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UNITED STATES v. DANIEL

April 12, 1973

UNITED STATES OF AMERICA FOR THE USE OF R. RUDNICK AND COMPANY, AN ILLINOIS CORPORATION,
v.
DANIEL, URBAHN, SEELYE AND FULLER, A PARTNERSHIP, ET AL.,



The opinion of the court was delivered by: Austin, District Judge.

MEMORANDUM OPINION and ORDER

Plaintiff, a corporation engaged in the general construction business, brought this suit under the Miller Act, 40 U.S.C. § 270a et seq. There are four defendants, one a partnership, Daniel, Urbahn, Seelye and Fuller (hereinafter referred to as "DUSAF"), alleged to be composed of the other defendants, which are another partnership and two corporations. The complaint has previously been dismissed as to five other defendants and two others were granted summary judgment.

The complaint alleges that DUSAF was the prime contractor for the United States and the Atomic Energy Commission (AEC) for the construction of proton beam enclosures at Batavia, Illinois.*fn1 Prior to submitting its bid, plaintiff examined the construction site and soil boring reports that were prepared by Soil Testing Services, Inc., (a previously dismissed defendant) and that were submitted by DUSAF in its "Invitation to Bid." Plaintiff alleges that based on its inspections and the soil boring reports it believed it would not encounter any unusual water conditions and determined the amount of its bid for the construction work accordingly. Its bid was accepted by DUSAF and after beginning performance plaintiff encountered an "unusual" amount of subsurface water, alleged to be an "unknown latent physical condition differing materially from those conditions usually encountered in work of this nature."

Plaintiff alleges that this condition falls within the provisions of two clauses of its contract with DUSAF that provide for an "equitable adjustment" of the contract by DUSAF; that it had increased costs of $497,559 as a result of the condition; that it demanded payment pursuant to the two contract clauses; and that DUSAF has refused to pay the additional costs.

Pending before the court are two motions, plaintiff's motion to strike the appearance of the U.S. Attorney and DUSAF's motion, filed by the U.S. Attorney, to dismiss or in the alternative, for summary judgment.

Motion to Strike the Appearance of the U.S. Attorney

In the court file is a copy of a letter from the Assistant United States Attorney General, Civil Division, which acknowledges receipt of a letter from the AEC that presumably asked the government to take part in this lawsuit. In that letter the Assistant Attorney General told the AEC that he was asking the U.S. Attorney in Chicago to undertake the defense of this case. The U.S. Attorney filed, on behalf of DUSAF, the aforementioned motion to dismiss or for summary judgment. He did not, however, file an appearance on behalf of DUSAF, as he is required to do under Local Civil Rule 6(b). Given the present posture of the case, the U.S. Attorney's filing a motion on behalf of DUSAF will be considered as equivalent to filing an appearance and therefore plaintiff's motion to strike the appearance is appropriate.

Plaintiff's contention is, in short, that because Miller Act suits are brought in the name of the United States, for the use of subcontractors, and because the purpose of the Act is to bestow a benefit upon subcontractors, it is inappropriate for the U.S. Attorney to represent a defendant contractor. The U.S. Attorney argues that because the contract between the AEC and DUSAF is a cost-plus-fixed-fee contract (CPFF),*fn2 under which the AEC will have to pay all of DUSAF's costs, the government has an interest in this case and under 28 U.S.C. § 516, 547 his appearance is proper.

The issue of the propriety of the government appearing on behalf of a defendant contractor in a Miller Act case is apparently one of first impression.*fn3 Therefore, it is important to determine the intent of Congress in passing the Miller Act and the statutes enumerating the duties of U.S. Attorneys.

Duties of the U.S. Attorney

The U.S. Attorney relies upon 28 U.S.C. § 516 and 547 as giving him authority to represent the government's interest in this case, which means appearing on behalf of the contractor DUSAF. Section 547 provides in relevant part:

    Except as otherwise provided by law, each
  United States attorney, within his district
  shall . . . prosecute or defend, for the
  Government, all civil actions, suits or proceedings
  in which the United States is concerned. . . .

Section 516 provides:

    Except as otherwise authorized by law, the
  conduct of litigation in which the United States,
  an agency, or officer thereof is a party, or is
  interested, and securing evidence therefor, is
  reserved

  to officers of the Department of Justice, under
  the direction of the Attorney General.

While on their faces these statutes might seem to grant the U.S. Attorney such authority, an examination of the legislative history makes their scope less clear.

Since § 547 is more clearly applicable to the instant case than § 516, its background will be examined first. The Judiciary Act of 1789 provided that a person should be appointed in each judicial district to

  act as attorney for the United States . . . whose
  duty it shall be to prosecute in such district
  all delinquents for crimes and offences,
  cognizable under the authority of the United
  States, and all civil actions in which the United
  States shall be concerned. . . .

Act of Sept. 25, 1789, ch. 20, § 35, 1 Stat. 92. While on its face it would seem to provide that the district attorney (as he was known until 1948) would only prosecute criminal and civil actions, he in fact had much discretion in defending cases in which the government was concerned.*fn4 In 1863 Congress provided that it was the attorneys' duty to appear on behalf of all revenue officers, Act of Mar. 3, 1863, ch. 76, § 13, 12 Stat. 741 [now 28 U.S.C. § 547(3)], although earlier it had provided for payment to them when they defended any officers of the United States for acts done in the "lawful discharge of their duties." Act of Aug. 16, ...


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