
    COHEN’S CASE.
    Abraham Cohen v. The United States.
    
      On the Proofs.
    
    
      In July, 1865, an acting assistant quartermaster at a frontier post, after due advertisement, enters into a contract for the purchase of hay. late in August, ascertaining that the post is to he abandoned, he notifies the contractor that the contract is annulled. Subsequently the Quartermaster-General disapproves the contract, ivhiah is not in terms subject to his approval. At the time of the annulment the contractor had performed, in part. He then stopped work.
    
    I.The oases of Parish (.8 Wall., 498) and Filor (9 ib., 45), so far as they relate to the approval of quartermasters’ contracts by the Quartermaster-General, examined and explained.
    II.Subsequent to July 14, 1879, quartermaster contracts (the general order of that date provides) are not considered in force until approved by certain commanding officers.
    III. The statutes separate the duties of directing the movements of the Army and of providing for its wants, and, to prevent collision, give a large range of discretion to the administrative officers charged with the latter duty.
    IV. The practical effect of the. Act ith July, 1864 (13 Stafc. L., 394), and of the regulations relating to it, was that assistant quartermasters at Army posts invited proposals and made contracts which did not require the approval either of their intermediate superior officers or of the Quartermaster-General.
    V. In 1865 it was the duty of an assistant quartermaster at a remote post to assume that the post would be kept up and to provide forage for it till notified to the contrary, and a contract made by him for that purpose in the proper manner was valid without approval.
    VJ. Contracts which call for immediate action in order to secure performance according to their terms, must be held operative from the day of their signature, subject to abrogation if disapproved by the Quartermaster-General. Contracts which are to be held in abeyance till approved by a superior officer should contain a clause to that effect.
    VII. The contractor’s right of recovery is to be measured by his rights at the time his contract was abrogated. The rule for computing damages in such cases stated.
    Tbe Reporters'1 statement of tbé case:
    The contract in tliis case provided that “ the said Abraham Cohen agrees to deliver at the government forage yards and such other points about Fort Scott as may be designated by the party of the first part, one thousand five hundred and fifty (1,550) tons of prairie or timothy hay, in ricks of one hundred tons (100) each. Said hay to be of the very best quality and securely stacked, and receivable only when ricked up complete.
    “ The delivery of said hay to be commenced by 1st of August, 1865, and delivered as rapidly as may be required by party of the first part, the whole to be completed on or before November 1, 1865.
    “And the said party of the second part further agrees that the said hay shall be subject to the inspection, acceptance, or rejection of the said party of the first part, or such person or persons as he may designate; and further, that if the hay presented for delivery under this contract shall be of an inferior character to what is hereinbefore stipulated to be furnished by the said party of the second part, the said party of the second part shall thereupon forthwith furnish other hay of the proper character in place thereof; and that if default shall be made by the said party of the second part in the time of the.delivery of the said hay, or in any of the provisions of this contract, the said party of the first part shall have power to supply any deficiency that may exist, by purchasing in open market, or in such manner as he may elect, and the said party of the second part shall be charged with the difference in cost.
    “And it is further hereby expressly stipulated and agreed by and between the parties to this contract that if default should be made as aforesaid, or in any other way, the said party of the first part shall have power to retain, from the sum hereinafter stipulated to be paid to the said party of the second part, such amount as may be necessary to indemnify the said party of the first part in the premises, and against all and any defects and deficiencies in the execution of the terms of this contract by the said party of the second part.”
    The following are the facts as found by the court :
    I. On or about the 21st day of July, 1865, after public advertisement inviting bids, the claimant' and Capt. Theodore 0. Bowles,, of the United States Army, stationed at Fort Scott, in Kansas, and acting as assistant quartermaster on behalf of the United States, entered into the contract which forms part of the claimant’s petition.
    II. The said Bowles transmitted the said contract to the chief quartermaster of the department at Saint Louis. On the 24th day of August, 1865, that officer notified said Bowles that Fort Scott was to be abandoned, and that he should provide only such forage as might be necessary for current use.
    III. On the 28th day of the same August the said Bowles informed tbe claimant that tbe said contract was annulled, and that be bad been directed to restrict contracts to tbe current necessities of tbe post.
    IV. Between tbe time of tbe signing of tbe contract and tbe receipt of tbe notice set forth in finding III, tbe claimant bad proceeded so far in tbe execution of bis said contract as to bave cut and delivered 247 tons of bay.
    V. At tbe time of tbe receipt of said last-named notice, tbe claimant bad already cut and cured a large quantity of bay, and could bave fully performed and completed bis portion of tbe said contract according to its requirements, and would bave done so but for the said notice.
    VI. On tbe 18th of September, 1865, tbe chief quartermaster of tbe department at Saint Louis recommended the Quartermaster-General to disapprove of tbe contract, because Captain Bowles bad been instructed on tbe 24th of tbe previous August to provide only such forage as might be necessary for current use. Subsequently, tbe Quartermaster-General disapproved of tbe said contract.
    VII. After tbe abandonment of said post there was no market for bay at Fort Scott. Tbe claimant took for bis own use 50 tons of tbe bay so cut, worth $250. Tbe remainder of tbe bay so cut, and not delivered to tbe defendants, and not taken by tbe claimant for bis own use, rotted on tbe field or was lost.
    VIII. On or about tbe 31st day of October, 1868, tbe claimant brought suit in this court, demanding judgment for the contract-price of 1,350 tons of bay not delivered, amounting to $13,486.50.
    IX. On or about tbe 18th January, 1871, tbe claimant’s attorney in said suit transmitted a copy of tbe petition therein to tbe Third Auditor of tbe Treasury, asking that it might be “ considered as a petition to tbe accounting officers of tbe Treasury,” and added:
    “ Tbe cause of this claim being presented to tbe Court of Claims is as follows: Tbe Quartermaster-General decided, under tbe known opinion of tbe Comptroller’s Office, that there could be paid only actual expenditures and no profits. Tbe claimant insisted upon a different rule, and it was mutually agreed that tbe case might go to the Court of Claims for tbe decision of that question. It was presented in that court and prepared as you see.
    
      “ Tbe reason of its being brought back to tbe department is as follows: After tbe presentation of this petition in tbe Court of Claims, tbe Supreme Court decided tbat iu cases like tbis tbe Court of Claims bas no jurisdiction, and cannot try tbe case upon its merits. Tbe principle of tbis decision is, tbat where tbe contract was disapproved by tbe Quartermaster-General tbe court bas no jurisdiction. (Filor v. United States, 9 Wall., 45.)
    “ It would be folly to prosecute tbe claim, when it is certain to be dismissed without any examination as to tbe merits of tbe case. Therefore, I relinquish tbe Court of Claims and ask you to bear tbe case.”
    X. On or about tbe 20tk January, 1871, tbe said Third Auditor referred said petition to tbe Quartermaster-General for examination and report.
    XI. On or about tbe 16th day of February, 1871, tbe claimant’s said attorney moved in tbis court tbat bis said petition be dismissed without prejudice, and tbe motion was allowed, and tbe said petition was so dismissed.
    XII. Tbe claimant’s claim and tbe credits against tbe same, as presented and claimed or admitted by him before tbe accounting officers of tbe Treasuy, and tbe several amounts of tbe same as allowed or deemed just by tbe Quartermaster-General, are shown in tbe following table. Tbe said table was made by direction of tbe Quartermaster-General, and returned by him to tbe said Third Auditor on tbe 18th March, 1871, with a statement signed by him, that “ to determine the allowance to be made in this case of a contract disapproved by the Quarter master-General and not carried to completion, belongs to the accounting officers, and to them' this whole case is submitted.”
    
      
    
    
      
      
    
    
      XIII. The balance of $6,144.71, as shown in the said table, was paid by the defendants to the claimant upon a voucher of which the following is a copy:
    “ The United States to A. Cohen, Q. M. D., Dr.
    
    “ For expenses which were incurred in preparing 1,303 tons of hay for delivery to the United States, in pursuance of an agreement made by said Cohen with Capt. Theo. C. Bowles, A. Q. M., July 21st, 1865, to deliver 1,550 tons of hay at Fort Scott, Kansas, which expenses became lost to said Cohen, because the said agreement was disapproved by the Q. M. General after 247 tons had been actually delivered and accepted, the occasion for such disapproval being no fault on the part of the contractor, but the removal of the post. $6,144 71
    “ Amounting to six thousand one hundred and forty- . four dollars and seventy-one cents, payable to A. Cohen, in care of Thomas Wilson’ esq., Washington, D. 0. $6,144 71
    “Treasury Department,
    “Third Auditor’s Office,
    “ March 31st, 1871,
    “A. Jaoicson, Clerk.
    
    “Treasury Department,
    “2d COMPTROLLER’S OFFICE,
    “ March 31,1871,
    “Wilson, Clerk.”
    
    XIY. A stipulation, of which the following is a copy, is filed in the case, and the court finds that the statements therein stated are proved as facts:
    “Abraham Cohen ) vs. > 6369. “The United States. )
    “It is agreed and stipulated between the parties hereto that if the plaintiff is entitled to recover any sum, he is entitled recover the sum of thirteen hundred and three dollars.
    “March 18, 1880.
    “Thomas Wilson,
    
      u Attorney for Plaintiff'.
    
    “ Thomas Simons,
    “A. A. <?.”
    
      
      Mr. A. D. Robinson (with whom was the Assistant Attorney-General) for the defendants.
    
      Mr. Thomas Wilson for the claimant.
   Davis, J.,

delivered the opinion of the court:

But one question is involved in this case: whether the contract made by the assistant quartermaster binds the defendants. The contract was made in good faith on both sides. It was duly transmitted by the assistant quartermaster to his superior. The claimant in good faith incurred considerable expense to carry it out. He was stopped in its execution through no fault of his and in consequence of a fact which the assistant quartermaster could not have known when the contract was made. He has been paid the actual expenses so incurred in order to execute his contract. It is agreed that he suffered a further loss of $1,303 profits, which he is entitled to if he can recover anything. He now sues to recover that sum and the government resists the recovery solely on the ground that the assistant quartermaster had no authority to make the ■contract, and that the contract he did assume to make was disapproved by his superiors.

The learned counsel for the government relies upon the cases of Parish (8 Wall., 498) and Filor (9 Wall., 45). He maintains that the former case decides that contracts of subordinates in the field or at a post are invalid and absolutely inoperative until approved by the superior officer; and that the latter reaffirms this doctrine and specially applies it to assistant quartermasters. The cases he cites do not quite come up to his contention. It forms part of the statement in Parish’s Case, that “ it was understood between the parties that this contract was not to be binding until it should receive the approval of the Surgeon-General, to whom it was forwarded.” In Filor’s Case, the Supreme Court say that they “ do not find in any regulation of the Army, or in any act of Congress, that the acting quartermaster at Key West was invested with power to bind the United States to the agreement or lease,” during the war, of the property of a citizen of Florida who u was a member of the convention which passed the ordinance of secession.” The military occupation of such property within the limits of Florida was, they say, an 11 appropriation of it ” by the Army within the meaning of the act of July 4,1864, which could not be converted into a contract by an unauthorized act of an assistant quartermaster. We therefore regard the authority of Parish’s Case as confined to contracts which expressly provide for an approval of the superior officer; andthatofFilor’s Caseasatthe most applicable to leases of real estate, if it is not confined to leases made as set forth in the statement in that case. For reasons which will appear in this opinion, we do not think that the language, which the court in Filor’s Case carefully limited to contracts for the use of real estate, was intended by them to apply to all contracts in the Quartermaster’s Department. Whether it should be applied to the present contract we now proceed to consider.

Before "entering upon the inquiry, it is first to be observed that the claimant’s contract, having been made in July, 1865, is to be construed with reference to the provisions of the Act July 4,1864 (13 Stat. L., 394), and the regulations which were in force when it was entered into. No similar question can arise as to contracts concluded since July 14, 1879, because on that day the following general order was issued, and is now in force:

“I No contract for furnishing supplies or transportation to the Army will be considered in force until it has received the approval of the proper department commander; and when such department is located in the Military Division of the Missouri or Pacific, until such contract is approved by the commanding officer of such division; with the exception that where a post is very remote from department headquarters, the commanding officer of the district in which such post is located will be required to take this action. It will therefore be inserted, as a condition in all contracts, that they are made subject to the approval of such commanding officers.”

The considerations which we are about to present are founded on the relations which existed between the different departments of the Army prior to this order, and upon the laws, regulations, and orders which were in force in 1865.

Some military Powers vest the authority to dispose of the forces in the field and in garrisons, and the duty of providing them with quarters, barracks, hospitals, camp-equipments, clothing, forage, transportation, &c., in the same responsible general staff, and permit such duties to be performed by means of purchases made in open market without special contracts. But our traditions led us in the conduct of the late war to a different system. We sex')arated the direction of our troops from the duty of providing for their wants and comfort. We vested in the Quartermaster-General and his subordinates a large part of these duties and we exacted their performance, except in cases of exigency, through the instrumentality of advertisements and contracts.

Our system had this disadvantage — that those who were to provide for the wants and comforts of troops did not know how many to x>rovide for, nor whether a post was to be continued, and had to depend upon another branch of the service for their information. The statutes, as if to obviate this difficulty and prevent collision, gave a large range of discretion to administrative officers. A series of early statutes had authorized the organization of a Quartermaster’s Dex>artment, with officers of various grades, and among them officers of a subordinate grade, called assistant quartermasters. The Act July 4,1864, already referred to (13 Stat. L., 394), organized that dex'tartment into several divisions, and placed the “ purchases, procurement, issue, and disposition of forage and straw for the Army” under the fifth division, subject to “such rules as might be prescribed by the Quartermaster-General with the approval of the Secre- • tary of War ” (§ 1). The head of that division was empowered, “ under the direction of the Quartermaster-General, from time to time to advertise for proposals for the supplies necessary for the post” (§ 2), and to purchase, or cause contract tobe made for the purchase of, such supxilies (§ 5). All quartermasters were required to report to the Quartermastef-General copies of all contracts made and all proj>osals received for supplies of any kind (§ 5). The eleventh section authorized the Secretary of War, during the continuance of the rebellion, to assign to each military department an officer to act as chief quartermaster of the department.

The practical effect of these statutes, and of the Army Begu-lations and Quartermaster’s Begulations made to enforce them, was this: Assistant-quartermasters were stationed at Army posts, and were directed to invite proposals for supplies, and to make contracts for them, and to transmit copies of the proposals and of all their contracts to the Quartermaster-General. They were not directed to, and did not, in fact, frame their written contracts so as to require them to be approved by tbe Quartermaster-General. The transmission of the contracts to that officer was necessarily to be made through the proper military superior of the officer who made them: but the intermediate officer had no authority either by law or regulation to take any action upon the instruments.

The effect of this system and of the laws and regulations in force in 1865 upon the claimant’s contract is apparent. Fort Scott, which had once been an important post, had lost its consequence with the termination of the war. Whether it was to be abandoned or to be kept up was not to be decided by the Quartermaster’s Department. Until the officers of that department were told that it was to be discontinued, it was their duty to see that it was supplied with forage. Captain Bowles,‘who advertised for proposals for supplies and signed the contract with the claimant, was an assistant-quartermaster. In good faith and in ignorance of the counter purposes of another branch of the service, and in the strict line of his duty, he made his forage contracts. Before they could be performed the decision to abandon the post, made by those who had a right to decide whether it should or should not be continued, made it necessary to abrogate honest and fair contracts through the formal disapproval by the Quartermaster-General.

Now we have seen that the statutes and Army Begulations-of that time did not make the approval of the Quartermaster-General necessary in order to make the contracts of his subordinates .operative. There was a good reason why they did not. They were made during the rebellion, and for the purposes of' war. The war could not have been carried on if no contract for supplies could be enforced until it could be sent to the Quartermaster-General and be examined and approved by him. When the cessation of hostilities came, the state of the country still required the maintenance of a considerable military force.. The Quartermaster’s Department was still burdened, and, at the time of the conclusion of the contract with the claimant, it would seriously have embarrassed it if no steps could be taken under a forage contract until it could reach the Quartermaster-General’s table, and be taken up and considered and approved there. The claimant’s contract was signed on the 21st July. The hay was to be furnished for the wants of the coming winter. The chief quartermaster of the department did not transmit it to the Quartermaster-General until the 18th September,. We do not know when tbe Quartermaster-General acted on it. It must, however, have been at a still later date. To expect the contractor, at that late day in the season, to purchase machines and to get together teams and mentó cut and cure before frost 1,500 tons of good hay would have been to expect an impossibility, which the law never demands.

Confining ourselves to the class of contracts Avhich, like this agreement, are free from fraud, and do not relate to real-estate, and call for immediate action in order to insure their performance according to their terms, we hold all such contracts, in form like the one set forth in the claimant’s petition, to be operative from the day of their signature, subject to be abrogated if disapproved by the Quartermaster-General. No rule short of this protects the citizen contractor against injustice at the hands of his government. If it is thought desirable to hold any such contract in abeyance until it can be passed upon by a superior officer, a clause to that effect should be in serted in the instrument, as is now- done.

The claimant’s right of recovery is to be measured by his rights at the time of abrogation. After the notice he could not go on and make needless damages. When he received it he had earned the right to be paid: 1st. The contract price for all hay then delivered; 2d. The amount then paid or incurred in good faith, in order to enable him to execute the unperformed part of his contract (Bulkley v. The United States, 19 Wall., 37), but none .subsequently incurred which could have been avoided at that time; 3d. His profits on the unexecuted part, which is defined to be the difference between the cost of executing the remainder of the contract and what he wag to receive for it, making reasonable deduction for the time engaged in it, and for release from the care, trouble, risk, and responsibility attending a full execution of the contract. (United States v. Speed, 8 Wall., 77.) If the hay which he had cut and had on hand when the contract was abrogated was or might have been made worth anything, the amount of that worth should also be deducted from the 2d and 3d items.

The findings show that the claimant has already been paid the 1st and 2d of these items; that he took 50 tons of the hay left on hand and allowed the government for it in the payments which have already been made to him; and that the amount of the 3d of the above items is $1,303. For this amount the claimant is entitled to judgment.  