#### C. E. SCHAFF, RECEIVER OF MISSOURI, KANSAS & TEXAS RAILWAY CO., v. THE UNITED STATES.

[No. 30230.

Decided June 7, 1920.]

*On the Proofs.*

*Contract; transportation of mails; readjustment of*compensation.— This ease comes within the rule laid down in *Delaware, Lackawanna*<£ *Western R. R. Co.,*v. *United States,*51 C. Cls., 426 ; 249 TJ. S., 385, and the plaintiff is entitled to recover for the reduction of its compensation during the period it rendered service under the original adjustment order.

*The Reporter’s*statement of the case:

*Messrs. F. Garter Pope*and *Benjamin Garter*for the plaintiff.

*Mr. J. Robert Anderson,*with whom was *Mr. Assistant Attorney General Frank Danis, jr.,*for the defendants.

The following are the facts of the case as found by the court:

I. Plaintiff is. the receiver, duly appointed, qualified, and acting, of the Missouri, Kansas & Texas Eailway Co., a corporation organized under the laws of the State of Kansas, which for many years both prior and subsequent to July 1, 1906, had been engaged in the transportation of the mails under agreements, closed every four years, as hereinafter stated, with the Postmaster General, over certain routes, *406established on its lines by the Postmaster General and known as numbers 153010, 155018, and 155083.

II. By an act of Congress approved March 3, 1873, 17 Stat., 558, it was provided as follows:

“ That the Postmaster General be, and he is hereby, authorized to readjust the compensation hereafter to be paid for the transportation of the mails on railroad routes upon the conditions and at the rates hereinafter mentioned, to wit, that the mails shall be conveyed with due frequency and speed; that suitable and sufficient room, fixtures, and furniture, in a car or apartment properly lighted and warmed, shall be provided for route agents to accompany and distribute the mails; and that the pay per mile per annum shall not exceed the following rates, namely, on routes carrying their whole length an average weight of mails per day of two hundred pounds, fifty dollars; five hundred pounds, seventy-five dollars; one thousand pounds, one hundred dollars; one thousand five hundred pounds, one hundred and twenty-five dollars; two thousand pounds, one hundred and fifty dollars; three thousand five hundred pounds, one hundred and seventy-five dollars; five thousand pounds, two hundred dollars, and twenty-five dollars additional for every additional two thousand pounds, the average weight to be ascertained in every case by the actual weighing of the mails for such a number of successive working days, not less than thirty, at such times, after June thirtieth, eighteen hundred and seventy-three, and not less frequently than once in every four years, and the result to be stated and verified in such form and manner as the Postmaster General may direct : *Provided*also, That in case any railroad company now furnishing railway post-office cars shall refuse to provide such cars such company shall not be entitled to any increase of compensation under any provisions of this act: *Provided*further, That additional pay may be allowed for every line comprising a daily trip each way of railway post-office cars at a rate not exceeding twenty-five dollars per mile per annum for cars forty feet in length; and thirty dollars per mile per annum for forty-five feet cars; and forty dollars per mile per annum for fifty-feet cars; and fifty dollars per mile per annum for fifty-five to sixty feet cars: *And -provided*also, That the length of cars required for such post-office railway-car service shall be determined by the Post Office Department, and all such cars shall be properly fitted up, furnished, warmed, and lighted for the accommodation of clerks to accompany and distribute the mails: *And provided*further, That so much of section two hundred and sixty-five of the act approved June eighth, eighteen hundred *407and seventy-two, entitled ‘An act to revise, consolidate, and amend the statutes relating to the Post Office Department.' as provides that ‘ the Postmaster General may allow any railroad company with whom he may contract for the carrying of the United States mail3 and who furnish railway post-office cars for the transportation of the mail, such additional compensation beyond that now allowed by law as he may think fit, not exceeding, however, fifty per centum of the said rates,’ be, and the same is hereby, repealed.”

The weighings in 1874 and 1875 under said act of March 3, 1873, required for the fixing of the compensation of the railroad companies for the fiscal years ending June 30,1875, and June 30, 1876, were made by the railroad companies concerned. An act of Congress approved March 3, 1875, 18 Stat., 340, 341, entitled “An act making appropriations for the service of the Post Office Department for the fiscal year ending June thirtieth, eighteen hundred and seventy-six, and for other'purposes,” contained the following provision :

“ Out of the appropriation for inland mail transportation the Postmaster General is authorized hereafter to pay the expenses of .taking the weights of the mails on railroad routes, as provided by the act entitled ‘An act making appropriations for the service of the Post Office Department for the year ending June thirtieth, eighteen hundred and seventy-four,’ approved March third, eighteen hundred and seventy-three; and he is hereby directed to have the mails weighed as often as now provided by law by the employees of the Post Office Department, and have the weights stated and verified to him by said employees under such instructions as he may consider just to the Post Office Department and the railroad companies.”

Since said acts were passed the weighing of the mails has been done solely by employees of the Post Office Department under the directions of the Postmaster General. In executing the provisions of these acts the Postmaster General divided the country geographically into four sections, designated the first, second, third, and fourth weighing sections, and weighed and readjusted the pay in one section each year. The above-mentioned routes of the claimant were in the first of said sections, and the quadrennial term of said section began with July 1, 1906, and expired June 30, 1910. *408The weighings upon which the pay of said routes was readjusted for this new term took place-in the spring of 1906. By such reweighing the average daily weight carried over the whole length of each of said routes was found to be in excess of 5,000 pounds per day. The compensation during said term was based on a service of not less than six round trips per week.

III. On February 13., 1906, the Post Office Department, in accordance with its long-standing practice, sent to the plaintiff and other companies certain distance circulars for use in connection with several postal routes mentioned in the plaintiff’s petition, which circulars were afterwards voluntarily filled out and returned by the plaintiff to the department and when so returned contained the following matter:

“ The company named below agrees to accept and perform mail service upon the conditions prescribed by law and the regulations of the department applicable to railroad mail service.

“A. A. AlleN,

“ *Vice President and General Manager.*

í[í $ H* ❖ ❖ sfc

“ ESr’Care should be exercised to state the *title of the company actually operating the railroad*in the blank space below, as the *company therein named*will be accepted as being entitled to the *■compensation for the*service, and to prevent any misunderstanding as to title the seal of the company should be impressed.

“ KgsT”Title: Missouri, Kansas & Texas Railway Co., State of Indian Territory. Route No. 153010, from Sedalia, Mo., to Denison, Tex.

“ 1. 'Distance from station to next station or point of exchange.

“ 2. List of stations and exchange points. Designate stations where the company has no agent or other representative thus: *.

*“*3. Official name of the post office or postal station re-ceivingor forwarding mail by this route.

“ 4. Distance from station to post office or postal station.

“ 5. Distance from post office or postal station to nearest point on railroad track.”

* * $ * $ $ $

The blank spaces in the circulars had been filled by the company with further informing data stating its title, the *409State or Territory in which it operated, the number of the route, and terminii of the same, a list of the stations and exchange points thereon, the distance from station to next station or point of exchange, the name of the post office or postal station receiving and forwarding mail by said route, the distance from railroad station to post office or postal station in each instance, together with the distance from post office or postal station to the nearest point on the railroad track.

The distance circulars substantially similar to the foregoing had been in use by the department for years prior to 1884, with the exception of the following clause:

“The company named below agrees to accept and perform mail service upon the conditions prescribed by law and the regulations of the department applicable to mail service.”

The department began to insert this clause about the year 1884, and, with some slight changes of language and no material change of meaning, it has been in use since that date.

IV. On February 13, 1906, the Post Office Department transmitted to the plaintiff and other companies, along with the distance circular set forth in Finding III, a notice that the General Superintendent of the Eailway Mail Service had been directed to weigh the mails, and use in so doing a certain form of circular, of which the following is a copy:

“ Post Ofeice Department,

“ Office of the Second

“ASSISTANT POSTMASTER GENERAL,

“Division of Eailway Adjustment,

“ 'Washington, *D. 0., Feb. 13,1906.*

“ Sir : The General Superintendent, Eailway Mail Service, has been directed to weigh the mails carried on route No. 153010, between Sedalia, Mo., and Denison, Tex., for not less than ninety successive working days, commencing Feb. 20, 1906, for the purpose of obtaining the data upon which the department may adjust the pay for mail service on the route (in accordance with the several acts of Congress governing the same) from July 1,1906, to June 30, 1910.

“The law requires that the weighing be done by sworn employees of the Post Office Department, and all Post Office Department employees will be instructed to take every pre*410caution to secure correct weights, to provide against all irregularities, and to prevent any diversion of the mails from their usual channels during said weighing.

“ This office, through the Superintendent, Railway Mail Service, for the division in which your roads is located, will advise your company relative to the requirements of the department in connection with said weighing.

“Very respectfully,

“W. S. SilALTJGNBERGER,

*“Second Assistant Postmaster General.*

“ Mr. G. M. Lindsat,

*“GeKl Agt. Mail Dept.,*

“Missouri, *Kansas <& Texas By.*Go.,

*“St.*Louis, Mo.”

A form of a circular letter similar to the foregoing was adopted by the department in 1899 and was sent out each year thereafter to railroad companies concerned. The practice of sending notices of the weighings along with the distance circular originated about 1886 and continued thereafter with one or two years’ interruption. The form of the circular notification letter varies in more or less material 'features between 1886 and 1899, when the foregoing form was adopted.

Y. After the plaintiff had received the distance circular mentioned in Finding IY, and after the transmission of the notice mentioned in Finding III, the Post Office Department made the quadrennial weighing of the mails. After the result of these weighings had been ascertained, stated, and verified as directed by the Postmaster General this official made and had issued the following orders applying respectively to each of the routes named in the petition and notices thereof sent to the plaintiff :

“(Order.)

“Post Office Department,

“ Office of the Second

“Assistant Postmaster General,

“Washington, *D. G.*

“ Orders of the Postmaster General, issued through the Office of the Second Assistant Postmaster General, Wednesday, September 26,1906, originating or affecting an account:

*411

“ F. H. Hitchcock,

*“Acting Postmaster General."*

“(Notice.)

“Post Office Department,

“ Office of the Second

“Assistant PostmasteR General,

“Division of Railway Adjustment,

*“Washington, D. O., Sept. %6,1906.*

“ Ste : The compensation for the transportation of mails, etc., on route No. 153010, between Sedalia, Mo., and Denison, Tex., has been fixed from July 1, 1906, to June 30, 1910 (unless otherwise ordered), under acts of March 3, 1873, July 12, 1876, June 17, 1878, and March 3, 1905, upon returns showing the amount and character of the service for 49 successive working days, commencing Feb. 20, 1906, at the rate of $169,090.95 per annum, being $389.88 per mile for 433.70 miles; and pay is allowed for use of R. P. O. cars from July 1, 1906, to June 30, 1910, at the rate of $31,420.35 per annum, being $25.00 per mile for 49.17 miles, Scott Jet. (n. o.) to.Parsons, Kans., for 1 line of 40 ft. cars; $90 per mile for 51.79 miles, Parsons to Vinita, Ind. Ter., for 2 lines of 40 ft. and 1 line of 50 ft. cars, and $115 per mile for 222 miles, Vinita to Denison, Tex., for 2 lines of 40 ft., 1 line of 50 ft., and *\*line of 60 ft. cars.

*412“This adjustment is subject to future orders and to fines and deductions, and is based on a service of not less than six round trips per week. .

“Very respectfully,

“ G. F. StoNe,

*“Acting Second Assistant Postmaster General.*

“ Mr. G. M. Lindsay,

“ *General Agent, Mail Department,*

*“ Missouri,.Kansas db Texas Ry. Go.,*

*“St. Louis, Mo."*

“(Order.)

“ Post Oeeice Department,

“ Oeeice oe the Second

“Assistant Postmaster Generad,

“ *Washington, D. G.*

“ Orders of the Postmaster General, issued through the Office of the Second Assistant Postmaster General, Monday, September 10,1906, originating or affecting an account:

“ W. S. Shallenberger,-

*“Acting Postmaster General."*

“(Notice.)

“Post Oeeice Department,

“Oeeice oe the Second Assistant

“Postmaster General,

“ Division oe Railway Adjustment,

“ *Washington, D. G., September 10, 1906.*

“ Sir : The compensation for the transportation of mails, etc., on Route No. 155018, between Kansas City, Mo., and *413Paola Station (n. o.), Kans., has been fixed from July 1, 1906, to June 30, 1910 (unless otherwise ordered), under acts of March 3, 1873, July 12, 1876, June 17, 1878, March 3, 1905, and joint resolution of June 9, 1906, upon returns showing the amount and character of the service for 49 successive working days, commencing February 20, 1906, at the rate of $8,541.38 per annum, being $198.36 per mile for 43.06 miles, lap service over route 155008; and pay is allowed for use of R. P. O. cars from July 1,1906, to June 30, 1910, at the rate of $2,798.90 per annum, being $65.00 per mile for 43.06 miles Kansas City, Mo., and Paola Station (n. o.), Kans., for one line 50-foot, and one line 40-foot cars.

“ This adjustment is subject to future orders and to fines and deductions, and is based on a service of not less than six round trips per week.

“Very respectfully,

“W. S. ShalleNberger,

*“Second Assistant Postmaster General..*

*“*Mr. G. M. LiNdsay,

u *Gen'l Mail*Agt., Missouri, *Kansas do Texas*

*“Ry.*Go., *St. Louis, Mo..”*

“(Order.)

“ Post Oeeioe Department,

“ Oeeioe oe SecoNd Assistaot Postmaster General,

*“*'Washington, *D. G.*

*“*Orders of the Postmaster General, issued through the Office of the Second Assistant Postmaster General, Monday, September 10,1906, originating or affecting an account:

*“ W. S.*ShalleNberger,

*“Acting Postmaster General.”*

*414“(Notice.)

“ Post Office Department,

“ Office of the SecoNd

“AssistaNt Postmaster General,

“ Division of Railway Adjustment,

“ *1V ashington, D. C., September 10, 1906.*

“ Sir : The compensation for the transportation of mails, etc., on route No. 155083, between Paola and Parsons, Kans., has been fixed from July 1, 1906, to June 30, 1910 (unless otherwise ordered), under acts of March 3, 1873, July 12, 1876, June 17, 1878, March 3, 1905, and joint resolution of June 9, 1906, upon returns showing the amount and character of the service for 49 successive working days, commencing February 20, 1906, at the rate of $27,537.11 per annum, being $293.26 per mile for 93.90 miles; and pay is allowed for use of R. P. O. cars from July 1, 1906, to June 30,1910, at the rate of $6,094.40 per annum, being $65.00 per mile for 93.76 miles, Paola and Parsons, Kans., for one line 50-foot and one line 40-foot cars.

“ This adjustment is subject to future orders and to fines and deductions, and is based on a service of not less than six round trips per week.

“ very respectfully,

“ W. S. Shallenberger,

“ *Second Assistant Postmaster General.*

“Mr. G. M. Lindsay,

“ *Gen^l Mail Agt.,*

“ *Missouri, Kans. (& Tex. Ry. Co., St. Louis, MoT*

VI. From and after July 1, 1906, to June 30, 1907, inclusive, the plaintiff received and transported mails as authorized by the Postmaster General in the aforementioned adjustment orders in Finding Y, and received and accepted periodically payment and settlement for service rendered thereunder.

YU. The act of Congress approved March 2, 1907, 34 Stat. 1205,1212, entitled “An act making appropriations for the service of the Post Office Department for the fiscal year ending June 30, 1908, and for other purposes,” contained the following provision:

“The Postmaster General is hereby authorized and directed to readjust the compensation to be paid from and *415after the first day of July, nineteen hundred and seven, for the transportation of mail on railroad routes carrying their whole length an average weight of mails per day of upward of five thousand pounds by making the following clianges in the present rates per mile per annum for the transportation of mail on such routes, and hereafter the rates on such routes shall be as follows: On routes carrying their whole length an average weight of mail per day of more than five thousand pounds and less than forty-eight thousand pounds the rate shall be five per centum less than the present rates on all weight carried in excess of five thousand pounds; and on routes carrying their whole length an average weight of mail per day of more than forty-eight thousand pounds the rate shall be five per centum less than the present rates on all weight carried in excess of five thousand pounds up to forty-eight thousand pounds, and for each additional two thousand pounds in excess of forty-eight thousand pounds at the rate of nineteen dollars and twenty-four cents upon all roads other than land-grant roads, and upon all land-grant roads the rate shall be seventeen dollars and ten cents for each two thousand pounds carried in excess of said forty-eight thousand pounds.”

Pursuant to this act the Postmaster General, on September 12, issued additional orders applying respectively to each of said routes named in the plaintiff’s petition, and on the same date notified the plaintiff of the Department’s action. These orders were as follows:

“ (Order.)

“ Post Office Department,

“ Office of Second

“Assistant Postmaster General,

“ *Washington, D. G.*

“ Orders of the Postmaster General, issued through the Office of the Second Assistant Postmaster General, Thursday, September 12, 1907, originating or affecting an account.

*416

“ G. v. L. Meter,

“ *Postmaster General.”*

“(Notice.)

“ Post Oeeice DepartmeNt,

“ Second Assistant Postmaster General,

“ Division oe Railway Adjustment,

“ *'Washington, September 1%, 1907.*

“ Sir : Under act of March 2, 1907, an order has been issued on route No. 153010, between Sedalia, Missouri, and Denison, Texas, restating compensation for the transportation of mail, from July 1, 1907, so as to be at the rate of $164,341.94 per annum, being $378.93 per mile, for 433.70 miles, and for R. P. O. car service at the rate of $27,027.67 per annum, being $82.50 per mile for 51.79 miles, Parsons, Kansas, and Vinita, Indian Ter., for 2 lines 40-ft., and one line 50-ft.; $102.50 per-mile for 222 miles, Vinita, I. T., and Denison, Texas, for 2 lines 40-ft., 1 line‘50-ft., and J line 60-ft. cars.

“ Very respectfully,

“ J. T. McCleary,

“ *Second Assistant Postmaster General.*

*“*Mr. G. M. Lindsay,

“ *Geni. Agt. Mail Dept.,*

“ Missouri, *Kansas, and Texas Railway Go.,*

*“St. Louis,*Missouri.”

*417“(Order.)

“ Post Office DEPARTMENT,

“ Office of SecoNd Assistaxt Postmaster General,

“ *Washington, D. 0.*

*“*Orders of the Postmaster General, issued through she Office of the Second Assistant Postmaster General, Thursday, September 12,1907, originating or affecting an account:

“ G. v. L. Metee,

“ *Postmaster GeneralP*

“(Notice.)

“Post Office Department,

“ SecoNd Assistant Postmaster General,

“Division of Eailwat Adjustment,

“ *Washington, September 12,1907.*

“ Sir : Under act of March 2, 1907, an order has been issued on route No. 155018, between Kansas City, Missouri, and Paola Station (n. o.), Kansas, restating compensation for the transportation of mails, from July 1, 1907, so as to be at the rate of $7,992.79 per annum, being $185.62 per mile for 43.06 miles, lap over route No. 155008, and for E. P. O. car service at the rate of $3,552.45 per annum, being $82.50 per mile for 43.06 miles, Kansas City, Mo., and Paola Station (n. o.), Kansas, for 2 lines 40-foot and one line 50-foot cars.

“ Very respectfully,

“ J. T. McCleary,

*“Second Assistant Postmaster General.*

“ Mr. G. M. LiNdsax, '

“ *Geni. Agt., Mail Dept.,*

“Missouri, *Kansas c& Texas Ry. Go.,*

*St. Louis, MoP*

*418“(Order.)

“Post Office DepartmeNT,

“.Office oe Second Assistant Postmaster General,

“ *'Washington, D. G.*

“ Orders of the Postmaster General, issued through the Office of the Second Assistant Postmaster General, Thursday, September 12,1907, originating or affecting an account:

“ G. y. L. Meyer,

*“Postmaster General*

“(Notice.)

*“*Post Oeeice Department,

“ Second Assistant Postmaster General,

“ Division op Railway Adjustment,

*’Washington, September W, 1907.*

“ Sirs : Under act of March 2,1907, an order has been issued on route No. 155083, between Paola and Parsons, Kansas, restating compensation for the transportation of mails, from July 1,1907, so as to be at the rate of $26,963.38 per annum, being $287.15 per mile, for 93.90 miles, and for R. P. O. car service at the rate of $7,735.20 per annum, being $82.50 per mile for 93*76 miles, Poala and Parsons, for 2 lines 40-ft. and 1 line 50-ft cars.

“ Very respectfully,

“ J. T. McCleary,

*“Second Assistant Postmaster General.*

“Mr. G. M. Lindsay,

*“Geni. Agt., Mail Dept.,*

“Missouri, *Kansas & Texas By. Go.,*

*St. Louis, MoP*

*419VIII. The average weight per day of mail carried over the whole length of the routes named in the petition, respectively, had been ascertained according to law prior to July 1, 1906, the beginning of the term of service for which compensation had been stated as shown in Finding V.

IX. The Postal Laws and Regulations of 1902, in effect in 1905, provided, among other things., as follows:

“ Sec. 1162. The Postmaster General shall arrange the railway routes on which the mail is carried, including those in which the service is partly by railway and partly by steamboat, into three classes, according to the size of the mails, the speed at which they are carried, and the frequency and importance of the service, so that each railway company shall receive, as far as practicable, a proportionate and just rate of compensation, according to the service performed. (Sec. 3997, Rev. Stats.)

*“*Seo. 1163. The Postmaster General may enter into contracts for carrying the mail, with railway companies, without advertising for bids therefor. (Sec. 3942, Rev. Stats.)

“ Seo. 1165. All railway companies to which the United States have furnished aid by grant of lands, right of way, or otherwise, shall carry the mail at such prices as Congress may by law provide; and, until such price is fixed by law, the Postmaster General may fix the rate of compensation. (Sec. 4001, Rev. Stats.)

“ Sec. 1170. If the Postmaster General is unable to contract for carrying the mail on any railway route at a compensation not exceeding the maximum rates herein provided or for what he may deem a reasonable and fair compensation, he may separate the letter mail from the other mail and contract either with or without advertising for carrying such letter mail by horse express or otherwise at the greatest speed that can reasonably be obtained and for carrying the other mail in wagons or otherwise at a slower rate of speed. (Sec. 3999, Rev. Stats.)”

The foregoing regulations appear in chapter 3 relating to the transportation of mails by railroads.

In chapter 7, relating to the transportation of mails on steamships, steamboats, and star routes, Subhead IY, advertisements for proposals for the mail service, there is a section as follows:

*“*Sec. 1253. The United States shall be divided into four contract sections. A general letting for one of these sec*420tions will occur every year, and contract will be made for four consecutive years, commencing on the 1st day of July. The sections and their current contract terms are:

“(a) Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, Connecticut, New York, New Jersey, Pennsylvania, Delaware, Maryland, District of Columbia, Virginia, and West Virginia; current term, July 1, 1901, to June 30, 1905.

“(5) North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Tennessee, Kentucky, and Porto Rico; current term, July 1, 1900, to June 30, 1904.

“(c) Ohio, Indiana, Illinois, Michigan, Wisconsin, Minnesota, Iowa, and Missouri; current term, July 1,1899, to June 30, 1903.

*“(d)*Arkansas, Louisiana, Texas, Indian Territory, Oklahoma, Kansas, Nebraska, North Dakota, South Dakota, Montana, Wyoming, Colorado, New Mexico, Arizona, Utah, Idaho, Washington, Oregon, Nevada, California, Alaska, and Hawaii; current term, July 1, 1898, to June 30, 1902.”

Also:

“Sec. 1277. The Postmaster General may discontinue or curtail the service on any mail route in whole or in part in order to place on the route superior service or whenever the public interests in his judgment shall require such discontinuance or curtailment for any other cause, he allowing as full indemnity to the contractor one month’s extra pay on the amount of service dispensed with and a pro rata compensation for the amount of service retained and continued.”

It is provided by the Revised Statutes, sections 3942 and 3956, as follows:

“ Sec. 3942. The Postmaster General may enter into contracts for carrying the mail with railway companies without advertising for bids therefore.

“ Sec. 3956. No contract for carrying the mail shall be made for a longer term than four years, and no contract for carrying the mail on the sea shall be made for a longer term than two years.”

X. Since 1873, up to and including the date of the contract in this case, it had been the continued and uniform practice of the Post Office Department to send out distance circulars quadrennially to railroad companies to be filled in and returned to the department preliminary to fixing the amount to be paid said companies for carrying the mails. *421The purpose of the department in sending said circulars so to be returned was to secure the necessary facts for use by the Postmaster General in readjusting the payments to be made for service on the specified route or routes as the case might be. The clause attached to said circulars as a part thereof sometimes alluded to as the “ agreement clause ” or the “ acceptance clause,” which in the instant case was as follows:

“ The company named below agrees to accept and perform mail service upon the conditions prescribed by law and the regulations of the department applicable to railroad mail service.”

was and has been intended and regarded by the Post Office Department as an expression of the railroad company to the Postmaster General, of its willingness and readiness to undertake and perform the service, and when signed and returned to him with the information requested in said circulars, was regarded by said department as an application to carry the mails. The contract in this case did not arise out of the sending of the distance circular and its return with the above-mentioned clause signed by the proper official of the railroad, and the delivery thereafter of the mail and its receipt and transportation by the railroad, but arose out of what subsequently happened — namely, the offers contained in the readjustment orders and notices set out in Finding V and the notice thereof to the plaintiff, and the acceptance of these offers by the plaintiff proceeding to perform, as it did in this case, the prescribed service in accordance therewith, and accepting the compensation due for s' _ch service under said offers.

This was the contract between the parties in this case, and there is no proof of any other contract. It was the right and privilege of the railroad company to accept or decline the terms of the said readjustment offers, and the contract here entered into could have been terminated at any time by either party, and under the practice of the Post Office Department it was so regarded. The contract in this case was not for-a term of four years, and no practice or usage of the Post Office Department or understanding between the parties has been proved which would establish such a con*422tract. No custom or usage of the Post Office Department or understanding between the parties has been shown which proved that the contract between the parties consisted of' the return by the plaintiff of the distance circulars with the agreement or acceptance clause executed, and the delivery of the mails to it by the defendant and the transportation thereof by it. No practice or usage of the Post Office Department or understanding between the parties has been shown which proved that the expressions, “ unless otherwise ordered ” and “ subject to future orders,” contained in the said adjustment orders and notices, Finding V, had any other scope, meaning, or application than that which their wording and the connection in which they were used in these orders would ordinarily be given to them to mean, which meaning included the right by readjustment orders to change and reduce the rate and the compensation named in the original orders at the will and discretion of the Post Office Department upon the giving of notice of such change.

XI. The plaintiff was notified on the 12th of September, 1907, of the change and reduction of rates and compensation as fixed by the readjustment orders issued in that connection, Finding VII; and from and after that date it continued to carry the mails without objection or protest, and received and accepted settlement from time to time on the basis of rates and compensation named in such orders until the institution of this suit on August 8, 1908.

Graham, *Judge,*

delivered the opinion of the court:

This case embodies an effort to prove certain usages and practices of the Post Office Department in its dealings with the railroads in carrying mails, and an understanding growing out of these usages and practices, for the purpose of showing by reading this understanding into the writings and correspondence between the parties, that the contract rested upon a different basis and set of facts from those which the court held in the case of *Delaware, Lackawanna & Western R. R. Co.*v. *United States,*51 C. Cls., 426; 249 U. S., 385, constituted a contract. The reading of this understanding into the contract, it is claimed, sustained the following contentions by the plaintiff:

*4231. That the contract between the parties consisted of the sending of the distance circular, its receipt and return with the agreement clause signed, and the delivery of the mails, and the performance of the service. That the adjustment orders were not a part of the contract and were intended to and did evidence only the performance by the department of a statutory duty giving results of the weighings previously made, as the rate of pay had been fixed by law and would be based upon the weight of the mails taken during the weighing period.

2. That the contract was for a term of four years at the rate of compensation thereafter named in the adjustment order, and for no other period, without the right in the department to diminish the rate of compensation during that period.

3. That the expressions in the adjustment orders, “ unless otherwise ordered” and “subject to future orders,” were understood by the parties and were intended to have a more circumscribed meaning than that heretofore given them by the courts in the above and other cases, and did not cover nor were they intended or understood to apply to an order changing and reducing the rate and compensation during the period named in the order, but only to such matters as were covered by the rules, regulations, usages, and practices of the department, and that these did not embrace the right of the department to reduce the rate and compensation during said period; and that, in any event, as the alleged contract was for four years at a stated rate, a reservation in the adjustment orders, which it is alleged was not a part of the contract, could not alter the contract by reserving the right to do what was contrary to its terms.

In the argument of the case counsel for the plaintiff stated that it was desired to have the ultimate facts found by the court, which has been done. (Finding X.) The facts as found by the. court completely negative each and all of these contentions as to the character and terms of the contract between the parties, and leave in the case, as showing the actual contract, facts which, in substance (except as to the difference in the parties, dates, and amounts of compensation), are on all fours with those which were before *424the Supreme Court and this court in the case of *Delaware, Lackawanna & Western R. R. Co.*v. *United States, supra.*

In this view of the matter it seems unnecessary to attempt any fuller discussion of the principles involved, and the decision here is grounded upon the decision in that case.

In that case it was held that the plaintiff could recover for the amount withheld through a reduction of its compensation, for the period which it rendered service under the original adjustment orders, prior to the date of its notification of the orders reducing the rate and its compensation, which was the 12th of September, 1907. The plaintiff was paid at the rate fixed by the original adjustment orders up to the 1st of July, 1907. It is therefore entitled to recover for the period between the 1st of July, 1907, and the 12th of September, 1907. Judgment for plaintiff in the sum of $1,157.94. It is so ordered.-

Hat, *Judge;*DowNey, *Judge;*Booth, *Judge;*and Campbell, *Chief Justice,*concur.