
    NORTHERN PACIFIC RAILWAY COMPANY v. THE UNITED STATES
    [No. B-60.
    Decided January 14, 1924]
    
      On the Proofs
    
    
      Land-grant laws; hills restated, with land-grant deductions; paid as restated; effect of protest. — Where bills for transportation are presented by a railroad company to tile disbursing officer at full tariff; rates and that officer refuses to pay them, and they are afterwards restated with land-grant deductions, with a statement stamped thereon to the effect that they were so restated because1 the disbursing officer had refused to pay them as originally stated and that the company would receive the reduced amount undSr protest, “ reserving its right to collect the balance,” there can be no recovery of the amount dropped by the restated bill.
    
      Excepted classes. — By Supplement No. 1 to Interterritorial Arrangement No. 1, effective January 1, 1917, the classes enumerated as excepted from the land-grant laws in the Union Pacific R. R. Co. case, 249'U. S. 354, and analogous classes were placed under the land-grant acts, and made subject to land-grant deductions and the additional 5 per cent deduction provided by said inter-territorial arrangement during the emergency beginning June 18, 1916.
    
      
      The Reporter’s statement of the case:
    
      Mr. Lawrence A. Cake for the plaintiff. Britton, Gray were on tbe briefs.
    
      Mr. Lisle A. Smith, with whom was Mr. Assistant Attorney General Robert II. Lovett, for the defendant.
    The following are the facts of the case as found by the court:
    I. The plaintiff is a corporation duly incorporated under the law's of the State of Wisconsin. At the times of the different transactions hereinafter set forth in these findings of fact the plaintiff operated, and still continues to operate, a system of railways in the State of Wisconsin and other States, doing business as a carrier of passengers and freight for hire and reward under tariffs duly filed with the Interstate Commerce Commission by it and by its connecting lines, with its concurrence, and published as provided by law'.
    II. Before the transactions hereinafter mentioned were performed, the railroad carriers generally of the United States, including the plaintiff, severally agreed with the Quartermaster Corps of the United States Army that they would accept for the transportation of Government troops and property the amounts that would be payable by the Government calculated by the cheapest route by way of the same terminal points. These agreements, known as equalization agreements, were in effect at the time the transportation in question moved and are still generally in effect. The amounts claimed in settlement have been arrived at by taking the amounts due for the transportation at commercial rates by way of the shortest applicable route between the terminal points of the movement affording the largest proportions of the land-grant mileage, and deducting from such amounts 50 per cent of such part of the amounts as would accrue to said land-aided portion.
    III. From time to time during the year 1917, beginning-in February and ending in December, the plaintiff performed certain transportation service for the United States in the movement on Government transportation requests of travelers variously described on the transportation requests as applicants and rejected applicants for enlistment, furloughed soldiers, retired soldiers, discharged medical survey, discharged general court-martial, civilians, and naval civilian employees, each of the said persons traveling individually and not as a part of the moving army, troop, or body of soldiers.
    IV. The plaintiff as the initial carrier commenced in February, 1917, presenting its bills to the disbursing officer at full public tariff rates. These bills were stated on the form prescribed by the Comptroller of the Treasury as directed by the Dockery Act, 28 Stat. 206, in cases where there were no- land-grant deductions to be made. (See 14 Comp. Dec., 945.) These bills were all returned by the disbursing officer with the statement that he would not pay them unless presented at land-grant rates. The plaintiff wordd then restate such bills on the land-grant basis. These restated bills were upon the form also prescribed by the comptroller for bills showing land-grant deductions, and in a column provided for the purpose stated in each instance the “ amount claimed.” The forms used had the certificate of the correctness of the bill mentioned hereafter in these findings. There was on each of these restated bills, stamped by plaintiff or its agent, the following: “ If the United States official auditing this bill declines to allow public tariff rates, claiming that land-grant rates and western military agreement should apply, the Northern Pacific Railway Company will receive such reduced amount under protest, reserving its right to collect the balance.” The restated bills would then be presented to the disbursing officer who paid them as presented. These land-grant deductions, made as above, amounted to $10,659.17.
    Several months later the disbursing officers abandoned the practice of returning the plaintiff’s bills presented at full tariff rates, and commenced to offer payments at land-grant rates, which were accepted without objection. The land-grant deductions from such bills aggregated $12,917.04.
    Finding the accounting work in restating its bills burdensome and cumbersome, the plaintiff about the middle of the year 1917 adopted the practice of stating its bills to the disbursing officer on the basis of land-grant deductions, using in each case the prescribed form already mentioned, and on the face of each bill was stamped the following: “ This bill is made and payment will be received on the basis of land-grant rates, but the railway company makes the bill in that form and accepts said payment under protest because of the refusal of the Government to consider a bill in any other form, the contention of the railway company being- that the transportation referred to in the bill should be paid for at tariff rate. The railway company reserves the right to sue for the tariff rates.” The plaintiff in making out such bills on a land-grant basis made lancl-grant deductions aggregating $39,078.62.
    At the end of every bill presented by plaintiff to the disbursing officer was the following, which was a part of the prescribed form: “ I certify that the above account is correct and just; that the services have been rendered as stated; that payment therefor has not been received; and that the rates charged are not in excess of the lowest net rates available for the Government, based on tariffs effective at the date of service.”
    
      V. On December 28, 1916, the carriers in the territories of the Central Passenger Association, New England Passenger Association, Southeastern Passenger Association, Southwestern Passenger Association, Transcontinental Passenger Association, and Western Passenger Association, entered into an Interterritorial Arrangement or contract with the United States Army, Navy, and Marine Corps, to be known as No. 1 Interterritorial Military Arrangement, to become effective on January 1, 1917, and to supersede and cancel all previous interterritorial arrangements between the same parties, the relevant and material parts of. which are as follows:
    “iii
    “ Traffic covered T>y ' tMs agreement. — -The net fares, allowances, and routes in connection therewith authorized hereunder are applicable exclusively for the transportation of officers and enlisted men and others connected with the United States Army, United States Navy, and United States Marine Corps for whom the United States Government is lawfully entitled thereto and when traveling on transportation requests of the issue of the United States Army, United States Navy, and United States Marine Corps and at United States Government expense only.”
    
      
      11 Net fares and allowances, — (1) (a) Tlie fares applicable under this arrangement will be tlie lawful commercial fares as on file with the Interstate Commerce Commission from starting point to destination at time of movement (see exceptions, Section V), less lawful land-grant deductions properly established, less five per cent (5%), the five per cent allowance not to exceed the maximum allowances or exceptions as specified in Section VI. Government fares so established will apply to all military traffic as described in Section III, including special train and special car movements as well as individual and party movements (see Section XI).
    * * * H* * % ❖
    “ Sections V, VI, and XI, referred to above, 'are not relevant to the issues involved in this suit.
    , “ xx
    “ Termination, of arrangement. — It is understood that this arrangement may be terminated at the pleasure of the United States Army, United States Navy, and United States Marine Corps, independently of each other, and the withdrawal from the arrangement of one of these branches of the Government will in no way affect the operation of the arrangement as to the other branches of the Government electing to continue it, the reservation being made, however, that the carriers may withdraw from the arrangement at their option.”
    On June 2,1911, the sanie parties entered into supplement No. 1 amending Interterritorial Military Arrangement No. 1 as follows:
    “ That in view of present emergency and the ruling of the Comptroller of the Treasury of April 3, 1917, mobilized and demobilized troops, also Naval Militia, en route from home stations to places of rendezvous and from places of rendezvous to points of concentration, or other points; also classes enumerated in Union Pacific case decided by the U. S. Court of Claims, February 19,1917 (appeal No. 33056), and analogous classes, be included under the Interterritorial Military Arrangement, Avhen movements are made under U. S. Government transportation requests, at U. S. Government expense and under orders of the President of the United States; to be retroactive to the date of the call of the President of the United States, viz, June 18, 1916 (see exceptions 1 and 2), and to apply to unsettled accounts' only; settled accounts not to be disturbed; tliis voluntary act of the carriers to be without prejudice to their rights in the premises.
    “ Exception No. 1: Ón traffic originating in New England, Trunk Line, Central Passenger, Southwestern, Transcontinental, or Western Passenger Association territories and destined to points in Southeastern Passenger Association territory, or vice versa, effective as of September 1,1916.
    “ Exception No. 2: On traffic originating in New England, Trunk Line, or Central Passenger Association territories, or at the Ohio and Potomac River gateways, or Norfolk, Ya., and passing through Southeastern territory, destined to points in Southwestern, Transcontinental, or Western Passenger Association territories, or vice versa, effective as of June 18, 1916.”
    On March 16, 1918, the chairman of the subcommittee on military passenger traffic wrote to the Auditor for the War Department as follows :
    
      “ Sir : Referring to your favors of February 15th, 18th, and 23d, 1918, on above:
    “ Your attention is respectfully invited to the enclosed copies of Military Committee Circulars 170,171, revised, and 187, containing a list of the classes which the carriers understand are entitled to come under the military arrangements between the Government and the carriers during the present war emergency.
    “ It will be noted that Circular 171, revised, includes civilian employees when traveling under Ú. S. Government transportation requests of the issue of the War Department and at U. S. Government expense.
    “ Therefore, I should say that the class referred to in your favor of February 15th, viz, civilian employees of the different bureaus of the War Department, who, while not directly connected with the Army, are subject to the control and direction of the War Department, come within the purview of the military arrangements, and are entitled to the 5 per cent allowance as well as land-grant deduction, provided they travel under U. S. Government transportation requests of the issue of the War Department, and further provided, that the expense of their transportation is paid by the Government out of appropriations for the War Department.
    “ The foregoing applies, without prejudice, to the interests of the carriers during the present war emergency only.”
    
      On October 19, 1920, the said carriers sent the following-notice to the Quartermaster General, the Chief of Burean of Navigation, and the quartermaster of the Marine Corps:
    “ Sir : Kef erring to supplement 1 to Interterritorial Military Arrangement 1, filed in behalf of specified carriers in the territories of the above-named associations and committee, under date of June 2, 1917, containing the following clauses:
    “Recommended, That, in view of present emergency and the ruling of the Comptroller of the Treasury of April 3, 1917, mobilized and demobilized troops, also naval militia, en route from home stations to places of rendezvous and from places of rendezvous to points of concentration, or other points; also classes enumerated in Union Pacific case decided by the U. S. Court of Claims, February 19, 1917 (appeal No. 83056), and analogous classes, be included under the interterritorial military arrangement, when movements are made under U. S. Government transportation requests, at U. S. Government expense and under orders of the President of the United States; to be retroactive to the date of the. call of the President of the United States, viz, June 18, 1916 (see exceptions 1 and 2),, and to apply to unsettled accounts only; settled accounts not to. be disturbed; this voluntary act of the carriers to be without prejudice to their rights in the premises.
    “ Exception No. 1: On traffic originating in New England, Trunk Line, Central Passenger, Southwestern, Transconti-mental, or Western Passenger Association territories and destined to points in Southeastern Passenger Association territory, or vice versa, effective as of September 1, 1916.
    “ Exception No. 2: On traffic originating in New England, Trunk Line, or Central Passenger Association territories, or at the Ohio and Potomac Liver gateways, or Norfolk, Ya., and passing through Southeastern territory, destined to points in Southwestern, Transcontinental, or ÍVestern Passenger Association territories, or vice versa, effective as of June 18, 1916.
    “ Referring also to certain other communications addressed by the chairman of the several territorial passenger associations and the Western Military Committee, bearing the same date (June 2, 1917) or bearing dates prior or subsequent thereto, under which any or all of the classes included in the said supplement No. 1 to the interterritorial military arrangement were for the period of the then-existing emergency included in the intraterritorial military arrangements applicable in the several territories named.
    
      “ On behalf of all carriers participating in the said inter-territorial and intraterritorial military arrangements the undersigned hereby give notice to you of the withdrawal and cancellation, effective November 1, 1920, of said supplements and any other communications under which any of the classes enumerated and under which any analogous classes were temporarily included in the military arrangements.
    “ The effect of this notice is that from and after November 1, 1920, the carriers parties to the interterritorial military arrangement and to the several intraterritorial military arrangements will require in settlement for transportation furnished on Government transportation requests of the issues of the War and Navy Departments, the Marine Corps, or of any of the civil departments of the Government, calling for the transportation of any or all of the classes enumerated in the said supplements or other communications, or any analogous classes, full commercial fares without land-grant or other allowance.”
    VI. The land-grant deductions, made as stated in Finding IV, aggregated $62,(554.83, of which the sum of $61,871.30 was deducted from bills for the transportation of applicants and rejected applicants for enlistment, $11.18 from bills for the transportation of furloughed soldiers, $53.38 from bills for the transportation of retired soldiers, classes involved in the decision of the Supreme Court in United States v. Union Paci-fic B. R. Go., 249 U. S. 354; the sum of $519.03 was deducted from bills for the transportation of enlisted men discharged by medical survey, $86.50 from bills for the transportation of enlisted men discharged by general court-martial, $57.48 from bills for transportation of civilian employees, and $55.96 from bills for the transportation of naval civilian employees.
   Campbell, Chief Justice,

delivered the opinion of the court:

This case presents questions that are decided in Southern Pacific Co. case and Western Pacific R. R. Co. case, decided January 7, 1924, ante, pp. 36 and 67.. (See also Baltimore & Ohio R. R. Co. case, 52 C. Cls. 468, and Oregon-Washington R. R. & Nav. Co. case, 255 U. S. 339, 347.) It also presents a distinct matter of defense not appearing in tlie cases mentioned. We might content ourselves with a reference to these decided cases, but the frequency with which the questions recur and the importance of a definite ruling upon them, so far at least as this court can make it, justify a restatement of what we regard as the controlling principles applicable to the class to which this belongs.

The plaintiff presented its bills to a disbursing officer and was paid the amounts claimed to be due on the face of the bills. They showed land-grant deductions. The plaintiff stated some of its bills at full commercial rates (without land-grant deductions) on one of the forms prescribed by the Comptroller of the Treasury for bills not involving-land grant, and the disbursing officer refused to pay the bills so stated. Thereupon the bills were restated upon the land-grant form prescribed by the comptroller, and they were paid. These restated bills had upon them when paid a stamped or typewritten statement to the effect that if the United States official “ auditing ” the bill declined to allow full tariff rates, claiming that land-grant rates or land-grant and western military agreement should apply, the plaintiff company would receive the reduced amount under protest, “ reserving its right to collect the balance.” It will be noted that this statement refers t-o the “ auditing ” official, though the bill on which it was stamped was presented for payment to a disbursing officer who is not an auditing officer and could only pay or refuse to pay a bill as stated. The statement therefore apparently has for its object the charging of some kind of notice upon some official who would subsequently handle the voucher, while the plaintiff Avould have received the only payment which the disbursing officer was authorized to make. After some time this practice of stating its bills on the one form and then restating them on the land-grant form when payment of the former was refused was abandoned by plaintiff, the practice being abandoned because “ the accounting work involved in the practice was burdensome and cumbersome ” to plaintiff, and it adopted the practice of rendering all bills for transportation of the chai-acter mentioned on the land-grant basis, using therefor the form prescribed for that purpose, accompanying the bill in each instance with a statement to the effect that the bill was paid and payment received on the land-grant basis, but that the bill was stated in that form and payment accepted by the company under protest “ because of the refusal of the Government to consider a bill in any other form,” the contention of the railway company being “ that it was entitled to full tariff rates,” concluding with the statement, “ the railway company reserves the right to sue for the tariff rate.” These so-called “ protests ” being lodged with the disbursing officer the railway company received payment in full of the amounts claimed on the bills stated. It received and collected the disbursing officer’s checks and he held as vouchers the bills.he had paid. These vouchers he would subsequently present to the aiiditor as his acquittance for expending Government funds when his accounts should come on for settlement. Manifestly there was nothing of duress or compulsion inducing plaintiff to state its bills as they were stated. It was more convenient to present them at the place where a disbursing officer might be than to forward them to the auditor at Washington for direct settlement, but the statute (see Dockery Act, 28 Stat. 206) had authorized the auditors or the Comptroller of the Treasury to allow parts and disallow parts of a bill and at the same time made their action final and conclusive upon the executive branch of the Government. No statute had authorized disbursing officers to perform any such function. The duties of these officers are purely ministerial. They could only pay bills as stated and when stated on the prescribed form. To present a bill to such an agent with an accompanying statement that if he pay the bill as stated and certified to be due the amount would be accepted under protest, notwithstanding he could not pay at all without the required certificate of the accuracy of the bill, and then to assert that the bill itself is not correct and some sort of right is reserved by the “ protest ” is to produce two most incongruous conditions. To protest against the payment of a bill presented for payment and certified to be correct is unusual, and it is not infrequent that while a party protests he is entitled to more he yet accepts, payment of his bill. (See Chicago, Milwaukee & St. Paul Ry. Co. v. Clark, 178 U. S. 353, 364.) Such a “ protest ” is not availing to save any right inconsistent with the party’s action. A protest does not create a right. It may in proper circumstances preserve an existing one. A party can not avoid the legal consequences of his acts by protesting at the time he does them that he does not intend to subject himself to such consequences. International Contracting Co. v. Lamont, 155 U. S. 303, 310. We are unwilling to concede that the large number of disbursing officers or paymasters charged with the ministerial duty of disbursing Government funds, whose limited authority is well known, may by the receipt of such statements as accompanied the vouchers in this case pay parts of the bills and leave the balance for settlement in the courts, thus setting at naught the carefully framed system of Government accounting. Under such a practice the Government officials whose duty it is to know can hardly approximate the status of the Government’s accounts at any regular accounting period. For it is to be remembered that the disbursing officers’ payments are by no means confined to bills like those in the instant case. These officers pay many of the great supply bills of the Government. Forms for these are prescribed by the comptroller and approved by the Secretary of the Treasury (see 14 Comp. Dec. 945), and a rule applicable to the disbursing officers’ powers when dealing with the one kind is also applicable when he is dealing with the other kinds. We repeat, therefore, that the only proper rule is one that will recognize the disbursing officers’ limited authority and that will require a creditor of the Government who is unwilling to accept the payment by the disbursing officer as conclusive to follow the course provided by the statute or bring suit in a court of competent jurisdiction. It may be noted here that the statute (sec. 8 Dockery Act) will not allow a creditor to receive an auditor’s allowance and then apply for a revision by the comptroller. It may pertinently be asked whether a creditor receiving what he claims to be only part payment from a disbursing officer shall be accorded a greater right than the statute allows in the case mentioned. We think the policy of the statute should apply alike in both cases. It is not to be assumed that the plaintiff desired the Government official to exceed his authority or commit a breach of duty. If it desired to insist upon its “ protest ” it should have insisted on its bill going forward for direct settlement. Its action in stating its bill -on the form used and then accepting payment from the disbursing officer is inconsistent with the claim now asserted. Not having pursued such a course, as could consistently with the accounting system have provided a remedy, it must be held that by accepting payment in the circumstances stated it waived any legal effect which could otherwise be accorded the so-called protest. (See Savage case, 92 U. S. 382; Sweeney case, 14 Wall. 75.)

Fuller discussions of the governmental accounting system appear in Southern Pacific Co. and Western Pacific R. R. Co. cases, both decided January 7, 1924, ante, pp. 36 and 67. We refer to these decisions and adhere to them.

2. This suit was instituted April 6, 1922. It seeks to recover a difference between what it claimed in the disbursing officer’s voucher was due and paid for and the amount it would have claimed at full tariff rates. The matters in question arose in 1917. In some of this class of cases the Government contends that the suit is barred by the statute of three years prescribed by section 424 of the transportation act of 1920, 41 Stat. 492. It provides that “ all actions at law by carriers subject to this act for recovery of their charges or any fart thereof shall be begun within three years from the time the cause of action accrues and not after.-” This is a new7 provision. Its terms apply to plaintiff as being a carrier subject to the act, and the action here seeks to recover what plaintiff claims is • a “ part ” of its lawful charges. The theory that this suit is not one to recover the carriers’ charges under the interstate commerce act, but is one upon an implied contract under the general jurisdiction of the court, does not property state the purpose of the suit. More aptly, one of the briefs for plaintiff states the theory of the suit to be that there is an implied contract on the part of the United States to pay what is the only known rate, the tariff rate. And if this be the correct theory, the plaintiff is suing to recover its charges, or part thereof, and is therefore barred by the limitation of three years. (See United States v. Baltimore & Ohio Railroad, 80 I. C. C. 143.)

3. Another matter of defense is interposed. By a supplement to the Interterritorial Military Arrangement, the different railroad associations, one of which included the plaintiff, agreed to include in this arrangement the very class of persons involved herein. Under this arrangement the fares applicable were to be the lawful commercial fares on file with the Interstate Commerce Commission from starting point to destination at time of movement, less lawful land-grant deductions properly established, less five per cent. The supplemental agreement covered the period in question. Having entered into this arrangement voluntarily and been paid accordingly for the transportation, the plaintiff will not be heard now to question it.

The petition should be dismissed. And it is so ordered.

Graham, Judge; Hay, Judge; DowNev, J lodge; and Booth, Judge, concur.  