Case ID: us-ct-cl_57/html/0453-01.html
Source: Caselaw Access Project
Author: {"author": "Campbell, Chief Justice,\n    ", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

DELAINE MILLS (INC.) v. THE UNITED STATES.
    [No. 34125.
    Decided June 19, 1922.]
    
      On the Proofs.
    
    
      Dent Act; award of hoard; acoeptmee of award. — Where plaintiff, claiming under an agreement executed by an officer who bad no authority to bind the Government, files a claim under the provisions of the Dent Act with a War Department board, which makes an award unsatisfactory to plaintiff, who appeals to the board of contract adjustment, which increases the award and files an order stating that said award is “ in full adjustment, payment and discharge of said agreement,” and plaintiff' indorses thereon its acceptance of said award, which is thereafter paid to it, plaintiff is bound by the adjudication of said board and can not maintain an action in the Court of Claims-for the balance of said claim.
    
      The Reporter's statement of the case:
    
      Mr. O hartes E. Hendrickson for the plaintiff.
    
      Mr. Lisle A. Smith, with whom was Mr. Assistant Attorney General Robert H. Lovett, for the defendant.
    The following are the facts of the case as found by the court:
    I. Plaintiff is a corporation organized under the laws of the State of Pennsylvania with its principal office at Baker and Mallory Streets, Philadelphia. It has borne true faith, and allegiance to the United States.
    II. The plaintiff was, during the period covering the transactions mentioned herein, lessee of a manufacturing plant or mill with 68 looms and equipped for manufacturing goods-known as khaki O. D. shirting flannel and melton cloth. The plaintiff bought the yarn, wove it, scoured the cloth, dyed and finished it. The terms of the lease and the amount of the rental are not shown by the evidence. The average weekly maintenance charge while the mill was in operation was $1,501.16.
    III. During the war with Germany the plaintiff made several agreements with the Quartermaster’s Corps, all of which were suspended under orders of the War Department after the armistice. Among these was the agreement hereafter mentioned. After the suspension, the plaintiff made application to the board of contract adjustment organized by the Secretary of War, under the act of March 2,1919 (40 Stat. 1272), commonly known as the Dent Act. The claims asserted as growing out of all these agreements, except the one mentioned below and a distinct item also mentioned, were disposed of by the board and accepted by plaintiff. All of such claims mentioned in the petition herein were abandoned by plaintiff, except the two items mentioned.
    The president of the plaintiff company states that of all the five items set forth in the petition herein, aggregating $108,844.37, all have been settled and paid by the Government except a part of the claim based on what is called “ contract No. 889-P.” This claim was for $16,574.94, and payments thereon have been made through action by the board, which leaves the balance of the asserted claim to be $10,266.75.
    IY. The plaintiff’s bid to furnish and deliver certain goods having been accepted, a contract was drawn up and forwarded to plaintiff for signature. It was dated February 11, 1918, and is known as No. 889-P. It called for the delivery of approximately 65,000 yards O. D. melton (mill style No. 131) at approximately 10,000 yards per month, to be completed by or before August 31, 1918, and 60,000 yards O. D. melton (mill style No. 621), deliveries to be completed on or before July 31,1918, both as per sample and at $2.85 per yard. In its offer of January 31,1918, the plaintiff had offered approximately 60,000 yards of style 621 and approximately 40,000 yards of style 131, and stated that it had “ the yarn and can further offer about 25,000 yards additional of style 131.” The contract is not produced or shown in evidence. It appears, however, that it was signed by the plaintiff, by its duly authorized officer and agent, and on behalf of the Government it was not signed by a duly authorized officer or agent of the United States. As signed, it failed to comply with the provisions of section 3744 Revised Statutes. The agreement was made on behalf of the Government by an officer acting under the authority or direction of the Secretary of War, but has not been executed in the manner prescribed by law.
    
      V. While the plaintiff was engaged in the manufacture of the meltons mentioned in the agreement, in March, 1918, the General Staff decided upon a change of the 16-ounce meltons to 20-ounce, and this matter was brought to plaintiff’s attention orally. On March 28, 1919, a communication from the Supply and Equipment Division, Woolens Branch, Quartermaster General’s office, was addressed to and received by the plaintiff, as follows:
    “ You have Government contract number 889 dated 2/11/18 for a total of 60,000 yards of 16-ounce melton.
    “The General Staff has ordered that the weight of this fabric be increased to 20 ounces and has issued new complete specifications therefor, copy of which is attached.
    “ You are instructed to take at once the necessary steps to make all future deliveries under this contract conform to the new specifications as to weight and otherwise to conform to the new specifications as far as possible, using the material you have purchased for the fulfillment of this contract.
    “ (You will be expected to deliver the same total poundage which is provided for in your present contract — the number of yards being reduced pro rata.)
    “An adjustment of price will be made without delay.
    “ Please answer the following questions at once:
    “How soon can you start deliveries of 20-ounce fabric?
    “Plow soon can all your deliveries be 20 ounces?
    “ How much fabric on contract will you necessarily have to deliver 16 ounces?
    “It is necessary that we receive this information by April 8th.”
    A duplicate of this communication of March 28 (excepting only that the yardage in the latter is 65,000) was sent and received with the same.
    Under date of March 30, the plaintiff replied as follows:
    “In reply to your letter of March 28th, concerning contract #889-P, for 16 oz. melton, would say that we. can change 75,000 yards on this contract to a proportionate number of yards of a 20-oz. fabric made like the swatch sent Captain Andrews on March 22nd.”
    And on April 10 plaintiff again wrote:
    “We confirm conversation the writer had with Lieutenant Wood in Washington on Monday, April 8th. We have changed a certain yardage of 16 oz. goods yet to be made on contract #889-P, to a 20 oz. melton. We will be able to make approximately 60,000 yards of this 20 oz. cloth, represented by onr samples submitted, styles #326 and 400.
    “ This 60,000 yards will be delivered in approximately even amounts during the months of May, June, July, and August, and the contract completed according to arrangements of contract #889-P.”
    On April 15, 1918, Col. Hirsch, Quartermaster Corps, purchasing and contracting officer, by Capt. Schofield wrote plaintiff as follows:
    “1. Referring to your contract No. 889-P, dated Feb-' ruary 11, 1918, for furnishing and delivering 125,000 yards 16 oz. O. D. melton to this corps, you are informed tliat in order to provide for the changing over from 16 oz. to 20 oz. O. D. melton, supplemental agreement thereto, dated April 15, 1918, will be immediately prepared in this office and forwarded to you for execution.
    “2. This supplemental agreement will provide for the cancellation of all the 16 oz. melton contracted for at $2.85 per yard, remaining undelivered and not now in the process of manufacture, and for you to furnish and deliver in lieu thereof approximately 60,000 yards 20 oz. O. D. melton, construction 6 harness twill, as per submitted samples No. 326 and 400, in all other respects to conform to original contract requirements at $3.56 per yard.
    “ 3. All the other terms and conditions of the said original award are to remain unchanged.
    “4. Please acknowledge receipt.”
    On April 18 plaintiff replied to this letter:
    “We have your favor of the 15th instant notifying us that supplemental agreement to contract. #889-P is being executed. We beg to state that we have been dressing only for the 20-ounce goods since Mr. Bosworth received your verbal instructions to do so when in Washington last week. As soon as the supplemental agreement is received we will execute the same.”
    Thereafter, but under date of April 15, the supplemental-agreement drawn in compliance with said letter and modifying the agreement No. 889-P, was executed by the plaintiff and was signed by Capt. Schofield for Col. Hirsch. The price stated was $3.56 per yard for the 20-ounce material instead of $2.85 for the 16-ounce material. It called for approximately 60,000 yards of the 20-ounce O. D. melton. At the time the said supplemental agreement was made the plaintiff had furnished about 32,500 yards of 16-ounce mel-ton. It finally delivered 33,195£ yards of 16-ounce melton at $2.85 per yard and 54,159|- yards of 20-ounce melton at $3.56 per yard, and was paid therefor $287,415.88 besides some other payments hereafter mentioned.
    VI. The plaintiff was directed to suspend operations upon the work shortly after the armistice was signed, and later signed a cancellation agreement, but neither the agreement nor a copy of it appears in the record. The plaintiff filed its claim based upon its several agreements with the claims board and board of contract adjustment. There was awarded to plaintiff by said boards amounts satisfactory to plaintiff upon four of the agreements set forth in Paragraph XIV of its petition, and any claim upon them has been abandoned. The claim asserted is upon what is called contract No. 889-P “ for material left on hands of petitioner and yardage taken by the United States $16,574.94.” Upon this claim plaintiff has conceded deductions of $3,111.45 and $3,196.74, the latter being the award of the board of contract adjustment, leaving the item of claim $10,266.75. An additional claim for damages is alleged in the petition (Paragraph XVIII).
    Plaintiff presented claims under all of its said contracts to the claims board or the board of contract adjustment, and accepted settlements made by one or both of these boards. "When the board of contract adjustment decided to allow the additional item of allowance, $3,196.74, it made an order to that effect, in which was stated that said sum was awarded “in full adjustment, payment, and discharge of said agreement,” the same being said contract No. 889-P. This award was accepted in writing by the plaintiff under date of June 9, 1919, and payment thereof ivas duly made to and accepted by the plaintiff.
    Plaintiff had left on its hands a number of pounds of yarn, being the difference between the amount that would have produced 73,443.6 yards and the amount necessary to produce 60,000 yards of 20-oz. melton, and this difference in pounds was of the reasonable cost of $10,266.75. When the supplemental agreement changing from, 16-oz. to 20-oz. meltons was made, plaintiff did not accurately determine the amount of poundage of yarn that would be used in making the change.
   Campbell, Chief Justice,

delivered the opinion of the court:

The case as presented upon the record and proofs is in an unsatisfactory condition. The plaintiff filed a petition claiming a large sum on five separate contracts. It appears that these contracts were not executed on behalf of the Government by an officer authorized to bind it as required by section 3744, Eevised Statutes, though the officer making each agreement itself did so under authority or direction of the Secretary of War. If the suit had proceeded upon the petition that was filed it is manifest that the plaintiff could not recover for the items claimed, because his recovery would be limited to the goods delivered to and accepted by the Government in the absence of a legally executed contract. St. Louis Hay & Grain Co. case, 37 C. Cls. 281, 191 U. S. 159; Monroe case, 184 U. S. 524; Clark case, 95 U. S. 539. But the plaintiff applied to the claims board. Its claims there were predicated upon the allegations in its petition that a contract had not been executed in the manner prescribed by law. This board considered the several claims. An appeal from the action was taken by plaintiff to the board of contract adjustment created by the Secretary of War, under the Dent Act, 40 Stat. 1272. This board made an award upon the agreement in question amounting to somewhat more than $3,000 in excess of the allowance by the claims board. With the allowances under the other contracts, whether made by the one board or the other, the plaintiff expresses satisfaction. The board of contract adjustment entered an order following the terms of the Dent Act reciting an award to plaintiff in the sum of $3,196.74, “ in full adjustment, payment, and discharge of said agreement,” and indorsed upon said award is its written acceptance by plaintiff under date of June 9, 1919. This amount was paid to and accepted by the plaintiff.

The award and acceptance are conclusive upon the plaintiff’s rights under the Dent Act. It is true that section 2 of the act authorizes this court to proceed on petition duly filed in the court where the party affected “shall not be willing to accept the adjustment, payment, or compensation offered by the Secretary of War,” or in the event that he shall fail or refuse to make a satisfactory adjustment. But when the matter has been presented to the Secretary, or the board organized by him to hear and consider it, and an adjustment is offered and accepted as in this instance, there is no basis for further proceeding in the Court of Claims. A salutary purpose of the Dent Act was to produce adjustments and settlements of a specified character of claims and not merely to produce or foster litigation. If the party accept the award the purpose of the act is accomplished, and there is no need of further litigation. Another point, mentioned so as not to appear to be entirely ignored, is that there is an absence in this case of a showing that an appeal from the Board of Contract Adjustment was prosecuted to the Secretary of War. We held in United States Bedding Co. case, 55 C. Cls. 459, that action by the Secretary of War was essential to give jurisdiction to this court under the Dent Act. Whether the board’s action should be taken as that of the Secretary, where a complaining party refuses to accept the board’s award, it is not necessary to now decide ; but where the award has been accepted and paid there was left nothing to appeal to the Secretary and nothing to bring to this court.

We have made a finding of facts. The plaintiff has been fully compensated under the terms of its supplemental contract. It intelligently agreed to the modification, itself stated the amount of yardage, and the suggested theory that the “poundage” was to be the same is not tenable. For the 16-ounce melton it was to receive $2.85 per yard, and for the 20-ounce melton it was paid at the rate of $3.56 per yard. It can not be relieved from its own contract by anything set forth in the record, and we say this upon the assumption that the contract was mutually binding. As already stated, however, the contract was not executed as required by law and could not be enforced against tthe Government, except for the Dent Act.

The petition should be dismissed, and it is so ordered.

Graham, Judge; Hat, Judge; DowNet, Judge; and Booth, Judge, concur.