Case Name: William S. Shrewsbury, appellee, v. The United States, appellants
Court: Supreme Court of the United States
Jurisdiction: United States
Decision Date: 1874-12
Citations: 10 Ct. Cl. 37
Docket Number: 
Parties: William S. Shrewsbury, appellee, v. The United States, appellants.
Judges: Mr. Justice Field dissented.
Reporter: United States Court of Claims Reports
Volume: 10
Pages: 37–50

Head Matter:
SHREWSBURY’S CASE.,
(9 Court of Claims R., 476;
— Wallace R., —.)
William S. Shrewsbury, appellee, v. The United States, appellants.
On the defendants7 Appeal.
An army transportation contract provides: Where stores have been transported, a board of survey shall be called at the point of delivery to examine the quantity and condition, and, in cases of loss, deficiency, or damage, to investigate the facts and report the apparent causes, and state whether the loss was attributable to neglect on the part of the contractor or to causes beyond bis control. Tlie contractor transports sacks of corn under the agreement and delivers them in good order. A hoard of survey finds and reports a deficiency in weight, and recommends that it he charged to the contractor; hut the report does not show that the hoard “ investigated the facts,” nor does it state the “ apparent causes,” nor that the “ loss was attributable to neglect on the part of the contractor.” On the trial the contractor proves that the deficiency was due to shrinkage in weight during transportation and to a defect in the scales used at the point of destination. The contract also provides, that the proceedings of the hoard shall he attached to the hill of lading, and conclude the payments to he made on it. At the time of payment the contractor protests against the deduction. The court heloio decides that for cases of deficiency the parties established a rule hy their contract as to what a hoard of survey should ascertain and report, and that, the proceedings of the board having wholly failed to carry out the intent and terms of the contract, the contractor toas not hound hy the deduction which the hoard made. Judgment for the claimant. The defendants appeal.
I. Where an army transportation contract provides that in case of loss or deficiency a board of survey at the point of delivery shall “ investigate the facts and report the apparent causes, and slate whether the loss or deficiency was attributable to neglect or want.of care on the part of the contractor or to causes beyond his control,” and the report of such' a board merely states that there was a deficiency in weight, coupled with a recommendation that snch deficiency be charged to the contrabtor, the presumption is that the board did investigate, although their report does notin terms say so ,• for this recommendation, if honestly made, could have rested only on ascertained facts, derived from a proper examination. Therefore such a report binds the contractor, and conforms in every substantial particular to the requirements of the contract.
II. Where an army transportation contract provides that in case of loss or deficiency a hoard of survey at the point of destination shall investigate the causes, and that the reportof the board “shall be attached to the bill of lading, and shall conclude the payments to be made on it,” tbe contractor must object either as i;o form or substance at tbe time when the report is made, if he would not he concluded hy it.
The Reporters’ statement of the ease:
The article of the contract relating to the matter now in dispute is as follows:
“Art. YIII. In all cases where stores have been'transported by the said William S. Shrewsbury under this agreement, a board of survey shall be called without delay, upon their arrival at the point of destination or delivery, to examine the quantity and condition of the stores transported, and, in cases of loss, deficiency, or damage, to investigate the facts and report the apparent causes, assess the amount of loss or injury, and state whether it was attributable to neglect or the want of care on the part of the contractor or to causes beyond his control; and these proceedings, a copy of which shall be furnished to the contractor, shall be attached to the bill of lading, and shall conclude the payments to be made on it. For loss of weight, due to shrinkage, or for leakage of vinegar, or, molasses, or other liquids, the contractor shall not be liable, if the packages are delivered in good order and condition, and the board of survey shall be satisfied that such shrinkage or leakage did not arise from neglect or want of care on the part of the contractor or his agents. For deficiences or damages, the contractor shall pay the costs at the point he receives the articles, and freight shall be deducted in the latter casein proportion to the amount of damage assessed. Should no board of survey be called,, through failure on the part of the Quartermaster’s Department or other military authority to convene one, it shall be considered that the contractor has delivered all the stores, as specified in the bill of lading, in good order and condition, and he shall be paid accordingly.”
With regard to the deficiency of the freight, the court below found as follows:
“On the 2d June, 1865, the claimant’s transportation train No. 5 received, at Fort Leavenworth, Kans., eight hundred and fifty-eight sacks of corn, weighing in the aggregate 101,860 pounds, averaging 118f pounds per sack. The train arrived at Fort Lyon, Colo., in the latter part of July, and delivered the corn in good order, except that nine sacks, amounting to 1,069 pounds, were lost. But, by reason of the difference or imperfection of the scales used in the determination of the weight of the remainder, and the shrinkage in weight upon the road, the remaining eight hundred and forty-nine sacks were reported to weigh only 97,620 pounds, instead of 100,791 pounds, their weight when they left Fort Leavenworth, and the claimant toas charged with the loss of 3,171 pounds. A board of survey was ordered on the 31st July, 1865, which met ou the 1st August, 1865, and examined the supplies delivered.”
The proceedings of this board are fully set forth in the opinion of the court, and also the payment pursuant to its recommendation, and the protest of the contractor.
Mr. Attorney-General Williams and Mr. Assistant Attorney-General Goforth for the United States, appellants:
The court below erred in deciding that the proceedings of the boards of survey did not conform to the terms of the contract.
The court erred in deciding that the claimant is entitled to the amount of deductions made by the board of survey.
The court erred in assuming that an acceptance by the claimant of the terms of the proceedings and reports of the board •of survey was not a ratification of and a waiver of any informality in such proceedings, and that the claimant was not concluded by such acceptance.
The court erred in deciding that the giving of receipts as in full for the services rendered did not conclude the claimant.
The reports of the board of survey contaiued everything made necessary by the eighth article of the contract. The condition of the stores was reported, the deficiency in weight noted, and the liability of the contractor for damages and deficiencies, contained in the recommendations of the boards. These are all that the contract contemplated, and the exact form of report was left to the judgment of the boards. If there were any informalities in the reports of the boards of survey, the claimant waived them by acquiescence in the conclusions of the reports and acceptance of payment on the vouchers or bills of lading, which included the deductions ordered by the boards, as in full of all services of the various trains against which the •boards had charged deficiencies. The agreement was to submit the questions of the condition and quantity of the stores transported by the claimant to boards of survey, and their reports were to be conclusive as the payments to be made on the bills of lading or vouchers. Boards were ordered, and they met and examined the transported stores, and their proceedings were attached to the bills of lading. No protest or objection was made to the composition, the proceedings, or reports of the boards, nor any charge made of informality in the proceeding's or reports. The claimant accepted the conclusions of the boards as in full payment of all services rendered, and then protested against the deductions made by the boards. The boards were in the nature of an arbitration, acting for both parties. Where there is a submission to arbitration, after a ratification of an award and execution of its requirements, it is too late for the parties to set up any defect in the proceedings or in the award. In the case of Hoogs v. Morse (31 Cal., 128) the court says:
“The action of the plaintiff in taking a judgment on the award, and then receiving the amount of the judgment in satisfaction, was a waiver of any errors or misconduct on the part of the arbitrators of which he had notice at the time, and he is charged with notice of all errors or misconduct which were known to his attorney. Under the circumstances of the case we are at loss to perceive how there could be any valid ground for setting aside the award at the instance of the plaintiff, except for fraud discovered after the plaintiff had accepted payment in full of the judgment.”
And in Tudor v. Scorell (20 N. H., 174) it is said :
“ But in general a party may waive a condition for which he has stipulated, and that principle seems applicable to the present case. Whatever advantages the parties might have contemplated in requiring the award to be made in writing, they were competent to waive that condition as to the whole or a part of the matters included in it.”
If the proceedings were informal, the claimant had the option to accept or not any money under them ; but after he waived or cured the informality by acceptance of the terms of the reports, that acceptance was in conformity to the eighth article of contract, which says u the proceedings shall conclude the payment to be made on the bill of lading,” and the contractor cannot now claim that the payments shall not be final, or be in full, or conclude him. No verbal protest could disturb the finality of the claimant’s uncontrolled, deliberate action in accepting the amount awarded.
A proper objection or x>rotest to the reports of the boards of survey would have been a refusal to receive the amount under the terms of the report; not, most certainly, a written receipt as in full of all services rendered by certain trains, even if accompanied by a verbal protest. A verbal protest to the reports or proceedings of the boards cannot be considered to have any effect when there is an acquiescence in the conclusions of the boards by an acceptance of the amount of the bills of lading, made in conformity to the reports, which the contract declared should conclude the payments. He could not have accepted the award without being concluded. The taking of the amount allowed by the boards of survey appointed pursuant to the contract, i. e., by the act of both parties, and giving the receipts as in full payment for all services rendered by certain trains, bring the case within the ruling of the Supreme Court in Justice, (14 Wall., 535;) Mason,' (17 id., 67 ;) and Sweeney, (17 id,., 75,) notwithstanding a promise on the part of the claimant to look elsewhere for the amount of the deductions. In fact, this case is more favorable for the United States than those quoted, because it is an acceptance of an award which the contract says shall conclude all payments on the bills of lading.
Mr. C. _F. Peck for the claimant, appellee:
It is unnecessary to regard the stipulation concerning the board of survey as in all respects amounting to an arbitration. It is sufficient to say that it was analogous to such a proceeding, and is to be governed by the same principles so far as they are applicable. Some method was necessary to determine the quantity and condition of the stores when delivered, and the responsibility for their loss or damage. It was a matter about which the contracting parties had the undoubted right to provide for by agreements between themselves. And as the law does not make agreements for parties, but only carries into effect such agreements as they make for themselves, I ask the consideration of the court to the precise terms agreed upon. The contractor consented that the officers constituting the board of survey might, for the purpose of ascertaining whether he had done his duty, do certain things, viz: Examine the quantity and condition of the stores transported, and, in cases of loss, deficiency, or damage, to investigate the facts; to report the apparent causes; to assess the amount of loss or injury; to state whether it was attributable to neglect or want of care on the part of the contractor or to causes beyond his control. These five points he agreed might be passed upon by the board; nothing more and nothing less.
The court below, whose conclusions of fact cannot be appealed from, says:
a The board did not investigate the facts; it did not report the apparent causes; it did not state whether the loss was attributed to neglect or the want of care on the part of the contractor or to causes, beyond his control.”
All the board did was to examine the quantity and condition of the stores, and, finding a deficiency, assessed the amount of it — as a matter of course, to be docked from the freight money. ■The board ended the investigation where it should have begun it. Having ascertained that there was a deficiency, and the amount of it, then the issue arose as to whom it should be charged. For this purpose they were required to go on and investigate the facts concerning the deficiency, to report the causes of the deficiency, and to state whether, in their judgment, it was attributable to neglect or want of care on the part of the contractor or to causes beyond his control. The contract says these proceedings shall conclude the payments to be made; and I submit that these proceedings are necessary for that purpose. It will be observed that neither the commanding officer at the station nor the officer receiving the property, nor the officers constituting the board, had anything to do with the payment.of the freight money. A copy of these proceedings was to be attached to the bill of lading, and the payments were made at a distant point. The board therefore merely established the proceedings upon which another officer was to act in making up the accounts, and it was all-important that these proceedings- should be complete and in accordance with the contract.
No case could better illustrate the necessity of complying with the precise terms of a submission than the one at bar. This same article YIII of the contract declares that the contractor shall not be liable for loss of weight due to shrinkage, if the packages should be delivered in good order; and the court below found that, as a matter of fact, the loss in these cases was due to shrinkage, and impliedly the board found the same fact, for ifc reported that tbe packages were in good order. If the board had taken the nest step which it was required to take, and reported the apparent causes of the deficiency, aud whether it was attributable to neglect or want of care on the part of the contractor or to causes beyond his control, a totally different result must have been reached.
This contractor placed himself, to a great extent, in the hands of the Government. The fact that so many advantages were on the side of the appellant renders it all the more imperative that the conditions upon which those advantages were to be used should be complied with. He did not stipulate that when goods were received, a board of survey might examine into the weight, and, if a deficiency was found, that it might, in its discretion, charge him with the loss, regardless of all other facts. Yet this is precisely what was done.
“ The power and authority of an arbitrator is derived entirely from the submission. He must therefore make his award strictly in pursuance and in conformity with the submission.” (Watson on Arbitration, 145.)
“ It is a general rule that unless the arbitrator makes his award of all matters submitted to him, the award is entirely void.” {Ibid., 158.)
“ Whenever a special authority is created, those who give it have a right to annex to it their own terms, with which he on whom it is conferred must comply.” (Russell on Arbitration, 3d edit., p. 235.)
“ If the submission contain instructions concerning the form, execution, or publication of the award, they must be strictly followed.” (Morse on Arbitration, 259.)
“An award owes, its force and validity to the agreement of the parties, and is not of course binding upon them unless it has been made in the manner which the agreement has pointed out.” (Tudor v. Scovell, 20 N. H., 174; Montague v. Smith, 13 Mass., 396; Allen v. Galpin, 9 Barb., 246.)
Mr. Morse says: “ This rule, however, is so far limited in its application to essentials that it is not to be extended to frivolous inconsistencies or neglects. The award will not be vacated for matters of sheer insignificance.. On the other hand, considerable strictness is shown in determining what are essentials. Generally, however, it may be said that if the parties.distinctly agree that a certain specific formality shall be observed in the execution of the award, their express demand must be complied with, or the award will be had.” (Morse on Arbitration, 260.)
It is further alleged by the appellant that if there were any informalities in the reports of the boards of survey, the claim* ant waived them by acquiescence in the conclusions of the reports and acceptance of payment on the vouchers or bills of lading.
The argument for the appellant proceeds upon the misapprehension that the contractor obtained an award in his favor and received the money. Such is not the fact. The board of survey had no jurisdiction over' the matter of freight money. That was definitely fixed by the contract; there was no controversy concerning it. There was no award, and could be none, as to the moneys earned by the contractor, but the report had reference solely to the counter-charges claimed by the United States. The moneys received by the claimant had no reference to the matters considered by the board, and they were both paid and received with an explicit understanding that it was not to be a final adjustment.
The cases cited in the brief for appellant are based upon the principle that a party cannot take the benefits of an award without accepting its disadvantages.
There is no such principle involved here. The claimant took that which had no relation to the controversy, submitting for the time to the reduction, but giving notice that he would claim the amount withheld.
The final ground of defense is that the claimant is concluded by the acceptance of the money and the receipt he signed. This is the familiar defense of accord and satisfaction. Blackstone says:
“Accord is a satisfaction agreed upon between the party injuring and the party injured, which, when performed, is a bar of all actions upon this account; as if a man contract to build a house or deliver a horse, and fail in it, this is an injury for which the sufferer may have his remedy by action; but if the party injured accepts a sum of money or other thing as a satisfaction, this is a redress of that injury, and entirely takes away that action.” (Book III, p. 15.)
The gist of the inquiry is whether the money was paid and accepted as a satisfaction. If it was, there is an end of the case. If it was not, the right of action remains.
This court has had occasion to repeatedly consider the precise question, under what circumstances will the payment and receipt of money be held as sufficient evidence of this satisfaction! Of course the intention of the parties must govern; not the secret intentions or mental reservations, but the intention as evidenced by their acts and plain declarations.
In the. case of Theodore Adams the claimant held large claims against the War Department, which the Secretary of War refused to pay or consider, except upon the investigation of the board known as the Holt, Davis and Campbell Commission. That commission gave the claimant an award for a reduced sum, and he signed a receipt in full of all demands, and afterwards received the money, signing a receipt in full for the account stated. No protest was made and nothing said on either side. This court held that the receipt was no bar,but the circumstances showed that the money was accepted in satisfaction of the entire claim. (7 Wall., 463.)
Afterward it was attempted to take the case out of the rule by showing that Adams had not submitted his claim to the commission. But the court held that, as he had made himself a party to the proceedings and had accepted the money, he was concluded. Nothing was said in this case about a protest, none haying been made. (7 Wall., 463.)
The next case, that of Child, Pratt & Pox, (12 Wall., 232,) was the same as Adams’, excepting it appeared affirmatively that claimants had not submitted their claims to the commission. The court again decided that the money was received in satisfaction of the claim, because it was a compromise fairly made. The opinion reads:
“If there had been no reference to and no finding by the commission, it would still remain true that here was a claim the justice of which had been denied and the amount that was due on it had been in dispute for nearly two years. The Government finally says to the claimants, (We will pay you a certain sum on this disputed claim, provided you will take it in full satisfaction of the whole,’ when, without intimidation, without fraud or concealment on the part of the Government, without protest or objection on their part, the claimants accept the money offered, and sign a receipt acknowledging it to be in full of the whole claim. Is not this a legal and binding compromise of the disputed demand ? Is it not a voluntary adjustment of the matter in dispute between the parties!”
This is a plain statement of the conditions required for an accord and satisfaction; and I insist that the case stated by the court differs in nearly every essential particular from the one at the bar.
The case of Clyde, (13 Wall., 37,) was where a charter-party had been signed for the use of a steamer, and afterward the Government officers had reduced the rate of payment. Upon this a dispute arose, and subsequently the claimant accepted the reduced rate and signed a receipt in full. It was held that he received the amount in satisfaction of his claim. There was no objection or protest shown, and therefore it fell within the rule in Child, Pratt & Foods Case.
The case of Justice, (14 Wall., 535,) was like that of Child, Pratt & Fox, excepting that no receipt was given. The court held that the acceptance of the money under the award made, without objection or protest, was conclusive upon the claimant, and that no receipt was necessary. Care was taken in this last case to define the limits of the rule laid down, as follows:
“ It is always in the power of parties to compromise their differences. One way of doing this is by arbitrators mutually chosen; but from such submission neither party is at liberty to withdraw after the award is made. The condition of the Government creditor is better than this; for if dissatisfied with the allowance made him by the commission, he can refuse to receive it, or can accompany his receipt, if he chooses to take it, with a proper protest. This protest is necessary to inform the Government that the compromise is rejected, and that this rejection leaves the claimant free to litigate the matter in dispute before the Court of Claims. If with this knowledge and under these circumstances the money is paid, there can be no just cause of complaint, and the status of the parties is not affected by anything which transpired before the commission.
. The rule here laid down covers this case and laps over all around. Even upon the extreme view taken by the Attorney-General, that the board of survey passed upon the whole claim, and that the claimant accepted the money under its award, it was only required, in order to preserve all of his rights, that he should protest at the time of receiving the money that it was not in satisfaction of the whole claim. If after such protest the officers saw fit to pay him, his status was not affected by such payment.

Opinion:
Mr. Justice S wayne
delivered the opinion of the court:
This is an appeal from the judgment of the Court of Claims.
But a single point is presented for our consideration.
The case arose out of a contract for the transportation of army supplies. The eighth clause of the, contrac tprovidod that upon the arrival of the stores transported at their point of destination, a board of survey should be called, without delay, who should examine their quantity and condition. In case of loss, deficiency, or damage, it was made the duty of the board to investigate the facts, assess the amount of loss or injury, and state whether it was attributable to neglect or to the want of care on the part of the contractor or to causes beyond his control. It was further provided that a copy of the proceedings of the board " shall be furnished to the contractor, shall be attached to the bill of lading, and shall conclude the payments to be made on it." For deficiency and damages the contractor was to pay the cost at the point where he received the supplies, and freight was to be deducted in the latter case in proportion to the amount of damages assessed.
If no board should be called, through the neglect of the proper military authority, it was to be considered that the contractor had delivered all the stores specified in the bill of lading in good order, and he was to be paid accordingly. Such a board was called and reported in several instances. All the reports were in the following form :
"Proceeding of a board of survey which assembled at Fort Lyon, C. T., by virtue of the following order, viz :
(Special Order No. 145.)
" Headquarters, Fort Lyon, O. T.,
" July 31st, 18G5.
"A board of survey is hereby ordered to meet at the commissary building to-morrow morning at 9 o'clock, or as soon thereafter as practicable, to examine and report upon the quantity and condition of certain commissary and quartermaster stores being received by Lieut. C. M. Cossit, A. A. Q. M. &' A. C. S.
"DETAIL EOR THE BOARD.
" 1st Lieut. J. A. Cramer, Yet. Batt., 1st Col. Cav.
" 1st Lieut. Henry Gronheim, 15th Kan. Cav.
" By order of Theo. Oonkey, capt. comdg. post.
(Signed) "JAMES OLNEY,
" 2d TAent. & Post Adjutant.
" Fort Lyon, Aug. 1 st, 1865.
" The board met pursuant to the above order — present, 1st Lieut. J. A. Cramer, Vett. Batt., 1st Col. Cav., & 1st Lieut. Henry Gronheim, 15th Kan. Cavy. — and proceeded to examine the supplies delivered by Freight-Contractor W. S. Shrewsbury, in contractors' train No. 124, Fort Lyon, No. 5, and find as follows:
" Packages all correct and in good order, with the exception of nine sacks of corn deficient; weight agreeing with the B. L., with the exception of four thousand two hundred and forty (4,240) pounds of corn deficient.
" The board therefore recommend that the deficiency of corn be charged to the freight-contractor, and that Lieut. C. M. Cossitt, A. A. Q. M., be permitted to drop said deficiency from his return. '
" The board then proceeded to other business.
"JOSEPH A. CRAMER,
" 1st Lieut. Vet. Batt., 1st Col. Cav., President.
"HENRY GRONHEIM,
" 1st Lieut. 15th Kansas Cavalry, Recorder.
"Approved.
"THEO. CONKEY,
" Capt. 3d. Wis. Cav., Comdg. Post"
In all instances the contractor was paid the amount due, according to the bill of lading, less the deductions found by the board to be chargeable against him, and gave a receipt as follows:
" Received, at Fort Leavenworth, Kansas, the 23d of October, 1865, of Gapt. H. L. Thayer, assistant quartermaster United States Army, the sum of ninety-one thousand two huD- dred and forty-three dollars and sixty cents, in full of the above account.
(Signed in duplicate.)
"W. S. SHREWSBURY,
" By ANDREW' STUART,
uRis Attorney."
In each case the 'contractor, when the receipt was given, u protested against the deductions, and gave notice to the quartermaster who made the payment that he should look ot the defendants for a corrected adjustment and for full payment." The Court of Claims held for naught the findings and recommendations of the board. The counsel for the appellee maintains that this was right, because the agreement was that in case of deficiency the board should " investigate the facts and report the apparent cause and assess the amount of loss or injury, and state whether it was attributable to neglect or want of care on the part of the contractor or to causes beyond his control," and that their proceedings failed to carry out the intent and terms of the contract in these particulars. This is too narrow and technical a view of the subject. The provision of the contract touching the board was important to the Government. The points of delivery were in the wilds of the West. If there was any failure by the contractor, the time and place of delivery were the time and place to ascertain the facts and to put the evidence in an effectual shape. Afterward it might be impossible for the Government to procure the proofs -; and if it were done, the expense might greatly exceed the amount of the items in dispute. At the delivery the bill of lading spoke for itself. The teamsters and guards who accompanied the train were present and could readily be examined. It is said by the Court of Claims, in their conclusions of law, that the board failed to make the requisite investigations of the facts. To do this was one of the most important duties devolved upon them. It is to be presumed they discharged it. They did not say in terms that they had done so, but they reported conclusions.carrying with them the strongest implicationthat what was recommended rested on a basis of ascer-tainedfacts. The board, ashonest men, could not have announced such results without the proper previous examination. The means were at hand, and the work was easy. A formal and technical instrument was not to be expected from military men acting' under such circumstances. We think the reports were sufficient, and that they conform, in every substantial particular, to the requirements of the contract.
It does not appear that the contractor objected either as to form or substance when the reports were made, nor that he disclosed any objection subsequently until the time of payment. Nor did his objections then assume a definite shape. He notified the quartermaster that he should claim "a re-adjustment and full payment." The reasons and grounds of the claim were not stated. The payments were made at a distant point and after the lapse of several months. The witnesses were then scattered and gone. Most of them doubtless were difficult if not impossible to be found. As the contractor was silent when he should have spoken, he cannot be permitted to speak at the later period, in the altered condition of things which then existed as regards the other party. He must be held to have waived any exception which he might have taken at the proper time, and to have been, when the payments were made, finally concluded.
The judgment of the Court of Claims is reversed, and the case will be remanded, with directions to dismiss the petition.
Mr. Justice Field dissented.