Petitioner contracted with the Federal Surplus Commodities Corporation of the United States Department of Agriculture to supply dried eggs under the Lend-Lease Act of 1941. Delivery was to be made on the "first day of a 10-day period within which the F. S. C. C. will accept delivery." The ten-day period started on May 18, 1942, and the eggs were to be inspected and ready for shipment on that date. Two provisions for "liquidated damages" were stated: one for delays in delivery, the other for failure to have the products inspected and ready on the specified dare. Petitioner failed to have the products ready by May 18, but they were ready before delivery was requested. The government claimed damages on the strength of the second liquidated damages provision, and was upheld in the Court of Claims. On certiorari, held, reversed. The provision was for a penalty and therefore void. Four justices dissented. Priebe & Sons, Inc. v. United States, (U.S. 1947) 68 S.Ct. 123·.
Hubert L. Rowlands S.Ed.,
CONTRACTS-LAW APPLYING TO GOVERNMENT CONTRACTS-PENALTY CLAUSES,
Mich. L. Rev.
Available at: https://repository.law.umich.edu/mlr/vol46/iss5/10