Source: https://supreme.justia.com/cases/federal/us/275/1/
Timestamp: 2019-04-21 10:17:54+00:00

Document:
1. Claims arising out of contracts with the Emergency Fleet Corporation are not within the jurisdiction of the Comptroller General. P. 275 U. S. 4.
2. The Fleet Corporation is an entity distinct from the United States and from any of its departments or boards, and the audit and control of its financial transactions is, under the general rules of law and the administrative practice, committed to its own corporate officers except so far as control may be exerted by the Shipping Board. P. 275 U. S. 11.
3. The power to settle and adjust claims arising from contracts made and cancelled by the Fleet Corporation under the power delegated by the President under the Acts of June 15, 1917, and April 22 and November 4, 1918, is conferred by § 2(c) of the Merchant Marine Act, 1920, on the Shipping Board. P. 275 U. S. 11.
4. The requirement of Rev.Stats. § 951, that, in suits by the United States against individuals, no claim for a credit shall be admitted unless it shall have been presented to the accounting officers of the Treasury and by them disallowed is satisfied when the claim is presented and disallowed by the officer who has power to allow the claim, although he is not a general accounting officer of the government. P. 275 U. S. 12.
Certiorari, 270 U.S. 626, to a judgment of the Court of Appeals of the District of Columbia which affirmed the Supreme Court of the District in dismissing a petition for a writ of mandamus, which was sought by Skinner & Eddy in order to compel the Comptroller General to pass upon its claims against the government, growing out of contracts with the Emergency Fleet Corporation.
Compare United States v. Fisher Flouring Mills Co., 295 F. 691; 17 F.2d 232. The Comptroller General declines to consider the claims, asserting that he has neither the duty nor the power to do so, and that the duty of passing upon them rests with the Shipping Board.
In 1923, the Fleet Corporation assigned to the United States all of its assets, including accounts against divers persons for the payment of money. Thus, the United States is the owner, either as principal or as assignee of the Fleet Corporation, of all the claims against Skinner & Eddy. Two actions arising out of these contracts are now pending in the federal court for the Western District of Washington. One is a suit by Skinner & Eddy against the Fleet Corporation, begun in 1923 in a state court of Washington, and removed to the federal court. In that case, the defendant has moved to dismiss the suit on the ground that the claim sued on is one against the United States. [Footnote 1] The other action is a suit by the United States against Skinner & Eddy, commenced in the federal court since this petition for a writ of mandamus was filed.
relief was properly denied, because his refusal to consider the claims was a disallowance thereof within the meaning of § 951, and thereby the requirement of that section was satisfied. It is conceded that mandamus is an appropriate remedy. Compare Interstate Commerce Commission v. Humbolt S.S. Co., 224 U. S. 474.
"All claims and demands whatever by the government of the United States or against it, and all accounts whatever in which the government of the United States is concerned, either as debtor or creditor, shall be settled and adjusted in the General Accounting Office. [Footnote 2]"
arising out of contracts made by a government-owned corporation "representing the United States." But here it must be construed in the light of the statutes dealing specifically with the Shipping Board and the Fleet Corporation, of the latter's origin and character, and of the administrative practice prevailing with regard to it and other similar corporations.
shall it be a minority stockholder therein." Being a private corporation, the Fleet Corporation may be sued in the state or federal courts like other private corporations; it does not enjoy the priority of the United States in bankruptcy proceedings. Sloan Shipyards Corp. v. United States Shipping Board Emergency Fleet Corporation, 258 U. S. 549, and its employees are not agents of the United States subject to the provisions of § 41 of the Criminal Code. United States v. Strang, 254 U. S. 491. Compare 34 Op. Attys.Gen. 241.
appropriated by Congress save those received from the sale of stock to the government, whereas the Fleet Corporation had the benefit of money appropriated to the Shipping Board and by it turned over to the corporation. [Footnote 10] The first statute making such an appropriation, however, provided in terms that the moneys were to be expended "as other moneys of said corporation are now expended." Act June 15, 1917, c. 29, 40 Stat. 182, 183.
The transactions of the Fleet Corporation arose out of the exercise of powers conferred upon it in several different ways. It was urged in the argument that the question of the jurisdiction of the Comptroller General would depend upon the source of the power giving rise to the transactions under consideration, because of certain special statutory provisions as to compensation for claimants, now to be considered. Besides powers conferred by the general incorporation laws of the District of Columbia, the Fleet Corporation was vested, by delegation from the President, [Footnote 11] with the powers conferred upon him by Act June 15, 1917, c. 29, 40 Stat. 182, Act April 22, 1918, c. 62, 40 Stat. 535, and Act Nov. 4, 1918, c.
"adjust, settle, and liquidate all matters arising out of or incident to the exercise by or through the President of any of the powers or duties conferred or imposed upon the President by any such Acts or parts of Acts, and for this purpose the board, instead of the President, shall have and exercise any of such powers and duties relating to the determination and payment of just compensation: Provided, that any person dissatisfied with any decision of the board shall have the same right to sue the United States as he would have had if the decision had been made by the President of the United States under the acts hereby repealed."
of the powers conferred upon him by the statutes referred to in § 2(c) of the Merchant Marine Act of 1920, and hence that the Shipping Board, and not the Comptroller General, has the power and duty to settle and adjust them, and thus to allow or disallow any claims by way of credits or set-offs arising out of the contracts. Skinner & Eddy urge that their contracts were made by virtue of the power conferred upon the Fleet Corporation by the Shipping Act of 1916; that a controversy arising out of such contracts is not within § 2(c) of the Merchant Marine Act of 1920, and that, hence, the Comptroller General had jurisdiction over its claims. We have no occasion to determine whether the contracts here in question were made under the original charter power of the Fleet Corporation or under the additional powers acquired by delegation from the President. Even if § 2(c) has no application, because the contracts were not entered into pursuant to the power delegated by the President in 1917, it does not follow that the claims fall within the jurisdiction of the Comptroller General. For the Fleet Corporation is an entity distinct from the United States and from any of its departments or boards, and the audit and control of its financial transactions is, under the general rules of law and the administrative practice, committed to its own corporate officers except so far as control may be exerted by the Shipping Board. If, on the other hand, the contracts were made and cancelled by the Fleet Corporation under the power delegated by the President, the settlement and adjustment of the claim falls clearly within the powers conferred by § 2(c) upon the Shipping Board.
there any basis for the further suggestion of Skinner & Eddy that the Shipping Board has power to make settlement, if it can, but where a settlement is not made and a suit by the United States is brought or threatened, the Comptroller General is the official to whom must be presented all claims for credit in such suit. It is true that the Merchant Marine Act did not modify § 951 of the Revised Statutes or impair the right of a defendant to a credit, if sued by the United States upon a Fleet Corporation contract. Since the passage of the Merchant Marine Act, as before, the defendant may set up the credit if he can show disallowance by the appropriate accounting officers. But § 951 does not prescribe who the appropriate officer is, or that the claim must be presented to a general accounting officer of the government. As was held in United States v. Kimball, 101 U. S. 726, the requirement of the section is satisfied when the claim is presented and disallowed by the officer who has power to allow the claim, although he is not a general accounting officer of the government.
The Court of Appeals of the District based its judgment of affirmance solely upon the ground that, since the claims involved were already in the course of litigation in two suits in another federal court, no other court of coordinate jurisdiction could interfere. The Comptroller General had originally taken a somewhat similar ground for declining to act. But later he stated, in the trial court, that his answer should be taken as broadly denying his jurisdiction to consider claims of this nature. And, in this Court, he specifically disclaimed reliance upon the ground taken by the court of appeals. We have no occasion to consider its validity. Nor need we consider whether the refusal of the Comptroller General to take jurisdiction was a disallowance of the claim within the meaning of § 951 or any of the other questions which have been argued concerning the application of that section.
In 1923, Skinner & Eddy began still another suit, upon the same cause of action, against the United States in the Court of Claims. It was finally allowed to dismiss that suit without prejudice. See In re Skinner & Eddy Corporation, 265 U. S. 86.
The accounting branch of the Treasury Department was created by Act Sept. 2, 1789, c. 12, §§ 1, 3, 5, 1 Stat. 65, 66. Steps in its growth and in the development of its control over government expenditures may be traced in Act May 8, 1792, c. 37, § 1, 1 Stat. 279; Act July 16, 1798, c. 85, § 1, 1 Stat. 610; Act March 3, 1817, c. 45, §§ 1, 3-5, 3 Stat. 366, 367; Act May 7, 1822, c. 90, 3 Stat. 688; Act March 30, 1868, c. 36, 15 Stat. 54; Act June 8, 1872, c. 335, §§ 21-25, 17 Stat. 283, 287, 288. In 1894, there was a general revision of the statutes dealing with the accounting officers. Act July 31, 1894, c. 174, 28 Stat. 162, 205-211. The powers and duties there outlined were in the main those transferred to the General Accounting Office by the Act of 1921.
The question of the jurisdiction of the Comptroller General is not a question as to bookkeeping merely. The decision of the Comptroller General upon the allowance of accounts within his jurisdiction is conclusive upon the executive branch of the government. Act July 31, 1894, c. 174, § 8, 28 Stat. 162, 207, following the provisions of the earlier Act March 30, 1868, c. 36, 15 Stat. 54. Save in cases where resort is had to the courts, therefore, the Comptroller is the final arbiter as to the legality of expenditures. See Annual Report of the General Accounting Office, 1924, p. 3. See St. Louis, Brownsville & M. Ry. Co. v. United States, 268 U. S. 169, 268 U. S. 173-174.
The United States acquired all the stock in the Panama Railroad Company in order that the railroad, with its adjuncts, might be used in the manner most helpful to the government in constructing the Canal. See letter of Wm. H. Taft, Secretary of War, in Annual Report of Isthmian Canal Commission, 1904, pp. 13-15; Annual Report of Directors of Panama Railroad, 1904, pp. 8-9; Annual Report of Isthmian Canal Commission, 1905, p. 18. For a list of the functions performed through the agency of the railroad, see Annual Report of Governor of Panama Canal, 1921, chart facing page 55. See also Panama Canal Act Aug. 24, 1912, c. 390, § 6, 37 Stat. 560, 563, 564. On the auditing of railroad accounts, see Annual Report of Isthmian Canal Commission, 1905, p. 179; Annual Report of Governor of Panama Canal, 1915, p. 42.
The government also held over 95 percent of the stock in the Federal Land Banks, when they were first created under Act July 17, 1916, c. 245, § 5, 39 Stat. 360, 364, but its holding now amounts to less than 2 percent. See Annual Report of the Secretary of the Treasury, 1917, p. 38; 1926, p. 106.
See Annual Report of Comptroller of the Treasury, 1919, pp. 23-26.
See Federal Control Act March 21, 1918, c. 25, § 12, 40 Stat. 451, 457.
The accounts of the Housing Corporation were handled by the Comptroller of the Treasury and his successors after the passage of Act July 11, 1919, c. 6, 41 Stat. 35, 55, 56, providing that the funds of the corporation be covered into the Treasury.
See, e.g., Annual Report of Inland Waterways Corporation, 1925, pp. 2, 3.
"to cause an audit to be made of the financial transactions of the United States Shipping Board Emergency Fleet Corporation, . . . under such rules and regulations as he shall prescribe;"
Appropriation Act March 20, 1922, c. 104, 42 Stat. 437, 444, directed the Comptroller General to make such audit, commencing July 1, 1921, "in accordance with the usual methods of steamship or corporation accounting and under such rules and regulations as he shall prescribe." These special audits were of a nature to afford some information concerning past transactions. But the Acts did not vest control over expenditures either in the Secretary of the Treasury or in the General Accounting Officer making the audit, and none was asserted. The nature, occasion, and purpose of these special audits is set forth in the Annual Reports of the Comptroller of the Treasury, 1919, pp. 23-26; 1920, pp. 24-41, and in the Annual Reports of the General Accounting Office, 1923, p. 34; 1924, p. 12; 1926, pp. 45, 46.
"no part of the sums appropriated . . . shall be available for the payment of certified public accountants . . . and all auditing of every nature requiring the services of outside auditors shall be furnished through the Bureau of Efficiency; Provided, that nothing herein contained shall limit the . . . United States Shipping Board Emergency Fleet Corporation from employing outside auditors to audit claims in litigation for or against the . . . corporation."
See Executive Orders, No. 2664, July 11, 1917; No. 2888, July 18, 1918; No. 3018, Dec. 3, 1918.

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