Evening star. [volume] (Washington, D.C.) 1854-1972, 1903-08-04
THE LYON CONTRACTS
Result Of Col. Garlington's
Investigation.
ARMY rs EX0NERATED
AN. AGREEMENT AS TO PROFITS
WITH LITTAUER BROTHERS.
The Attorney General Asked Whether
the Law Was Violated-Secretary
Roots Endorsement Of Report.

gloves from Llttauer Brothers. the senior
member of the firm. Mr.. L. N. Littauer.
being member Of Congress. Secretary
Root has referred the case to the Depart
ment Of Justice in order that it may be
ascertained If the law has been violated,
and If so that appropriate measures may
be taken in the premises. There Is a
statute which prohibits contracts for gov
eminent supplies being made directly or in
directly with member Of Congress, and
this was the basis of the investigation by
the War Department.
Inspector General Darlington made an in
vestigation of the facts in the case. His
report was referred to Judge Advocate
General Davis, who made an extensive re-
view and submitted an opinion to Secre-
tary Root. In the course of his report
General Davis says:
Facts Regarding the Contracts
ut appears from the testimony that on
October 10. 1888, contract was awarded
to Lyon for 5000 pairs of muskrat gloves
at $1.54 per pair; on December 7, 1893,
second contract for 10000 pairs was award
ed to Lyon at s17O per pair; stipulation
being inserted to the effect that deliveries
under 1T could be increased 80 per cent, at
the discretion Of the officer making the
contract. The government took advantage
OF the stipulation, and 3O,O61 pairs were
actually called for and delivered under the
contract of, December Z, 1893. Some dis
cussion having arisen as to the price which
Lyon was to pay for quantities. delivered
under the contract of December z, an
agreement was entered into between Lit
tauer Brothers and Lyon to the effect that
an accurate account Of the cost of manu-
facture was to be kept, and If, after the
contract was completed. it should prove
$1.65 per pair, Lyon was to receive one
half of the profits. There was profit of
$3,537.O5. one-half of which was credited
to Lyon on the books of Littauer Brothers.
A case falling within the prohibition of
the statute is clearly shown in the testi-
mony. which, in the opinion of this office,
charges the department with the perform
ance of the duty set forth in Section $3.50
or the Revised Statutes; and it Is, there
FORE recommended that a demand be made
by the quartermaster general upon the firm
of Littauer Brothers for the repayment of
whatever sum Is found to- have been paid
in consideration Of the contract of De-
cember :. 1888, with E. r. Lyon. as ex-
tended. in accordance with Its terms. by
the quartermaster's department
Gen. Davis Accommodation.
1T will be observed that section 3739 of
the Revised Statutes requires that de-
mands shall be made for the repayment of
any sums of money which may have been
advanced on the part Of the United States
in consideration of any such contract or
agreement and. in the case Of refusal
or delay to repay the same the statute goes
on to require that a suit shall be instituted
for the recovery OF any such sum Of
money SO advanced thus making an i'm
portant distinction between those portions
of the consideration which are advanced
and those which retain their executory
character. Having regard to the highly
penal character of the statute above cited,
which requires it to receive strict con-
struction at the hands of the department
II ia recommended tho int NJ fbo
Attorney General be obtained as to wheth-
er, in view Of the fact that the contract
has been completely executed; that the en-
tire consideration has passed, and that
the articles stipulated for have been de-
Hvered to and have become the property
OF the United States. the whole or q por-
ton Of the consideration shall be made the
subject Of the demand.
The Duty Of Contracting Officer.
1.-THE fact that a member Of Congress was
an active manager Of firm which made
large sales OF gloves and gauntlets to con-
tractors with the quartermaster's depart
ment should have caused the officer
charged with the making Of such contracts
to scrutinize their execution with a degree
of diligence measured by the likelihood OF
an attempted violation OF tho statute; and
should also have caused him to be on his
guard for evidence Of financial weakness on
the part of the principal in the perform
was perfectly lawful for the bidder to make
purchase Of any firms engaged in the max
ing of gloves. whatever their composition,
made 1t difficult for the contracting officer
to ascertain whether a corrupt intent ex-
listed. 80 long as the terms Of the contract
were carried out In apparent good faith:
and 1t made 1t similarly difficult to obtain
information of a positive character in re-
spect to the execution Of a particular con-
tract that would justify formal inquiry.
1T was the first duty of an officer
charged with making purchases In behalf
Of the United States to see that the ar
and that the prices paid were reasonable,
The testimony elected during the course of
the investigation showing the prices paid.
the profits realized. and the numerous re-
standards established by the department
shows that this duty was thoroughly and
conscientiously performed"
Secretary Roots Endorsement.
Secretary Root made the following in
dorsement on the opinion of the Judge
advocate general:
II suppose there is no doubt that man
ufacturing firm, one member Of which
happens to be a member of Congress, has
right to manufacture and sell goods to
jobbers who are filling government con-
the prohibition of the statute so long as
the contract between the firm and the
tobber is separate ana distinct transac-
ton from the contract between the jobber
and the government. There appears to
be no evidence that in the manufacture
Of gloves by the Messrs. Littauer Brothers,
to be used in filling government contracts
made by Lyon and others, there was any
violation of the statute except in one case,
the contract Of December Z. 1898. 1t ia
not the duty or the right of the Secretary
Of War to adjudicate that case, or to de-
termine whether the statute was OF was
not violated, except in SO far as 1t may
be necessary for him to decide what action,
If any, should be taken by the War De-
partment in view Of the facts disclosed
l think the indications of an interest by
the manufacturing firm in the jobber's
contract with the government are sufficient
to require me to proceed upon the theory
that there is a prima facie case Of violation
of the statute. Three duties are thereupon
devolved upon the War Department.:
First. To put the Department Of Justice
in possession of the facts, in order that
If that department finds the law to have
been violated It may take appropriate
measures for it's enforcement This will
be done.
Second. To direct the proper officer of
the department to demand repayment Of
any sum of money which has been 'ad-
vanced on the part of the United States
in consideration Of such contract Strict