Case: AMERICAN LITHOGRAPHIC COMPANY v. THE UNITED STATES
Abbreviation: American Lithographic Co. v. United States
Decision Date: 1922-06-05
Docket Number: No. 34016
Citation: 57 Ct. Cl. 340
Volume: 57
Reporter: United States Court of Claims Reports
Court: United States Court of Claims
Jurisdiction: United States
Parties: AMERICAN LITHOGRAPHIC COMPANY v. THE UNITED STATES.
Judges: 
Pages: 340–356

Head Matter:
AMERICAN LITHOGRAPHIC COMPANY v. THE UNITED STATES.
[No. 34016.
Decided June 5, 1922.]
On the Proofs.
Contract; Liberty loan posters; error in quotation; implied warranty.- — -The Government invites proposals for designs ' for posters to aid in the sale of Liberty bonds, and the design submitted by plaintiff is examined by Treasury Department officials, and, with a slight modification, accepted; bids are invited for the production of 500,000 lithographic copies of the same, and plaintiff’s bid for said production is accepted. A contract is made with it and it lithographs and delivers the required number of copies to the Government. About 10 days later an official of the Treasury Department discovers that the alleged quotation on the poster is not accurate. Plaintiff is then called upon to furnish and does furnish 500,000 more copies of the lithographed poster with the correct quotation thereon. The Government sells the copies first furnished for waste paper. Held, that there was no implied warranty by the plaintiff that the quotation was correct and it is entitled to recover the contract price for the posters containing the erroneous quotation.
Printing. — Where there was an appropriation for all necessary expenses connected with the sale of Liberty bonds (act of April 24, 1917, 40 Stat. 35, 37), to be expended in the discretion of the Secretary of the Treasury, the latter was not required by section 3786, Revised Statutes, to have all printing and lithographing done at the Government Printing Office.
The Reporter's statement of the case:
Mr. Isadore Shapiro for the plaintiff. Guggenheimer, TJntermyer <& Marshall were on the briefs.
Mr. J. Robert Anderson, with who was Mr. Assistant Attorney General Robert H. Lovett for the defendant.
The defendant maintains that the plaintiff impliedly, if not expressly, did warrant the genuineness of the quoted matter in the circumstances and considering the relationship of the parties.
A purchase order stipulated, among other things, a “ Lincoln ” poster evincing the “ best of * * * workmanship.” A specification “ to do good work ” covers everything neces sary to accomplish that end. Stillwell Marmfaeturing Oo. v. Phelps, 130 TJ. S. 520. This condition precedent with respect to workmanship is not satisfied with a misquotation in which new words are added and original ones transposed.
The quotation marks themselves amounted to a representation that Abraham Lincoln did use the words attributed to him in his Gettysburg Address. This representation was later discovered to be untrue.
The rule is that where one holds itself out as competent to undertake and perform a specialized kind of work involving skill and accuracy in the production of an article which is made at its plant, controls and supervises the manner in which the -work should be executed, it implies a promise to do the work and complete the article in the way it ought to be done; and when such a manufacturer knows or has information as to the use the completed article is to be devoted, it further promises in law to make the same suitable for the purpose for which it was intended. Wade v. Haycock, 25 Pa. St. (1 Casey) 382.
In this case the plaintiff held itself out as having quoted correctly an excerpt from Lincoln’s Gettysburg Address. There was nothing in the circumstances putting the Treasury Department on inquiry that the purported excerpt was, in fact, a misquotation. Confessedly, the Treasury Department, believing the quotation to be correct, intended to purchase the exact words employed by Abraham Lincoln. Afterwards it was discovered that the quotation was untrue, and as a result the Government was discharged from any obligation whatever to pay for an untrue statement, which was nonexistent and which the plaintiff had published as the truth.
It is axiomatic that no one can make his own error, mistake, or misconduct a basis for an action in his own favor. This is particularly true where the party committing the error has not communicated the fact to the other who has been prejudiced thereby.
In the case of Pompton v. Cooper Union, 101' U. S. 196, 204, the court held that if any error or wrong was committed (issuance of bonds) it was the act of the agents of the plaintiff; that if it is a case where both parties are innocent, "the law throws the burden upon him who contributed to produce it and not upon the other party, citing Merchant's Bank v. State Bank, 10 Wall. 645. Assuming both to be equally at fault, the condition of the defendant is preferable. Briggs c& Easterly, 62 Barb. (N. Y.) 61.
There was a mutual mistake as to the existence, identity, and quality of the subject matter contained within the quotation marks on plaintiff’s imperfect poster. If the Treasury Department had known of the error or mistake committed by the plaintiff it would not have given an order for the reproduction of the same. The facts bring the case clearly within the rule regarding mistakes as defined by Pomeroy in his work on Equity Jurisprudence (vol. 2, 4th ed., sec. 839, p. 1707), where the rule is stated as follows:
Mistake, on the other hand, is internal; it is a mental condition, a conception, a conviction of the understanding— erroneous, indeed, but none the less a conviction — which influences the will and leads to some outward physical manifestation. Its operation is ordinarily, though not always, affirmative — the doing of some act which would not have been done in the absence of the particular conception or conviction which influenced the free action of the will. Its essential prerequisite is ignorance.
The principle underlying the doctrine of mutual mistake applicable herein is illustrated in the case of Gox v. Prentice, 3 M. & S. 344, where the plaintiff bargained to buy and the defendant to sell a bar of silver containing four ounces, the bar supplied contained only two ounces. On the assumption that the bar contained the required amount of silver the same was paid for. In the opinion it is stated:
They both understand that the one agreed to buy and the other to sell a bar containing such a quantity of silver, as should appear by the assay; and the quantity is fixed by the assay, and paid for; but through some mistake in the assay the bar turns out not to contain the quantity represented, but a smaller quantity.
The evidence of a mutual mistake is much stronger in the instant case than in that of Toledo, St. Louis <& Western R. R. Go. v. United States, 55 C. Ols. 40, where the question of the identical number of feet between a railroad station and a post office was involved. The Post Office Department had stated the distance to be less than eighty rods, and al though it was the duty of the officers of the railroad company to ascertain distances, the latter acted upon the distance submitted by the department which suggested a verification of the fact by plaintiff road. After the company had acted upon the appearances for several years as presented to it by the department, it measured the distance in question and found the same to be in excess of eighty rods.. The court held that the rights of the parties were to be adjudged in the light of the corrected distance.
The principle is further illustrated in the case of Allen v. Hammond, 11 Pet. 63, in which the parties had contracted in respect of a claim which had been allowed and which fact was unknown at the time. No actual fraud entered into the transaction.
The quotation on the imperfect poster amounted to an implied warranty of its genuineness, 'and that the same was correct as thus represented.
It is a well-established principle, that whenever suppressio-veri or suggestio falsi occur, and more especially both together, they afford a sufficient ground to set aside the contract otherwise good.
Any representation whether by words or deeds or conduct which induces another person to act to his prejudice is a misrepresentation and is very material in a case where the person addressed relies upon or has confidence in the person making it. (Smith v. Richards, 13 Pet. 26.)
Where one undertakes to manufacture an article he impliedly warrants that the same is free from latent defects. If the completed article is defective or imperfect, the seller is responsible therefor. It is not necessary to prove scienter. Knowledge will be presumed. {Hoe v. Sanborn, 21 N. Y. 552.)
In the case of Ainslie v. Medlycott, 9 Vesey 13, 19, the court said:
No doubt by a representation a party may bind himself just as much by an express covenant. If knowingly he represents what is not true, no doubt he is bound. If without knowing that it is not true he takes upon himself to make a representation to another upon the faith of which the other acts, no doubt he is bound, though his mistake was perfectly innocent.
A warranty may enter into a contract without express words to that effect or even the intention of the person who makes the representation which constitutes it. (Wilfred v. Myers, 40 Fed. 170, 173.)
The Government’s contention is that before a contract is created it was necessary as a condition precedent that the plaintiff furnish a correct quotation. The nature of a condition precedent, its effect, how it arises and prevents the consummation of a contract is illustrated and discussed in the case of Springfield Shingle Company v. Edgecomb Mill Company, 52 Wash. 820.
In the instant case the plaintiff proposed to sell and the Treasury Department intended to buy an excerpt from the Gettysburg Address. The plaintiff described the matter as being taken therefrom with literal exactness. If the plaintiff imposed something different upon the defendant, it failed to comply with the necessary condition precedent to effect a contract, and consequently none was created. The plaintiff by its own misconduct prevented the consummation of a contract.
The following are the facts of the case as found by the court:
I. The plaintiff, the American Lithographic Company, is, and at all times hereinafter mentioned was, a corporation duly organized and existing under the laws of the State of New York, with its principal place of business in the city of New York.
Said company is one of the leading and largest companies in the United States engaged in the lithographic business, and has an established reputation for high-class work, the execution of which requires skilled labor and talented sketch artists and designers.
II. On or about November 1, 1917, the United States Treasury Department sent to lithographers, artists, and others throughout the United States a circular inviting the submission of color sketches for posters to be used in connection with raising the third Liberty loan, which circular read as follows:
“Lithographic Advertising for the Third Liberty Loan Campaign.
(For the information of lithographers and artists.)
“ The Bureau of Publicity of the Treasury Department will consider color sketches for third Liberty loan posters up to and including November 12, 1917, on the following conditions:
“ 1. Any design submitted will be open to general bidding by lithographers for its reproduction, and is to become the property of the Treasury Department without cost, regardless of who reproduces it or whether it is reproduced at all, if the director of publicity chooses to so retain it. It is probable that approximately eight designs 20" x 30", one oblong design 62"x42", one or more window-card designs 10f" x 14£", and one automobile windshield sticker design 6" x 5f" will be selected for use in the third Liberty loan campaign.
“ 2. Actual manufacturers who have their own lithographing plants and are prepared to do all the work that they may contract for under their own roofs in a satisfactory manner will be given an opportunity to meet the bids of competent competitors for reproduction of their designs, if their own original bids are deemed too high by .the director.
“ 3. Contracts will be awarded only to actual lithographers who make their transfers from stone and do all their lithographic printing and finishing in their own factories. Contracts will not be made with brokers or with individuals or firms expecting to do any of the work through subcontractors.
“ 4. The minimum contracts will probably require complete delivery of one-half million posters from a single design within 30 days from date of delivery of the 0. K’d sketch to the contracting lithographer.
“ 5. The number of presses available and the ability and disposition of firms or companies to shorten the time of delivery, should emergency require it, or to speedily increase the output within the contract period will be considered in awarding contracts. The known records, methods, and practices of lithographers in cooperating with their customers and their geographic locations for efficient and convenient distribution will also be given consideration.
“ 6. The paper stock for all except cards (which will be twenty point coated one side) will be on an eighty-pound basis, 28" x42", 500 sheets to the ream, high-grade machine finish.
“ 7. Bonds for the entire amount of each contract covering delivery according to the strict specifications will be required.
“8. The director reserves the right to reject any or all bids and to award the contracts in his discretion as may seem to the best interests of the Government.”
III. Pursuant to the invitation contained in the aforesaid circular the plaintiff, on or about November 12, 1917, produced and submitted to the Treasury Department a certain color sketch known as the Lincoln design or poster. This design consisted of a picture of Abraham Lincoln, having above it the words “ Buy Liberty Bonds,” and below it the words, in quotations marks, “ so that government by the people, of the people, and for the people shall not perish from the earth,” followed by the purported signature of President Lincoln. And at the bottom of the design, following the purported quotation, were the words “ From the Gettysburg Address.”
This purported quotation from President Lincoln’s Gettysburg Address was erroneous, the correct version of the expression being “ and that government of the people, by the people, for the people, shall not perish from the earth.”
IV. The Treasury Department selected and adopted said design with the modification, solely for artistic effect, of the omission of the words “ From the Gettysburg Address,” and invited bids for the production of a half million lithographic posters of the design, as so modified. A number of lithographers, including the plaintiff company, submitted bids in response to said invitation, plaintiff company’s first bid being at the rate of $18 per thousand of the posters to be furnished. This bid was higher than some of the other bids, and by reason of the plaintiff company being the author of the design of the poster it was permitted to reduce its bid, which it did under date of January 11, 1918, reducing it to $17 per thousand. In plaintiff company’s said bid or proposal it was specified that “ Submitting of proofs to be waived.”
Y. By letter of January 12, 1918, the Treasury Department requested of the plaintiff company a half dozen photographic prints of each of the several different designs of posters being prepared or made by the plaintiff company for the department, which photogrphs were to show the final lettering of the designs. In complying with this request the plaintiff on or about January 15, 1918, forwarded to the department six photographs of the said Lincoln poster or design; and on or about January 22, 1918, the department acknowdedged receipt of said photographs, by letter of that date, in which decided satisfaction with said photographs and poster was expressed.
YI. On January 24, 1918, the Treasury Department accepted the plaintiff company’s said bid by transmitting to the said company the department’s purchase order No. 2316 for said posters, reading substantially as follows:
“ Purchase Order No. 2316.
“ TREASURY DEPARTMENT,
“ Oefice of Chief Clerk and Superintendent,
“ January &£, 1918.
“Appropriation: Expenses of loan, act of September 24, 1917.
“ To: American Lithographing Company, 52 East 19th Street, New York City.
“ Please furnish the articles or services named below:
“ Deliver to storekeeper, Treasury Department, Washington, D. C.
“ Note. — All goods are to be billed on forms furnished by the department, at the prices agreed, which include delivery charges to the place designated. A delivery invoice on form furnished by the department must accompany each delivery.
“Item No. - and article of service^ general supply schedule.
“ 12-A Liberty loan poster, ‘ Lincoln ’ design, 20" x 30", lithographed in six printings, on best quality supersized and calendered clear white paper, 80 pounds, basis of 28" x42", 500 sheets to the ream, best of inks and workmanship, to be packed in substantial wooden boxes of convenient size for handling by express companies, each box to be plainly labeled with the key number and letter of the poster it contains, and the quantity. Complete delivery of the entire amount of the order.must be made at the factory to an official representative of the Treasury Department, who will be assigned to certify to and to receive deliveries, and to supervise the shipping of the boxes or posters on Treasury Department express bills of lading, by February 2,1918, subject, in lieu of a bond, to forfeiture of ten per cent of the price for the entire amount of the contract for failure to complete delivery by the date specified, at the option of the Secretary. Overrun not to ex ceed two per cent, and to be paid for at the same rate as the contract, if such overrun occurs. Key number and letter 12-A is to appear on the lower left-hand corner of the poster.
“ As per your proposal dated January 11, 1918— “ Quantity, 500; unit, M; unit price, $17; amount, $8,500.00.
Days on which Fuel Administration will not permit fuel to be burned in plants of contractors will be considered as days of grace on contracts.
“Total_ 8,500.00”
This order was accepted by the plaintiff company in lieu of a signed contract with the department, no formal written contract being executed by the parties; and the company thereupon proceeded with the production of the posters so ordered by the department.
VII. On or about January 26, 1918, the plaintiff company forwarded finished samples of said Lincoln poster to the Treasury Department at Washington, D. C., and also to William J. Eyan, Subtreasury Building, New York City, who was the “ official representative ” of the Treasury Department referred to in the department’s said purchase order No.'2316, set forth in Finding VI. Plaintiff company also, by letter of said January 26th, notified the department of the forwarding by the company of said samples of the finished poster, stating that it hoped they would meet the department’s entire approval, and also stating that the company would be ready to “ enter ” the department’s shipping instructions the beginning of the next week.
Said samples were approved by the department, and on February 1,1918, the department telegraphed plaintiff company to ship to the department at Washington, D. C., with the certification of said William J. Eyan, the department’s said representative in New York City, 211,451 copies of said Lincoln poster, and stated that shipping orders for the remainder of the posters contracted for would follow by mail the first of the week. The certification of the said Eyan was especially as to number, general quality, and condition of the posters presented for shipment and shipped by the company.
Pursuant to this telegraphic order of the department plaintiff company immediately shipped as directed therein the 211,451 copies of said poster, properly certified by the department’s said New York representative, Mr. Eyan, which posters were delivered to and received by the department in Washington, D. C. .
VIII. On February 16,1918, the Treasury Department, by letter, directed plaintiff company to ship the remainder of said 500,000 posters by express, on the department’s bills of lading, under direction of the said William J. Eyan, to numerous persons and places throughout the country, as specified in said letter.
Pursuant to this direction plaintiff company shipped the remainder of said posters as directed, shipment thereof being completed by February 25,1918; and under date of February 27, 1918, the plaintiff company wrote the department enclosing its bill for the full contract price for said posters, $8,500, together with the “ Delivery invoice,” certified to on February 26, 1918, by the department’s said representative, William J. Eyan, which certification, so far as material in this case, was as follows:
“ I certify that the above articles have been received by me in good condition, and in the quantity and quality above specified.”
Said invoice contained no statement of the quality of the “ articles ” invoiced.
In its letter transmitting said bill and certified invoice to the department, plaintiff company stated that it would be pleased if the department could pass the bill for prompt payment.
IX. On February 27,1918, the same day plaintiff company forwarded its bill for said posters to the Treasury Department, as stated in Finding VIII, an employee of the New York Liberty bond branch of the department discovered, and reported by telegram to the department at Washington, the said error in the purported quotation on said poster from President Lincoln’s Gettysburg Address shown by Finding III. Upon receipt of said telegram, the department called plaintiff company’s sales manager over the telephone and informed him of said error, and that the department would expect that this edition of the posters, with the erroneous quotation, would be made good by the company by the printing by it of a corrected edition to take its place. The company’s sales manager .expressed surprise at the information given him as to error in said quotation, asked time to investigate the matter, and after a brief investigation confirmed the fact of the error. On the following day said sales manager visited the Treasury Department in Washington, where he was informed by the department that' it would not accept said posters with the erroneous quotation thereon, whereupon he stated that he wished to consult with the officials of the company before stating what the company would do about the matter.
X. On March 4, 1918, plaintiff company wrote the Treasury Department as follows:
“ We propose to print a new edition of the Lincoln Liberty loan posters at once. We submit you herewith copy for the same, which, if you find correct, we would be pleased to have O. K.’d and returned at your early convenience. This offer is made without prejudice to our rights for the payment by you of the amount of our bill for the Lincoln Liberty loan posters heretofore furnished and delivered to you.”
On the same day the Treasury Department telegraphed said company to please telegraph the department “what disposition to make of defective Lincoln posters,” to which telegram the company, on the same date, replied as follows:
“ We have advised you that we are proceeding with the printing of the new edition of Lincoln posters and we propose to take up the question of the proper settlement of the bill already rendered for future adjustment, believing that you intend to be just as fair as we are in the matter. In the meantime it would seem unwise to order the posters shipped back to us if they can still be held until we have arrived at a proper settlement of this difficulty. We have taken this action because the use of the posters was imminent and immediate steps must be taken to print them if they are to do any good for the third Liberty loan.”
Subsequently said posters with the erroneous quotation were sold by the Treasury Department as waste paper, pursuant to a letter of July 25, 1918, from plaintiff company reading as follows:
“ You are authorized to dispose of the imperfect Lincoln posters in any way you see fit, without prejudice to either party in the controversy over the payment for the posters now pending in the Treasury Department. They can be destroyed or sold as waste paper.”
The amount realized by the department from the sale of said posters was $109.46.
XI. The second, or corrected, edition of said Lincoln poster .was produced by plaintiff company and delivered to and accepted by the Treasury Department between about March 12 and April 8, 1918, and payment therefor, at the rate of $11.00 per thousand, was duly made by the department to said company.
XII. No payment has been received by the plaintiff from the United 'States for or on account of the said 500,000 Lincoln posters rejected by the Treasury Department because of the said erroneous quotation thereon, the value of which posters, at the contract rate of $11.00 per thousand, would be $8,500.00.

Opinion:
Booth, Judge,
delivered the opinion of the court.
When the United States enters into a contract with a citizen the elementary principles of contractual relations govern. The instrument which evidences the reciprocal obligations of the parties thereto is in nowise exceptional, and no greater privileges are to be accorded the United States under the circumstances than accrue to individuals similarly situated.
The Treasury Department, prior to November, 1917, was engaged in preliminary preparations for the flotation of the third Liberty loan. The idea of popular subscription was foremost, and to this end wide publicity was given, in order to arouse the interest of the people. One feature of the very laudable plan was the circulation of large numbers of attractive posters, so framed as to appeal to the patriotism and generosity of the people. The plan evolved to attain this desired end was the issuance on November 1, 1917, of a circular to lithographers and artists throughout the country inviting them to submit to the department appropriate sketches for posters, and expressly setting forth in said circular that all sketches so submitted would become the property of the defendant, without compensation to the owner, and subject to be reproduced by any successful bidder who might thereafter be awarded a contract to reproduce the same. A preference was given to the originator of the sketch accepted if it appeared subsequent to the receipt of bids to do the work that he or they possessed adequate facilities and would assent to reduce his bid and thereby meet the figures of the lowest competitor. The obvious intent of the public invitation thus extended was to secure for the defendant the widest range of selection and at the same time encourage competition by the hope of ultimately securing the contract for reproducing the poster. Care was taken to relieve the defendant from all contractual responsibility, through copyrights or otherwise, by compelling all competitors to dedicate their sketches to the public and vest exclusive title thereto in the defendant without compensation or other reward. The invitation simply extended to the presentation of tentative sketches to the defendant, from which it would make a selection and subsequently award a contract for reproduction of the same. The competitors had no voice in the selection and no part in the preliminary proceedings other than the physical presentation of that which they deemed of sufficient merit to win the award. The plaintiff company submitted a design, a poster 20 by 30 inches, upon which were the words "Buy Liberty Bonds," followed by a profile of President Lincoln, and beneath it in plain and distinct printed words at least seven-eighths of an inch in height the following alleged excerpt from his Gettysburg address: " So that government by the people, of the people, and for the people shall not perish from the earth," to which was added a facsimile of President Lincoln's signature. Beneath this were the following words: "From the Gettysburg address," which, at the request of defendant, were eliminated from the sketch. This design, altered at the defendant's request, was in the possession of the defendant from about the middle of November, 191T; not a single copy, but many copies, some exhibits being lithographed in a quadruple series attached; it was on public exhibition and subjected to the scrutiny of the parties charged with the duty of making the awards. Two days before the plaintiff company was awarded the contract for reproducing the same the defendant pronounced it "excellent."
On January 24, 1918, the plaintiff company was awarded the contract for reproducing the poster and agreed to furnish within the time specified one-half million Lincoln posters for $8,500. The plaintiff company complied with said agreement. An exact reproduction of the preliminary sketch, except as deleted at the request of the defendant, was furnished. They were lithographed, inspected, delivered, and every express term of the contract fully and completely discharged by the plaintiff without complaint or objection by the defendant. On February 27, 1918, after all of said posters had been lithographed, delivered, and accepted, an error was discovered by one of the defendant's publicity agents in the wording of the extract from President Lincoln's Gettysburg Address. The quotation was erroneous. The defendant thereafter sought to decline delivery of the posters, place the responsibility for the mistake upon the plaintiff, and thus cause it to lose the purchase price stated in the written agreement. The plaintiff company declined to accept the defendant's conception of its rights. The time for the release of the posters was drawing near, the needs of the defendant were imminent, and the plaintiff, reserving its rights under the original contract, very commendably ac-ceeded to the defendant's later and urgent request for other and corrected posters, and expeditiously furnished and delivered the same, which were duly accepted and paid for. The defendant refused to pay for the original posters furnished under the contract because of some doubt as to its liability therefor, leaving the ultimate decision to the courts.
It has seemed to us from a careful consideration of the record and after an elaborate oral argument of counsel that a substantial defense to the claim would assuredly tax the ingenuity of the party presenting it. If we are correct in our conception of the argument advanced to defeat it, it is predicated upon three precise contentions, among which is the rather startling assertion that "the quotation on the imperfect poster amounted to an implied warranty of its genuineness, and that the same was correct as thus repre sented," notwithstanding it was quoted, the authorship given, and the address identified. It is manifestly difficult to comprehend wherein an express or implied warranty arises by reason of a transaction wherein a party voluntarily and without consideration, at the request of another, submits a sample of an article which the other desires to purchase, the ultimate selection resting entirely upon its peculiar merit over and above numerous other samples of a similar character, and in addition dependent exclusively upon the judgment and taste of the purchaser. We had always supposed that if an implied or expressed warranty in any way attached to a transaction of this character it extended no further than an exact duplication of the sample furnished for the purchaser's inspection, without the slightest obligation to buy until he had satisfied himself as to its quality and perfection, eliminating, of course, the question of fraud.
The doctrine thus advanced, if carried to its logical conclusion, would indispensably involve the plaintiff company in pecuniary liability under the circumstances narrated in the findings had some other one of the numerous bidders for this work procured the contract, for by the express ternas of the invitation to submit sketches it renounced all proprietary interest in the sketch and threw its reproduction open to the public. If a palpably honest and not uncommon mistake carries with it such dire responsibilities and unlimited liability, then one dealing with the defendant, as the plaintiff herein, might well hesitate to accept them. There was never any contractual obligation on the part of the plaintiff to do anything for anybody until it accepted the tendered contract to refroduce the sketch it had voluntarily furnished the defendant, and this it did without protest or objection, until after the completion of the contract and the acceptance of the posters.
The mode resorted to by the defendant in this case to secure some needed supply or negotiate an authorized contract is not unusual. We have had occasion heretofore to pass upon the transactions of a similar character. The Supreme Court in the case of Lord c& Hewlett v. United States, 211 U. S. 340, 341, in a brief opinion, conclusively commented, upon the respective rights of the parties in so far as preliminary negotiations were concerned. The contract is the only instrument to which we may look in determining the contractual rights and liabilities, and when viewed in its entirety it. is obvious that the plaintiff obligated itself only to the extent of reproducing a sketch it had submitted to the defendant. No attempt to deceive is charged; no fraud was practiced; the transaction was open and notorious and the opportunity to know and observe open alike to both parties. The duty was as much upon the defendant as the plaintiff to know what it was getting and whether what it did get complied with the sample it had chosen from among many. We are not to assume that the defendant did not know that the quotation was incorrect. It had ample opportunity and time to investigate the fact, and the exercise of the most ordinary diligence upon its part would have obviated the error it subsequently treated so seriously. Surely it may not be said that the error upon the face of the proffered sketch is what induced the defendant to enter into the contract. As a matter of fact the inference is strong indeed that the quotation was merely incidental. It was apparently the sketch of the former war President, Abraham Lincoln, that doubtless was designated to arrest public attention, and the transposition of his words with the substitution of two others would not have inured to forestall subscriptions to the bonds, whatever the reflections upon the learning of those who viewed it. Grymes v. Sanders, 93 U. S. 55; United States v. Ames, 99 U. S. 35.
The intent of the lithographer was to present an attractive poster, one which in competition with others would appeal to the public to purchase Liberty bonds. It was an approved method of advertisement, addressed to the people generally, not the execution of a precise and technical instrument whose vitality and usefulness depends upon the exactness in every minute particular. The lithographer was asked to submit a sketch, a design, something in his particular line which people would stop and look over, and having stopped would be impressed with it as a whole, and this he did in entire good faith. The defendant inspected and accepted it, permitted the plaintiff to go forward with the contract and supply the posters, and it is difficult to perceive wherein the transaction can in any possible manner fall outside the ordinary and elementary rules which govern the construction of contracts. The very terms of the proposals exclude the idea of the defendant's willingness to trust to the judgment of the lithographers.
Another obstacle, quite anomalous, is interposed to forestall recovery under the express contract, a defense which, if meritorious, would necessarily involve the officers of the defendant in violation of express statutory law. A counterclaim is pleaded. Its worthiness is alleged to depend upon the express mandate contained in section 3786 Revised Statutes, which, in terms, provides as follows:
"All printing binding, and blank books for the Senate and House of Representatives and for the executive and judicial departments, shall be done at the Government Printing Office, except in cases otherwise provided by law."
We think we need only quote section 8 of the act of April 24, 1917, first Liberty loan act, 40 Stat. 35, 37, to dispose of the contention. It is as follows:
" That in order to pay all necessary expenses, including rent, connected with any operation under this act, a sum not exceeding one-tenth of one per centum of the amount of bonds and one-tenth of one per centum of the amount of certificates of indebtedness herein authorized is hereby appropriated, or as much thereof as may be necessary, out of any money in the Treasury not otherwise appropriated, to be expended as the Secretary of the Treasury may direct."
The scope, purpose, and intent of the Liberty loan act authorized what was done in this case.
Judgment is awarded plaintiff in the sum of $8,500. It is so ordered.
Graham, Judge; Hay, Judge; DowNey, Judge; and Campbell, Chief Justice, concur.