Case ID: us-ct-cl_5/html/0134-01.html
Source: Caselaw Access Project
Author: {"author": "Nott, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

CLYDE’S CASE, (1st.) Thomas Clyde v. The United States.
    
      On the Proofs.
    
    
      A steam ferry-boat is chartered by a quartermaster during a military emergency,. asid under proper authority, at §115 a day. Five months afterward the Quartermaster General disapproves the charter and orders that the compensation be reduced to §75 a day, the excess already paid to be deducted from future payments. The owner protests against the reduction, but alloivs the boat to remain in the service. Previously to this chartering, the boat toas employed by another quartermaster, also at §115 a day ; her pay also was reduced by the Quartermaster General to §75 a day, and she was withdrawn from the service by her owner. It appears that he neilhei’ sought the second chartering, nor disclosed to the second quartermaster the previous order of the Quartermaster General, but that $115 a day was only a reasonable compensation. The petition sets forth a second cause of action, never presented to the proper department for payment.
    
    I. Where a charter-party made "by a quartermaster under proper authority fixes the compensation for a vessel in the military service, the Quartermaster General has no arbitrary power to reduce it, either for the period already j>ast when the reduction is ordered, or for any future period during which the vessel is conrpelled to remain in the service against the request of her owner. But where the owner allows the vessel to-remain in the service after her charter has been, disapproved and a reduction of compensation ordered, he can recover only at the reduced rate. Pratt’s Case, (3 C. Cls. R., p. 105.) Finery and, Blalce’s Case, (4 id,., p. 401,) cited and approved.
    II. Concealment by the owner, at the time of chartering his vessel to a quartermaster, of the fact that the Quartermaster General once fixed her compensation at a lower rate than that now agreed upon, and ordered her discharge at the rate now given, is not a fraud if the compensation given is reasonable and the chartering was unsought by the owner. Amid other circumstances the concealment might be an important element of fraud.
    III. Alleging in a petition that the claim has been presented for piayment “to the proper department” is but the conclusion of the pleader, and not the averment of the material fact. The defendants are entitled to know to what department it has been presented. Where the suit is. brought before the claim has been presented to the proper dex>artment, it is prematurely brought.
    
      Messrs. CMjpman and Jlosmer for claimant:
    The petition contains two counts:
    1st. Claiming $10,000, as tbe balance due under charter-party of the steamer Tallacca.
    
      2cL Five thousand dollars, the value of the barge Wm. E. Hunt, destroyed by rebels, while under charter to the government.
    The allegations of the first count are, substantially, that the petitioner was, on November 16,1862, the owner of the steam ferry-boat Tallacea, and that on that day she was chartered by the Quartermasters Department, for military service, at the rate of $115 per day; that she continued in the service of the government, faithfully performing all the obligations of the charter, until July 31, 1863, when she was finally discharged; that during the continuance of the charter, the Quartermaster General, arbitrarily and without the consent of the petitioner, reduced the charter rates from $115 per day to $75 per day, on account of which there remains unpaid under the charter the sum of $10,000.
    The facts show a charter-party legally executed with the government in which a stipulated rate per day was agreed to be paid for the services of the Tallacea. That charter remained in full force from its date until the vessel was finally discharged; during its life-time, however, the Quartermaster General sought to deprive the claimant of part of its benefits, by an arbitrary reduction in the compensation agreed to be paid. This reduction was never assented to by the claimant, or any one on his behalf.
    The whole amount thus illegally withheld was $10,000.
    This barge, Hunt, we claim, is shown to have been lost by a risk of war, which the government assumed. We think the claim fully proved. The only possible question which can be suggested in defence is this, whether the loss was by marine disaster or by act of the enemy. The doctrine of remote and proximate causes is fully examined in the Mannahasset, (3 O. Cls. E., p. 76.) If the decision rendered by the court in that case be correct, and we think it is, there can be no doubt of the liability of the government in the present case.
    
      The Assistant Attorney General for the defendants:
    1. Clyde was guilty of a fraud in procuring from Quartermaster Ferguson the chartering of the Tallacea, at $115 a day. He knew that the Quartermaster General had refused to allow $115 a day on a former chartering; and that he, the owner, bad agreed to an employment of bis vessel by the United States, at $75 a day. The quartermaster, Ferguson, was ignorant of these facts. Clyde fraudulently suppressed the truth, when he knew that a knowledge of it would have prevented Ferguson from making the contract. This fraud avoided the original charty-party, and made it proper that his rate should be reduced.
    2. The chartering by Ferguson was for no fixed period; and as soon as Clyde was notified that the Quartermaster General had disapproved his charter-party, and ordered his rate of pay reduced from the date of chartering, otherwise that the vessel should be discharged, that moment the obligation of the contract ceased; and Clyde had his election to agree to the Quartermaster General’s terms, or quit the service. The fact of the vessel continuing in the service for near three months after this, is satisfactory evidence that the owner, Clyde, had accepted the terms, and agreed to take $75 a day for his whole service.
    3. No exigency is shown to have existed after the fall of 1862 to authorize the hiring of a vessel without advertisement; and the legal effect of the original charter ceased with the emergency.
    The loss of the Hunt was the result of the storm, and fell on the owner, who, by the terms of his contract, assumed the marine risk in those waters.
    This claim was never presented to the War Department for adjustment. In such case, the claimant cannot come into this coiu’t.
   Nott, J.,

delivered the opinion of the court:

There are two distinct causes of action embraced by this case: the one is a balance alleged to be due upon the charter-party of the steam ferry-boat Tallacca; the other is the value of the barge William E. Hunt, lost in the government service. For the former the damages are laid at $10,000, for the latter at $5,000.

1. With regard to the first: It appears that on November 16, 1862, and during the emergency caused by the removal of the army of the Potomac to Falmouth, the Tallacca was chartered by Captain. C. B. Ferguson, an officer in the Quartermaster’s Department, acting under the instructions of General Pucker, the chief quartermaster at Washington. A charter-party was formally executed, and the agreed compensation named therein was $115 a day.

The boat continued in the service of the government until July 31, 1863. She was paid at the agreed rate up to the last of February, 1863, without objection or question being raised on either side. But on May 13th, the Quartermaster General u disapproved” the charter-party. He at the same time made an order, that the steamboat be paid for “only at the rate of $75 per day so long as she may he retained in the service,” and “ the excess of $40^er day already paid in former settlements” “will he deducted on the present settlement.”

It does not appear in the evidence at what precise time this order was communicated to the claimant; nor whether, on being-notified of it, he determined to allow his boat to remain in the service at the redneed rate, or sought to take her out of it and terminate her employment by the government. It does appear that he was notified soon after Captain Ferguson received the order, and that “ he did not consent to the reduction,” and “offered to file a paper to that purport,” or to receive the money “ under a written protest.” The boat nevertheless remained in the service, with or without his consent, and the deduction of $40 a day from the time her service began was made and subtracted from the subsequent payment.

As to the law applicable to these facts: Two points already have been determined by this court in other cases: 1. “Where a charter-party provides a fixed compensation, the Quartermaster General has no arbitrary power to reduce it,” either as to the period already past when the reduction is ordered, or as to any future period during which “ the vessel is compelled to remain in service against the request of her owner.” (Pratt's Case, 3 C. Cls. R., p. 105.) 2. Where a party allows his vessel to remain in the service after her charter-party has been disapproved by the Quartermaster General, and a reduction of her compensation ordered, he can recover only at the reduced rate. (Emery & Blake's Case, 4 C. Cls. R., p. 401.)

The first of these decisions settles the claimant’s right to recovery tbe second limits that recovery, restricting it to the period prior to his receiving’ notice of the reduction of the compensation, and excluding the period during which he voluntarily allowed his boat to remain in the government’s service with knowledge that her charter-party had been disapproved by the Quartermaster General.

It may be noted that an opinion to the same effect was given subseqently, in a similar case, by Attorney General Evarts. (James T. Sanford’s Claim, December 9, 1868.) In this opinion the Attorney General says, decidedly: “ It was not in the power of the officers concerned with the chartering of the vessel, by their arbitrary will, to impose upon the owner the terms and conditions of any different form of charter-party to which he had never assented.” He adds: “ If the parties had agreed to-rescind the charter-party,” and “had entered into such a contract as that suggested in the circular instructions of the Quartermaster General, with a modified rate of compensation,, the rights and obligations of the parties would have been different-Or, if the government had returned the vessel to the possession of the owner, and he had agreed to any such modified charter as has been mentioned, the government would have been obliged to pay thereafter only in accordance with the stipulations of that charter.”

It is, indeed, asserted that the claimant did not consent to-the boat being retained in the service, and consequently that this is precisely like the case of Pratt, before cited. The clerk who had charge of “ all the government water transportation under Captain Ferguson,” and who has been examined as a witness in the case, talks of the Tallacca having been “retained not a very long time after that in the service;” and he also tells a story of a question having arisen “ whether if the amount due her did not make up the difference for the time for which she had been paid, we should still keep the boat until her accounts should be square at the reduced ratebut seems to .have left the question of the vessel having been detained against the will of her owner, in a state of intended obscurity.

It is contended by the defendants:

1. That the charter-party was valid only for the emergency a point also determined in Emery & Plaice’s Case, (before cited.) But it is needless to consider tbe objection, for if' the boat rendered the government service she wotdd be entitled to a fair compensation; and the evidence indicates that the-compensation agreed upon was reasonable.

2. It is also contended that the owner of the Tallaccawas. guilty of fraud in concealing from Captain Ferguson the fact that the Quartermaster General had some months before ordered, her discharge from the service at $115 a day, and fixed her rate of compensation at $75. But a court cannot impute fraud where no wrong has been done. There is no such thing in law or equity as defrauding a man out of the fair value of the thing sold. Fraud looks to injury, to wrong, to extortion, but where those ingredients are wanting, a man cannot say he has been defrauded out of the reasonable price of the thing bought. In this, case there is nothing to show that the owner sought the transaction. It would be inferred, rather, from the evidence, that the quartermaster sought the vessel. The owner, thus applied to, was not bound to disclose the fact that some time before this-the Quartermaster General had fixed the compensation of his-vessel at a rate which he had declined, nor that the Quartermaster General had forbidden her then being continued in the-service at the rate now agreed upon. Such concealment amid other circumstances might be an important element of fraud; standing alone, it is an immaterial fact.

Upon all the facts relating to this cause of action we are of' the opinion that the claimant should recover the balance of $40-a day, according to the terms of the charter-party, up to the time of his receiving notice of its disapproval by the Quartermaster General. That disapproval bears date at Washington,. May 13, 1863. It then had to be forwarded to Captain Ferguson and by him transmitted to the claimant. A day or two would also intervene before the claimant could go down to Acquia Creek or Fortress Monroe, or Baltimore, (between which places the boat plied,) and take her out of the service..' It may not be unreasonable to extend this time to the end of' the current month, and allow the claimant to recover the pay-withheld up to May 31st.

II. With regard to the second cause of action: The objection is specifically taken by the Assistant Attorney General that “ the claim toas never presented to the War Department for adjustment.V The rules of the court require that “ the petition must set forth a full statement of the claim and of the action thereon * * * by any of the departments.” Also that u in every •case where the claim is such as is ordinarily settled in any executive department, the petition shall show that application for its •allowance has been made to that department, and without success, -and its decision thereonP (Rule II.)

The petitioa here does not comply with these requirements. It alleges, in the language of the rule, that application has been ■made for payment u to the proper departmentf but that is a conclusión of the pleader and not the averment of a material fact. It is pleading the opinion of the xileader and not the circum•stance which the other party may seek to traverse. Moreover, it appears by the return of the Quartermaster General that no ■record of the claim is to be found in his department, and it does mot appear by any testimony of the claimant that the claim has been submitted to any department. As the objection is taken in the brief of the Assistant Attorney General we must conclude that the fact is as it appears to be, and that the suit on ■this cause of action is prematurely brought.

The judgment of the court is that upon the first cause of ■action in the petition set forth the claimant recover $40 a day for the 191 days, amounting to $7,640, and that as to the ■second cause of action in the petition set forth, the petition be .dismissed without prejudice.