
    THORNE’S CASE. Quentin M. Thorne et al. v. The United States.
    
      On the Proofs.
    
    
      The steamer Rescue is chartered for one month, “ and as much longer as the said vessel-may be required by the United States War Deiiartment/’ at the rate of !¡¡!50 per day, until she is returned to the oioner. The vessel enters service and 
      is paid the stipulated price. On the 9th September, 1863, an order from the Quartermaster General’s office is issued reducing the rate to $40 per day, from August 1,1863, or the boat to be discharged and the order endorsed on the charter. But notice'of the reduction of the vessel’s wages is not communicated to the claimant until October 8,1863, when he receives and recepts for the first payment at the reduced rate. At this time he objects to the reduction, and demands of the assistant quartermaster at Afew Torts the discharge of the boat; that officer tells him that he has no control over the boat, she is then at Fortress Monroe and beyond his jurisdiction. The claimant also receives the following reply from the quartermaster: “ X cannot assist yon in this case. There is the order from the Quartermaster General; we are obliged to abide by it.” No further steps are talcen by the claimant to obtain possession of the boat; but on the 15th October, 1863, he sells the Feseue to another party, ivho subsequently charters the vessel to the defendants at |40 per day. No release for her ivages is given, and the claimant, on the 31 st October and 9th December, 1863, receipts for the boat’s wages at the reduced rate, xoiihout complaint. The matter rests without demand for further payment, until the institution of this suit in 1869.
    The Quartermaster General cannot arbitrarily change the terms of a written'contraet, nor order a retroactive reduction of the charter rate of a vessel, without the consent of the contracting parties. But whore he issires such an order of redaction, in a case where he has the right to discharge the vessel at anytime, and the owners permit the Quartermaster’s Department to remain undor the false impression that they acquiesced in the reduction, they are estopped from claiming the original charter rate, both before and after notice. And they are so estopped, although they sell their vessel immediately after notice of reduction.
    
      Messrs. Ghipmcm & ITosmer for the claimants:
    Petitioners claim $760 as reduction illegally made by the Quartermaster’s Department from the charter rates of the steam-tug Besen e,, beginning August 1, 1863, ending October 15, 1863, the date of sale by the claimants of the tug Bescue to other parties. This tug was chartered the 6th day of March, 1862, at $50 pier day, “ for each and every day she may be employed,” • &c., and continued in service under the charter from that date until she was sold to Messrs. Morgan & Binehart, viz., the 16th day of October, 1863, after which no claim is made.
    On the 8th day of September,' 1863, the Quartermaster General indorsed upon the charter-party in his possession as follows: a The rate of this tug is ordered to be reduced to $40 per day, commencing August 1, 1863.”
    The Quartermaster General’s letter sustains the statements we have made; the vouchers upon which payments were made are found in the printed return of the Treasury Department. The 'enrollment of tbe vessel, showing the owners and their several interests, and the custom certificate, showing- the sale of the vessel to Morgan & Rinehart, are found on pages 3 and 4 of the record. We assume that the ownership and loyalty of the parties will not be questioned.
    The only defence that has been suggested by the Quartermaster General in this case is where it is said by that officer, after stating the fact of the reduction, u There is no record in this office that the owners agreed, in writing, to this reduction, but it is believed that they did, as no protest was made by them against it.” A. B. is charged with being a horse-thief. He does not deny it; therefore he is guilty. •
    But suppose'the owners did not protest, does it follow they acquiesced? There ivas a solemn covenant; it cannot be frittered away by non sequiturs and false deductions.
    We think if the owners received what was tendered them under this peremptory order, and were silent as to the right or wrong of the proceeding, we should recover. We think, also, that this matter of consent to the- reduction is such defense as must be proved by the defendants, and will not be presumed by the court.
    •Another suggestion is made by the Quartermaster General, that Messrs.' Morgan & Rinehart, after they had purchased the Rescue from these claimants, chartered her to the government at $40 per day. This charter was a few days after their purchase, viz., November 4, 1863, and nearly a year after this, in August, 1864, thej»' agreed that this second charterrparty should take effect April 1,1863. They had been the owners of the Rescue, with the consent of the government, in. whose service she was, under a new form of charter-party, during this whole period. The claimants here had no interest whatever in her or her earnings. They had the same right to control Morgan & Rinehart’s charter which Morgan & Rinehart had over theirs.
    
      The Assistant Attorney General for the defendants:
    On the 6th day of 'March, 1862, the claimants chartered to the government their steam-tug Rescue, for one month, “ and as much longer as said vessel may be required by the United States War Department,” at the rate of $50 per day. They were paid at this rate up to August 1, 1863.
    On the 9th day of September, 1863, Colonel Clary, quartermaster in charge oí water transportation in the office of the Quartermaster General, addressed a letter to Major Yañ Yliet, quartermaster in charge of the post where the .charter was executed, in which, in reference to this tug, he says: “ Yessels of larger capacity are offered at $40 per day, without making any charge for pilotage. The rate of this tug must be reduced accordingly to, at tbe most, $40 per day, from August 1, 1863, or the boat discharged
    
    What time this order came to the knowledge of the claimants does not certainly appear; but, as a payment was made to them in Yan Yliet’s office just six days afterward, we must presume that they were informed of it at least that soon. They made no complaint, and allowed their vessel to remain in the service. They received compensation for her services, and receipted in full therefor, at the reduced rates. They not only received pay at the reduced rates while they continued to own the vessel, but for sixteen days afterward. The vessel remained in the service till April 14, 1866, her new owners having executed a charter at $40 per day.
    I. The claimants acceded to the reduction, and thus entered into a new or different contract from that embodied in the charter-party. The quartermaster at New York was ordered to make such a contract •, it must be presumed, and the circumstances show, that he did.
    II. By receiving compensation at the reduced rates, and signing receipts in fall therefor, the claimants are barred from making any further claim. Such receipts are prima facie evidence of a settlement and full payment. (Kirlcham & Brown’s Case, 4 O. Oís. II., p. 226.) The circumstances of this case present nothing to vary this rule. (Lawrence v. Schuylkill Navigation Company, 4 Wash. O. C. B., p. 562, and cases there cited.)
    III. The claim not having been presented to the executive department charged with the settlement of such claims, no suit can be maintained upon it in this court. (Clyde’s Case, decided at the present term.)
   MilligAN, J.,

delivered the opinion of the court:

This action is founded on a charter-party, entered into on the 6th March, 1S62, by and between Quentin M. Thorne, owner of the steamer Rescue, and Henry C. Hodges, captain and assistant quartermaster, for the United States, whereby the said steamer was chartered to the United States for the full term of one month from the date of the charter-party, “ and as much longer as said vessel may be required by the United States War Department.”

The facts necessary to a decision of this case are found to be as follows:

1. The charter provides that the boat’s compensation shall be $50 per day for each and every day said vessel shall be employed, (the United States furnishing’ fuel,) from the date of the charter-party, “ until the said vessel is returned to the said party of the first part,' in the same order as when received, common wear and tear excepted; to become due, owing, and payable in the manner and form following — that is to say, payable to the order of Quentin M. Thorne, at the quartermaster’s office of the United States, at New York, upon presenting certificates of the duly authorized ag’ent of the Quartermaster’s Department, that said vessel has faithfully performed her part of this contract.” ,

2. The vessel went into the service of the government, under this charter-party, and was duly paid, as the claimants admit in their petition, the stipulated price of her wages up to the 1st August, 1863.

3. The following order was subsequently issued from the Quartermaster General’s office:

“ Quartermaster General’s Oeeice,

“ Washington, D. 0., September 9, 1863.

“ Major : • * * * The account of the steamer Rescue, from June 5 to July 31, 1863, inclusive, at $50 per day, less time lost, three days, at $50, is in like manner referred to you for payment, in accordance with the evidence of service inclosed.

‘‘The claim for pilotage, two months, at $75 per month, is hereby disallowed, not being authorized by the terms of the charter-party, nor is it deemed essential that they should be retained on board. Vessels of larger capacity are offered at $40 per day, without making any charge for pilotage. The rate of this tug must be reduced accordiug to, at the most, $40 per day, from August 1, 1863, or the boat discharged.

“ By order.

•‘Very respectfully, your obedient servant,

“E. E. CLARY,

Golotiel and Quartermaster.

“Major Stewart Van Vliet,

Quartermaster, Neiv York.”

4. A similar order, bearing date “ Quartermaster General’s Office, September 8th, 1863,” is indorsed on the charter-party, which declares:

“The rate of this tug ordered to be reduced to $40 per day, commencing August 1st, 1863.

“ By order.

“R. E. CLARY,

Colonel and Quartermaster.”

The exact time when this indorsement was made does not distinctly appear; but we find it was not entered until or subsequent to the 9th December, 1863, which is the date of the preceding indorsement on the charter of payment for the boat’s services for the month of October, 1863.

5. In like manner the date o'f notice of the reduction of the vessel’s w-ages -from $50 to $40 per day does not very distinctly appear. But we find that, the notice was not fully communicated to the claimant until the 8th October, 1863, when the owner received and receipted for the first payment of the vessel at the reduced rate.

6. At this date, when tbe boat’s ivages were paid for the month of August, the claimant objected to the reduction, and demanded of Captain Orilly, the assistant quartermaster and disbursing officer at New York, the discharge of his boat, and was told by Captain Crilly that he had no control over the vessel. She ivas then, in i>oiut of fact, at Fortress Monroe, and beyond his jurisdiction. It further appears in proof that when the claimant, Thorne, complained to Captain Orilly of the reduction in the wages of the boat, he said- to him, “ I cannot assist you in this case, Mr. Thorne; there is the order from the Quartermaster General; we are obliged to abide by that.”

7. No further steps appear to have been taken by the owners to obtain possession of their boat; and on the same day (October 8th, 1863) oil which the objection to the account was made by Mr. Thorne he received and receipted for the wages of the boat for the month of August, at $40 per day. And again on the 31st October and the 9th December, 1863, he received and receipted for the wages of the boat respectively for the months of September and October, at the reduced rate of compensation, without objection or complaint.

8. On the 15th October, 1863, the claimants sold out their interests in the Rescue to Morgan and Rheinheart, who subsequently entered into a new charter-party with the United States for the same vessel at $40 per day.

9. No further demand or effort for the discharge of the vessel appears to have been made by the owners after the date of the notice of reduction, or any release for her wages given at or subsequent to that time. The whole matter rested quietly, without demand of further payment than the $40 per day, until the institution of this suit in 1869.

The claim made in the petition'is for $760, which is alleged to be still due on the contract of charter for the services of the boat from the 1st of August to the 16th of October following, when she was sold to Morgan and Rheinheart.

The questions presented in this record are neither difficult nor novel. They are of the same character of those involved in several other vessel cases determined at the present term of this court.

It is clear, as we have decided in several other similar cases, that the Quartermaster General could not arbitrarily change the terms of the written contract, or lawfully make his order of reduction retroactive, without the concurrence of other contracting parties. He had the right, by the terms of the contract, after the expiration of one month from the date of the charter-party, to discharge the vessel at any time. He was authorized to end the contract, but he could not arbitrarily change it.

But this is not conceived to be the controlling question in the case. It is essential first to ascertain the legal effect of the claimant’s conduct in respect to the order of the Quartermaster General requiring Major Yan Yliet to reduce the wages of the boat $10 per day from the 1st August, 1863, or to discharge the vessel. Was this order acquiesced in, either directly by the claimants or impliedly by their conduct at the time or subsequent thereto ? On this question the case turns, and a majority of the court are satisfied that the acts and conduct of the claimants estop them from prosecuting this action. '

The law on this subject, as laid down by Parsons on Contracts, (vol. 2, 340, g.,) is stated in the following language: “When a man has made a declaration or representation, or caused^ or in some cases not permitted, a false impression, or done some significant act with intent that others should rely and act thereon, and upon which others may have honestly relied and acted, he shall not be permitted to prove that the representation was false or the act unauthorized or ineffectual, if injury would occur to the innocent party, who had acted in full faith in its truth or validity.”

The rule is also stated thus in other authorities: “To constitute an estoppel in pais a party must have subsequently made an admission inconsistent with the defence or claim which he proposes to set up, and with his knowledge and consent another party must have so acted on that admission, that he will be injured by allowing the admission to be disproved; and this injury must be co-extensive with the estoppel.” Smith v. Schrce-der, (U. S. C. C., Rhode Island, 21 Law Rep., 739.) Dyer v. Cady, (20 Conn., 563.) Cambridge Savings Bank v. Littlefield, (6 Cash., 210.)

And this admission may be implied from the acts or conduct of the party. Lawrence v. Brown, (1 Seld., 394;) Dezell v. Odell, (3 Hill, 215 ;) Wuscott v. Davis, (4 Bar., 493;) Dewey v. Field, (4 Met., 383; 6 Peck, 455.)

Now, do the facts of this case bring it under the principles of law announced1? We think they do. It is admitted the notice of the Quartermaster G-eneraPs order was brought home to the claimants on the 8th ^October, 1863, when the wages of the boat for the months of August, September, and part of October were due. The order itself presented to the claimant the alternative of accepting its terms, or submitting to the discharge of their boat. Phey were free to take either horn of the dilemma, but could not hold on to both. They elected to accept the reduced rate of compensation, and to continue their vessel in the service, and they must be held to their own election.

There can be no reasonable doubt, had they acted otherwise their vessel would have been discharged, and they left to their remedy at law for the unpaid balance drie on the original contract.' The retroactive feature of the Quartermaster General’s order was felearly illegal and inoperative, and this fact, by presumption of law, was fully known to the claimants, as well also as the fact that this court was open to compel the government to a full compliance with the terms of their contract. The remedy was as plain and open in the one case as the Quartermaster’s order was direct and positive in the other. There could have been no misunderstanding, and the claimants failing to take the necessary steps to reclaim their boat, or to prosecute the demand for its discharge to any one having authority to return it, must be held to have elected to leave it in the service under the terms of the order.

This view of the case is corroborated by the fact that they afterward again and again received and receipted for her wages at the reduced rate of compensation, without murmur or complaint. The receipts of themselves are subject, as we have repeatedly holden, to explanation, and when explained do not work an estoppel; but when coui>led with the fact that the claimants did not prosecute their demand for the discharge of the vessel before any one but Captain Clary, the disbursing agent at New York, who declared he had no authority over it, they become important instruments of evidence to establish an acquiescence in the Quartermaster’s order.

It must also be observed that the Quartermaster General’s order was addressed to Major Orilly, and he, on the face of the order, was charged with .its execution, and not Captain Clary, to whom the claimant, Thorne, appealed for the discharge of his vessel, and who promptly informed him'he had no control over it, and that he could not go beyond the quartermaster’s orders, and “there is the order.” Thorne did not further prose-ecute Ms demand for the discharge of the boat, or even apply to Major Orilly, who by the order had authority to act in the premises, but accepted her wages and receipted for them at the reduced rates.

It is true the owners soon afterward sold the boat, but that cannot change, in the slightest degree, the legal consequences of their acts at the time of the notice of the order to reduce her rates or discharge the vessel. The defendants had then acted on their acquiescence in the terms of the order, and returned the boat, and no subsequent action of the owners, in which the defendants had no participation, could change the legal rights of tbe parties subsequently fixed. The act was done, and now injury would accrue to the defendants to allow the claimants to disprove their own conduct, upon which the government acted in good faith, in retaining' the boat.

The petition must be dismissed, and the claimants go hence without taking anything by their action.

Nott, J.,

dissenting:

This, probably, is the hardest case that has been before the court since that of Pratt. (3 C. C1s. R., 105.) Four citizens place their vessel in the service of the government upon the faith of a valid charter at an agreed compensation. After she has been in service eighteen months an order issues from the Quartermaster General’s office on the 9th September, 1863, directing that the compensation be reduced twenty per cent. It is retroactive in terms, and directs that the reduction take effect from the 1st August preceding, or that the boat be discharged. The quartermaster at New York neglects to notify the owners of the reduction until they come for their pay on the 8th October. The owners refuse the reduced rate and demand their vessel. The quartermaster calmly tells them that he has no control over her; and his chief clerk pleasantly adds that they can take the money or let it alone, as they please, but that is all they will get. The owners, finding that they cannot get out of the clutches of the Quartermaster’s Department, sell their vessel. Considering that they proceed from New York to Fortress Monroe, find a purchaser, make a bargain, and transfer the vessel within six days after receiving notice of the reduction, they may. be said to sell her immediately. They then do what any creditor would do under like circumstances — they get what money they can out of their delinquent debtor, give a receipt for the part which is paid to them, and bring an action for the balance.

What the error of these unfortunate owners was, which is to preclude them from recovering upon a cause of action so mani-foldly just, I do not comprehend. In some such cases the claimant has been defeated because he voluntarily allowed his vessel to remain in the service with knowledge of the Quartermaster General’s order; but here the owners were in haste to get her out. In some, the benefits arising from the continued service, coupled with, tlie acceptance of the reduced rate, has been regarded as an estoppel in pais upon the owners; but these owners received none of this resulting- consideration, and, on the contrary, in six days had succeeded in cutting themselves loose from the peculiar benefits of the connection. Other cases seem to have turned on the receipts, they being-taken as evidence of acquiescence; but such evidence I take it is at best prima facie, and here there was the strongest dissent, while the receipts are only in full of the part alloived by the Quartermaster' General, expressing nothing that looks like release or compromise of the part unpaid. It is also intimated that the suit was not brought soon enough, and that the parties had slept on their rights; but the suit has been brought within the time prescribed by law, and sleeping- on a cause of action is but evidence toward establishing a compromise where an agreement to compromise is alleged and in dispute. Here no such agreement is alleged nor pretended.

The case stands thus: The claimants entered into an agreement and performed all that it required of them; the defendants entered into an agreement and violated it. The claimants never consented to the breach nor waived the forfeiture, nor received any advantage from the contract after the violation was known to them. The defendants never restored to the claimants their property nor discharged their indebtedness for the use of it, nor procured any release for the balance left unpaid. Why the claimants should not recover I do not know; why the defendants should succeed I cannot understand.

PECK, J., did not sit in this case and took no part in the decision.  