American Surety Co. v. Westinghouse Electric Manufacturing Co.

A contract for drilling a well at the Naval Air Station at Pensacola, Florida, was made in November, 1930, between Melton J. Gray and the United States Government. It was drawn in the standard form. Payments were to be made in accordance with approved estimates during the progress of the work, but the contracting officer was required to retain 10% of the estimated amount “ until final completion and acceptance of all work covered by the contract.” The percentage might be reduced in stated contingencies. A bond was to be given for the protection of the Government and of persons supplying labor…