Case ID: us-ct-cl_51/html/0043-01.html
Source: Caselaw Access Project
Author: {"author": "Downey, Judge,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

HAYWOOD B. NALLE v. THE UNITED STATES.
    [No. 30451.
    Decided January 24, 1916.]
    
      On the Proofs.
    
    
      Contract; delays in delivery; deductions.—Plaintiff, who contracted to furnish certain Army horses to the United States, sues for the recovery of amounts deducted from the contract price because of alleged delays in delivery, said deductions representing the statutory pay of the officers of the Army who composed the inspecting board for the number of days they were on duty as members of the board and their mileage from station to place of inspection and return during the periods of inspection.
    
      Performance; additional expense.—-Where wort under a contract is of such a nature that expense of inspection does not attach continuously during the contract period, and where the inspecting board was not continuously on duty during the periods of extension, deductions therefor can not be made from the contract price under a provision of the contract that deductions shall be made “ for any additional expense incurred by the United States because of the failure of the contractor ” to perform within the original contract time, in the absence of proof that the expense incurred was in whole or in part in excess of that which would have been incurred had the contract been performed within the contract period.
    
      The Reporter’s statement of the case:
    The following are the facts as found by the court:
    I. On the 27th day of May, 1907, the claimant entered into a contract with the United States, through Jesse N. Baker, captain and quartermaster of the United States Army, whereby he contracted to furnish to the United States 223 Cavalry horses and 36 Artillery horses, which number, under an optional clause in said contract, was thereafter increased by 13 Cavalry horses. The specifications were annexed to and made a part of said contract, and said contract with said specifications, marked, respectively, Exhibits A and B, are made a part of the petition. Said contract was approved by the Quartermaster General on the 13th day of June, 1907.
    II. Under the provisions of said contract claimant was obligated to furnish 20 per cent of said animals before June 30, 1907, and the remainder within 60 days after the date of the award, which by the parties was construed to mean 60 days from the date of the contract, but that on the 12th day of July, 1907, the time for the performance of said contract was by supplemental agreement in writing extended to the 27th day of August, 1907, with the following provision incorporated in said supplemental agreement to wit:
    “Provided, That any additional expense or other loss incurred by the United States because of the failure of the contractor to complete delivery by the date originally fixed for the completion shall be charged to the contractor or surety and may be deducted from any money due or that may become due under said contract.”
    III. Thereafter the time for the performance of said contract was by supplemental agreement in substantially the same form extended five times, the date for final performance of the contract by the last of said extensions being the 26th day of January, 1908. Said several extensions of the contract period were granted upon the application of the contractor and were largely because of the contention on his part that members of the inspecting board were incompetent and prejudiced and his refusal to submit horses for inspection of the board as then constituted.
    IY. Twenty per cent of the required number of horses were delivered on or before June 30, 1907, and the last of the required number were delivered and accepted on the 24th day of January, 1908, and thereafter the claimant was paid the full amount due him for horses delivered under said contract without any deduction under the provision of the supplemental contract quoted in Finding II.
    Y. After the execution of the contract of May 27, 1907, this claimant entered into other contracts for the furnishing of horses to the United States, one of which was dated November 4, 1907, and the other of which was dated January 17, 1908. On settlement with the claimant for horses delivered under the contract of January 17, 1908, which settlement was subsequent to final settlement under the contract of May 27, 1907, the United States charged against the contractor, under the provision quoted in Finding II, the sum of $2,583,65 as cost of inspection subsequent to the time provided in the original contract of May 27, 1907, for the performance thereof, and deducted said amount from the amount due the claimant under the contract of January 17,1908. Said sum was the statutory pay of the officers of the Army of the United States who composed the inspecting board for the number of days they were on duty at St. Louis as members of said board subsequent to the 27th day of July, 1907, and their mileage as such officers for various trips from different points in the United States to and from St. Louis, and said amount was made up of pay to the amount of $1,294.11 and mileage to the amount of $1,289.54. Said deduction was predicated upon the following certificate:
    “ Statement showing time occupied by board of officers and clerk to the board inspecting Cavalry horses under contract with II. B. Nalle, dated May 27,1907, during extensions of said contract, as per extra agreements of the following dates: July 12, August 16, September 14, October 22, November 25, and December 23, 1907; also mileage received by the officers composing the board from and return to station from place of inspection during period of said extensions of contract.”
    YI. The contract of November 4, 1907, was for the delivery of 14 Cavalry horses and 14 Artillery horses, which was thereafter under an optional clause in said contract increased by 2 Artillery horses, and was by said contract to be performed within 30 days. After the execution of said contract, and within the period limited, the contractor had on hand and was ready to submit for inspection and delivery horses called for by said contract, but the United States for a time refused to accept deliveries on said contract of November 4 until deliveries shordd have been completed under the contract of May 27. By reason of the refusal of the United States to inspect and receive such horses as were ready for delivery under said contract of November 4 the claimant was put to additional expense in feeding and caring for such horses, but the evidence in the case does not satisfactorily show what expense was so incurred by the claimant. The claimant was paid for the horses delivered under the contract of November 4,1907, with some deduction on account of expense of inspection after the expiration of the contract period, which deduction was afterwards allowed and paid to him, and he made no claim for additional expense incurred by him in the keeping of horses intended for delivery under said contract until the claim made in this suit.
    
      Mr. George A. King for the plaintiff. King do King were on the brief.
    
      Mr. W. F. Norris, with whom was Mr. Assistant Attorney General Huston Thompson, for the defendants:
    We can not agree with the comptroller in his opinion that claimant should have been allowed to apply horses on the later contract while the earlier remained unperformed. The comptroller may have been right in reversing the auditor’s deduction under the contract of November 4, 1907, but the quartermaster was right in insisting that the long-delayed contract should be completed. The quartermaster was perfectly reasonable. The contractor was to supply cavalry horses under each agreement, the same kind of horses for the same purpose. What was acceptable under the contract of May 27 was acceptable under that of November 4. The May contract had been extended several times for the benefit of the claimant and upon his application. The extensions requested were occasioned by delays of his own making. Why apply horses offered for the Cavalry to the contract made in November while that made six months earlier remained uncompleted ?
    There is no evidence showing any delay caused by the Government under either contract. Claimant is not entitled to damages for delay while engaged in performing his contract in delivering horses. It does not appear that the horses were delivered continuously after December 16, but when accepted were applied by the quartermaster to the completion of the earlier contract. No delay is shown by reason of this procedure or by the Government’s refusal to apply the horses first received after December 16 to the November agreement.
    
      There was no waiver of penalty, as contended by claimant. The opinion of the comptroller bears directly upon the facts of the present case, and we submit are decisive as showing the right of the Government to deduct the damages sustained under the contract of May 27 from the money due claimant under that of January 27:
    “That this deduction of damages can properly be made on a subsequent contract with claimant, having due regard to the legal rights of other parties, has frequently been held by this office. 15 Comp. Dec., 286; 7 id., 218; 6 id., 345; 2 id., 429.
    “ The case cited by claimant, St. Louis Hay and Grain Co. v. United States, 191 U. S., 159, is one of private individuals against the Government, and the reasons why such a rule as there applied does not prevail where the Government is the claimant are fully set forth in the case of the Wisconsin Central Railroad v. United States, 164 U. S., 210, 212.
    “ The Government having in its possession money due it from a party is not obliged to turn over the money to the party and go into court to establish its claim thereto. The Government in a settlement under one contract, having due regard to the legal rights of all other persons, may withhold moneys due it from the same contractor under a former contract. 7 Comp. Dec., 218; 6 id., 345; 2 id., 429; Wisconsin Centred Railroad v. United States, 164 U. S., 210, 212. 15 Comp. Dec., 286.”
    The United States Supreme Court, in the case of Wisconsin Central Railroad v. United States, at p 211, referring to the Postmaster General, says:
    “ If in his judgment money has been paid without authority of law and he has money of the same claimant in his hands, he is not compelled to pay such money over and sue to recover the illegal payments, but may hold it subject to the decision of the court when the claimant sues And in that way multiplicity of suits and security of action are avoided.”
    “ When a sum of money has been voluntarily paid by the United States to a mail contractor by mistake or fact, or any circumstances to bring the payment within the provisions of Rev. Stat., par. 4057, the amount may be applied by the Government toward the payment of any balance that may be found due him in the settlement of his accounts for their services under his contract. United States v. Carr, 132 U. S., 644.
    
      The claimant is liable for the expenses after the expiration of the original contract, and for services performed under the supplemental agreement. The comptroller in his opinion in this case says:
    “ Claimant in his third objection, supra, to the deductions made against him, assumes that because only a certain number of horses had to be inspected the period it would take to inspect them would be no greater at one time than another, and that the cost to the Government would have been the same if inspected during the time fixed in the contract, as it was when inspected after the expiration of the contract^ This might be true under some circumstances, but it certainly is not so if the contractor unreasonably delayed the contract by offering the animals for inspection in small numbers and at infrequent intervals, as claimant appears to have done. Nor can claimant be relieved from the payment of the costs of inspection by the circumstance that the inspections were made by salaried officers of the Government. (See 8 Comp. Dec., 257, 506; 14 id., 628.) All other duties and services to the Government by these officers ceased during the time they were inspecting these animals, and while they were en route to and returning from making the inspections, and no evidence has been offered by claimant to show that the expense of inspection would have been less if made by others than salaried officers of the Army.”
    Claimant delivered the horses under the contract of November 4 without making any objections as to delay on the part of the Government. The horses were accepted, the contract completed, and he received his pay without protest or objection and made none until he later decided to sue the Government. The claim for damages arose out of the same contract and any objection should have been made before final settlement. “It is well settled that where a party brings an action for a part only of an entire indivisible demand and recovers judgment he can not subsequently maintain an action for another part of the same demand.” Baird v. United States, 96 U. S., 432.
    As applicable to the facts of the pending case, the court is referred to the following language of the opinion of the court in Francis v. United States, 96 U. S., 360.
    “ Even suppose that it is so, still it is insisted by the petitioner that, inasmuch as the order of the post commander 
      
      stopping the work of hauling the wood cut within the reservation was overruled by the commanding general, he, the appellant, is entitled to recover for the damage which he suffered by his teams remaining idle for thirteen days; but the court is not able to sustain that proposition, as it appears that he delivered the wood under the contract, collected and received the contract price for the same, and gave receipts in full for the same as a transaction completed in pursuance of the written contract set forth in the petition. Competent evidence of such acts is sufficient to prove an accord and satisfaction, and they show that there is no error in the record.”
    In the above case the post commander stopped the work, but the United States was held not liable for damages arising from the act of its official to the contractor, after he had accepted payment and receipted therefor without protest.
   Downey, Judge,

delivered the opinion of the court:

We do not regard it as necessary in this opinion to repeat the material facts which are stated in the findings. Indeed, the case might be permitted to rest upon the findings of fact and the conclusion of law but for the fact that right of recovery is asserted upon different grounds, and it is therefore regarded as desirable that the basis of the court’s conclusion should be briefly stated.

The conclusion reached on another point renders it unnecessary to decide the question presented as to whether an amount subsequently found to be due the United States under the contract of May 27,1907, might rightfully have been deducted from the amount due the contractor under the contract of January 17, 1908.

As to the amount of that deduction it is apparent that it is a right asserted not under any provision of the original contract of May 27, but under the provision quoted in the findings from the contracts supplemental thereto extending the time for the performance of the original contract. As to the amount itself, it is plainly apparent that it was an amount of money primarily due the contractor because of his performance of the contract of May 27, as extended, and paid him as such. The right to a subsequent deduction from other moneys found due the contractor is an asserted right under the provision quoted, as to which it seems quite clear that the burden is on the United States.

That right under the provision of the supplemental contracts was a right to deduct from any money due or that might become due the contractor under the original contract the amount of any additional expense incurred by the United States because of the failure of the contractor to perform the contract within the time originally fixed. The only evidence before the court in support of the exercised right of deduction is the departmental certificate, the caption of which is quoted in Finding V. This certificate shows that the amount of the deduction is for the pay and mileage of the members of the inspecting board for all of the time of their service in making inspections under all of the supplemental contracts of extension; in other words, the total expense of inspection subsequent to the time provided in the original contract for the performance thereof. There is no assertion in this certificate, and it does not otherwise appear in the evidence, that any portion of this expense is an expense additional to that which must have been incurred by the United States in the inspection of these horses had the deliveries been made within the original contract period. It is quite apparent from the entire record in the case that had deliveries been made within the original contract period, some portion of this expense, if not all, must necessarily have been incurred, and in the absence of proof that the expense in question, or some portion thereof, was an additional expense made necessary by the extensions of time granted by the supplemental contracts the court can not indulge in presumptions to that effect.

It is urged in support of this deduction that it has been held in similar cases that all expense of inspection subsequent to the expiration of the period provided in a contract for its performance is necessarily to be regarded as additional expense. We do not understand that such has been the holding in any contract of this character. If so, it was clearly unjustified. Where the work to be performed under a contract is of such a nature that expense of inspection attaches continuously during the contract period, it must necessarily follow that expense of inspection subsequent to the.expiration of the original contract period is additional expense. But that theory can not apply in the instant case. The members of the inspecting board were not continuously upon this duty during the original contract period; they were not continuously on duty during the periods of extension; they were on duty a few days at a time when their services were needed, and it nowhere is made to appear that these days of service were in whole or in part additional to the days of service which would have been required in the event of performance within the original contract period. The United States has not sustained its right to the deduction or any part thereof. We, therefore, do not find it necessary to consider the other question raised as to whether or not under other circumstances the United States might charge as an additional expense the pay of an officer of the Army who receives continuously a statutory compensation. Neither do we find it necessary to comment upon or consider the fact that this contractor was charged with mileage of officers in large amounts for repeated trips from points very remote from the place of inspection.

Upon the other feature of the case it is sufficient to say that even if we should conclude that the United States was responsible for delay in delivery under the contract of November 4,1907, and that the contractor was entitled to recover for any additional expense to which he was subjected on account of that delay, the evidence as to that expense is too unsatisfactory to justify any finding by the court in his favor.

It is, therefore, concluded that the claimant is entitled to recover the sum of $2,583.65, and judgment is awarded accordingly.

All judges concur.