Freund v. United States
Freund v. United States
Opinion of the Court
delivered the opinion of the Court.
This is a suit against the Government to recover $34,012.90 as the remainder unpaid of an amount earned by 16 months’ service in carrying the mails by wagons in the City of St. Louis. After official advertisement, a bid was made by appellants April 4,. 1911, and accepted April 20, 1911, for service on a particular route described by a schedule, for a certain annual gross sum, which, being divided by the miles to be covered, made a certain rate per mile. A contract was signed May 22nd. The contract was for four years, beginning July 1, 1911. The route was for seven daily circuit trips from and back to the new St. Louis Post Office. That office was not. ready for occupancy on July 1,1911, or for 16 months thereafter, and the old Post Office, which was thirteen blocks from the new one, continued to be used.. The, Post Office Department, relying on certain clauses in the contract, and upon a notice given to bidders, substituted another' route and ordered .the contractor to begin performance on July 1st, at what the Department held to be. the same rate per mile of service. The contractors protested, but, threatened with suit upon their bond, performed the service and accepted periodical payments on the new route until October 28, 1912, the date of occupying the. new Post Office, when thé route bid upon , and contracted for was initiated and the contractors did the work under it till the term .ended. The' cost to the contractors of doing the work on the substitute route was $43,726.89,
The contractors’ claim was that the substitution of the new route for the one they bid on was not within the terms of the contract, but was unconscionable, and that they were entitled to recover for the work done on the new route on a quantum meruit. The Court of Claims held that it was not necessary to determine whether the new route was properly substituted for the old, because the contractors had acquiesced in this view by their performance, but that the Government had not, in adapting the mileage rate of the original route under the contract to the new route, done justice to the contractors in the number of miles allowed, and on this basis gave judgment for $7,346.66. From this thé contractors appealed. The Government brings a cross appeal, claiming that, as the contractors accepted full pay under the contract as construed and expressed by the Department, they should recover nothing.'
It is, of course, wise and necessary that government agents in binding their principal in contracts for construction or service should make provision for alterations in the plans, or changes in the service, within the four corners of the contract, and thus avoid the presentation of unreasonable claims for extras.. This court has recognized that necessity and enforced various provisions to which it has given rise. But sometimes such contract provisions have been interpreted and enforced by executive officials as if they enabled those officers to remould the contract at will. The temptation of the bureau to adopt such clauses arises out of the fact that they avoid the necessity of labor, foresight and care in definitely drafting the contract, and reserve power in the bureau. This does
The Court of Claims, after giving the two schedules in full, sums up the contrast between them as follows:
“ The service bid upon was a circuit service on seven circuits, on a mileage basis, each circuit beginning and ending at the new post office and for which the contractor was paid for every mile traveled regardless of the quantity of mail carried or whether for any part of the distance no mail was carried. The restated service [i. e., on the new route] was a trip service for which payment was made on a mileage basis when mail was carried, but no payment was made for a return trip if mail was not . carried or for distance traveled by empty vehicles in going to a point from which mail was to be moved.
“ The service bid upon involved the handling of the mails for a small area and was a comparatively light service. The restated service required the hauling of incoming and outgoing mails for the entire city and involved handling several times the weight of mail. The .service bid on required 6 automobiles. The restated service required 18 wagons of different capacity exceeding several times in aggregate capacity that required for the bid on service. The mileage of each wagon when carrying*64 mail, was allowed and paid for. The larger bulk of mail required proportionately more time in loading and unloading.
“'The bid upon service, with the exception of one early trip on each of these circuits, was all to be performed within 12 hours from approximately 8 A. M. to 8 P. M. The restated service required trips during practically every hour of the twenty-four.”
By a note in the advertisement, by paragraph ten in the contract, and by a further somewhat more elaborate stipulation in the contract, provision was made for changes. The last contained all that was in the others, and was as follows:
“ It is hereby stipulated and agreed by the said contractors and their sureties that the Postmaster General may change the schedule, vary, increase, or decrease the trips on this route, or extend the trips to any. new location of the post offices, railroad stations, steamboat landings, mail stations, or points of exchange with cable or electric cars named in the schedule for service for said route, in said advertisement, establish service to and from like offices, stations, landings, or points not named therein, and vary, increase, or.’decrease the trips thereto, and discontinue 'service between any of the post offices, railroad stations, steamboat landings, mail-stations, or points of exchange with electric or cable cars., or between any of them: Provided, That for any increase or decrease in the servicé authorized by the Second Assistant Postmaster General, the pay of the contractors shall be increased or decreased, as the. case may be, at the rate per mile of travel agreed to be paid for service under this contract, as shown by the annual rate of compensation and the annual miles cf travel, based on the frequency and distances shown in the schedule of service for said route in said advertisement.”
, There are two limitations in this very broad provision which deserve notice. One is that the offices, stations,
It is sought in the argument for the Government to distinguish this case from the Stage Company Case and the Hunt Case, on the ground that in them the compensation was for a lump sum, and the new work required was not to be paid for -at all, while here the additional or variant work was to be done at a rate of so many cents per mile. We do not think this is a real difference. The radical change made in the character of the work to be done on the substituted route and the wholly inadequate price to be paid for it as found by the Court of Claims make the injustice just as clear as in. the cited cases. We hold that the substitution of the new route and schedule for the one bid upon w'as not within the terms of the contract.
We think that there was no acceptance of the new route under the circumstances which would bar a recovery for what the services were reasonably worth. The Hunt Case was not a stronger case than this; and in the Stage Company Case the right to recover for work not properly and legally included in the contract was not even questioned, although in both cases the work demanded was done and periodical payments accepted. It is said on behalf of the Government that those cases are to be distinguished from this because the contractor was in the midst of his work under his contract and he could not be expected'to throw it up with all the uncertainties and certain losses he would sustain, while here the contractors had not begun work or extended preparation. But while the cases are different, the difficulties faced by the contractors here were quite as formidable. They had been nursed into making the bid and giving the bond by the assurance as to the possible date of .beginning the contract by the postmaster to whom they had been officially referred for information. They thus became bound under their bond to sign and complete the contract before they had been otherwise adyised as to the actual date when their service would begin. At the time the contract was executed, the Department had formed the purpose to thrust on the contractors this burdensome route; but it
We think that the contractors are entitled to recover the reasonable value of their services for the 16 months including a fair profit.
This relieves us of considering the conclusion reached by the Court of Claims.
The judgment isi reversed, the cross appeal of the United States is dismissed, and the case is remanded to the Court of Claims, with directions to find the value of the services rendered by appellants on the substituted or restated route including a fair profit, and to enter judgment for the balance found due.
Reversed.
Route No. 445004- (Mileage basis) — Regulation screen-wagon service at St. Louis, Mo. — Mail-station service.
From— By-To— Distance. Number of trips daily except Sunday (306). Number of trips on Sun- . day. Total number of trips holidays (7)» Running time.
' (Footnote continued on p, 66,)
“ Postoffice Department,
“ Second Assistant Postmaster General,
“Washington, June SO, 1911.
“ Postmaster, Sf-Louis, Mo.
“ Sir: An order has been issued to-day on route No. 445004, screen-wagon service at St. Louis, Mo., restating the service from July 1, 1011, making total annual travel 57,679.60 miles and pay $18,265.61 per.annum, being pro-rata of original contract price.
“ Respectfully,
“(Signed) Joseph Stewart,
“Second Assistant Postmaster General.”
Reference
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- FREUND v. UNITED STATES UNITED STATES v. FREUND
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