validity, as a de-

fense, could be governed by equitable principles at law,

without resorting to the competing Chancery Courts. The

determination, made at Phillips’ request, was: Neither

April nor June “contracts” are valid as a defense (Con-

clusions denied, R. 1931; given, R. 1922). The composite

case reversed (according to the opinion) is quantum me-

ruit and for damages for fraud and deceit, damages for

breach and damages for abandonment (R. 1988). Phillips,

and the opinion, assert the June “contract” supplemented

that of April. If so, it supplemented a nullity and a fraud

and was stillborn. Its obvious and only purpose was to

fix a “‘price ceiling” for “extra” and ‘‘additional” work re-

quired, for which Phillips was clearly liable. The “extra

work” (particularly the $35,597.16 allowed by Finding

22) was payable 30 days after the job ended (Par. 35, R.

15). The alleged defense was designed in June. No rec-

ords of form losses were produced by Phillips. It pre-

ferred concealment. Assuming validity on appeal, of the

June “contract” without discussion, was simple, after life

was conferred on the void April “‘contract.”” Discovery of

“accord and satisfaction,” “compromise and settlement”

and “accounts stated’ (although never pleaded below,

and despite their denial by Phillips’ own evidence) also

were no problem. Long after trial, at oral arguments

carefully heard in the trial court (R. 1878), before finally

filing his indicated Findings, for the first time Phillips

then announced that it had “dug up a case” (R. 1891) and

asked for a Conclusion, that, if the April and June con-

tracts were invalid, its “‘extra work orders” were binding

contracts. These were never used to order “extra work,”

as specified in April Contract, Paragraph 5 (R. 6), how-

ever (R. 1659-62). Phillips prepared them for everything,

after the work was done. That Conclusion was denied

(R. 1932). Finding 32 (R. 1921) determined that the

“extra work orders” were nothing but field memoranda,

and ends with a Conclusion of Law, reading, “There is

nothing in the entire evidence on which a waiver, ratifi-

cation or an estoppel by plaintiff may be predicated.”

Finding 25 (R. 1917) determined that fraud was not dis-

covered until completion. At R. 2032, it was carefully

pointed out that the trial court conducted his own exami-

nation to determine the facts, that the hand excavating,

done early in the job, was at Phillips’ request, to avoid

damage to concealed pipes. Phillips paid for that until

the June memorandum was signed; thereafter no pay-

ment was made but the same work was compelled.

10. That plaintiff derived no benefit from the June

agreement, or that any April “unit price” was increased,

is denied by Phillips’ Chief Engineer (R. 1809, 1814),

who discusses the items of “extra work” or “additional

work,” for which he set a “price ceiling” in the June

memorandum. That there was no accord or satisfaction

from checks or “statements of estimates” (a mere list of

“extra work orders’) is denied by the Record, Findings

and Phillips’ evidence. Stipulation (R. 1089) shows that

the only endorsement on checks was: “In full settlement

of the within account.” R. 1090-91 is a copy of Phillips’

financial records, and lists every check. It definitely es-

tablishes there was never a check issued by Phillips, for

$2,010.23, with an accompanying statement, or for any like

amount (cf. Opinion, R. 1994). Phillips’ Exhibit 45 (R.

1366; its Exhibit 40, R. 1244); its Chief Engineer (R.

1820-22, 1937); and its Engineer Hubbell (R. 205-207) all

deny the conclusions on appeal (R. 1993), that a settle-

ment of the claims in suit followed the acceptance of any

check. The two checks received after completion are

shown in the above letters and records. They were paid

for Phillips’ benefit, to discharge lienable bills at its re-

quest, and a list thereof was furnished as agreed (R. 1820,

1837, 205). The express agreement is established by Phil-

lips’ evidence and by Finding 5 (R. 1900), that every

claim in suit would remain open, without prejudice, until

a meeting with Phillips’ Mr. Riney, at Bartlesville, which

was held December 20, 1939, or exactly seventeen days

after receipt of the last check accepted. Plaintiff’s men

went there at their own expense at Phillips’ request. The

only check ever offered as final settlement was for $1,-

787.51, dated, December 21, 1939, which was promptly

returned (Exhibit 4, R. 1244). Finding 1, R. 1899, es-

tablished from the evidence, for the first time, just what

items were included in Phillips’ judgment consent. It

also finds that the original answer admitted $2,108.53 and

not $2,010.23. April “contract,” Paragraph 35 (R. 15),

specifies that all payments, except the final one, are only

“estimated to be due.” Final payment was due 30 days

after completion (or December 14th) and then only after

Phillips’ Engineer certified to the whole value of all “‘con-

tract” and “extra work,” which has not yet been done.

The last check accepted was December 3, 1939.

11. Finding 1 (R. 1898) determined that jurisdic-

tion was based on diversity of citizenship. There is no

intimation of that on appeal, nor is there anything to in-

dicate a Missouri contract for Texas work, induced by

false representations made in Oklahoma and Texas.

12. These matters were urged on original hearing

and in petition for rehearing (R. 2030, 2040). It was

overruled, without comment and without correction of

plain errors of fact. The opinion is not only without

record confirmation but it is expressly denied by Phillips’

evidence and financial records, as stated. These and the

many anomalies presented under “Reasons Relied Upon”

(p. 18) seem to differ with the accepted course of recog-

nized judicial proceedings in United States Courts.

13. Nothing was overlooked, for Phillips. The trial

answer of November 13, 1940 (R. 69), was to the com-

plaint filed January 2, 1940. Under Missouri law that

was demand, to start interest. By Texas law, interest

started January 1, 1940. Answer, Paragraph 23 (R. 66),

admitted $2,010.23 was due and consented to such judg-

ment, with costs. The directions on reversal require judg-

ment entry of $2,010.23, but on filing the mandate. In-

terest was disallowed on even that. Phillips did not bring

its falsely represented conditions, integral to the contract

subject matter, into existence. It had no contract with

mutuality of obligation to enforce. Fraud and duress un-

justly enriched it and it obtained a further bonus in the

high premium paid by plaintiff, in waiving damages for

delay (final Paragraph Finding 23, R. 1916) and damages

for fraud. That was done to insure recovery, under the

. equitable rules governing assumpsit, of bare reasonable

value of work done (without recovery of other losses

. Sustained). Petitioner was denied all. Phillips’ conduct

was rewarded on appeal, by grant of more rights than any

contract ever.reserved. Different facts and a different

action were assumed, for Phillips. Duress findings were

plainly ignored. Any reference thereto rendered reversal

impossible. Opinion (2) (R. 1989) says: “In the view we

take of this case, it is unnecessary to discuss the findings

* * * that appellant was guilty of fraud in inducing

the execution and .performance of the contract.” What

else is established by the record, answer and Findings?

STATEMENT OF THE BASIS OF JURISDICTION.

(a). U.S. C., Title 28, §§347 (a) and 377, and Rule

' 38 of this Court, are the basis of jurisdiction.

(b) . The questions of. substance and of public con-

cern which are of special importance in the public in-

terests are stated in the ‘Reasons Relied On For Allow-

. ance of the Writ,” p. 18 herein. These cases sustain

_ jurisdiction:

Layne & Bowler Co: v. Western Well Works,

261 U. S. 387, 392, 67 L. Ed. 712.

. Magnum Import Co..v. Coty, 262'U..S. 159,’ 163,

67 L. Ed. 922.

Federal Rules of Civil Procedure, and U. S. C., Title 28,

§§773 and 875, and these cases, which sustain jurisdic-

‘ tion:

State Farm Mutual Auto Ins. Co. v. Cotighran,

- 303 U..S. 485, 487, 82.L. Ed. 970, 972, subd. 1.

Deputy v. DuPont, 308 U. S. 488, 497; 84 L. Ed.

416, 423, subd. 6.

Law v. U. S., 266 U. S. 494, 496, 69 L. Ed. 401, 402.

The error. of the decision in failing to declare and apply

the controlling state law and in denying equal protection

of laws (see infra p. 22) is shown by these’ decisions

which also sustain jurisdiction:

_ Griffin v. McCoach, 313 U. S. 498, 85 L. Ed. 1481.

Klaxon v. Stentor Elect. Mfg. Co., 313 U. S. 487,

85 L. Ed. 1477, 1480.

Fidelity Union Trust Co. v. Field, 311 U. S. 169,

85 L. Ed. 109.

Pecheur Lozenge Co. v. Nat. Candy Co., 315 U. S.

666, 86 L. Ed. (adv.) 739.

(d) The substantive rights denied by refusal to apply

the equitable rules governing an assumpsit action con-

travene:

Guerini Stone Co. v. P. J. Carlin Const. Co., 248

U. S. 334, 343, 63 L. Ed. 275, 284.

Stone v. White, 301 U. S. 532, 534, 81 L. Ed. 1265,

1267.

Phillips & Colby Const. Co. v. Seymour, 91 U. S.

646, 23 L. Ed. 341.

(e) The decision reversing the judgment of the Dis-

trict Court was filed August 19, 1942 (R. 1994). It

is reported, 130 F. 2d 499, and appears, R. 1987. Peti-

tion for Rehearing (R. 1995), filed September 2, 1942 (R.

2042), was overruled, without comment, on September 24,

1942 (R. 2043). Order staying mandate for thirty days

was filed October 2, 1942 (R. 2044).

QUESTIONS PRESENTED FOR DECISION.

1. Was it error to reverse a contractor’s judgment

of $140,582.53, entered as the value of concrete con-

struction work performed under compulsion, above the re-

quirements of a project falsely depicted and which in-

duced a “unit price” construction contract?

2. Are these rulings, made in support of reversal,

erroneous, to-wit:

(a) Under Missouri law it is not fraud, but only an

“expression of opinion or expectation,” before unit plans

are drawn, to supply a false ‘‘cross section’”’ and false en-

gineering information, through an authorized engineer

acting in the scope of his employment, to induce a “unit

price” construction contract?

(b) A “unit price” construction contract is not aban-

doned nor breached, nor is there any recourse, where the

contractor is required by compulsion to erect a project of

different nature, conditions and unit sizes from the rep-

resented project, and costing nearly $125,000 more

to build?

are drawn, for construction of approximately 12,000 cubic

yards of concrete, does not require certainty of engineer-

ing “‘job cost factors’’?

(d) If there was any original contract uncertainty,

it vanished seriatim, with the delivery of plans as issued

by the owner, where no independent Engineer was des-

ignated to draw them. The owner had the right to sup-

ply plans, with 215 changes made after the first issue of

500 plans, for a project contrary to prior, definite represen-

tations of the nature, conditions and unit sizes of con-

struction, and a judgment allowing the exact difference

in value is ‘not justified’? and must be reversed?

(e) The printed contract of Phillips Petroleum Com-

pany, providing that it shall not be liable for “any quanti-

ties expressly stated or implied by any of its representa-

tives” (R. 7, Par. 8), released all liability for the reason-

able value of all construction work performed under

compulsion, in excess of the requirements of a “unit price”

contract induced by false engineering information and a

“cross section,” supplied (before unit plans were drawn)

by Phillips’ Engineer, acting in the scope of his employ-

ment (Answer, Par. 12, R. 63). Although delivered in

Missouri by agreement (Finding 13, R. 1909), it should

be enforced by reversal, with no mention of the Missouri

public policy which condemns such contracts?

(f) Mutuality of obligation inheres in a “unit price”

contract specifying that the owner may terminate it and

all liability thereunder, at will, by paying the value of

completed work in place, but without paying for uncom-

pleted work, or for the cost of moving men, materials and

equipment in, and then out again, upon such termination?

(g) Performance, under compulsion, of an entirely

different and more costly project than that originally

represented to induce a “unit price” contract is per-

formance of the contract and supplies any original want

of mutuality, if it was lacking at its inception?

3. If error, are such determinations in the public in-

terests; was Phillips Petroleum Company thereby granted

the fruits of authorized fraud and deceit; do they en-

danger the Construction Industry and tend to delay con-

struction vital to the public interests in the present emer-

gency, and are the high principles of the United States

Courts truly reflected in the public interests and in the

interests of the Judiciary?

(a) Is it in the public interests that District Courts

of the Eighth Circuit, in following the decision, will be

bound to (1) grant the fruits of fraud to those who so

induce “unit price” construction contracts (2) follow the

rule of Roosevelt v. Mo. State Life Ins. Co., in fraud cases

governed by Missouri law (3) enforce contracts relieving

in advance from all liability for authorized fraud and (4)

rule that it is not fraud, but merely an expression of opin-

ion or expectation, to wilfully misrepresent unit sizes and

“job cost factors” to induce construction contracts?

4. Did the decision err and does it conflict with rul-

ings of this Court, in failing to consider or to determine

whether there was any substantial evidence to support

trial Findings?

(a) Did it err in ignoring supported trial Findings,

without consideration of, or comment thereon?

(b) Did it err in either respect, or deny equal pro-

tection of laws, when the same Court, at the same Term,

declared for other litigants, that trial Findings are pre-

sumptively correct and, if supported by substantial evi-

dence, will bind determination on appeal?

failing to declare or apply the controlling law, or did it

avoid that error by ignoring the basis of jurisdiction and

ignoring that the contract enforced by reversal was for

Texas work but was delivered by agreement in Missouri

and was induced by deceit accomplished in Oklahoma and

Texas?

(d) Did it err in failing to apply the controlling

declared Missouri law on fraud and in citing and follow-

ing the former Circuit rule declared before Erie R. R. V.

Tompkins, when the same Court, at the same Term, de-

clored for other litigants, that the former Circuit doctrine

of Roosevelt v. Mo. State Life Ins. Co. may no longer be

assumed to apply in any case governed by the Missouri

law on fraud? (Page 23 herein.)

(e) Was equal protection of laws thereby denied?

(f) Did it err in failing to follow the Missouri law

declared in the first Missouri case cited in the opinion

(R. 1993), when Phillips’ own evidence indisputably es-

tablished that every claim in suit was left open, without

prejudice, until reviewed at a meeting held seventeen

days after the last check was accepted. and that by agree-

ment the checks were delivered in Missouri? (Page 9

herein. )

(g) Did it err in the same conclusions, when Par-

agraph 35 (R. 15) of the “contract” which Phillips pleaded

as a defense, specified that all payments, except the final

payment, are only “estimated to be due” and that the

final payment will be due not earlier than 30 days after

completion, and the last accepted check was received 11

days prior to the expiration of that time?

(h) Was there error in the same rulings, when the

questions were never in issue below, and “accounts

stated,” “release,” “compromise” or “‘accord and satisfac-

tion’? were not pleaded by answer?

5. The decision (R. 1992) reversed $35,597.16, al-

lowed “For loss of (concrete) forms, form panels and re-

use, totalling 355,971.64 (square) feet, at 10c per foot,

per Finding 22” (R. 1911), with the statement that the

allowance was “not justified by anything in the conduct

of the parties or in the words of their agreement” to pay

ten cents per foot under Paragraph 4 of memorandum of

June 17 (R. 18) “For changes in forms caused by a change

in the plans.” Supported Findings 22 (R. 1911); No. 31

(R. 1920); No. 20 and No. 21 (R. 1921); and No. 17 (R.

1908), and denial of requested Conclusions of Law (R.

1931) established these facts:

(a) The agreement was invalid for fraud and du-

ress. The allowance was made as reasonable value under

implied contract. The trial court, under the law of the

forum, found also that the language was ambiguous and,

after hearing the evidence of the parties who made it, ar-

rived at the identical results. whether the agreement was

valid or invalid (Finding 22). The above Findings es-

tablished:

(b) 15.4c per square foot “contact area” was speci-

‘ied in the April “contract” (R. 14) but that sum was

paid only for the exact area of concrete forms which

touched and held erected concrete. Contract, Paragraph

5 (R. 6), provides for changes in plans, but requires

agreement for the price and extent of work caused there-

by. Nothing whatever was paid for concrete forms built

ready for use, nor for the form panels which were used

at Phillips’ direction and which were fabricated to be used

on one structure, shown by issued plans, and were de-

signed to be successively moved and re-used to pour

the concrete for similar structures, likewise shown by is-

sued plans. The area of concrete forms and panels, men-

tioned above, was completely lost for any use after the

expense of building or fabricating was incurred, because

of the 215 changes made in the plans by Phillips, after

their delivery, with orders to erect.

597.16 loss resulting from the useless fabrication of costly

panels nor for erecting unused concrete forms. $1,165.67

was included in its judgment consent, for a few items,

based on memory alone. Plaintiff’s proof was by actual

field records. Phillips’ Engineers were ordered to keep

such records. None were produced. Phillips took ad-

vantage of the lower rate for forms wrecked by its trucks,

etc., although Finding 22 states that Phillips’ own evi-

dence indicated that it should pay 15.4c for many items

(Finding 22, R. 1911; No. 31, R. 1920; No. 17, R. 1909;

No. 1, R. 1898; Ex. 5, R. 295; Phillips’ Ex., R. 1380,

1381; Phillips’ Evidence, R. 1658-9).

Phillips’ letters (R. 1381, 1382) referred to therein con-

firm Finding 22 (R. 1911). The exact amount computed in

these letters is included in the judgment consent. Finding

1 (R. 1898). After trial, Phillips re-confirmed the admis-

sions made by its request for Conclusion VIII (R. 1932).

These facts were clearly presented (R. 2002) without re-

sult. Was the reversal error?

6. Was. it error to overrule petition for rehearing,

without comment and without correction, when (R. 2009)

attention was clearly invited that even under the errone-

ous ruling here made, Finding 22 established that Exhibit

5 (R. 295) was correct and on the face of that exhibit

petitioner was entitled to a minimum of $5,341.95 not paid

for concrete forms erected ready for use, but which could

not be used because of changed plans?

7. Was an aggregate of $4,775.34 properly reversed

without any comment or reference thereto, where trial

Findings established that the allowance was for overtime

specially ordered, without necessity and for the conven-

ience of defendant, with knowledge of the added costs,

and for items of additional work, all outside of the terms

of any express contract? (R. 2001.)

8. Was it error to rule:

(a) That fraud was known early in the work from

discovery of a difference in ratio of hand to machine ex-

cavation?

(b) That a “supplemental agreement” ‘“substan-

tially increased the contractor’s compensation” after dis-

covery of fraud and effected a waiver of fraud, or com-

promise thereof?

when the decision ignored trial Findings, which estab-

lished that differences between the work and “cross sec-

tion” representations were not discoverable until comple-

tion, and that there was nothing in the entire evidence

on which to predicate a waiver, ratification or estoppel

of plaintiff, or to deny “* the reasonable value of addi-

tional work performed nder compulsion. Defendant’s

Conclusions requested in an assumpsit case, to declare

the alleged ‘“‘supplemental agreement” valid and that it

was not obtained by fraud, were denied. Findings de-

termined facts which establish that the “agreement” was

invalid for both fraud and duress. Compromise was not

pleaded nor in issue below. The trial Court conducted

its own examination to determine that the “hand exca-

vating” was performed at Phillips’ request on oral agree-

ment to pay the additional cost for locating concealed

pipes to avoid damage by excavating machinery. The al-

leged ‘‘supplemental agreement”’ confirmed the prior, oral

agreement but after compulsion was exerted the same

work was thereafter required without compensation? (See

Page 7 herein.)

9. Was it error to reverse a composite quantum

meruit case and an action for damages for fraud and

deceit; for breach and for abandonment, when only sim-

ple assumpsit issues were pleaded and tried? (Page 7

herein.) :

REASONS RELIED ON FOR. ALLOWANCE

_OF THE WRIT.

The decision on appeal fundamentally erred in basic

questions of substance and of special importance in the

permanent public interests and in the public interests

particularly affected in the present emergency.

The opinion contravenes good morals, public policy

and Engineering ethics. It rewards the authorized de-

ceit of Phillips Petroleum Company, but denies the simple

arithmetic and common sense clearly demonstrated in trial

Findings.

_ The errors gravely affect. the Construction Industry

and the Engineering Profession. Every concept of “unit

price” construction contracts is nullified. That important

type of engineering contract is designed to avoid delay to

wait for detailed plans.

. The Construction. Industry is endangered by the ap-

proval of fraud, where it may readily be perpetrated, as

the facts here illustrate. The Engineering Profession is

bewildered by the decision.

The District Courts of the Eighth Circuit are obliged

to grant others the fruits of deceit in inducing “unit

price” construction contracts.

The decision erred in ignoring lawful trial Findings

and in refusing to apply the controlling Missouri law and

the same law declared at the same Term, to govern other

litigants. Justice and equal protection of laws was there-

by denied, contrary to the accepted course of judicial pro-

ceedings and to the law repeatedly declared here.

There s a firm faith in this Court to decide the ques-

tions and to correct the basic errors made on appeal or,

otherwise, the now vital Construction Industry would be

paralyzed and an unfavorable reflection of the United

States Courts would follow, contrary to the public inter-

ests and the interests of the Judicial System.

Basic Errors on Appeal.

The fundamental errors on appeal are of the gravest

concern in the Construction Industry. They astound the

Engineering Profession. By analogy, the ethics and

arithmetic taught on appeal is: An owner may induce a

unit price of $100 for erection of one 10 yard cube of con-

crete. It may, at the same price, thereafter require the

contractor to dig the holes and pour the same amount of

concrete to form the base of 300 separate highway mar-

kers. Under the supported Findings of Fact in the record,

the decision on appeal determines:

1. There is no fraud in inducing a “unit

price” construction contract, by knowingly supplying

false information and a false engineering ‘“‘cross-sec-

tion,” before plans are drawn. Such deceitful repre-

sentations “if made and if false” are mere ‘“expres-

sions oi opinion or expectation.” Opinion (2) (R.

1989). Likewise, it is immaterial that the owner

alone knew the true facts and could change the plans

at will, where no independent Engineer or Architect

was employed. Answer, Par. 12, R. 63, admits: that

everything given, was with authority, but it was ‘“‘not

accurate and not intended to be accurate.”

2. “Unit price” construction contracts require no

certainty of ‘‘job cost factors.” Any original uncer-

tainty is removed seriatim, as plans are received

during progress of the work. The plans may depict

a project of any nature, conditions or unit sizes, re-

8Cf. Picard v. United Aircraft Co., 128 F. 2d 1. c. 641, saying

“it is intolerable that the public interests should be at the mercy

of the haphazard scientific information of judges.” After stating

a difficulty to understand, United Const. Co. v. City of St. Louis,

(Mo.) 69 S. W. 2d 647, subd. 9, says:

“The contract deals with an engineering proposition,

abounds in technical and scientific terms, and was to be

carried out by men learned in that line of work. An expert

in that line of work was best fitted to interpret the contract

and solve the controversies. * * *”

That “human society is not so organized that a dispute be-

tween A and B can be of no concern to anybody else” is stated

in Note 7, 1. c. 295, in Aero Spark Plug Co. v. B. G. Corporation,

130 F. 2d 290, 295.

RAPALA MNT ETE NEA EAA ALAIN SANE RS OPIN Oe Mad oe ce AO

gardless of prior representations. Opinion (1) (R.

1988).

3. Contracting in advance against all liability

for authorized fraud is valid and properly enforced by

reversal on appeal, without mention nor application of

the governing Missouri public policy, which condemns

such contract provisions. Opinion (2) (R. 1990).

4. There is mutuality in a “unit price” construc-

tion contract which may be terminated at will by the

owner, upon paying the value of work completed ac-

cording to specifications and in place, but without

paying anything for moving in men, materials, ma-

chinery, sheds, field offices, shops, etc., and then mov-

ing them out again. Partially completed construction

need not be paid for. Moreover, want of original

mutuality is removed by building, under compulsion,

an entirely different project, costing nearly $125,000

more (excluding overtime and undisputed items).

That is performance, to make the contract binding,

if it was wanting in mutuality or was too indefinite

to be enforceable at its inception. Opinion (1) (R.

1989).

5. A “unit price’ contract is not breached nor

abandoned, nor is there any recourse for the con-

- tractor, who is required, under compulsion, to build a

project of different nature, conditions and unit sizes

and costing nearly $125,000 more than the originally

depicted project (excluding overtime and undisputed

items). Opinion (3) (R. 1991).

6. An aggregate of $4,775.34, allowed by trial

Findings for overtime and additional work, required

under compulsion and outside of any possible contract

terms, may be reversed on appeal, without mention.

Findings 23, 28, 29 (R. 1919; Rehearing, 2001).

The only interpretation of this decision in Engineer-

ing and Construction fields is that the United States

Courts refuse to recognize as fraud the intentional, au-

thorized misrepresentation of “job cost factors,” where

falsely made to induce “unit price’ contracts. The in-

evitable disruption, with extensive litigation necessarily

following, is disturbing in this vital Industry. That re-

flection of United States Courts is not in the public in-

terests.

The generality of statement and failure to declare the

law guiding the decision on appeal, may only be inter-

preted to mean that the doctrine erroneously announced,

is of universal application throughout the United States

and in every state. The importance of the rules of

Klaxon v. Stentor and Griffin v. McCoach, etc. (cited

but ignored on appeal, R. 1999), is here made manifest.

The Engineering Purpose and Design of “Unit Price” Type

of Contracts and Their Vital Importance Now.

The reversal destroys and denies realization of the

basic engineering design of “unit price” contracts. That

is the type reviewed. The type enforced defies descrip-

tion. The opinion (R. 1992) says that the right to change

plans was reserved, but it says nothing of the coordinate

provision (R. 6, Par. 5) requiring advance agreement on

the price and extent of work so caused.

“Unit price” construction contracts (now, especially)

are an important general engineering type, designed to

avoid construction delay to wait for detailed plans. The

extent Or total amount of any classification of work, or

of the whole project. may legitimately he changed, within

reasonable limits. However, the conditions, nature and

unit sizes of a project, as represented to the contractor,

are the onlv “cost factors” available to compute “unit

nvices,”” particularly, where unit plans are not complete.

Those represented “cost factors” may not be altered at

will by the owner (as was done here). without a breach

or an abandonment of a “unit orice” contract. if it is

possible to conceive an original ‘meeting of minds’ there-

on, or if fraud did not vitiate it. In this respect, this

type closely resembles a “lump sum” contract.

Judicial consideration of the lawful Findings of an

engineering-exnerienced trial court. would have made the

errors impossible. The Findings demonstrate, by simple

arithmetic, that the plans issued during construction, for

10,735 of an approximated total of 12.000 cubic yards of

concrete, required a project of materiallv different nature,

conditions and unit sizes from those falsely represented

to induce the April “contract.”’ Because of those vital

differences, the record and Findings establish that plain-

tiff actually verformed over 9,485 separate work onera-

tions and additional work valued at $88,481.50. Exhibit

aie as toto

46, R. 1467, details the totals of $124,093.84, for additional

labor and material and itemizes each class of work and

the entire project (excluding overtime and admitted

items). Plaintiff was paid the exact sum it would have

received without that expenditure, if Phillips brought the

false program into reality.

The ratio of 10,735:12,000, for completed to approxi-

mated work, approaches a reasonable change in the total

extent or amount of the construction. No damages for

breach or abandonment therefor were claimed. The opin-

ion, however, reverses such an action. No distinction was

found between a change in extent of construction and

changes made in the nature, conditions and unit sizes

of the project despite the definite Findings which made

that so very obvious.

The decision acts as a “stop order” for all projects

if misrepresentation appears, no matter how vital they

may be. Continuing the work, or any adjustment, de-

spite or to endure duress, or an agreement to accept

pay for hand trenching ordered to protect pipes from

excavating machinery, effects a waiver or compromise,

under the teachings here. That result also follows ac-

ceptance of money indisputably due, to pay lienable bills

therefrom at Phillips’ request, with a concurrent agree-

ment that the controverted claims (later sued for) will

remain open, until a subsequent conference. Such is an

accord, if no satisfaction, but requires reversal, if this

decision rightly rules.

ioe

The Denial of Equal Protection of Laws and Other

Errors on Appeal.

The denial of equal justice and equal protection of

laws destroys a private interest, but that is of public con-

cern. Implicit public faith in equality of justice without

denial (inadvertently or otherwise) is essential for orderly

government. Petitioner filed its complaint, firm in that

faith. Indisputable rights, existing even under the errors

made, were denied, without comment, on prayer for re-

hearing (R. 1998-2001).

The same Court, however, at the same Term, declared

and applied for other litigants:

1. That trial findings are presumptively correct, and,

if supported by substantial evidence, bind the determina-

tion on appeal. American Insurance Co. v. Scheufler, 129

F. 2d 143. Chicago Mill & Lumber Co. v. Tully, 130 F.

2d 268, 274, 275.

2. Roosevelt v. Mo. State Life Ins. Co. is the first

case cited in Opinion (2), R. 1990, in support of its fraud

conclusions. With the same presiding Judge as here, it

was declared in Dubinsky v. Lortz, 129 F. 2d 669, 673,

that the Roosevelt case Circuit fraud doctrine may not

be assumed to apply in fraud cases governed by Missouri

law.

The governing Missouri “waiver of fraud’ rule was

printed at length, in Petition for Rehearing (R. 2074),

from a case cited in, but misapplied by, the opinion. The

governing rule of fraud was also printed (R. 2025). That

case is not cited in the opinion and the contrary state-

ment at R. 2027 is error. The Missouri law was ignored.

The opinion (1) (R. 1988) errs in presuming that a

Petroleum Company “can do no wrong.” History denies

that. United States v. McMullen, cited in support, is the

only mentioned construction case, where an independent

‘architect or engineer was not designated to prepare the

plans. The presumptions attending Sovereignty or

Government Departmental Engineers are an incongruity

here.’ Correction of specific fact errors, directly contrary

to the record (R. 2030, 2037, 2039), were denied. The

many anomalies are inconsistent with the accepted course

of iudicial proceedings. The existence of the power of

review vested in this Court usually suffices to render its

frequent exercise unnecessary. It failed here.

The decision and opinion erred in each and every

respect stated, and erred (a) in failing to declare and

apply the controlling state law in a diversity of citizen-

ship case; (b) in failing to adjudicate the only questions

presented, to-wit: are the trial Findings supported by sub-

stantial evidence and do they sustain the judgment (c)

8Cf. Secs. 216-218; 340-341. Engr. & Arch. Juris., J. C. Wait,

M.C.E. Cornell; LL.B. Harvard, 1st Ed.; 17 C. J. S. 772, N. 51, 55;

9 C. J. 695, N. 32; 697, N. 64, 68, 69.

in ignoring Findings entirely, (d) in contravening the

controlling law in each and every ruling made and by the

determination (e) in reversing a composite damage action

for fraud and deceit, breach and abandonment, when only

simple assumpsit issues were presented by the record and

(f) in reversing Finding 22 under the facts specified in

Prayer for Writ.

Your petitioner prays that a Writ of Certiorari is-

sue under seal of this Court, directed to the United States

Circuit Court of Appeals for the Eighth Circuit, command-

ing that Court to certify and send to this Court a full

and complete transcript of the record and of the proceed- ’

ings in the case of Phillips Petroleum Company, a Cor-

poration, Appellant, v. Rau Construction Company, a Cor-

poration, Appellee, No. 12138, to the end that this

cause may be reviewed and determined by this Court as

provided for by law; and that the findings and decision of

said Circuit Court, to which petitioner has objected, be

reversed by this Court, and for such further relief as to

this Honorable Court may seem proper.

Rau Construction Company,

a corporation,

Petitioner,

By Maurice J. O’SULLIVAN,

700 Gloyd Building,

Kansas City, Missouri,

Attorney for Petitioner.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.