Shaw v. United States

delivered the opinion of the court:

The petitioner claims, for the use of certain insurance companies, $25,000, retained on the findings of the Third Auditor from the amount'found by him to have been the value of the Eobert Campbell, jr., when she was burned.

It seems, therefore, quite clear that if the Third Auditor had *397not jurisdiction of the case, his whole proceeding is legally a nullity and in no way binding on the United States, for they are never parties to the unlawful or unauthorized acts of their officers.

And, therefore, the first question here is, whether the case submitted by Mr. Shaw to the Third Auditor was within the j urisdiction and authority of that officer under the Act 3d March, 1849, and its amendment, (12 Stat. L., p. 743,) and as contended for the defendants at the trial in the able argument of counsel. A majority of the court think it was not.

The fact is found that the steamer was impressed, and if that were all, the case would be certainly within the act of 1849 and its amendment, for in the statute the word “ impressment ” is used in contradistinction to contract, and thus would seem to include every taking by the mere authority of the United States.

But the facts are also found, that, at the time of the impressment, the officer making it contemplated paying a price for the services of the boat, and stipulated and offered it then, and the owner accepted this price, and, for all the time the boat was in the service, received it and receipted for it. The owner was not obliged to do this, and, by doing it, he converted the imprlfesment into a contract, to be performed by him and paid for by the Government; and that was the status of the steamer when she was destroyed by fire. She was in the possession of her owner and navigated by his master and crew and performing his contract for the transportation of stores, and was therefore in the service of her owner, like any other chartered vessel performing a contract of affreightment, as decided by the Supreme Court in Russel's Case and in Reed's Case.

Now, the Supreme Court decided in Guttman's Case, and we therefore have held at this term, in transportation contracts, that, where the owner of teams remained in possession of them, using them to perform the transportation he had contracted to perform for a price stipulated, in the teams were his service and not in the service of the United States, and that if the teams were destroyed, the case was not within the statute of 1849. Now, this is a like case, and the only difference is that the means of transportation here was a steamer instead of ox or mule trains, and if the case is not within these statutes, then the United States never authorized — were *398never liable for — the action of tbe Auditor, nor for $70,000 found by him to be the value of the vessel, nor for any part of it. They were mere strangers to the submission to the Auditor, and are in. no way estopped or affected by his judgment or anything done under it.

Then it was contended for the defendants that the Robert Campbell, jr., being, when burned, in the possession of her owner, performing his contract, she was at his risk; and in this we concur. He who undertakes the performance of a contract undertakes the risk of it, and it was never held that freighters, who put goods on board of a vessel to be carried by her for the freight-money, were thereby her insurers for the voyage.

dissenting:

It has been decided by the Supreme Court that where the officers of the Executive Departments have given a construction favorable to the Government for a long time to a statute, and Congress has regulated its appropriations accordingly, there the true construction of the statute is no longer an open question. It seems to me (though I confess the Supreme Ooflrt may be of a different opinion) that it is a poor rule which will not work both ways. I also think that a statutory construction favorable to claimants by the executive officers should be even more binding upon the Government than one which is strictly conducive to its own interests.

The statute now under consideration has always been held by the auditing officers of the Treasury to embrace just such cases as the one now before us. The fact of this construction is sufficiently evidenced by the cases which have been before this court. Reed's Case, (4 C. Cls. R., p. 132.) The auditing officers, at the same time, have never extended their favorable construction to cases like that of Guttman, the distinction made at the Treasury apparently resting on the fact that in the one case there was an implied contract springing out of a threatened impressment, which the owner did not voluntarily seek, and which was sought and compelled by the Government, while in the other case the contractor voluntarily sought and obtained an express contract, in which he inserted no clause of liability on the part of the Government. The distinction *399made between the cases, in other words, was, that when the officers of the Government forced an implied contract upon the owner, they in- effect made it the mselves according to the terms of the statute; but when the owner voluntarily entered into an express contract, he in effect made it himself, and left it open to the construction which would be given to it as between any other two parties. The construction now given to the statute by this court, upon the authority of Guttman’s Case makes the broader distinction, that when the owner retained the possession of his vessel and discretion as to her immediate control or navigation, the risk remained with him, as though it were a case of express contract. If the question were an open one, I am inclined to think that this would be the better construction.

But the construction given by the Treasury to the statute in effect made the Government assume the relation of an insurer of a boat thus used for military purposes. The consequence has been that the o fficers of the Government, when estimating / the compensation which they thought proper to allow, have taken into consideration this character of insurer on the part of the Government, and have fixed the compensation at a lower rate than -they would have allowed if the owner had been his own insurer.

This court has held the same, (Reed’s Case, above cited,) and Congress has year after year appropriated money to give effect to the awards of the Auditor for such damages. I may add, that the same construction has been given by different Attorneys-General to the statute, and that in the recent argument of ex-Attorney-General Evarts, before the Judiciary Committee of the House of Representatives in regard to the Alabama claims, he cites the opinion of Ex-Attorney-General Hoar as to this identical claim for the steamer Robert Campbell, jr., relying upon it as sufficient authority for the subrogation of an insurance company in a right of action against the Government. What all parties have thus united in regarding as the true construction of the statute had better be left, I think, undisturbed, even though the construction is less philosophical and less clear than the one which the judiciary would give.