Case Name: William Herndon v. The United States
Court: United States Court of Claims
Jurisdiction: United States
Decision Date: 1879-12
Citations: 15 Ct. Cl. 446
Docket Number: 
Parties: William Herndon v. The United States.
Judges: 
Reporter: United States Court of Claims Reports
Volume: 15
Pages: 446–453

Head Matter:
HERNDON’S CASE.
William Herndon v. The United States.
On the Proofs.
A deputy eolleetor of internal revenue, appointed l>y the collector at a salary of $1,200, in 1873, also acts as an assistant in mahing surveys of distilleries. When the colleetor’s accounts are audited, the accounting officers refuse to allow double pay to the same officer, and deduct from the allowance of $1,200 for the deputy’s salary the pay which he received as assistant. The collector accordingly deduets it from the deputy’s salary, and he brings this action to recover it. It appears that the collector was duly authorized by the Secretary of the Treasury to employ a deputy at $1,200 a year.
I. Prior to the Act 1st March, 1879 (20 Stat. L., 329, 5 2), deputy collectors of internal revenue were employés of the collector hy whom they were appointed and compensated, and the government was not liable to them for their services.
II. Where the Secretary of the Treasury, under the Revised Statutes ($ 3145), made such allowance as he saw fit to a collector for the payment of deputies, and the collector appointed them and paid them, and the Treasury had no accounts with them, no privity existed between them and the government.
ill. When a deputy collector of internal revenue performs under authority of law the duties of collector, a privity arises, and he may maintain an action for his compensation as collector.
The Reporters’ statement of the case:
The following are the facts of this case as found'by the court: I. The claimant was one of the deputies of W. J. Landrum, collector of internal revenue for the eighth district of Kentucky,. from August 1,1873, to March 31,1875, duly appointed by said collector as provided by law, at a salary of $1,200 a year.
II. Under tbe provision of tbe statute permitting tbe Secretary of tbe Treasury to make to collectors of internal revenue further allowances from time to time, in addition to their salaries and commissions specifically given to them, tbe Secretary, previous to tbe commencement of each fiscal year, while tbe claimant was such deputy, granted to said collector a special allowance of $1,200 each for two deputies, among other allowances, for other deputies and for a clerk.
III. Said collector from time to time rendered bis accounts, which were approved by tbe Commissioner of Internal Revenue, and in which he credited himself with said special allowances. These accounts were all settled, except that the sum of $990 was disallowed by the First Comptroller because the claimant, during the period of his employment as deputy, had been paid that sum by the defendants for his services for 198 days as an assistant to the collector in making surveys of distilleries, for which service he had been designated by the Commissioner at a compensation of five dollars a day.
IY. The defendants have not paid said $990, nor any part thereof, on account of said allowance, either to said collector or to the claimant j and, to that extent, the claimant has not been paid by the collector.
Y. The claimant was designated by the Commissioner of Internal Revenue, on the 20th of May, 1873, to assist said collector in making surveys of distilleries in said district at a compensation of $5 a day in addition to his necessary traveling expenses. Under said designation he was employed 198 days before April 1, 1875, for which his per diem compensation was $990, and that has been paid to him by the defendants.
During the month of April, 1875, he was employed in such service five days, for which he has not been paid.
Upon the foregoing findings of fact the court decided as conclusions of law—
1. That before the passage of the act of March 1, 1879, ch. 125, § 2 (20 Stat. L., 329), the United States were not liable to the deputy collectors of internal revenue for payment of their services. Such deputies were employós of the collector by whom they were appointed and by whom they were to be com-densated.
2. The claimant is not entitled to recover from the defendants the balance of compensation due to him from the collector.
3. The claimant is entitled to recover $25 for Jive days’ services in April, 1875, under the designation of the Commissioner of Internal Revenue, for assisting the collector in the survey of distilleries.
Mr. George L. Douglass for claimant:
This case falls clearly within the principles laid down in Collins v. The United States (ante, p. 22). The disallowance of claimant’s salary as deputy collector was erroneous, and he is entitled to recover the same from the United States.
The compensation of a deputy collector, though paid through the collector, really comes from the United States. This is the mode of payment prescribed by law for convenience sake in settlement of the public accounts,* but it does not prevent this court from rendering judgment in favor of the claimant to whom the money is due for services actually rendered and the performance of duties which were imposed upon him by law.
While a deputy collector may not be a public “ officer” in the sense of the Constitution, he is at least an employé of the government, and is an “officer” within the meaning of the statutes. Public duties are imposed upon him, and he is expressly referred to as an “officer” in sections 3167, 3177, 3197, 3198, 3199, and 3203 of the Revised Statutes.
- Furthermore, a special allowance of $1,200 per annum was made by the Secretary of the Treasury to the collector for the salary of the present claimant, and expressly limited to that purpose. This was in legal effect a promise to the collector for the benefit of the deputy, and brings the latter into a contract relation with the defendants.
“Where a promise is made to A, for the benefit of B, either may sue for a breach of it.” (United States v. Kerman, Pet., C. Ot., 169.)
“ A third party may maintain an action on a promise made to another for his benefit.” (21 Ill. 194; 18 Ind., 40 ; 3 Met., 198; 10 Mass., 287 ; 15 Mass., 286; 15 Abb. N\Y., 280; 10 Vt., 25i.)
There is no question as to the liability for $25 due to claimant on his surveyor’s accounts-.
Mr. Assistant Attorney-General Simons (with, whom was Mr. George 0. Wing) for the defendants:
There is no privity of contract between the parties. By section 10, Act June 30,1864 (12 Stat. L., 226; § 3148, Rev. Stat.), it is expressly declared, in authorizing the appointment by a collector of “ as many deputies as he may think proper,” that they are “to be by him compensated for their services.” Claimant must therefore look to him. The compensation of deputies is drawn ultimately, no doubt, from the Treasury, but for reasons of convenience or otherwise Congress has seen fit to exclude them from direct relation with the defendants as respects that matter. The collector has a legal obligation to his deputies which cannot be shifted, and for the due performance of which by him the law carefully provides. Thus, by section 3145, Revised Statutes, he is allowed, in salary and commissions, a compensation fixed within certain limits, out of which he must himself pay (with some immaterial exceptions) for all the assistance required and other expenses of his office. If any part of that agreed compensation is withheld from him, his employé cannot recover it.
If the claimant can stand as suitor in the collector’s place, he must take it subject to all conditions annexed thereto by law. (Sail v. The United States, 2 Dill., 427; 91 U. S., 559.)
The case cited also decides that the claim of a collector for compensation of his deputies, disallowed by the accounting officers, and not shown to have been especially allowed by the Secretary, is within the prohibition of section 1765, Revised Statutes, as interpreted in Converse v. The United States (21 How., 470), and that ruling seems clearly applicable to this case.

Opinion:
Richardson, J.,
delivered the opinion of the court:
The claimant was a deputy collector of internal revenue, duly appointed by the collector of the eighth district of Kentucky, at a salary of $1,200 a year. During the time of his employment the collector was granted by the Secretary of the Treasury, annually, among other allowances for other deputies and for a clerk, a special allowance of $1,200 each for two deputies. That allowance has been settled and paid, except the sum of $990, disallowed by the First Comptroller because the claimant during tbe term of bis employment as deputy bad been paid that sum by tbe defendants for bis services for 198 days as an assistant to tbe collector in making surveys of distilleries; for wbicb service be bad been duly designated by tbe Commissioner of Internal Revenue, at a compensation of $5 a day.
We do not find it necessary to consider the reasons assigned for not paying tbe money in question to tbe collector, nor to determine whether or not the United States bad a valid defense to it as against him. Tbe collector is not a party to this action, and bis rights cannot be judicially determined in suits between other parties.
In our ojtinion, deputy collectors, before tbe passage of the Act March 1, 1879 (20 Stat. L., 329), ch. 125, § 2, were not em-ployés of tbe United States for tbe payment of whose services the defendants were liable to them. There was no authority of law by wbicb tbe Secretary of tbe Treasury or any other officer of tbe government could make valid contracts with deputy collectors of internal revenue to pay to them salaries from tbe public Treasury. On tbe contrary, tbe statutes expressly provided for their appointment and payment by tbe collectors for whom they were deputies.
Section 3148 of tbe Revised Statutes, embodying tbe preexisting law, is as follows:
"Bach collector shall be authorized to appoint, by an instrument in writing under bis band, as many deputies as be may think proper, to be by him compensated for bis services; to revoke any such appointment, giving such notice thereof as the Commissioner of Internal Revenue may prescribe; and to require and accept bonds or other securities from such deputies. Each such deputy shall have tbe like authority, in every respect, to collect the taxes levied or assessed within tbe portion of tbe district assigned to him, wbicb is by law vested in tbe collector himself; but each collector shall, in every respect, be. responsible both to tbe United States and to individuals, as tbe case may be, for all moneys collected, and for every act done or neglected to be done by any of bis deputies while acting as such."
Section 12 of the act of February 8, 1875, ch. 36 (18 Stat. L., 309), is in nearly tbe same words :
" Bach collector of internal revenue shall be authorized to appoint, by an instrument in writing under bis band, as many deputies as be may think proper, to be by him compensated for their services; to revoke any such appointment, giving such notice thereof as the Commissioner of Internal Revenue may prescribe; and to require and accept bonds or other securities from siich deputy; and actions upon such bonds may be brought in any appropriate district or circuit court of the United States, which courts are hereby given jurisdiction of such actions concurrently with the courts of the several States."
In section 3145 of the Revised Statutes it is provided that "there shall be allowed to collectors, in full compensation for their services, and for those of their deputies, a salary of fifteen hundred dollars per annum, to be paid quarterly and, in addition thereto, a commission" on the money by them collected, with certain further allowances which the Secretary of the Treasury was authorized to make to the collectors.
After the passage of the Act December 24, 1872 (17 Stat. L., 401, ch. 13, § 1), abolishing the office of assessor and of assistant assessor of internal revenue, and transferring most of their duties to the collectors, these officers found their labors so much increased that many of them were obliged to appoint an additional number of deputies.
This proved to be a heavy burden to many collectors; and, in order to reimburse them to some extent, more or less, for their expenses in employing deputies and also clerks, the Secretary of the Treasury adopted the practice of granting to them special allowances, under the provisions of a clause of the law now found in section 3145 of the Revised Statutes, which is as follows:
u The Secretary of the Treasury may make such further allowances [to collectors], from time to time, as may be reasonable, in cases where by reason of the territorial extent of the district, or the amount of internal taxes collected, or other circumstances, it may seem just to make such allowances."
Before the commencement of each fiscal year, the Secretary, at the request of the collector, determined the extent of such special allowances to him, stating the amount which would be granted for a specified number of deputies. The collector was thus informed what he could rely upon in that regard. He might still appoint, as provided by law, as many deputits as he might think proper, but whether he appointed more or less, his special allowance on account of them was limited to the number specified by the Secretary.
The Treasury Department had no accounts with deputy collectors. They were paid as before, as expressly required by statute, by the collectors who appointed them.
There was, therefore, no privity of contract between the United States and the deputy collectors for the payment of their salaries. The fact that the Secretary of the Treasury made an allowance to collectors on account of the employment of deputies did not change the relation of the parties as fixed by statute, nor create any privity of contract on the part of defendants with the collector's employés.
In that respect the case is very much like that of Driscoll v. The United States (13 C. Cls. R., 15, and 96 U. S., 421). A contractor had made an agreement with the United States to furnish all the labor for the erection of a certain building. He was to pay the wages of the laborers, and was to be repaid the amount with 15 per cent, added for his services. The government employed a superintendent and clerk. The clerk entered the name of every workman in a book kept by him, and no laborer was employed who was not approved by the superintendent. The contractor gave the men to understand that he would pay them whatever wages the superintendent would allow. The government clerk made out the pay-roll at the end of each month, had the men sign it, and it was then sent to the Treasury Department by the contractor, who was paid the full amount with 15 per cent, added for his services.' This court held that no privity of contract was created by those transactions between the United States and the laborers, and that the legal claims of the workmen for their wages were wholly against the contractor. Our opinion was sustained by the Supreme Court on appeal; and the pro forma judgment which was entered for the claimant contrary to the views of the court on the merits, in order that the case might, be taken to the tribunal of last resort, was reversed. That case cannot be distinguished from this in principle on the question of privity of contract, and is conclusive against the present claimant on his claim for salary as deputy collector.
By the Act March 1, 1879 (20 Stat. L., 329, ch. 125, § 2), the law and the practice of the Treasury-Department in relation to the payment of the salaries of deputy collectors have been changed; but that does not affect the claimant's case, which arose before the passage of that act.
There is one case in which a deputy collector of internal revenue may maintain an action against the United States. When he performs, under authority of law, the duties of collector in consequence of a vacancy in tbe office, be is entitled to receive tbe salary and commissions allowed by law to sucb collector, or tbe allowance in lieu of said salary and commissions. It is expressly so provided by section 3150 of tbe Revised Statutes. It was under that section that tbe claimant recovered judgment in bis favor in Farden's Case (13 C. Cls. R., 347, affirmed on appeal, 99 U. S., 10). But that is not tbis case.
Tbe claimant in bis petition seeks to recover tbe further sum of $25 for five days' services in April, 1875, as an assistant of tbe collector in making surveys of distilleries, duly designated for that service by tbe Commissioner of Internal Revenue, at a per diem compensation of $5 a day. Tbis was done under authority of tbe statute, and tbe claimant is entitled to recover for tbe amount allowed to him by the Commissioner. (Rev. Stat., § 3264, and now Act March 1, 1879, 20 Stat. L., 334, ch. 125, § 5.) No defense is set up to tbis claim.
Tbe judgment of tbe court is that tbe claimant recover tbe sum of $25 for bis services as assistant to tbe collector in tbe survey of distilleries; and that as to bis claim of $990 for salary as a deputy collector, bis petition be dismissed.