
    SAMUEL P. WREFORD v. THE UNITED STATES.
    [No. 16861.
    Decided June 1, 1897.]
    
      On the Proofs.
    
    The Post-Office Department notifies a mail contractor that it will employ another unless he will perform at a reduced rate. He replies that he can make no reduction. The Department replies that it considers this a declination and that it will procure the service at a lower rate if he will not reduce his price. The-Department then enters into a contract with a third party.
    I. Where a mail transportation contract is not treated by the Department as abandoned or forfeited, but is terminated by notice that the rate of compensation must be reduced, "which is followed by tbe transfer of the service to another person, the contractor is entitled to one month’s extra pay.
    II. Where a mail contractor’s steamboat is laid up for repairs, and he procures the services of another to transport the mail, the arrangement does not concern the defendants and is no ground for forfeiture.
    
      The Reporters’ statement of tbe case:
    Tbe following ate tbe facts of tbis case as found by tbe court:
    I. March 5, 1884, plaintiff made with defendants a contract in relation to postal service. In tbis contract plaintiff agreed to transport tbe mail [route No. 16096] from Chattahoochee, Fla., to Apalachicola, Fla., and back twice a week, in safe and suitable steamboats, by a schedule satisfactory to tbe Post-Office Department, for tbe term from July 1, 1884, to June 80, 1888, and defendants agreed to pay for tbis service at tbe rate of $7,475 per annum.
    II. Tbe contract contained tbe following provisions:
    “Now, therefore, tbe said contractor and bis sureties do, jointly and severally, undertake, covenant, and agree with tbe United States, and do bind themselves, * * * to be answerable for tbe person to whom tbe said contractor shall commit tbe care and transportation of tbe mail and accountable to tbe United States for any damages which may be sustained by tbe United States through bis unfaithfulness or want of care, and that said contractor will discharge any carrier of said mail whenever required to do so by tbe Postmaster-General. * * *
    “For which services, when performed, and evidence thereof shall have been filed with tbe Postmaster-General, tbe said Samuel P. Wreford, contractor, is to be paid by the United States tbe sum of seven thousand four hundred and seventy-five dollars a year, to wit, quarterly, in tbe months of May, August, November, aud February, through tbe postmasters on the route, or otherwise, at tbe option of tbe Postmaster-General; said pay to be subject, however, to be reduced or discontinued by tbe Postmaster-General, as hereinafter stipulated, or to be suspended in case of delinquency. .
    “ It is hereby stipulated and. agreed by tbe said contractor and bis sureties that tbe Postmaster-General may increase tbe service or change tbe schedules, be allowing not to exceed a 
      pro rata increase of compensation within the restrictions imposed by law for the additi nal service required, but the contractor may, in case of increased service or change of schedule, relinquish the contract on timely notice, if he prefers it to the change; also that the Postmaster-General may curtail or discontinue the service in whole or in part, he allowing one month’s extra pay on the amount dispensed with, and not to exceed pro rata compensation for the service retained.
    “ It is hereby also stipulated and agreed by the said contractor and his sureties that in all cases there is to be a forfeiture of the pay of a trip when the trip is not run, and of not more than three times the pay of a trip when the trip is not run and no sufficient excuse for the failure is furnished; a forfeiture of at least one-fourth part of it when the running is so far behind time as to lose connection with a depending mail, unless it is shown that the same was not caused by neglect or want of proper skill or misconduct, and a forfeiture of a due proportion of it when a grade of service is rendered inferior to the mode of conveyance above stipulated, and that these forfeitures may be increased into penalties of a higher amount, according to the nature or frequency of the failure and the importance of the mail; * * * also that fines may be imposed upon the contractor * * * f0r not arriving at the time set in the schedule, unless not caused by neglect or want of proper skill or by misconduct. ■ * * *
    “And it is hereby further stipulated and agreed by the said contractor and his sureties that the Postmaster-General may annul the contract for repeated failures, for violating the post-office laws, for disobeying the instructions of the Department, for refusing to discharge a carrier or any other person having charge of the mail by his direction when required by the Department, for setting up or running an express as aforesaid, or for transporting persons conveying mail matter out of the mail as aforesaid, or whenever the contractor shall become a postmaster, assistant postmaster, or Member of Congress, or shall admit to any share, or part of, or any benefit to arise from this contract any Member of or Delegate to Congress, or whenever, in the opinion of the Postmaster-General, the service can not be safely continued, the revenues collected, or the laws maintained on the route herein named; and this contract shall be subject to all the conditions imposed by law and by the several acts of Congress relating to post-offices and post-roads.”-
    III. Under this contract plaintiff (July 1, 1884) began to carry the mails upon this route, and so continued (except as hereafter stated) to including August 14, 1885;
    Until July 11, 1885, plaintiff carried the mails in his own boat; then, as this boat needed repair, he engaged Orienith F. Allen, wbo also owned a boat, to carry the mails for him; the mails were carried by Allen during the period in question. Plaintiff agreed to pay Allen $50 a trip until the agreement was terminated by either upon reasonable notice.
    IV. July12,1885, the Department of the Post-Office informed plaintiff that the compensation under this contract was considered excessive, that the service could be obtained at a less rate, and he was asked to inform the Department at what lower rate he would be willing to continue, to which the response was, “ Inasmuch as the service is expensive to maintain, I can not consent to any reduction whatever.”
    July 28,1885, the following telegram was sent and in due course received:
    “Samuel Wreford, Apalachicola, Florida:
    
    “ Tour letter is considered declination to accept less than contract rate for service Chattahoochee to Apalachicola. Department can procure service at lower rate, and will do so if you will not reduce your price.
    “A. Leo Knott,
    “ 2d AssH P. ill. General.”
    Plaintiff at the time of receipt of this telegram was suffering from a protracted attack of swamp fever, which rendered him almost helpless. As soon as he was able, viz, August 23,1885, he replied thus:
    “Blounts Spring-, Ala., Aug. 23d, ’85.
    “Hon. A. Leo Knott,
    “ Second AssH Postmaster-General, Washington, D. G.
    
    “ Sir : Tour telegram of the 28th ult., notifying me of the cancellation of my contract for carrying the mails on Fla. route 16996, between Chattahoochee and Apalachicola, Fla., is received, and would have been answered sooner had I not been confined to a sick bed. I have the honor to respectfully inform you that your action in the premises has caused me to lose everything I had. It appears that a contract with the Government is good so far as holding the contractor strictly within its terms, but is not at all binding upon the Government.
    “ I carried the mail on my own boat until July lltli, when I employed Mr. O. F. Allen, of Apalachicola, to carry it with his boat, the ‘Little Sam.’ I will thank you to pay him the full amount earned by him since July 11th. The sum of $228.36 is due me for 11 days’ service from July 1st to July 11th, inclusive; alsoone months’pay allowed by law when contract is canceled by Government; 11 days’ service, $228.36; 1 month’s pay, $622.91; total due me, $851-^,-.
    “ Having lost everything in consequence of losing this contract, I respectfully ask that you will remit the amount due me at your early convenience.
    “Very respectfully,
    “ Sam’l P. Wreeord.
    “Address: Box 681, Jacksonville, Fla.”
    Y. July 12, 1885, for the reasons hereinbefore stated, plaintiff committed the care and transportation of the mail on his route to O. F. Allen, who fulfilled the duty thus imposed upon him from that day to August 14, 1885. Plaintiff paid said Orienith F. Allen for this service $50 per trip.
    YI. August 4, 1885, this order was recorded in the Department of the Post-Office, viz:
    “Contract with C. D. Owens, of Savannah, Chatham Co., Geo., for the performance of service from Chattahoochee by all intermediate offices to Apalachicola, Florida, 144 miles and back, twice a week, in safe and suitable steamboats, by a schedule •satisfactory to the Department, from August 15,1885, to June 30,1888, at the rate of $5,500 per annum.
    “Wm. F. Yilas,
    “Postmaster-General.”
    This contract was made.
    YII. August 13,1885, this order was recorded in the Department of the Post-Office:
    “For repeated failures, annul contract with Samuel P. Wre-ford; to take effect from August 14, 1885.
    “Wm. F. Yilas,
    “Postmaster-General.”
    YIII. This correspondence followed:
    “U. S. Post-Oeeice Department,
    “Oeeice oe the Second Assistant
    “Postmaster-General,
    “ Washington, Aug. 29, 1885.
    
    “Sir: By direction of the Postmaster-General, you are desired to give answer to the underwritten inquiry by writing it opposite thereto or on the next page and returning this sheet containing such answer, signed and dated, without delay.
    
      1 ‘ Y ery respectfully,
    “G. M. 'Sweney,
    
      uAcfg Second Assistant Postmaster-General.
    
    
      “To Postmaster, Chattahoochee, Gadsden Co., Florida.
    
      “Inquiry of Second Assistant P. M. G.
    
    “What is the date of the last trip on No. 16096 by or in the-interest of Samuel P. Wreford, formerly contractor for said service?
    “By whom and at what rate of pay was O. F. Allen employed, as temporary carrier?
    “How many trips did he perform?
    “Beport trips, if any, performed by Mr. Allen for contractor for -which he has or has not been paid.
    “Beport trips, if any, performed by Mr. Allen as employed, by you as temporary carrier.
    “Beturn this with your answer.
    “ Chattahoochee, Fla., Sept. 1st, ’<55.
    “ Hon. 2nd Ass’t P. M. General, Washington, JD. 0.
    
    “ Dear Sir : I never employed O. F. Allen on route No. 16096. S. P. Wreford got him to carry the mail and promised to give him his pay. I received an order to employ temporary service, but had no-occasion to use it, only in this way: I informed Allen I thought the Department would pay him out of Wre-ford’s contract.
    “My record here shows ten trips infavor of Allen for Wreford. Wreford owed Allen some other moneys for mail service. I enclose you his letter to me.
    “ Wreford’s last trip was on July the 10th; Allen then carried the mail until Aug. 14th.
    “ Bespectfully,
    “ Chas. B. Scull, P. M”
    
    IX. The Auditor for the Department of the Post-Office found to be due to plaintiff from defendants for service on the route aforesaid full compensation, according to the terms of said contract, as follows:
    From July 4, 1884, to September 30, 1884 . $1,868.75
    Less fines and deductions. 17.96
    • 1,850. 79
    From October 1,1884, to December 31,1884.. $1,868.75
    Less fines and deductions. 35. 93
    - 1,832.82
    From January 1,1885, to March 31,1885. 1,868.75 1, 868.75
    No fines or deductions.
    From April 1, 1885, to June 30,1885. 1, 868. 75 1, 868. 75
    No fines or dedirctions.
    From June 20,1885, to August 14,1885 . 914.06 914.06
    No fines or deductions.
    All of this has been paid plaintiff except $718.75, which, in accordance with plaintiff’s request and by direction of the Second Assistant Postmaster-General, was paid to O. F. Allen for tbe service aforesaid.
    X. After August 15,1885, tbe service on said route was performed by O. D. Owens, under an order of tbe Postmaster-General dated August 4, 1885.
    Upon tbe foregoing findings of fact tbe court decide as conclusion of law that plaintiff recover judgment in tbe sum of ■$622.91.
    
      Mr. Frederick D. McKenny for tbe claimant:
    While tbe decisions of tbe Postmaster-General upon questions of fact arising in tbe course of tbe administration of tbe postal laws and tbe performance of contracts made pursuant thereto are, generally speaking, binding upon tbe contractor and are not reviewable by tbe courts, this result does not follow when such decisions are impeached “by showing-such a state of facts as constitute in law a failure on tbe part •of that officer to discharge tbe duty imposed upon him in substantial requirement with bis duty in tbe premises;” Tbe power to decide must be exercised reasonably, not arbitrarily, and certainly not in a manner plainly incompatible with its legitimate usé. (Otis v. United States, 24 C. Gis. R., 61, 72. WoodliefY. United States, 26 ib., 457, 466.)
    If from tbe evidence in tbe case it should appear to tbe court that-there bad not been in fact “repeated failures” on tbe part' of tbe contractor to fulfill tbe obligations of bis contract, but that tbe suggestion of “repeated failures” was a mere subterfuge on tbe part of tbe post-office officials, resorted to for tbe purpose of enabling them to abrogate Wreford’s contract and to substitute a cheaper service for that which be was Tendering, then tbe annulment of 'Wreford’s contract should be held to bave been as to him an arbitrary discontinuance of the service, by reason whereof be became entitled under tbe terms of tbe contract to one month’s extra pa.y on the contract price.
    In Pratt ,v. United States (3 O. 01s. R., 105,110), this court declared that tbe law which bound a citizen to tbe performance of bis contracts with tbe Government also protected him against assaults upon bis rights thereunder. Contracts between tbe United States and tbe citizens are equally binding upon both; and in tbe case of The United States v. Smoot (15 Wall., 3'G), the Supreme Court said that it would not give to Government contracts a construction or effect different from that which courts of justice apply to contracts between individuals.
    The annulment of Wreford’s contract was nothing more nor less than the forfeiture of claimant’s right thereunder.
    In enforcing forfeitures, which are abhorred by the law, it is a requisite that not only shall it be proved that a condition has been broken, but also that the breach has been promptly availed of, and that between the time of condition broken and forfeiture declared no act has been done recognizing the continued existenceof the former relations. (Lester v. United States, 1 C. Ols. B., 57.)
    In the absence of any showing of “failures” other than those above referred to which would reasonably afford ground for annulling the contract, and in the absence of any power reserved to the Government in the contract by which it would be entitled to insist upon the full service at a reduced compensation, the claimant having refused to abate anything from the agreed price, it is apparent that the order of August 13, 1885, was worded as it was for the purpose of putting an end to claimant’s contract and to avoid paying the indemnity of a month’s extra pay, which the contract provided should be paid to the contractor as compensation for changes in the service. (Salisbury v. United States, 28 0. Cls. B., 52, 56; Chicago & Nortino ester n By, Co. v. United States, 104 U. S., 680.)
    If Congress, as was held in that case, could not, by express legislation, alter or change such contracts without the assent of the contractor, save in the manner provided in the contracts themselves, it is submitted with confidence that this court will not countenance an attempt on the part of Government officials to evade, by subterfuge and falsification, the payment of the indemnity specified in the contract as compensation for its abrogation.
    
      Mr. Charles C. Binney (with whom was Mr. Assistant Attorney-General Bodge) for the defendants:
    Assuming, for the sake of the argument and in spite of Wre-ford’s own admission to the contrary, that he did not by any act of his own abandon the contract, or, in other words, that when be left Apalachicola be did so in tbe belief that bis contract would be carried out by Allen, as bis agent, until sucb time as the Government saw fit to terminate it, tbe result would still be tbe same. If tbe agency was not terminated by Wreford, it was certainly renounced by Allen, and ceased to exist by August 3, if not before. After Allen’s renunciation of tbe agency and bis direct employment by tbe United States as a temporary contractor, performance of tbe claimant’s contract ceased, and between that date and August 15 tbe failures to perform were certainly “ repeated.” Even if Allen’s renunciation bad not been warranted by bis contract with Wreford, while this would have rendered him liable to Wreford, it would not have affected tbe position of tbe United States. If a contractor employs an agent, and that agent refuses to act, so that tbe contract is not performed, tbe breach is as substantial as if done by tbe act of tbe principal.
   Davis, J.,

delivered tbe opinion of tbe court:

This plaintiff (owner of a steamboat) was under contract to carry the mails upon a “ star route” in Florida. In July (1885), bis boat being laid up for repairs, be employed another steam-boatman, Orienitb F. Allen, to perform tbe service for him temporarily. Tbe contract between them was'that Allen should carry tbe mails for $50 per trip, tbe agreement to be terminated by either party upon notice.

About July 12,1885, tbe Post-Office Department informed Wreford that bis compensation was considered excessive; that tbe service could be obtained at a less rate, and be was told to inform tbe Department at what lower rate be would continue. To this be answered: as tbe service was expensive, be could make no reduction. This reply tbe Department (by telegram) “considered declination to acceptless than contract rate, * # * adding Department can secure service at lower rate, and will do so if you will not reduce your price.”

When this telegram was received, plaintiff was ill and almost helpless. Hence nearly a month elapsed before be answered tbe Department. He then stated the facts which led to tbe delay, and added that be bad employed Allen, meantime, to carry tbe mail in bis place. Defendants, nevertheless, employed another contractor.

The facts as to this employment may thus be summarized: July 28 the Department telegraphed plaintiff that they intended to employ another contractor; August 4 the Department ordered a contract to be concluded with one Owens for performance of this postal service “ from August 15 ;” between July 21 and August 15 the mail was carried by Allen under a previous arrangement with plaintiff; the Post-Office paid Allen and charged this payment to plaintiff. Thus on the books plaintiff is charged with the cost of the service, but not credited with the sum due for it under his contract, and that sum is the subject-matter of this action.

The contract (with plaintiff) was not treated by the Post-Office as abandoned or forfeited, but was terminated by the Postmaster-General under his notice that the rate of compensation must be reduced and his order for a new contract (with Owens) to begin August 15.

The result of all this is that: plaintiff’s boat being under repair, he procured the services of another boat owner to perform the service for him; the service was, in fact, performed, without loss to defendants. The arrangement between plaintiff and his agent does not concern defendants. No deceit or fraud is shown in the case and no provision of the contract required the plaintiff to carry the mails in his own or any other particular boat. On the contrary, as the contract made him “answerable for the person to whom ‘he might’ commit the carriage and transportation of the mail,” it may be inferred that he had authority to employ some one to do that work for him and that the duty imposed by the contract was not regarded as personal. The service which the Government required was, in fact, performed by another upon plaintiff’s request, because of his own temporary inability to perform it. There appears no ground for forfeiture here.

We are of opiuion that plaintiff should recover the one month’s extra pay for this service. (See Otis v. United States, 24 C. Cls. R., p. 61; Woodlief v. United States, 26 ib., p. 457; Salisburg v. United States, 28 ib., p. 52; Chicago v. N. W. Rwy. Co., 104 U. S. R., p. 680.)

Judgment for plaintiff in the sum of $622.91,  