FEDERAL CONTRACT LAW: Joseph J. Petrillo

Time to remember a judge who cast a long shadow

Joseph J. Petrillo

I was asked recently to name some of the most influential people in the development of government contract law. The late Judge Oscar H. Davis came immediately to mind.

Davis, after a distinguished career in the Solicitor General's Office, was appointed by President Kennedy to the U.S. Court of Claims in 1962.

He served there and in its successor, the Court of Appeals for the Federal Circuit, until his death in 1988.

His many landmark decisions shaped the legal doctrines we use today that govern contractual relations between the government and citizens.

His best-known ruling was in G.L. Christian and Associates vs. United States. According to the Christian doctrine, there were times when a court should read a mandatory, but missing, clause into a contract.

The doctrine was limited to regulations which embodied a 'deeply ingrained strand of public procurement policy,' Davis wrote.

He had an uncanny knack for expressing complex ideas simply.

He described the doctrine of superior knowledge in the Helene Curtis Industries case as follows:

'In this situation the government, possessing vital information which it was aware the bidders needed but would not have, could not properly let them flounder on their own. Although it is not a fiduciary toward its contractors, the government'where the balance of knowledge is so clearly on its side'can no more betray a contractor into a ruinous course of action by silence than by the written or spoken word.'

The elegant phrasing of his opinions set Davis apart. In WPC Enterprises Inc. vs. United States, he wrote the perfect preamble for an all-too-familiar situation in government contracting:

'This is a study in the toils of ambiguity. The parties put their names to a contract which, on the point crucial to this lawsuit, could reasonably be read in two conflicting fashions. Each signatory seized in its own mind upon a different one of these contradictory versions. ' The impasse became unmistakably plain when it was too late. Our task is to determine on whom should fall the risk of such mutually reinforced obscurity.'

And no one who has read Deloro Smelting & Refining Co. vs. United States can forget how he rejected a contractor's one-sided interpretation of the contract. The government 'can hardly be thought to have thrust its head into the lion's mouth in the hope that the animal would turn out to be a vegetarian.'

Davis was a consistent and influential innovator in the law. His decision in the second Keco case, Keco Industries Inc. vs. United States, is still the keystone for analysis of when a court should grant a bid protest suit.

You're both wrong

Another innovative ruling was National Presto Industries Inc. vs. United States. Faced with a completed contract in which a mutual mistake undermined the basic assumptions of the contracting parties and reformation was the only adequate remedy, Davis judiciously divided the contract loss in half, apportioning it equally to the contractor and the government.

He wrote, 'An equal split would fit the basic postulate that the contract has assigned the risk to neither party.'

Few jurists alive today are capable of such bold and confident resolutions to difficult questions.

Davis, a lifelong public servant, was not reluctant to impose the obligation of fair dealing on the government. In a decision which resonates to the present day, he overturned a termination for default when the record showed that 'nobody in the Navy, neither the contracting officer nor his superiors, exercised the discretion they possessed under the [default termination] article' in Schlesinger vs. United States. The technical default of the contractor was merely a 'useful pretext' for action otherwise motivated.

Davis didn't lack intellectual humility. Further reflection cast doubt on his ruling in Colonial Metals Co. vs. United States. He did not hesitate to overrule his own decision in a subsequent case.

Oscar H. Davis put his mark on government contract law like no judge before or since. His legacy challenges us to achieve excellence when we grapple with legal issues.

Joseph J. Petrillo is an attorney with the Washington law firm of Petrillo & Powell.
E-mail him at jp@petrillopowell.com.

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