Notes - Collins Radio Co. | Kessler, Gilmore & Kronman | August 28, 2012


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by Kessler, Gilmore & Kronman



1. Compare Briggs & Turivas v. United States, 83 Ct. Cl. 664 (1936), cert. denied, 302 U.S. 690 (1937).


2. Mississippi & Dominion Steamship Co. v. Swift, quoted in the opinion, contains (at 259) a most helpful discussion of the circumstances to be considered in determining the intention of the parties:


In determining which view is entertained in any particular case, several circumstances may be helpful, as: whether the contract is of that class which are usually found to be in writing; whether it is of such nature as to need a formal writing for its full expression; whether it has few or many details; whether the amount involved is large or small; whether it is a common or unusual contract; whether the negotiations themselves indicate that a written draft is contemplated as the final conclusion of the negotiations.  If a written draft is proposed, suggested or referred to, during the negotiations, it is some evidence that the parties intended it to be the final closing of the contract.


See further Llewellyn, Our Case Law of Contract, Offer and Acceptance, I, 48 Yale L.J. 1, 14 n.29 (1938); Massee v. Gibbs, 169 Minn. 100, 210 N.W. 872 (1926); Schwartz v. Greenberg, 304 N.Y. 250, 107 N.E.2d 65 (1952); Ryan v. Schott, 109 Ohio App. 317, 159 N.E.2d 907 (1959)


3. The predicament that confronted the supplier in the Collins Radio case was dealt with during World War II by so-called Letters of Intent issued by the government. The Letter of Intent used by the Navy Department, Bureau of Supplies and Accounts (5 February 1942) contained the following pertinent provisions:


The Secretary of the Navy finds that in the interest of National Defense it is necessary that production be not delayed awaiting the placing of the aforesaid order. You are hereby authorized to purchase such materials as are necessary for the production of the airplanes and spare parts and to proceed with the production thereof in anticipation of the placing of the order, subject to the receipt by the Purchasing Officer of notification of the items to be purchased and the estimated maximum prices and confirmation by the Purchasing Officer of authorization to proceed with such purchases.

You will agree in connection with the purchase of such material as aforesaid that you will comply with all laws pertaining or relating to the purchase of such material. All applicable contract clauses required by Federal Law to be incorporated in contracts for articles of the kind herein contracted for are hereby incorporated herein by reference. Your attention is invited to the National Defense clause included in present classified contracts.

In the event that the order for the airplanes and spare parts is not placed with you prior to 1 April 1942, the Government will, upon demand made prior to 1 May 1942, reimburse you for the cost incurred by you and will assume your obligation for any commitment which you have made in this connection. Upon payment and assumption. by the Government, title to such material, including rights under commitments assumed, will vest In the Government.


For the modern Letter of Intent (letter contract), see 41 C.F.R. §1-3.408 (as of July, 1984).


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June 02, 2014 Notes - Collins Radio Co. Notes - Collins Radio Co.

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