to 267+13 (Project Diary of August 20, 1968). He was told that his fill was four to eight feet too wide. and that his cut slopes were too full. He was asked to "cut his slopes and pull his ditches” and that if he still needed more material, he would have to drag it up off of the fill or borrow at his own expense. He was further told that he could use material from the next balance but that no overhaul would be paid for it. However, the Project Diary of August 22, 1968, states that after material allegedly improperly placed was salvaged, the balance was "way short," and that the Bureau would have to pay for borrow.55

PHL hauled an estimated 3,000 yards of material across the balance point from the cut at 247+50 to 249+92 to the fill at 264+00 to 267+00 (Project Diary of August 21, and 22, 1968). This, of course, was beyond the free haul distance 56 and would appear to involve more than finishing material.

55 Nevertheless, when Mr. Lyshaug inquired whether any allowance for borrow for finishing had been made in the monthly estimate, he was told no because the Bureau wouldn't pay for borrow where material was wasted (Project Diary of September 7, 1968). When Mr. Lyshaug denied wasting material suitable for finishing Mr. Bilderback responded that PHL had filled in a hole one-and-a-half to two feet by 200 to 300 feet with material conserved for finishing. Accepting the larger of these figures and two feet for the missing dimension, the maximum amount of material involved would be less than 45 cubic yards. This assumes the material was suitable for finishing which has by no means been established.

The Project Diary of August 22, 1968, states that Propes and Lyshaug agreed that 450 yard-miles involved was about equal monetarily to the 150 or 200 yards of material beyond the roadway prism in the fill at 266+00 to 267+00. The record is not clear whether PHL was subsequently paid overhaul on this material.

The project inspector's view that PHL was wasting material suitable for finishing is based upon PHL's failure to complete rough grading operations to Mr. Bilderback's satisfaction, the undercutting of the cuts and the overbuilding of the fills. Although, Mr. Bilderback excused the variation between the estimated and actual excavation quantities upon the ground that this was a "tough, mountain, rock job” (note 38, supra), one looks in vain for any recognition of this fact in his interpretation and application of contract requirements during the contract period.

The project inspector was critical of PHL's operations for not being closer to planned grade, for not having more grade checkers and for conducting a "hop, skip and jump” operation. The record indicates that PHL's rough grading operations resulted in a grade from one to two feet below the planned elevations in some areas, as much as three feet too low in at least one cut, and as much as a foot and-a-half too high in some other areas.57 Since boulders of from two to eight feet in diameter were excavated and placed in the fills,58 and since there was a short

57 See Project Diaries of July 25, August 5 and 7, September 2 and 5, 1968, and July 16, 28 and 31, August 1, 4, 6, 12 and 25, 1969. Most of the low areas are stated to be due to "undercutting." One of the high areas (fill at station 134) was attributed to placing boulders six to eight feet in diameter which had to be repositioned, while another of the high areas (stations 158 to 162) was attributable to placing of boulders and to the fact the area was not staked because it was under three feet of water (Project Diaries of July 16 and 28, 1969).

5 Tr. 126, 136, 292; Project Diaries of September 16, 1968, and July 16, 1969.

age of finer materials, it is hardly surprising that such variations could occur in the course of the work. Mr. Propes testified that under such conditions he did not know any way of coming out on grade without select material (Tr. 345). There is evidence that some of these variations are due to staking errors (Tr. 264, 265, 274, 275; Project Diary of September 13, 1968). In this connection, it is not clear what criteria the project inspector applied in determining that the grade was "close enough" so as to warrant the application of material conserved for finishing or borrow.59 Mr. Lyshaug testified that "*** you like to bring them [fills] up to within 6 inches more or less of final grade so you can have a continuity (sic) through the job." (Tr. 228.)

The alleged lack of grade checkers and the "hop, skip and jump" operation are closely related. Mr. Lyshaug insisted that PHL did have grade checkers, but asserted that since they were forced to spread out all over the area, they could not have a grade checker for each piece of equipment (Tr. 288, 290, 291). Part of the reason for being spread out was as we have seen, the encountering of unanticipated rock. The other reason was the refusal of

50 Testifying with reference to the area between stations 160 and 200, Mr. Bilderback complained: "* ** all of the finishing material, all of the dirt that was on top of the cut section was not conserved. * * * piles of material that was [sic] conserved for finishing were hauled and placed in undercut areas in cuts and fills so that the material in this area that could have been available for finishing was used up in a rough grading process." (Tr. 562.)

the project inspector to permit a balance area to be finished until he determined how the next balance area would come out (Project Diary of August 9 and 12, 1968). Mr. Bilderback admitted directing PHL, particularly during the 1968 season, not to waste material in one balance section until it was determined whether it could be used in the next balance (Tr. 589, 664). We note that under Article 102-1.2 of FP-61 no material from borrow pits was to be placed in the embankment in any balance section until it has been determined that all of the material within the balance section could be utilized in the embankment as planned. Mr. Lyshaug characterized this as a "wait and see" operation and indicated that it was one of the reasons preventing PHL from completing the work in sequence (Tr. 228, 231, 240, 259). We find that this practice was contrary to the contract.6 60

In blasting operations it is normal to drill and shoot below grade in order to avoid rock knobs in the grade (Moving the Earth by H. L. Nichols, App's Exh. 14). Mr. Bilderback readily admitted that this was so (Tr. 663). Mr. Lyshaug admitted to overdrilling approximately two feet (Tr. 292). Mr. Propes testified that it was necessary to drill two feet below ditch

60 The project inspector apparently considered his actions to be justified by Article 105-1.1 of the Special Provisions which provides that the contractor may be required to haul outside of the designed balance section. However, this was limited to the utilization of "suitable material" and, of course, the haul was not to exceed 1,000 feet.

even though he admitted to designating some of these areas as possible borrow sources, the findings state that this expensive borrow was accomplished by the contractor on his own without authorization.63

One of these sources, the area between 271+00 and 273+50, was described thusly: "This is the same silt material that we have all over but the moisture content was just perfect." (Project Diary of September 28, 1968.) This is apparently the type of material referred to by Mr. Lyshaug when he testified: "* * * It was basically an organic material. When it was subjected to rain or moisture to any extent it just went to pieces. It didn't have anyit doesn't have any road bearing qualities." 64 He asserted that the project inspector ignored their protestations that the material was unsuitable. Mr. Adams confirmed Mr. Lyshaug's testimony that the material over the rock was unsuitable when subject to moisture and stated “*** it didn't have any compac

63 Findings, par. 129. An illustration of the project inspector's attitude in this regard is that when Mr. Propes inquired where large boulders in the 125+00 to 150+00 area could be placed as the fills were insufficient, he was told there was unsuitable material in the area at station 120 which could be removed and the surplus rocks deposited there. (Project Diary of September 16, 1968). Yet two days later the project inspector was refusing to pay for 250 yards of material moved in order to dispose of rocks upon the ground it was unauthorized (Project Diary of September 18, 1968).

4 Tr. 233. Photos purportedly demonstrating the adequacy of finishing materials on the eastern section of the project appear in Appeal Exhibits 7 & 8 (Gov't's Exh. A). We conclude that the photos support Mr. Lyshaug's testimony that the material was unsuitable when subjected to moisture.

tion factor whatsoever." (Tr. 138.) We accept this unrebutted testimony as accurate.

The project inspector was of the view that no borrow was necessary in the area from 160+00 to 200+00 and directed PHL to finish by "cutting high spots and filling low spots" (Project Diary of September 29 and 30, 1968). PHL attempted to do so but was apparently unsuccessful. Despite this and despite his awareness of PHL's letter of September 16, 1968,65 the project inspector told Mr. Adams that he did not want to borrow anymore and to "scarify" high spots in this area (Project Diary of October 1, 1968). Thereafter scarifying and grading operations were conducted in this area (Daily Logs of October 1-3, 1968). While scarifying "high spots" is not contrary to the contract, it can in no sense be deemed a substitute for the Bureau's obligation to provide borrow.

We have previously alluded to the testimony of PHL's witnesses establishing a lack of finishing materials in 1968 (note 23, supra). The need for borrow in areas from station 174 to the east end of the project was ultimately recognized by the issuance of Change Order No. 1 on June 30, 1969 (Exh. 3). The Justification for Change Order No. 2

Exhibit 9. The letter alleged that there was a lack of material suitable for finishing from station 180 in the middle section to station 284. It requested the designation of an adequate borrow source, the establishment of an overhaul price, payment for all borrow furnished to date and that PHL be compensated for all expenses incurred in attempting to obtain suitable material.

states that an estimated 8,000 cubic yards of borrow were necessary to complete the project of which 6,000 yards were beyond the free haul distance. The mass diagram (App's Exh. 2) indicates that approximately 16,000 cubic yards of borrow were utilized in the area from station 160 in the middle section eastward to the end of the project. As noted previously, it does not appear how much of this was beyond the free haul distance. This figure would undoubtedly have been substantially higher except for the intransigence of the project inspector 66 and grade changes. While the findings (par. 133) assert that these changes were for the benefit of PHL, we find that the real reason for the grade changes was to adjust the design to actual conditions 8 and so the Bureau. would not have to pay for additional borrow (Tr. 256; Project Diary of June 19, 1969; App's Exh. 13).

67

The record is clear that PHL

6 Notwithstanding his recognition that some borrow would be necessary from station 214 eastward, the project inspector refused to buy borrow until the rock piles were placed, ditches and slopes were "pulled", and all cuts were finished (Project Diaries of July 25, and 30, 1969). While this may have been a reasonable position under Section 107 "Finishing--Roadbed", it cannot be justified under Section 102 when sufficient quantities of suitable materials are not available.

67 It appears that the grade changes in the area from stations 158 to 162 in the middle section and from approximately stations 230 to 247 in the eastern section were substantial (a foot or more) while the changes in the remainder of the area between stations 160 and 274 varied from two tenths to three tenths of a foot (Project Diaries of September 11, 12 and 20, 1968, and July 28, 1969; App's Exh. 13).

68 For example, Mr. Lyshaug testified that the grade change across the pond in the 160 area was "***, to get out of the water." (Tr. 276.)

made considerable efforts to conserve finishing material (Tr. 125, 140, 203; photos, pp. 8, 9, App's Exh. 4). We find that these efforts were reasonable under the circumstances.

Messrs. Adams, Lyshaug and Propes denied that there was excess waste on the project or that material suitable for building fills or finishing was wasted." Mr. Bilderback acknowledged that he contemplated saving the overburden for finishing (Tr. 649, 650). We have accepted as accurate the testimony to the effect that this material was largely unsuitable.

DECISION

The Government was clearly obligated to designate borrow sources if sufficient quantities of suitable materials were not available from roadway excavation as planned. That sufficient quantities of suitable material was not available is established by the record and was ultimately recognized by the issuance of Change Order No. 2 and in the justification therefor. The claim is for the additional expenses incurred in attempting to obtain finishing materials prior to the issuance of the Change Order.70

The Government defends the claim upon three grounds: (1) PHL made an inadequate site investigation; (2) PHL did not complete suf

Tr. 140, 261, 352. We agree with Mr. Adams' testimony to the effect that some wasting is inevitable (Tr. 140).

70 PHL appears to have been paid for all measurable and agreed borrow excavation.