
    WOOD’S CASE.
    Albert Wood v. The United States.
    
      On the Proofs.
    
    
      The claimant agrees to furnish at Fort Brown, near Brownsville, 1,000,000 pounds-of “good merchantable prairie hay, subject toa rigid inspection.” If objections be made to the hay, a board of officers is to be convened “ to decide ■whether the said hay is receivable according to the conditions of this-
    
      agreement, the decision to "be finad.” The claimant furnishes hay to which objection is made. A board of officers is convened ; but it is to be “ guided in its actions by letter of instructions from office of chief quartermaster Department of Texas, the requirements of which will be strictly complied with.” The board finds the hay “ is not of good merchantable quality, it being unfit to feed animals; ” but that “ no good merchantable prairie hay can be obtained in this vicinityand that this hay “is of the same quality as that furnished by the contractor ” under a prior contract. The claimant does not request that a board be convened under the contract. The hay being rejected he brings his action.
    
    I. If a contract provide that, in case of dispute as to the article to be furnished, a board of officers shall be convened whose decision shall be final, and a board is convened for the purpose of examining the article, but is to be guided by a general letter of instructions issued by the chief quartermaster of the department, its decision will be final unless the contractor requests that a board be convened with instructions to proceed according to the terms of the contract.
    II. Where the defendants neglected to convene a board of .officers whose decision as to the quality of the goods to be furnished is to be final, according to the terms of the contract, the burden is nevertheless upon the contractor to show the fact or the. probability that such aboard would have accepted an article which the defendants’ officers had refused.
    III. The word “ merchantable" in a contract means, generally, vendible in market. Merchandise is vendible because of its fitness to serve its proper'purpose. Applied to forage, “ merchantable" means edible. Me. gr. prairie hay is not “ merchantable” if it be not edible.
    
      The Reporters' statement of the ease:
    The evidence in this case was exceedingly voluminous and exceedingly conflicting. From it the court deduced, among others, the following facts:
    The contract between Lieut. Col. James A. Ekin, chief quartermaster of the Department of Texas, and the petitioner, was, on advertisement and the following proposals:
    “ Brownsville, Texas, May 1,1871.
    “ I, the subscriber, hereby propose to furnish and deliver to the Quartermaster’s Department United States Army, at the post of Ford Brown, Texas, in accordance with the requirements hereunto annexed, and of advertisement of chief quartermaster, Department of Texas dated January 2,1871, inviting proposals for furnishing and delivering the following supplies, viz:
    <{ One million one hundred thousand pounds of prairie hay,. put up in bales, properly pressed and fastened, at the price of £24 per ton. The hay furnished to be of as good quality as that delivered by me to the Quartermaster’s Department United States Army at Fort Brown, Texas, in the year 1870. Or I propose to furnish one million one hundred thousand pounds of western hay at the price of $60 per ton, and pledge myself to enter into a written contract with the United States, with good and approved securities, within the space of five days after being notified that my bid has been accepted.
    “ Your obedient servant,
    “ALBERT WOOD.”
    Previous to the making of said contract and the offer of any hay thereunder by the petitioner, it had been ordered by the military authorities of the Department of Texas that such stores, of those supplied by contract, should be received on the inspection and examination of a board of officers instead of upon the inspection of a quartermaster.
    On the 11th day of September, 1871, a board of officers was •ordered to convene at Fort Brown. The order was as follows :
    “ Headquarters Post op Fort Brown, Texas,
    
      “ September 11, 1871.
    [Extract.]
    “ I. Paragraph I, S. O. No. 144, from these headquarters, of August 12,1871, is hereby amended so as to read as follows:
    “Aboard of officers are hereby ordered to convene at this post at 2 o’clock p. m. to-day, for the purpose of receiving fifty tons of hay, or more, from Albert Wood, hay contractor.
    “ The board will be guided in its actions by letter of instruction from office of chief quartermaster Department of Texas, dated June 2, 1871, the requirements of which will be strictly ■ complied with by the board.”
    At the time and place in the above-mentioned order, the board of officers thereby appointed convened, and made the following report:
    
      “ September 11, 1871 — 2 o’clock p. m.
    “ The board met pursuant to the foregoing order. Present, all the members.
    “The board being duly sworn, proceeded to examine the hay referred to in the above order, and after a rigid inspection thereof, finds that said hay is not of good merchantable quality, it being unfit to feed animals. The board is, however, of the opinion that no good merchantable prairie hay, in any quantity, can be obtained in this vicinity, and that the hay now submitted is of the same quality as furnished by Mr. Albert Wood under his contract of date December 31, 1870. (69.)”
    And the said hay was rejected as not conforming to the contract.
    At the inspection and examination of said hay by the board, about twenty bales of it, to test its quality, were fed to the animals, which had been grazed on green grass and fed with northern timothy hay ; the mules ate the hay so fed to them fairly; the horses did not.
    At a second examination, 23 bales of the petitioner’s hay was fed to the animals for four days, as a test thereof, and the horses and some of the mules refused to eat it.
    The hay fed to the animals weighed from 225 to 250 pounds per bale, and no part thereof was returned to the petitioner. The residue of said hay brought by said Wood to Fort Brown was left there by him, and, after repeated notices from the quartermaster to remove it from the Quartermaster’s Department, he (the petitioner) declined to have anything to do with it, and it was carried outside the fort and left there by the order of the quartermaster.
    “There are several kinds and qualities of grass and hay that grow on the prairies of Texas. Of those, the hay offered by the petitioner under said contract at the examinations above stated was the worst kind, and is called sacahuiste or wire-grass, and consists of a spire ending in a thorn, and it is not generally bought or used in the vicinity of Fort Brown as food for animals when any other hay can be procured, although it is abundant and cheap. The term ‘ prairie-hay ’ had no commercial signification at Brownsville, and there was no particular variety of hay known there by that term.”
    “The hay proffered by the petitioner under said contract was not good, merchantable prairie-hay.”
    The following are the provisions of the contract referred to:
    “ First. That the said Albert Wood shall furnish the Quartermaster’s Department United States Army, at the military post of Fort Brown, Texas, with 1,000,000 pounds of good merchantable prairie hay, properly baled, and rated at 2,000 pounds to the ton, subject to a rigid inspection.
    ' “Second. That the said Albert Wood shall deliver the said hay as follows: To'commence July 1, 1871, 250,000 pounds to be delivered by September 1, 1871; 250,000 pounds more by October 1, 1871; and 500,000 pounds, the remainder, on or before December 1,1871; provided, that when the hay herein stipulated to be delivered is deficient in quantity or quality, the receiving-officers shall have power to supply the deficiency by purchase, and have the contractor charged with the difference in the cost to the Government.
    “ Third. That the said Albert Wood shall receive for each and every ton of hay so delivered the sum of $24 per ton in United States currency, payment to be made monthly when the Department is in funds, 10 per cent, of each payment to be withheld until the supplies contracted for shall have been delivered on the subsequent month.
    “Fourth. That if any objection shall be made to the said hay, a board of three United States officers shall be convened, to decide whether the said hay is receivable according to the conditions of this agreement, the decision of the same to be final.”
    
      Mr. Enoch Totten for the claimant:
    The “receiving-board” which assumed' to reject complainant’s hay was an unlawful body, and its acts are void. The officer who made the contract had no authority to submit any question to arbitration, and the provision in the contract on that subject is void for want of mutuality. (United States v. Ames, 1 Wood & Minot, 76.)
    The said provision of the contract is void, because it is against the policy of the common law. (Hurst v. Litchfield, 39 N. Y., 377; Graham v. Ketelias, 17 N. Y., 491-496; Thompson v. Char-node, 8 Term 139; Kill v.Hollister, 1 Wilson, 129; Story onPart., § 215, Story’s Eq., § 670; Douglas v. United States, 2 N. & H., 347.) The “ board ” which assumed to determine the rights of the plaintiff, by the report of September 11,1871, was not organized in pursuance of the contract, and was not governed by the contract, but by a special military order, and its proceedings are therefore void. Its proceedings are void also for the reasons set forth in the preceding paragraph, and because ex parte affidavits and other improper evidence were heard.
    
      
      Mr. John S. Blair (with whom- was the Assistant Attorney-General) for the defendants:
    The power to refer the question in dispute to a board of surrey resulted from and is necessary to the proper execution of the power to contract. This case is similar to the case of Culbertson v. Ellis, (6 McLean, 248,) and Philadelphia, Wilmington and Baltimore Bailroad Company r. Soioard, (13 How., 307,) and is expressly ruled by the case of Albert Brown, (10. Ols. K., p. 307.)
    An examination of the special military order referred to shows that it does not wary the terms of the contract, but only adds a regulation as to the manner of stacking the hay, the additional expense being borne by the United States. Whether the hay was properly stacked or not does not appear to have been considered by the board, but the whole evidence shows that their attention was directed exclusively to its merchantable quality.
   Losing, J.,

delivered the opinion of the court :

The contract was for a million pounds “ of good, merchantable prairie hay,” and the court has found that the hay did not conform to that description. The controlling word in it is “ merchantable and that is not used in reference to any particular locality or market, but only as descriptive of the quality of the hay required by the contract, and so used, the word merchantable means generally vendible in market; and merchandise is so vendible because of its fitness to serve its proper purpose, and therefore, when it is applied to forage, “merchantable” means generally edible. And the purpose of the contract so construes it between the parties.

In this case, as in most cases which turn on a matter of judgment, there is a conflict of testimony, and the witnesses on the respective sides differ, but the evidence furnishes an authoritative umpire between them. For it shows, and the fact is found, that the horses for whom the hay was furnished refused to eat it in two experiments by two different lots of hay, at different times, in the latter of which they were furnished with this hay and no other for four consecutive days. It is true that they had their usual quantity of grain; and had been fed previously on better bay or green food ; but four days of fasting would necessarily waken an appetite for edible bay; and that, under such experiments, tbe borses refused this bay, we think supports tbe opinion that it was not generally edible nor in conformity with tbe words or purposes of tbe contract.

Under tbe military orders of tbe department, and tbe provisions of tbe contract, two boards of military officers were provided ; one an inspecting-board, to perform tbe inspection required by law; the other a revisory board, to re-examine bay rejected by tbe inspecting-board. And this revisory board was an advantage to tbe contractor, provided for him by tbe contract, which be might use or waive.

As it is not found that tbe revising-board was appointed, or that tbe petitioner requested its appointment, tbe necessary conclusion is that tbe revisory board was not appointed by the-defendants nor requested by tbe petitioner.

The only claim tbe petitioner can have on tbe contract is for a breach of contract by tbe United States in not convening a board of officers to re-examine tbe bay rejected on tbe inspection, and it would seem to be answer enough to this that tbe petitioner did not request that such board might be convened. For where a contract provides for an advantage to one party requiring tbe action of tbe other, tbe former has bis option whether be will use tbe advantage provided for him or forbear its use, and therefore be should declare bis option that the other party may not be subjected to tbe cost or trouble of acting uselessly.

But admitting that tbe omission of tbe United States to convene tbe revisory board was a breach of contract, then tbe question is, what is tbe measure of damage 1 And it is manifest that if the revisory board would have found that the bay was not conformable to tbe contract, tbe petitioner would have suffered no damages from the non-appointment of tbe revisory board. And on tbe facts found by the court that tbe bay was not good, merchantable prairie-bay, tbe presumption must be that the revising-board would have found in tbe same way, and thus affirmed tbe action of tbe inspecting-board.

And if tbe burden is on tbe petitioner to establish the fact or tbe probability that the revisory board of officers would have approved tbe hay rejected by tbe board of inspection, this is not done by evidence that better bay could not have been procured in tbe quantities contracted for within ten miles of ' Brownsville, or that the same kind or quality of hay was purchased in former years on other contracts. For this contract does not confine the contractor to within ten miles of Brownsville, nor does it refer to other contracts for the description of the hay to be furnished under this; neither is it pertinent to-show that individuals in Brownsville purchased this kind anil quality of hay ; for individuals seek economy in feeding their animals, and consult their own means of expenditure, while officers seek efficiency for the animals in the public service, and would not be likely to approve of hay which horses supplied with it and no other for four days refused to eat. Neither is-it pertinent to refer to the advertisement and proposals which led to the contract; for each of these was the act of one only of the parties, and is therefore irrelevant to the contract, which is the final result both parties agreed on as such, and made the declaration of their mutual intent to the exclusion of any other intent.

The statements of facts show—

1. That after the rejection of the hay tendered by the petitioner, and in lieu of that contracted for and not delivered, the-defendants purchased 274,484 pounds of hay for the supply of Fort Brown, at a cost of $5,268.80, and paid for its transportation $2,575.39 ; and on account thereof they in their counterclaim filed with the pleadings claim $4,548.39 as due to the United States.

2. That in the experiments above stated, 10,750 pounds of the hay of the petitioner was supplied to the animals at Fort Brown, the value of which at the contract-price was $129.

And the judgment of the court is that the United States are entitled to recover from the petitioner the difference between, said sum of $4,548.39 and the said sum of $129, amounting to the sum of $4,419.39.

Nott, J.,

dissenting:

The controlling facts which go to the merits of this case, 1 deem to be these :

In 1870 the claimant cut and furnished to the quartermaster at Fort Brown, under a contract, a quantity of prairie-hay, which was accepted and paid for, and as to which no dispute-arose. In tbe following year tbe claimant again contracted for and furnished a quantity of prairie-bay, wbicb is tbe subject of tbe present dispute. Tbe second quantity of hay was cut on the same prairie, was well cured, and was found by the examining-board wbicb rejected it to be '‘of the same quality as that furnished” by tbe contractor under bis previous contract.

In tbe second contract, tbe one now tbe subject of litigation, tbe only descriptive term used is '•‘good, merchantable prairie hay.” Tbe first question, therefore, wbicb a court should ask is, what was tbe intent of this term “prairie-bay” within tbe meaning of tbe parties when they made tbe contract? Had “prairie-bay” a well-defined commercial significance at tbe time and place of purchase'? Did tbe term by well-established usage relate to bay made of any particular variety of grass'? Was its meaning as well understood in tbe vicinage as “ timothy-hay ” or “clover-bay” would be in a northern market1? If so, it would be a simple matter to determine whether tbe contractor furnished what the term imported, or whether be furnished an article which would not be known as “prairie-bay” in tbe local market.

• A finding of tbe court, and it is to my mind the only finding material to the issue, answers these questions in part by saying “ the term ‘ prairie-bay’ had no commercial signification in Brownsville, and there toas no particular variety of hay Icnoion there by that term.” I cannot, therefore, say when dealing with such a contract that, exvi termini, the contractor agreed to deliver one thing and in fact tendered another. Tbe parties really bargained for a non-mercbantable article by an undefined term. In such a case a court can only ascertain whether the article tendered came within tbe conditions of tbe term used, and then resort to tbe acts or expressions of tbe parties to see whether any further restrictions can be put upon it.

As to the general conditions imported by the term used, it is self-evident that bay made of the grass of a prairie is prairie-bay. If the bay contracted for, notwithstanding tbe generality of tbe term, was to be cut on any particular prairie, or was to be of any particular variety of prairie-grass, tbe burden would be upon the defendants to establish tbe particular essential upon wbicb they rely, and to show that it came fairly within tbe intent of tbe parties, and was as truly an element contracted for as though it bad been written in tbe contract. But, waiving this, there are three controlling facts which show beyond a reasonable doubt that the hay tendered by this contractor was the very article contemplated by him and the contracting quartermaster when they entered into their ambiguous agreement. The first of these is that this hay was made on the same prairie from which hay had previously been cut for the Government. The second is that the contract required that the hay furnished should be baled, and this was the only variety of prairie-hay susceptible of being baled. The third is that ^the hay furnished and rejected was of as good quality as that which the preceding year had been bought and sold by the same parties.

The error of construction which, in myjudgment, is now being committed by the decision of the court, consists in looking beyond the meaning of the thing contracted for, and in casting upon the contractor an implied warranty of its utility. The words ‘‘good” and “merchantable,” though they may mean “useful” and “salable,” are always construed in contracts as words of quality and not of kind. If the words of a man’s contract are that he shall purchase a cord of “ good, merchantable sycamore wood,” he cannot show in defense that sycamore is a non-merchantable article, unknown and valueless in the market. Neither can he be permitted to show that sycamore wood is worthless as fuel; nor would the conclusive test avail him anything, that he tried to burn it for four days in his stove and found it practically incombustible. A court would tell him that the obligation imposed by the contract on the other party was not to furnish fuel for his stove, but simply to furnish a specified quantity of sycamore wood, be it useful or worthless. These defendants have been permitted to show that their horses would not eat this hay, though “the mules ate the hay so fed to them, fairly;” and certainly, if mules would eat it “fairly,” oxen would. But the contractor did not agree to furnish forage for horses; and if the obligation were upon him to suppose anything, he may well have supposed that his prairie-hay was intended for mules and oxen. In fact, the more the case is examined, the more clearly it appears that the contracting-agent of the Government purchased an article which the officers at Fort Brown thought they could not use, and that they prudently and in good fajth, but without the slightest reference to the terms of the contract, declined to receive the thing contracted for, because it was a thing which they could put to no practical purpose, and would prove a total loss upon their hands.

A remaining ground of defense is the rejection of this hay by the examining board. The contract contemplated the action of such a board, and the contractor agreed to be bound by its decision. If the board acted upon the contract, and decided that the hay did not fulfill its conditions, there undoubtedly would be the end of the claimant’s case. But no such decision was ever made, either in form.or in substance. The only guide to such a decision necessarily must be the terms 'of the contract. Now, what was the guide enjoiued upon the examining board by the commanding officer who called it into existence and prescribed its duties ? .“The board will be guided in its actions by letter of instruction from the office of chief quartermaster Department of Texas, dated June 2,1871, the requirements of which will he strictly complied, with by the boardP These are the only directions under which the board acted, and which it was bound to obey. Moreover, the officers manifestly thought that while passing upon the utility of the hay, and rejecting it “as being unfit to feed animals,” they were inevitably doing the contractor injustice if his contract were to be taken as his guide; for they are careful to add, “ The board is, however, of the opinion that no good merchantable prairie-hay can be obtained in this vicinity,” meaning, as I understand it, that it would have been impossible for the contractor to furnish horse-forage made from prairie-grass in that vicinity; and they then proceed further and say, “ The hay now submittedis of the same quality as [that] furnished by Mr. Albert Wood [the contractor] under his contract of date December 31, 1869,” showing, as I think, conclusively, that, in the judgment of the board, the hay furnished was the hay contracted for — the only prairie-hay that could have been furnished, and hence the only prairie-hay that could have been contracted for— and that the cause of its rejection was the worthlessness of the kind, and not the inferiority of the quality.

But as in this case our brother, Mr. Justice Bichardson, took part in its decision, and agreed with the majority of the court, and as a postponement till his return would only result in a year’s delay in announcing the decision, I now join with the majority of the court in directing a judgment for the defendants, to the end that if the claimant elects to appeal he may not be delayed in procuring a review by the appellate court.  