Summary
On hath parties’ Appeals.
The Reporters’ statement of tlie case:
It will be observed tliat tlie Supreme Court does not pass upon the principal questions discussed in tlie court below, viz, whether tlie contracts were void tui dor tire advertisement acts; whether an action will lie to recover back money allowed to a contractor by the accounting officers of the Treasury, &c. The court treats both contracts as valid, and discusses merely the true construction to be given to them. Tlie findings of fact on which the Supreme Court adjudged the case are fully set forth in the report of the case in 12 Court Claims lieport, 504. Tlie following-are the contracts on which the suit was brought. It will he noticed that in the opinion of the Supreme Court they are spoken of as identical in terms, but the term utimothy or ppuirie hay,” on which the court lays great stress, is not to be found in the first contract:
“ Articles of agreement entered into this 20th day of June, 1864, between Captain Greene Durbin, assistant quartermaster or volunteers in the service of the "United States of America, of the one party and Henry E. McKee, of Fort Gibson, Indian Territory, of the other part.
“This agreement witnesseththat tlie said Captain Greene Dur-bin, for and on tlie behalf of the United States of America, and the ■said Henry E. McKee, for himself, his heirs, executors, and -administrators, have mutually agreed, and by these presents do mutually covenant and agree, to and with each other, as follows, viz:
“I. That the said Henry E. McKee .shall deliver at the post of Port Gibson one thousand tons of hay; and, further, shall deliver, at or within the distance of seven miles from said post, the further quantity of two thousand tons of hay, said two thousand tons of hay to be put up in good stacks of not less than one hundred tons to the stack and not less than four hundred tons at one point.
“ The delivery of the said three thousand tons shall commence on or before the 15th day of July and be all delivered on or before the 1st day of September, 18G4.
“The said Henry E. McKee agrees to furnish the additional quantity of three thousand tons of hay or less, as the assistant quartermaster may elect, upon receiving from the said quartermasters timely notices, either at the post of Fort Gibson or within a distance of seven miles from said postyfor which additional amount the said Henry E. McKee shall be paid as set. forth in paragraph II of this notice.
“II. The said Henry E. McKee shall receive thirty dollars per ton for each and every ton of hay delivered at the post of Fort Gibson, and twenty-two dollars per ton for each and every ton of hay delivered within a distance of seven miles, subject to the restrictions in paragraph I as to the quantity to be delivered- at any one point.
“III. Payments shall be made upon the acceptance of each one thousand tons in certified accounts or such funds as the assistant quartermaster may have for that purpose.
“IV. In case of failure or deficiency in the quality or quantity of hay stipulated to be. delivered, then the assistant quartermaster shall have power to supply the deficiency by purchase, special contract, or otherwise, and the said Henry E. McKee shall be charged with the difference of cost.
“ V. It is expressly unclerstoodby the contracting parties hereto that sufficient guards and escorts shall be furnished by the Government to protect the contractor while engaged in the fulfillment of this contract.
“ VI. No member of Congress, officers, or agents of the Government, or any person employed in the public service, shall be admitted to any share herein or any benefit Avliich may arise herefrom.
“ In witness whereof the undersigned have hereunto placed their hands and seals the dav and date first above written.
“ GBEENE DUBBIN,
“ Oapt. cmd A. Q. M., U. 8. Vols.
“HENBY E. MCKEE,
“Fort Gibson, Indian Territory.
“ In presence of Avitnesses to both signatures—
“Thomas G. Wildman.
“ Charles N. Hahn.
“ Approved.
« JOHN M. THAYEB,
“Brig. General, Commanding
■‘Articles of agreement entered into this 18th day of July, 1864, between Captain Greene Durbin, assistant quartermaster of the United States Yolunteers, of the one part, and Henry E. McKee, of Fort Gibson, Indian Territory, of the other part.
“This agreement witnessetli that the said Captain Greene Dur-bin, for and on behalf of the United States of America, and the said Henry E. McKee, for himself, his heirs, executors, and administrators, have mutually agreed, and by these presents do mutually covenant and agree, to and with each other, as follows:
“I. That the said Henry E. McKee shall deliver at Cabin Creek, forty (40) miles from Fort Gibson, C. N., and at Hudson’s Crossing of the Neosho River, seventy (70) miles distance from the fort, and each of said points, on the direct route of supplies from Fort Scott, Kansas, to Fort Gibson, C. N., four thousand (4,000) tons of timothy or prairie hay, two thousand (2,000) tons to be delivered at each of the above-mentioned points.
“ The delivery of each two thousand tons shall commence on or before the 10th day of August, 1864, and all delivered on or before the 25th day of September, 1864.
The hay to be put up in good stacks of not less than one hundred tons to the stack, and all of said hay to be stacked at the posts established at those points.
“ II. The said Henry E. McKee sh all receive thirty dollars ($30) per ton for each and every ton of hay delivered and accepted.
“ III. Payments to be made upon the acceptance of each one thousand tons in certified accounts or such funds as the assistant quartermaster may have for that purpose.
“IV. It is expressly understood by the contracting parties hereto that sufficient guards and escorts shall be furnished by the Government to protect the contractors while engaged in the fulfillment of this contract.
“V. No member of Congress, officer, or agent of the Government, or any person employed in the public service, shall be admitted to any share or any benefits which may arise herefrom.
“ In witness whereof the undersigned have hereunto placed their hands and seals the day and date first above written.
(Signed) “GREENE DURBIN,
“ Oapt. and A. Q. M., TI. 8. Vols.
(Signed) “ HENRY E. McKEE,
“ Fort Gibson, Indian Territory.
“ In presence of witnesses to both signatures—
“Eli Evans.”
Messrs. 8. TV. Jolmston and R. B. Warden for the claimant: Was the contract of June 20, 1864, in -any measure violative of the Act March 2, 1861 (Rev. Stat., p. 738, § 3709; 12 Stat L., p. 220)—
“That all purchases and contracts for supplies or services iu any of tbe departments of the Government, except for personal services, when the public exigencies do not require the immediate delivery of the article or articles or performance of the service, shall be made by advertising a sufficient time previously for proposals respecting the same. When immediate delivery or performance is required by the public exigency, the articles or service required may be procured by open purchase or contract, at the places and in the manner in which such articles are usually bought and sold or such services engaged between individuals.”
The contract in question here was made after but not pursuant to the advertisement. Neither the quartermaster nor the contractor was compelled to adhere to the advertisement or to the proposal. Either could, and both evidently did, change their minds. The contract is the only evidence of the final agreement ■of the parties, and both the advertisement and the proposal were merged in it.
There had been no informal contract. There had been no •contract whatever till the paper under notice was completely signed. Till then, it is quité clear, no one was bound. Indeed, the advertisement had expressly warned the bidders that it was not itself to be taken as a proposal, the acceptance of which, Avith the acceptance of a counter-proposal, would constitute a contract; for the advertisement said: “The right is reserved to reject, any and all bids, as the interests of the service may require.” But no such reservation was necessary. Had there been no reserA'ation, the officer Avould still ha\re been en tirely unbound. But if he AAras not bound, Iioav could McKee be bound before a mutual agreement had been arrived at, reduced to writing, and signed by the parties to it? The law required that the contract-should be reduced tó AAuiting and signed by the contracting-parties. (ReA". Stat., p. 743, § 3744.)
The true reading of the statute, so far as it here requires construction, makes it mean that the contracts or purchases shall be made after adArertisement, the word “by” here denoting no more than after. (See Speed’s Case, 8 Wallace, 77.)
This court, in Harris v. Runnels (12 How., 7!)), well holds that, before the rule that a contract in Adolation of a statute is therefore invalid can have application to a statute that does not declare that such shall be the legal consequence of violation, the enactment as a whole must be examined, so as to discover whether or not the legislature meant that a contract out of harmony with it is on that account to be held AToid.
We refer also to Bivnh U. 8. v. Bandridge (12 Wheat., 64); Thompson v. Ocm-oll (22 How., 422); Cole v. Green (6 Man. & Or., 872, 890); Holland v. Osgood (8 Yt., 279); Pease v. Morriee-(2 Ad. & EL, 96); Bladen v. Philadelphia (60 Penn. St., 466).
The opinion in this case in the court below says: “The contract was in form a contract of sale and delivery, but in substance a contract for wort and service. When I employ a man to go upon my land and cut and delivermy hay at so much per ton, the property remains in me, whatever be the form of the agreement, and what I pay him is not for his property in the hay, but for the labor which he has expended upon it. Here the hay indisputably was to be cut upon the public domain, and the property in it was and remained in the defendants. But the point need not be discussed, for it was considered in 8peneer,s Case (10 O. Gis. B., 255), and expressly so decided. If the defendants’ officers had arbitrarily refused to furnish a guard, clearly the contractor would have been relieved from his obligation to perform.”- (Porter’s Case, 9 C. Cls. B., 356.) In this case, the property in the grass out by McKee was expressly reserved by the United States by article 3 of the- Cherokee treaty of December 29,1835. (Stat L., vol. 7, i>. 478.)
Consideration of the contract dated July 18, 1864, involves-construction of the Act of July 4, 1864, in which we have these words:
“When an emergency shall exist requiring the immediate procurement of supplies for the necessary movements and opera-tians of any army or detachment, and when such supplies cannot be procured from any established depot of the Quartermaster’s Department, or from the head of the division charged with the duty of furnishing such supplies, within the required time, then it shall be lawful for the commanding officer of such army or detachment to order the chief quartermaster of such army or detachment to procure such supplies during the continuance of such emergency, but no longer, in the most expeditious manner, and without advertisement; and it shall be the duty of such quartermaster to obey such order, and his accounts of the disbursements of moneys for such supplies shall be accompanied by the order of the commanding officer, as aforesaid, or a certified copy of the same, and also by a statement of the particular facts and circumstances, with their dates, constituting such emergency.”
We maintain that the fact that it was not till the 30th of July,. 1864, that Quartermaster-G-eneral Meigs (see General Orders,. No. 30) promulgated the act of Congress here referred- to, in general orders, for tbe information of tbe officers and agents of tbe Quartermaster’s Department, is a matter to be judicially noticed by tbe court, because it is a matter of pubbe bistory. It is also matter of public bistory tbat tbe organization contemplated by tbe affieady-cited provisions of said statute was not made till tbe following December. (See General Orders, No. 62, dated December 23,1864.)
Section 3 provides for tbe establishment of depots from time to time at places convenient to tbe principal armies in tbe field, but allows tbe Quartermaster-General or tbe beads of divisions to cause supplies to be sent from tbe place of purchase directly to tbe quartermasters of tbe commands for whose use tbe supplies are. procured, where it may be more, economical or advantageous to do so.
Where supplies are not, so furnished, and when they cannot be procured from any established depot of tbe Quartermaster’s Department or from tbe bead of tbe divisions charged with tbe duty of furnishing them, within tbe time required by an emergency, as contemplated by clause first of section 4, tbe power of tbe commanding general is called into exercise. Tbe findings clearly show tbat this must have happened in tbe case of tbe contract here in question.
Tbat tbe action of tbe commanding general was, in point of fact, such as tbe law sanctioned, and tbat tbe subordinate action of Captain Durbin was, in point of fact, such as the law authorized, is, we think, sufficiently set forth in tbe opinion of tbe court, below.
Wo refer, however, to tbe case of Motory v. V. ■8. (2 C. Cls. K., 68); in which tbe court said: “A contract to construct 100 railroad cars, 50 to be delivered in 18 days and 50 in 30 days, is an immediate performance within tbe. meaning of tbe act.”
Tbe petitioner’s first claim was for damages ari sin g from tbe failure of tbe Government to fully protect 1dm and bis subcontractors in tbe fulfillment of bis first contract, dated June 20,1864, whereby be lost the profits thereof and certain property employed in performing tbe work. Had the quartermaster tbe right to insert, this stipulation for sufficient escort and guards into this particular contract? It was made after due advertisement and the reception of proposals; therefore it is based upon them, and its terms are limited by them so far as these things impose limitations upon tiie contents of any contract. If they do not form part of the final contract, they determine what it is that is to be contracted for; and any substantial and vital variation will be the execution of a different contract from that suggested by the advertisement, and for which the bidders sent in their proposals. To malee such a change in favor of the contractor would be unjust toward his competitors, whose bids were based upon the theory of a strict compliance with the advertised terms.
The advertisement, proposals, and their acceptance substantially make up the contract which is to be subsequently formally written out and executed. How important the variation was in the present instance is perceived by noting that it constitutes the whole ground of the claim under this first contract. The advertisement offered only such protection as the interests of the public service would permit; the contract stipulated for absolute security; and the failure to afford it arose from the necessities of the public service. Other bidders understood they must take their chances of hostile interference; Mr. McKee is promised complete immunity from it.
If the clause which is the basis of his claim was improperly inserted, of course the United States have a right to a refund •of its moneys paid to the claimant without any authority of law.
The second contract was entered into, without any previous advertisement, upon the 18th of July, 1804, a fortnight after the passage of tlie.Mci of July 4, 1864, c. 394, c. 253, 13 Stats., 394 ■el seq.; see p. 396, § 4.
It will be noticed, by referring to this section, that the “emergency” which is to justify the omission to advertise must be one “requiring the immediate procurement of supplies for the necessary movements and operations of an army or detachment,” &c., and not simply for its future support in fort, garrison, or quarters.
That no such emergency existed, requiring the adoption of the course pursued in this case, is evident from the period of time to be covered by the contract and for its general tenor.
Therefore the contract was illegal and invalid, and all sums paid under it, for matters from .which the Government derived no benefit, may be reclaimed.
The payments made to him by the Treasury Department were not upon any such accounts as its officers a.re authorized finally to adjust. They profess to be for damages, but they cannot be called liquidated damages, because the claimant does not acquiesce in the liquidation, but sues for and recovers more in this action. The items are not those which could be filed in set-off in a suit in court. (St. Louis Ins. Go. v. Homer, 9 Met., 42.)
“Balance of account,” as used in the act conferring jurisdiction upon the county courts, is thus defined by Pollock, C. B.: “The term ‘balance of account’ means after payment of part, or after allowance of set-off, as an item in account with the agreement of the parties, which is equivalent to payment of part, and not when the plaintiff claims more than twenty pounds after a simple set-off.” (Avarcls v. Rhodes, 8 Exch., 316.) It shows that the power to determine and act upon a balance of account is confined to items strictly of account, and not to sums stated as liquidation of damages for torts or breaches of contract. (Woodluans v.Heicman, 7 O. B., 654; JBeswiek v. Capper, id., 669, being 62 Eng. C. L. Eeps.)
Syllabus and headnotes are prepared by the reporter or publisher, not the court, and are not part of the opinion.
