Case: W. FLEET STEELE, TO THE USE OF THE CORN EXCHANGE BANK v. THE UNITED STATES
Abbreviation: Steele ex rel. Corn Exchange Bank v. United States
Decision Date: 1884-02-18
Docket Number: No. 12318
Citation: 19 Ct. Cl. 181
Volume: 19
Reporter: United States Court of Claims Reports
Court: United States Court of Claims
Jurisdiction: United States
Parties: W. FLEET STEELE, TO THE USE OF THE CORN EXCHANGE BANK v. THE UNITED STATES.
Judges: 
Pages: 181–199

Head Matter:
W. FLEET STEELE, TO THE USE OF THE CORN EXCHANGE BANK v. THE UNITED STATES.
[No. 12318.
Decided February 18, 1884.]
On the Facta.
Tbe claimant avers an oral contract witb the Navy Department, whereby he was to do plumbing on a naval vessel and take old material in part payment. Subsequently a naval constructor turns over to him ' a quantity of old material. This he assorts and sells for $9,000. The department charges it to him at $2,0(.'0 and gives him a voucher for the balance, on which he brings this action. The defendants set up a counter-claim for the full value of the old material.
I.An oral contract made by the chief of the Bureau of Construction and Repair of the Navy Department, for work to be done on a vessel, is void under the provision requiring certain contracts to be in writing, Revised Statutes, § 3744.
II.A naval constructor in the Navy has no authority to turn over old material to a contractor, and his doing so confers no title.
III.The transfer of old material in the Navy in payment of work done or to be done, or in exchange for other material, is in effect prohibited by the provision of the Revised Statutes ($ 1541) which directs the Secretary to sell such as “cannot ie advantageously used" at public sale; and by the provision ($ 3618) which requires “ all proceeds of sales of old material ” to be covered into the Treasury.
IV.A naval contractor -who receives old material in part payment of his account for services rendered is not an innocent purchaser.
V.A person who receives old material contrary to the provision of the statutes and sells the same, acquires no title and is liable to the government for the proceeds.
VI.Where a person received and sold property of the government, the burden is upon him to show what expenses he incurred in preparing it for sale. If none be shown the damages will be the gross amount of proceeds.
The Reporters’ statement of the ease:
The following are the facts as found by the court:
I. In the month of March, 1875, and thereafter in that year, while the matters hereinafter set forth were occurring, the claimant was engaged in the city of Philadelphia, Pa., in the business of ship-plumbing, and had a capital of about $2,500 cash; and during the same time Robert W. Steele was a naval constructor in the United States Navy, and was on duty as such in said city, but not in the navy-yard there; and Edward Hartt was a naval constructor in said Navy, and was on duty as such at the Philadelphia navy-yard; and Isaiah Hanscom was chief of the Bureau of Construction and Repair in the Navy Department. The duty of said Robert W. Steele in Philadelphia was that of superintending the repairing or rebuilding of monitors at the different yards of Harlan & Hollingsworth, at Wilmington, Del., Cramp & Sons, in the northern part of Philadelphia, and John Roach & Sons, at Chester, Pa.
II. In the said month of March the United States steamer Quinnebaug was on the ways in the Philadelphia navy-yard, and the firm of Neafie & Levy, sbip-builders, had a contract with the Navy Department to do work on and launch her. All plumbing work on her under the water-line had to be done before she should be launched.
III. In the latter part of said month of March, or early in April, the claimant, learning that said plumbing work had to be done, went to Washington, and had an interview in relation to that work with said Hanscom, in the office of the latter, when no third person was present. It does not appear what passed between the claimant and Hanscom in that interview, except that some verbal understanding was had between them for the claimant to do the needed work on the Quinnebaug; that Hans-com gave him verbal instructions to go on with the work; that the matter of using in the Quinnebaug old material taken out of other vessels was talked of; and that Hanscom spoke of the old material being of the value of $2,000; but it does not appear what particular material nor what quantity of material was referred to.
IY. After said interview the claimant sent to said Hanscom the following letter:
“Phila., April 6th, 1875.
“ Sir : I will furnish all material and labor for the plumbing •of the U. S. S. Quinnebaug according to the requirements of the service, and to the satisfaction of the inspecting officers, for the sum of fourteen thousand five hundred dollars, and will take in whole or part payment any old brass or lead arising from old vessels that can be reworked for that purpose.
“ Eespectfully, yours,
“W. Fleet Steele,
“ Ship-Plumber, No. 3 South St.
“I. Hanscom,
“ Chief of Bureau of Gonstmction and Repair,
“ Navy Dept., Washington, D. CP
No answer to this letter appears to have been returned, except that of July 30, 1875, set forth in finding IX.
Y. On the receipt of said letter of the claimant the Bureau of Construction and Eepair directed Naval Constructor Hartt to draw up specifications of the plumbing work to be done on the Quinnebaug, and to obtain proposals from the ship-plumbers in the vicinity to do the work.
Such proposals were received by the bureau, but from whom does not appear, except that contained in the aforesaid letter, which was the lowest bid for the work.
YI. On the 15th of April, 1875, the Bureau of Construction and Eepair addressed the following letter to Naval Constructor Steele:
“ Nayy Department,
“Bureau oe Construction and Eepair,
“ April 15th, 1875.
“Sir: Please have all the old lead, brass, and composition arising from breaking up the monitors, including the Amphi-trite, Miantonomoh, and Terror, at the establishments of Messrs. Harlan and Hollingsworth, John Eoach, and Wm. Cramp & Sons, carefully weighed, boxed up, and sent to Philadelphia, and report the amount to the Bureau.
“ Yery respectfully, your ob’d’t serv’t,
“I. Hanscom,
“ Chief of Bureau.
“ Naval Constructor E. W. Steele, U. S. N.,
“ 424 Walnut St., PM lad? a, PaP
Naval Constructor Steele, interpreting this letter as an authority from the bureau to him to deliver to the claimant the old material therein referred to, proceeded to deliver to him, and the claimant received and took into his possession, old material to the amount of 103,949 pounds, property of the defendants ; of which there were delivered to him, on or before April 29, 1875, 49,399 pounds; and in the month of May ensuing, 44,775 pounds; and between May 31 and July 7, 1875, 9,775 pounds; and on the last-named date the claimant signed and delivered to Naval Constructor Steele the following two receipts :
“Received, Philadelphia, July 7th, 1875, from Naval Constructor R. W. Steele, U. S. N., old scrap material taken from broken-up monitors at Win. Cramp & Sons’ ship-building yard, amounting to 67,109 pounds.
“W. Fleet Steele,
“Ship-Plumber ’
“Received, Philadelphia, July 7th, 1875, from Naval Constructor R. W. Steele, U. S. N., old scrap material taken from broken-up monitors at the ship-yard of the Harlan and Hol-lingsworth Company, Wilmington, Del., amounting to 36,840 pounds.
“ W. Fleet Steele,
“ Ship-Plumber. ”
VII. Of the quantity of 103,949 pounds of old material received by the claimant, as stated in finding YI, he made the following disposition of 98,748 pounds, to wit:
1. April 29, 1875, he turned over 49,399 pounds of old scrap lead, at 6¿- cents per pound = $3,025.69, to a party, in payment for new lead purchased by him of said party.
2. May 3, 1885, he sold 18,489 pounds of old brass, at 12J cents per pound = $2,311.12.
3. May 18, 1875, he sold 26,286 pounds of old brass at 12 J cents per pound = $3,285.75.
4. June 12,1875, he sold 1,074 pounds of scrap brass at 12-J cents per pound = $134.25.
5. June 12, 1875, he sold 3,500 pounds of scrap lead at 6J cents per pound = $218.75.
As to the remainder of the 103,949 pounds, to wit, 5,201 pounds not turned over or sold, as aforesaid, it does not appear what became of it; but it does appear that, to get the stuff into a condition for reworking or for sale, it required considerable breaking up, handling, and sorting, as there was mixed up with the metals a quantity of gum, glass, and dirt; and it is therefore found as a fact that the said quantity of 5,201 pounds was lost in that operation.
VIII. Naval Constructor Steele informed Hanscom of the delivery of said 103,949 pounds of old material to the claimant, by the following letter:
“ Philadelphia, July 9th, 1875.
“ Sir : In obedience to your instructions, I respectfully report that there has been delivered to W. Fleet Steele, plumber, of this city, 103,949 pounds of old material from the monitors broken up at the works of the Harlan and Hollingsworth Company, of Wilmington, Del., and from Win. Cramp & Sons, this city, embracing brass, lead, iron, putty, glass, and gum attached, estimated to be worth $2,000, which will be deducted from his first payment for the plumbing work on the U. S. S. Quinne-baug. I beg to say that it was impossible to arrive at a satisfactory estimate of its value when appraised, as there was much alloy and dirt mixed with it, and the cost of transportation and labor in'separating and preparing it for use is not known, which makes it necessary to correct the value after I obtain full information on the subject, and before his contract is completed and adjusted.
“ Very respectfully, your.ob’d’t serv’t,
“ E. W. Steele,
“ Naval Constructor, TJ. 8. N.
“ I. Hanscom, U. S. N.,
“Bureau Construction and Repair,
“Navy Department, Washington, D. CP
IX. On the 30th of July, 1875, said Hanscom sent to the claimant the following letter:
“ Navy Department,
“Bureau op Construction and Eepair,
“Washington, July 30th, 1875.
“ Sir : Eeferring to your offer of the 6th of April, 1875, to do all the plumbing work on the Quinnebaug for the sum of $14,500, the bureau considers the sum named too high, and proposes to you thatyou shall do all the necessary plumbing work; ■that is to say, furnish all necessary ship’s water-closets, urinals, with tanks, cocks, valves, waste-pipes, and other lead pipes connecting the same ; also the lining of the head and manger with head pumps ; all the necessary dills; also lining the bowsprit-bed, hawse-pipes, galley-bed, ship’s scuppers, air-ports, rudder case, chocks, magazines, shell-rooms, passages, light-boxes, boat ammunition-room, sail-room, bread-room, pantry, and furnishing sea cocks, channel-pumps, deck-pumps, bilge-pumps, fresh-water pumps, copper strainers, sounding-pipes, sills, &c.
“And in consideration of your doing the -work as above set forth, the bureau agrees to pay the sum of twelve thousand dollars ($12,000). The old materials the Government will furnish to you to be reworked, which have accumulated from the breaking up of the light-draught monitors Koka and Min-netonka at Wilmington, Del., and the Algoma and Otsego, at the works of Cramp & Sons, Philad’a, will go towards the materials used in this work. The balance to be paid in two equal payments, in money, on the certificate of the naval constructor superintending the work that the work is satisfactorily completed according to the specifications which will be furnished.
“ Please notify the bureau in writing of your acceptance of this proposition.
“ Bespectfully, &c.,
“I. Hanscom,
“ Chief of Bureau.
“W. Fleet Steele, Esq.,
“Philadelphia,, Pa.”
To this letter the claimant returned, the following answer:
“Philadelphia, August 2d, 1875.
“Sib: I accept the proposition and terms of your letter of July 30th, 1875, and will proceed with the work to completion as rapidly as the vessel may be prepared for the reception of the same, for the sum of twelve thousand dollars, "as named by you,’ utilizing and reworking the old material delivered to me for that purpose.
“Bespectfully, &c.,
“W. Fleet Steele,
“Ship-Plumber.
“I. Hanscom, ü. S. N.,
“Chief Bureau of Construction,
“Navy Department, Washington, D. 6’.”
It does not appear, that the claimant did any work on the Quinnebaug until after this correspondence took place.
Before the correspondence set forth in this finding there does not appear to have been any advertisement by the Navy De partment, or any officer thereof, inviting proposals for the doing of the work which was done by the claimant on the Quinne-baug, as hereinafter found.
X. The said Hanscom, knowing from the letter of Naval Constructor Steele, of July 9, 1875, set forth in finding VIII, that 103,949 pounds of old material had already been delivered to the claimant, addressed to Commodore George Henry Preble, commandant of the navy-yard, Philadelphia, the following letter :
“ Navy Department,
“Bureau oe Construction and Repair,
“August 12 th, 1875.
“Sir: Enclosed please find copy of a i roposition made by the bureau to Mr. W. Fleet Steele to do the plumbing work on the Quinnebaug for the sum of $12,000 which has been duly accepted by him, and the si>ecifieations for doing the work are herewith forwarded.
“You will please direct the naval constructor superintending the work to have it proceeded with as rapidly as the other work on the Quinnebaug will allow.
“ With regard to the old materials to be furnished, as mentioned in the letter enclosed, they will be supplied to the contractor at a fair valuation, and when the work, in the opinion of the superintendent, has sufficiently progressed to entitle the contractor to the first of the two money payments provided for in the agreement, bills for the same will be matte and certified by him for the approval of the bureau. A reservation of fifteen {15) per centum will be withheld from the amount of this bill, which reservation, as also the second payment, will not be paid until the completion and acceptance of the work.
“ Respectfully, your ob’d’t serv’t,
“I. Hanscom,
“Chief of Bureau.
“Oommo. Geo. Henry Preble, U. S. N.,
“Com’d’t Ncwy-Yard, Philadelphia.”
XI. In addition to the said quantity of 103,949 pounds of old material, the claimant, between August 21 and November 29, 1875, removed from the Philadelphia navy-yard, under written passes given to him, sixteen loads of plumbers’ old material, of which neither the specific description, the weight, nor the value appears. The said loads were removed as follows: August 21 and September 4, one load each; November 12, tour loads; November 22, eight loads; and November 29, two loads. Of the written passes, seven were signed by Naval Constructor Hartt and nine by Assistant Naval Constructor John B. Hoover, each being in one or the other of the following forms: “Pass lot of plumbers’ old material from monitors, &c., per bureau order dated August 12th, 1875;” or, “Pass one load of plumbers’ old material from monitors, &c., for Fleet Steele, per bureau order” [or “per order bureau”] “Aug. 12th, 1875.”
On account of the material removed in said sixteen loads the claimant was charged, August 21, with $50; September 4, with $50; and November 18, with $200; the first two of which sums were deducted from the money due him for work on the Quinnebaug, as shown in finding XIII; and the last was debited to him in the final statement of his account, as shown in finding XIY.
XII. No survey or inspection of any of the old material referred to in findings YI and XI appears to have been made by any officer of the United States, with a view of appraising, fixing, or ascertaining its value. Naval Constructor Hartt, who superintended the plum bin g work on the Quinnebaug, was notified at the time by a messenger from Naval Constructor Steele of the quantity of old material delivered to the claimant, and that it was scrap material from broken-up iron-clads; and Hartt subsequently told Naval Constructor Steele that he would value it upon the same basis as that of the similar old scrap sold or exchanged in removing the yard material from the old Philadelphia yard to League Island, and at that rate he supposed its value to be about $2,000. This led Naval Constructor Steele to state, in his letter of July 9 to Hanscom, set out in finding YIII, that the 103,949 pounds were estimated to be worth $2,000; but when he so stated in that letter he was not positive whether that was to be its fixed value or not. It does not appear that Hartt at any time saw any of the 103,949 pounds of old material of which he so spoke to Naval Constructor Steele; but he assumed the value of it to be $2,000, and so set it down in an account book in his office, and so charged it against the claimant in the settlement of the account of the latter.
XIII. The claimant proceeded to do plumbing work on the Quinnebaug, and on the 8th of November, 1875, the following bill was made out and approved in his favor, and he received payment thereof:
“The U. S. Navy Department,
To Fleet Steele, Dr.
“ Appropriation, Construction and Bepair,
“Bureau of Construction and Bepair:
“To one-half (J) cost of plumbing of Quinnebaug, less value of old materials, $3,900.
“ Bureau order Aug. 11, 1875.
“Having fully examined the above charges, I certify the same are correct.
“John B. Hoover,
Ass’t Naval Constructor, Ü. 8. N.
“Constructor’s Oppioe, U. S. Navy-Yard,
“Philadelphia, Nov. 8,1875.
“Approved for the sum of three thousand nine hundred dollars.
“Geo. Henry Preble,
Commodore, Commandant.”
XIV. On the 28th of September, 1876, the said Hanscom sent to Captain O. H. Wells, U. S. N., commandant pf the navy-yard at League Island, the following letter:
“Navy Department,
“Bureau op Construction and Repair,
“28th Sept., 1876.
“Sir: You will please appoint a board, consisting of the naval constructor, assistant naval constructor, and the foreman plumber of the yard under your command, who will examine the plumbing work of the U. S. S. Quinnebaug, now at the yard of Messrs. Neafie & Levy, Philadelphia, and report what proportion of said work has been done up to date by W. Fleet Steele, under his agreement of July 30, 1875; also reporting the sum which in their opinion is now due him, estimating on the basis of the agreed amount ($12,000), which, under agreement referred to, he was to receive for doing the entire plumbing work of that vessel.
“When the report is submitted, you will please have bills made for the amount stated by the board to be due, forwarding same to the bureau with report.
“ Respectfully, your obed’t serv’t,
“I. Hanscom,
“ Chief of Bureau.
“ Captain C. H. Wells, U. S. N.,
“Com’d’t Navy-Yard, League Island.”
In pursuance of this request, Captain Wells appointed a board, which made the following report to him:
“Naval Constructor’s Ofpice, U. S. Navy-Yard,
“League Island, Pa., October 2d, 1876.
“Sir: In obedience to your order of the 29th ult., appointing us a ‘board’ to examine the plumbing ‘of the U. S. S. Quinne-baug,’ now at the yard of ‘Messrs. Neafie & Levy, Philadelphia, and report what proportion of said work has been done up to date by W. Fleet Steele, under h'is agreement of July 30th, 1875, also reporting the sum which, in your (our) opinion is now due him.’
“We have to report that, upon a careful examination and estimate of the work referred to, we find that about eight-tenths (T\-) has been completed in accordance with the agreement, which entitles him to receive, in old plumbing materials and money, the sum of nine thousand six hundred dollars ($9,600) in all.
“ Mr. Steele has received approved bill dated Nov. 8th, 1875, for $3,900, and old materials valued at $2,100 .............................. $6,000 00
“ And has since received old material valued at -.. 200 00
“ Total payment.......................... 6,200 00
“ We are of the opinion that the sum due him to date is three thousand four hundred dollars ($3,400).
“We are, sir, very respectfully, your obedient servants,
“Philip Hichborn,
“ Naval Constructor, TJ. 8. N.
“John.JB. Hoover,
“ Ass’i Naval Constructor, TJ. 8. N.
“John B. Coppin,
“Foreman Plumber.
“ Captain C. H. Wells, U. S. N.,
“ Condd’t Navy-Yard, League Island, Pa.”
XV. On the 5th of October, 1876,'Caj)tain Wells made out and certified the following bill of the work done by the claimant, as reported by said board:
“ The U. S. Navy Department,
“ To W. Fleet Steele, Dr.
“ Appropriation, Construction, and Repair,
“ Bureau of Construction and Repair:
“Balance due for plumbing work on U. S. S.
Quinnebaug, per agreement dated July 30,1875, as per report of board, Oct. 2, 1876 ................. $3,400 00
“Entered—
“.Wm. J. Manning,
“ Clerk to Commrfd’t. $3,400 00
“ In triplicate.
“ Having fully examined the above charges, I certify the same is correct.
“ Philip Highborn, N. O.
“Naval Constructor’s Oeeioe,
“ U. S. Navy-Yard, League island,
October 5th, 1876. 7
“Navy-Yard, League Island,
“ October 5th, 1876.'
“ This bill is approved for the sum of thirty-four hundred dollars cents.
“ $3,400. “ C. H. Wells,
“ Captain, Commanding.”
XVI. The claimant performed eight-tenths of the work on the Quinnebaug which was to be done by him ; and the value of the work he did was $9,600, on account of which he has been paid $3,900 in money. The other two-tenths of the work was done by the government.
XVII. At the claimant’s request it is found, that on the 1st of December, 1876, the claimant sold the voucher set forth in finding XV to the Corn Exchange National Bank of Philadelphia, for value, and without knowledge by, or notice to, said bank of any objection to or infirmity in the voucher or in the claim represented by it. The president of the bank, before making the purchase, was assured by a Mr. Bussell, who was Navy agent, or pay agent, or pay director, in Philadelphia, for the government, that the voucher was as good a voucher as could be made by the government; and said Bussell recommended him to buy it.
Mr. It. B.. Washington for the claimant:
1. The stating of an account is in the nature of a new promise. (Holmes v. I)’Camp, 1 Johns., 34; Montgomery v. Ives, 17 John., 38 ; Hoyt v. Wilkinson, 10 Pick., 31.)
When a defendant acknowledges his indebtedness for a specific sum, being a balance of an account, the court is at liberty to treat it as an account stated, and give judgment for such balance. (May v. Kloss, 44 Mo., 300.)
2. The rule is, that when a party indebted upon an account receives and retains it beyond such time as is reasonable under the circumstances, and according to the usage of the business for examining and returning it, without communicating any objections, he is considered to acquiesce in its correctness, and he becomes bound by it as an account stated. Signature to the account or express admission is not necessary. (Case v. Hotchkiss, 1 Abb. Ot. App. (N. Y.), 324; Wiggins v. Burkham, 10 Wall., 129; Townley v. Denison, 45 Barb., 490; Law v. Cross, 1 Black., 533; Terry v. Sickles, 13 Cal., 427; White v. Hampton, 10 Iowa, 238; Tharp v. Tharp, 15 Vt., 105; Langdon v. Roane, 6 Ala., 518.)
3. Where the parties have adjusted an account, struck a balance, and agreed upon the amount due, courts are exceedingly unwilling to open it up again, unless there has been fraud, or if is very clear thei’e has been a mistake. (Kook v. Bonita, 4 Daly, 117; Ghappedelaine v. Decheneaux, 4 Cranch, 306 ; Hager v. Thompson, 1 Black., 80.)
4. The commandant of the League Island navy-yard was acting within the scope of his authority when he approved the bill, and the government is bound by that act.
It is not necessary to constitute a general agent that he should before have done an act the same in specie with that in question ; it is enough that he has usually done things of the same general character and effect, with his principal’s assent. (Com. Bank of Lake Erie v. Norton, 1 Hill, 501; Exchange Bank v. Monteath, 26 N. Y., 505.)
If the authority of an agent is left to be inferred by the public from powers usually exercised by the agent, it is enough if the transaction in question involves precisely the same general powers, though applied to a new subject-matter. (Merchants'1 Bank v. State Bank, 10 Wall., 604; see Le Roy v. Beard,, 8 How., 451.)
Mr. John S. Blair (with whom was the Assistant Attorney-General) for the defendants:
Section 1541 Revised Statutes expressly grants power to sell at public sale; this excludes the right to sell at private sale. But even if private sale were allowed, the peculiar contract of barter contended for by claimant would be a direct violation of section 3618 Revised Statutes. Before the passage of this law (Act 8th May, 1872, sec. 5, 17 Stat., 83) it was said by Attorney-G-eneral Taney that “ there is no power under any law of Congress to make contracts of barter, but all articles intended to be purchased are intended to be paid for in money.” (2 Op.,-580.)

Opinion:
Drake, Oh. J.,
delivered the opinion of the court:
There is no controversy in this case over the claim sued on, a voucher for $3,400, issued to the claimant for a balance due for plumbing work done by him on the United States ship Quinnebaug in 1875. The whole amount earned by .him for that work was $9,600. In partial settlements with him he was charged $2,100 and $200 for certain old material which had been delivered to him by Naval Constructor Steele at Philadelphia, under assumed authority from the Navy Department. It is with that old material that the counter-claim is connected.
The claimant is content to be charged with those items, claiming that the old material was lawfully delivered to him ; that it was, by competent authority, valued at those sums; that the defendants are thereby concluded as to the value, and that therefore the account ought to stand as it is.
On the other hand, the defendants contend that the old material was not lawfully delivered to him; that it was not, by competent authority, valued at, those or any other sums; that he unlawfully received it, and is therefore bound to account to the defendants for it; that though he was charged for it only $2,300, he actually sold 98,748 pounds of it for $8,975.56; to recover which amount from him, less the amount of his just claim against the government, for work done, is the object of the. counter-claim.
The facts and documents connected with the counter-claim are set forth fully in the findings, and therefore no more of them need be recounted here than is necessary to a due presentation of the grounds of the conclusions reached by the court.
Before stating the facts it is proper to refer to a feature of the case which has attracted our notice, namely, the unusual number of instances in which matters do not appear which might have been reasonably expected to appear. So far as the non-appearance of those facts may unfavorably affect the claimant's interests, he has no ground for complaint, for he was examined by the defendants as a witness, and his testimony was offered in evidence by the defendants at the trial, so that he had the full benefit of it. If, therefore, he failed in his testimony to unfold the transaction in all its details, it is his misfortune, if not his fault, that facts important to his defense against the counter-claim, if such facts existed, do not appear.
We will now briefly state the facts which have been found bearing on the counter-claim.
In March, 1875, the claimant, learning that plumbing work had to be done on the Quinnebaug, came from Philadelphia to Washington, and had a private interview in regard thereto with Isaiah Hanscom, chief of the Bureau of Construction and Repair, in Hanscom's office, with no third person present. All that appears in regard to that interview is stated in finding III, where it is found that some verbal understanding was had between the claimant and Hanscom for the claimant to do the needed work on the Quinnebaug; that Hanscom gave the claimant verbal instructions to go on with the work ; that the matter of using in the Quinnebaug old material taken out of other vessels was talked of, and that Hanscom spoke of the old material being of the value of $2,000. What particular material or what quantity of material was referred to by Hans-com is nowhere shown.
This is all that appears in regard to that interview. Upon that slender foundation it was contended by claimant's counsel that a verbal agreement was made between the claimant and Hanscom, and that in pursuance of that agreement the old material was rightfully delivered to the claimant. But this theory is conclusively rebutted by the claimant's own act in making to Hanscom a subsequent written proposition to do the work, without referring in the slightest way to that interview, and by the fact that he never did a stroke of work on the Quinne-baug until after the 2d of August, and then not in pursuance of a verbal agreement in March, but of a letter of Hanscom to him, dated the 30th of July. But even supposing there was such a verbal agreement, did it make a contract binding the government 7 Manifestly not; for section 3744 of the Revised Statutes provides that " it shall be the duty of the Secretary of War, of the Secretary of the Navy, and of the Secretary of the Interior to cause and require every contract made by them severally on behalf of the government, or by their officers under them appointed to make such contracts, to be reduced to writing, and signed by the contracting parties, with their names at the end thereof."
It was at one time contended that this section, as it stood in the Act June 2, 1862 (12 Stat. L., 411), was merely directory to the officers named in it, and not mandatory; but the Supreme Court of the United States held otherwise in Clark v. United States (95 U. S. R., 539), and said :
u The statute makes it unlawful for contracting officers to make contracts in any other way than by writing signed by the parties. This is equivalent to prohibiting any other mode of making contracts. Every man is supposed to know the law. A party who makes a contract with an officer without having it reduced to writing is knowingly accessory to a violation of duty on his part. Such a party acts in the violation of the law. We are of opinion, therefore, that the contract itself is affected, and must conform to the requirements of the statute."
In the presence of this statute, and this interpretation of it by the Supreme Court, it is utterly futile for the claimant to contend that his conversation with Hanscom had any force whatever as a contract binding the government.
After the interview between the claimant and Hanscom, the claimant returned to Philadelphia, and on the 6th of April, 1875, wrote to Hanscom a letter in these words:
" Sir : I will furnish all material and labor for the plumbing of the United States steamer Quinnebaug, according to the requirements of the service, and to the satisfaction of the inspecting officer, for the.sum of $14,500, and will take, in whole or part payment, any old brass or lead arising from old vessels that can be reworked for that purpose."
This proposal was never agreed to by the Bureau of Construction and Repair, and therefore it has no bearing on the determination of this case.
On the receipt of that letter the bureau directed Naval Constructor Hartt, at the Philadelphia.navy-yard, to draw up specifications of the plumbing work to be done on the Quinnebaug, and to obtain proposals from the ship plumbers in the vicinity to do the work. Such proposals were received, and among them that of the claimant; but none of them was accepted.
A verbal proposition was then made, before the 15th of April, to the claimant, but by whom does not appear, that if he would do the work for $12,000 he could do it, and might .proceed at once with it.
The foregoing are all the facts, which existed prior to the 15th of April, 1875, and they show that up to that date there had been no sort of contract between the claimant and the bureau.
Immediately following that date were the transactions out of which has grown the present controversy, which may be succinctly stated as follows:
On that day the bureau sent to Naval Constructor Steele, at Philadelphia, an order to—
" Have all the old lead, brass, and composition arising from breaking up the monitors, including the Amphitrite, Miantono-moh, and Terror, at the establishments of Messrs. Harlan & Hollingsworth, John Eoach, and Win. Cramp & Sons, carefully weighed, boxed up, and sent to Philadelphia; and report the amount to the bureau."
Naval Constructor Steele, interpreting this letter as an authority to him to deliver to the claimant the old material referred to, proceeded to deliver to him, from time to time, old material to the amount of 103,949 pounds as follows: On or before April 29, 49,399 pounds, in the month of May, 44,775 pounds, and between May 31 and July 7, 9,775 pounds.
On the 7th of July ensuing the claimant gave to Naval O n-structor Steele two receipts for old material aggregating the said quantity of 103,949 pounds.
It is for the money received by the claimant from the sale of 98,748 pounds of this old material that the defendants seek a recovery here in counter-claim, and in that connection the first question is, whether the old material was lawfully 'delivered to the claimant.
In connection with this delivery is one of the remarkable features of this case. The findings disclose no real explanation of the transaction, though we had before us at the trial the deposition of the claimant and a long report made by Naval Constructor Steele about the matter. It is not pretended that Naval Constructor Steele received any order from a superior officer to make it. So far as appears, it was altogether his own act, resting solely on his own interpretation of the above bureau order of April 15th to him to have the old material sent to Philadelphia.
How he could have found in the words of that order any even distant seeming of an authority to him to turn the material over to the claimant passes any comprehension we have been able to exercise on the subject. There is not the least reference to the claimant, not the least authority or permission to deliver possession of the material to any one, but, on the contrary, a mere order to have it brought to Philadelphia and then " report the amount to the bureau." This was tantamount to an express order to him to hold the material until otherwise ordered by the bureau. For him to let it pass from his control without authority from the Navy Department, was, to state it mildly, a clear violation of his official duty; and, being such, his act- in letting it pass into the claimant's possession could not give the claimant any right or title whatever to or in the material.
Not only so, but in delivering the property in question to the claimant, he violated express statutes directly bearing on such a case. Section 1511 of the Revised Statutes is in these words:
" The Secretary of the Navy is authorized and directed to sell, at public sale, such vessels and materials of the United States Navy as, in his judgment, cannot be advantageously used, repaired, or fitted out; and he shall, at the opening of each session of Congress, make a full report to Congress of all vessels and materials sold, the parties buying the same, and the amounts realized therefrom, together with such other facts as may be necessary to a full understanding of his acts."
When a statute directs a public officer to do a certain thing in a certain way, it is a prohibition of his doing it in any other way, and takes from him all discretion as to how it shall be done. This section not only authorized, but directed, that material which cannot be advantageously used, should be sold, not turned over to a contractor, in consideration of work done by him for the government; and should be sold at public sale, not bartered away in. a private transaction, however honest it might be. And that the Congress might be able to exercise strict supervision over every such matter, the remarkable rule is laid down that the Secretary of the Navy shall at the opening of the next session of Congress make to that body u a full report of all materials sold, the. parties buying the same, and the amount realized therefrom, together with such other facts as may be necessary to a full understanding of his acts." We venture the supposition, that in the whole body of the Revised Statutes there can hardly be found any description of official action more completely hedged in by restrictive safeguards than this very one of selling old material of the Navy. But there is further legislation bearing on this subject.
Section 3618 of the Revised Statutes provides that—
"All proceeds of sales of old material shall be deposited and covered into the Treasury as miscellaneous receipts, on account of ' proceeds of government property,' and shall not be withdrawn or applied, except in consequence of a subsequent appropriation made by law."
The effect of those two comprehensive provisions, in our opinion, is to forbid, in the strongest terms, the use of old material in payment for work to be done, or in exchange for other material or for work. If old material can be advantageously used, it must be used by the proper officers for government purposes; if it cannot be advantageously used, then it must be sold at public sale, and the proceeds of the sale must not be " applied" in payment for other material, or for work, or for any other purpose, but be covered into the Treasury. And yet in the face of .these provisions Naval Constructor Steele turned over to the claimant 103,949 pounds of old material.
It is quite vain to say that the claimant was an innocent receiver of the material, believing that Naval Constructor Steele had a right to deliver it to him; and therefore that he should not be made to suffer the loss consequent on a recovery under the counter-claim. He knew that he was dealing with a public officer; and no doctrine of law is better settled in this court, and everywhere else, so far as we know, than that he who deals with such an officer is bound to know whether the officer's acts are within the scope of his lawful authority. It was perfectly open to the claimant to have ascertained whether Naval Constructor Steele had lawful power to turn ovpr that property to him; but, so far as appears, he made not the least inquiry on that point. He, therefore, must bear the responsibility of any untoward results to himself from his own failure to make proper inquiry.
But it was contended by claimant's counsel that, " assuming that the Navy Department had no right to make payment partly in old material, yet they did it, and there is an end." We notice this proposition merely out of respect to the counsel, and not because it seems to us'to have any weight.
It is simply an assertion, that if a public officer, no matter how unlawfully, turns over government property to a supposed contractor, in payment for work done by him, the government is concluded by that unlawful act, and cannot hold the receiver of the property liable for its value. It is a noteworthy evidence of the willingness of this court to hear in every case all that counsel see fit to urge, that it would listen for a moment to a proposition so utterly baseless and indefensible as that.
The sum of the whole matter is, that the claimant, long before any sort of agreement was made between him and the bureau for work on the Quinnebaug, and when he gave no sort of consideration for the delivery of the old material to him, unlawfully received and sold 98,748 pounds of old material, the property of the defendants, and that he is liable to the defendants therefor.
This brings us to the question of the amount recoverable under the counter-claim. The counter-claim is for money had and received by the claimant for the use of the defendants. As the claimant did not show what expenses, if any, he was put to in preparing the old material for sale, we have nothing before us upon which he could base a demand upon us to reduce the amount found to have been received by him from the sale of it.
The findings show that for the 98,748 pounds of old material which the claimant sold he received---- $8,975 56
Add to this the three small lots of material set forth in finding XI............................... 300 00
And cash paid him as shown in finding XIII . 3,900 00
And the total amount received by him was....... 13,175 56
Against this he is entitled to a credit for the whole work done by him on the Quinnebaug of........ 9,600 00
Leaving balance due from him to the defendants . 3,575 56
For this balance judgment will be entered in favor of the defendants against the claimant.