
    ROME BRASS & COPPER COMPANY v. THE UNITED STATES
    [No. A-228.
    Decided February 2, 1925]
    
      On the Proofs
    
    
      Contract; lach of authority; liability.- — -Where the plaintiff, at the request of two Army officers, who have no authority to bind the Government, furnishes copper to a manufacturing company which has contracts with the Government, on the promise of such officers that the Government will return to it the same amount of copper furnished to said company, and the Government returns the same amount of copper of equal quality but at h time when copper has fallen in price, there is no liability on the Government to pay to plaintiff the difference between the selling price of the copper when furnished and when returned.
    
      The Reporter's statement of the case:
    
      Messrs. M. J. Larkin and Frank Davis, jr., for the plaintiff. Palmer, Davis & Scott were on the brief.
    
      Mr. George E. Foster, with whom was Mr. Assistant Attorney General Robert H. Lovett, for the defendant.
    Motion for new trial overruled May 4, 1925.
    The following are the facts as found by the court:
    I. The plaintiff is now and was during the years of 1917, 1918, and 1919 a corporation organized and existing under the laws of the State of New York, with its principal office at the city of Rome, New York, and is and was engaged as its principal business in treating and rolling raw or cake copper into what is known as sheet copper.
    II. Early in September, 1918, the United States entered into certain contracts with the Rome Manufacturing Company, of Rome, New York, for the manufacture and delivery to the United States of certain shell bands and base covers required for the manufacture of projectiles. The Rome Manufacturing Company is a separate and distinct corporation from the plaintiff, although closely allied to it in business.
    III. Among the contracts entered into by the United States with the Rome Manufacturing Company for the manufacture of shell bands were contracts Nos. P. 15647-3744A and P. 14754-3559A, which two contracts were negotiated by Lieutenant Lincoln of the Ordnance Corps, U. S. A. Later on contracts were entered into by the parties for the manufacture of brass covers; three of these contracts were negotiated by Captain Brown of the Ordnance Corps, U. S. A., and were numbered as follows: P. 15449-3648A, P. 15999-382SA, P. 12528-3097A; and there were also two other contracts between the parties for the manufacture of shell bands, which were not negotiated by Lieutenant Lincoln, and were numbered as follows: P. 17007-4090A, P. 15802-3778A. There was another contract between the parties for base covers numbered P. 12512-3089A.
    Contract P. 15449-3684A for 150,000 copper base covers for 12" shells; P. 12528-3097A for 400,000 copper base covers for 8" shells; P. 15999-3823A for 3,665,000 base covers for 155 m/m shells; P. 17007-4090A for 80,000 5" copper bands; P. 15802-3778A for 500,000 4.7" copper bands; P. 15647-3744A for 5,000,000 155 m/m copper bands; P. 14754-3559A for 5,000,000 75 m/m copper bands.
    The said Lincoln and Brown were in the Procurement Division of the Ordnance Corps, and had no authority to make contracts.
    IY. Contracts between the Government and the Rome Manufacturing Company made prior to October 24, 1918, obligated the Government to furnish only a part of the cake copper for the manufacture of shell bands; after that date the Government agreed to furnish all the copper for that purpose. At the time the contracts which were negotiated by Lieutenant Lincoln and Captain Brown were made it was necessary that manufacture should begin at once. The Government did not have at that time at Borne the cake or raw copper required to start such manufacture.
    The plaintiff had at that time at its plant in Borne about 16,000,000 pounds of raw or cake copper, and had commercial orders on which it was then at work, in filling which it would have used all of the copper then on hand. The plaintiff had paid for said copper 26 cents a pound plus the freight, which was $0.0015; 26 cents per pound was the price fixed by the Government, and was the price which all persons buying copper had to pay.
    The two contracts Nos. P. 15647-3744A and P. 14754-3559A for shell bands were negotiated by Lieutenant Lincoln, procurement division, projectile section, Ordnance Department, U. S. A. The base cover contracts were negotiated by Captain Brown. Lieutenant Lincoln had nothing to do with the other shell band contracts enumerated in Finding III. The two officers were at Borne at different times, and did not act in concert • in negotiating the contracts.
    The plaintiff did the rolling for the Borne Manufacturing Company and all deliveries of raw copper for work on Borne Manufacturing Company contracts were delivered to the plant of the plaintiff. The arrangements made tentatively by Lieutenant Lincoln and Mr. Williams acting for both the plaintiff and the Borne Manufacturing Company were that two large contracts would be awarded to the Borne Manufacturing Company subject to approval by higher officials, and that in order that work should be begun at once upon the contracts the plaintiff would start the rolling by using its own copper until such time as the Government should deliver its own copper, the contracts providing that the Government should furnish the copper for the manufacture of the shell bands. The contracts for the shell bands were awarded to the Borne Manufacturing Company.
    V. Lieutenant Lincoln and later Captain Brown asked the plaintiff to devote its entire capacity to rolling sheet copper to be delivered by it to the Borne Manufacturing Company for use in manufacturing the shell bands and base covers. They also requested the plaintiff to use its own copper until copper was supplied by the Government. Lieutenant Lincoln told the plaintiff that he would see to it that the plaintiff should suffer no loss by use of its copper. The plaintiff desired Lieutenant Lincoln to put this in writing, but he declined to do so. This request by the plaintiff was made when the letter awarding the contracts to the Rome Manufacturing Company was sent, and the request was positively refused. In the absence of any order or request by the Government to the plaintiff to use its own copper the plaintiff went ahead and furnished 4,043,410 pounds of copper to the Rome Manufacturing Company to be used in the contracts aforesaid. The copper furnished by the plaintiff was afterwards returned by the Government to the plaintiff.
    On the two contracts for shell bands negotiated by Lieutenant Lincoln the plaintiff furnished to the Rome Manufacturing Company for the United States 1,808,831 pounds of copper up to and including November 2, 1918, and the United States up to and including November 5, 1918, had returned to the plaintiff 1,808,831 pounds of copper in full of the amount of copper furnished on the contracts aforesaid. As to the other contracts for copper bands it does not appear that any request was made to the plaintiff by anyone representing the Government that it should furnish the copper for their manufacture; and the copper so furnished on said contracts by the plaintiff was furnished voluntarily by the plaintiff.
    During the summer or fall of 1918 Capt. Brown advised the Rome Brass & Copper Company to use its own copper on these contracts when Government copper was not available.
    The total weight of metal used on contract P15449 was 554,449 pounds and the total, number of covers manufactured under this contract was 150,000 articles, the contract having been reduced on November 1, 1918, from 300,000 to 150,000 articles. Plaintiff received, as shown by its statement attached to its claim before the Ordnance Department, 325,009 pounds of Government copper by November 21, 1918. The total amount of copper which the Government was obligated to furnish the Rome Manufacturing Company under the contract as reduced November 1, 1918, was 228,900 pounds.
    It does not appear how much copper was used in the manufacture of the 1,150,715 articles manufactured under contract P 15999. The contract was suspended by notice to the manufacturer December 11, 1918, which was formally accepted December 28, 1918. The total amount of copper which the Government was obligated to furnish plaintiff for the 1,150,775 articles manufactured under the contract was 243,964 pounds.
    The total weight of metal used on contract P12528-3097A was 114,550 pounds. The .total number of covers manufactured was 140,600 articles. Plaintiff’s statement shows that 239,600 pounds of Government copper were available for this contract on October 21, 1918.
    Plaintiff has included with the statement of claim before the Ordnance Department figures relating, to use of copper on contract 12512-3089A, but the record does not disclose that an official or employee of the Government requested plaintiff to use its own copper on this contract. This was a contract for base covers, with provisions as to furnishing the copper similar to those recited above.
    No amendments were made in the base cover contracts obligating the Government to furnish any more copper than the amounts stated above. The amendments as to the Government’s furnishing the gross amount of copper related to band contracts only.
    All copper used by plaintiff from its own stock in place of Government copper has been replaced by the Government, and the copper account, by volume, has been closed.
    The copper so returned by the Government was accepted by the plaintiff and no claim was made by it at the time of the delivery of the copper that the United States owed the plaintiff anything on account of the difference in value of the copper at the time of its acceptance, and the time when the plaintiff furnished its copper to the Rome Manufacturing Company, 4,043,410 pounds of copper at 26 cents per pound plus freight amounted to the sum of $1,057,351.72, and the same amount of copper at 15 cents per pound amounted to the sum of $606,511.50. The difference between these two sums is the sum of $450,840.22.
    VI. About the middle of September, 1918, the plaintiff ■suspended entirely the operation of its plant on commercial orders it then had on hand; and the entire capacity of the plant was devoted to the rolling of sheet copper to supply the Borne Manufacturing Company for its use on Government contracts. The plaintiff was anxious to do this work for the Borne Manufacturing Company, and on September 12, 1918, wrote the Borne Manufacturing Company as follows : “ The sooner you give us order for the new lot of band •copper the less time will be lost. If we have to shut down and let our men go, we probably will never be able to get them back and we have few enough as it is.”
    The order for the copper was then given by the Borne Manufacturing Company, and thereafter until December 31, 1918, the plaintiff worked on the rolling of copper for the use of the Borne Manufacturing Company.
    VII. At the time that Lieutenant Lincoln was in Borne ■negotiating the contracts aforesaid with the Borne Manufacturing Company he said to a representative of the plaintiff that the plaintiff ought to devote its plant to Government work, and that if it did not do it, he, Lincoln, would take steps to compel it to do so. Neither the President nor the Secretary of War nor any officer having authority to do so ever placed an order with the plaintiff for work. The work done by the‘plaintiff was done by it for and at the request of the Borne Manufacturing Company.
    VIII. On or about the 25th day of September, 1918, the plaintiff company received the following letter from the War Industries Board:
    WAR INDUSTRIES BOARD,
    Washington, Seftember 1918.
    
    From: Everett Morss, chief brass section, War Industries Board.
    To: Borne Brass & Copper Company, Borne, N. T.
    1. Because of the shortage in the supply of copper and copper base alloy products, public interest requires that the production and distribution thereof be regulated.
    2. Effective immediately, please make the acceptance of •each and every order conditional on receipt of a permit from the brass section of the War Industries Board, unless such order be placed with you direct by the Army, Navy, or Emergency Fleet, which orders require no permit.
    3. This request covers all brass and copper mill products except bare and insulated copper wire, but does not cover brass foundry products.
    4. The notice of June 26, 1918, to manufacturers of brass and copper tube will continue in force on all tube orders. This notice supersedes notice of June 26th, 1918, on all future tube orders.
    5. Except tube, existing orders now covered by definite specifications may be shipped, without permit, until further notice, but in no case after November 30,1918.
    6. Please acknowledge receipt of this notice and indicate that you will comply.
    Everett Morss.
    Approved.
    B. M. Baruch.
    On September 26, 1918, plaintiff company replied to said letter as follows:
    Sept. 26/18.
    War INDUSTRIES Board,
    
      Washington, D. 0.
    
    (Attn. Mr. Everett Morss.)
    Dear Sir : In reply to yours of the 24th, beg to advise we will instruct our mills and customers accordingly in order to comply with your request.
    Yours truly,
    Rome Brass & Copper Co., Treas. -
    On or about the 19th day of November, 1918, the plaintiff • company received the following letter from the War Industries Board:
    (B. M. Baruch, Chairman)
    War Industries Board,
    
      Washington, November 18, 1918.
    
    advice sheet number xi
    
      To brass and copper rolling mills:
    
    (1) In our notice, dated September 24, you were requested to make no shipments after November 30, 1918, without permit, of then existing orders. The period during which such shipments may be made is hereby extended to December 31, 1918. This change does not affect seamless brass, and copper tube.
    
      (2) Under existing conditions it seems hardly necessary to issue special regulations regarding jobber’s stock orders. You are informed that application for permit to enter jobber’s stock orders for tube or other material will receive favorable consideration provided they cover only their reasonable requirements.
    (8) Until further notice you may make such deliveries to your own branch stores as you see fit.
    (4) Permit is hereby granted for the shipment of all jobber’s stock orders for seamless brass and copper tube placed with you previous to July 10, 1918. ,
    WAR INDUSTRIES BOARD, BRASS SECTION.
    On November 27, 1918, the plaintiff company received the following letter from the War Industries Board:
    Wae Industries Board, Priorities Division,
    
      Washington, November 25,1918.
    
    From: Henry A. Wyman, brass section.
    To: Rome Brass & Copper Co., Rome, New York.
    Subject: Permits.
    1. By the inclosed advice sheet you will see that no further requests for permit to manufacture are necessary.
    2. For the completion of the files of this section the requests this day received are retained and duplicates returned to you.
    Henry A. Wyman.
    The advice sheet referred to in said letter is as follows:
    (Bernard M. Baruch, Chairman)
    United States War Industries Board,
    
      Washington, November 23,1918.
    
    ADVICE SHEET NUMBER XII-REMOVAL OE RESTRICTIONS
    
      To brass and copper rolling mills:
    
    (1) The war demands of the Government for brass and copper rolling mill products are not now sufficient to cause a shortage and the permit system is no longer necessary.
    (2) Our letter of September 24, 1918, requesting you to make the acceptance of all orders subject to permit from this section, and our letter of June 26, 1918, addressed to the manufacturers of brass and copper tube, as well as all other restrictions placed upon the industry by the brass section, are hereby withdrawn.
    (8) May we suggest that under present conditions it is but a continuation of your war service to use your best efforts to see that all the customers who have suffered during the period of shortage now receive their necessary supplies promptly that labor may be employed and that business ■may get back to normal conditions.
    (4) Your attention is called to priorities circular No. 58 inclosed, from which you will see that all priorities outstanding November 22, 1918, are canceled except those for the Navy, Emergency Fleet, railroads, telegraph and telephone companies.
    (5) The brass section will be continued for the present in an advisory capacity, but only for so long as it may be necessary.
    WAR INDUSTRIES BOARD, BRASS SECTION.
    IX. From September 4, 1918, to November 12, 1918, upon orders of the Government there were shipped to Nome, New York, 12,080,480 pounds of raw copper. This copper was for use on the contracts of the Government with the Borne Manufacturing Company, which contracts are referred to specifically in these findings, and the copper was sent to the plant of the plaintiff, as it had a contract with the Borne Manufacturing Company for the rolling of the copper. The price of copper had not declined at this time. On November 29, 1918, 2,000,000 pounds of raw copper was shipped on account of the Borne Manufacturing Company contracts, and was delivered to the plant of the plaintiff, and was applied by it to replace its own copper, which it had used on some of these contracts. It does not appear what the decline in the price of copper was on November 29, 1918, or whether there was any such decline.
    On November 5, 1918, the Government had replaced 1,808,831 pounds of copper which the plaintiff had furnished for contracts P.14754^3559A and P.15647-3744A, these being the contracts negotiated by Lieutenant Lincoln. The copper furnished by the plaintiff was worth 26 cents per pound and the copper replaced by the Government was also worth on November 5, 1918, 26 cents per pound.
    On contracts negotiated by Captain Brown the Government replaced on or before November 19, 1918, 348,885 pounds of copper, which had been furnished by the plaintiff on said contracts, which copper was equal in value to that furnished by the plaintiff.
    The plaintiff furnished copper on these contracts after the price of copper declined. It furnished copper for contract P.15449-3684A on- and after December 5,' 1918, to April 7, 1919, to the quantity of 188,798 pounds. This copper was worth 15 cents a pound. The Government returned the same quantity of copper to the plaintiff after December 5, 1918, which copper was also worth 15 cents a pound. The plaintiff furnished for contract P.15999-3823A on and after November 29, 1918, to December 28, 1918, 120,-529 pounds of copper worth 15 cents per pound; the Government replaced this copper after November 29, 1918, with copper also worth 15 cents per pound. The plaintiff furnished for contract P.12528-3097A from August 29, 1918, to October 21, 1918, 114,550 pounds of copper worth 26 cents per pound; the Government replaced this copper on and before October 21, 1918, with copper worth 26 cents per- pound.
    As to copper furnished by the plaintiff to the Rome Manufacturing Company on other contracts than those above enumerated, no claim is made that the Government is owing anything to the plaintiff by reason thereof.
    N. On November 22, 1918, and again on November 30, 1918, the plaintiff wrote to the Government stating that it had on hand 7,000,000 or more pounds of copper, which it asked the Government to purchase at 26.15 cents per pound for use on Government contracts. This the Government declined to do.
    XI. Upon the release of the Government’s restrictions on copper, to wit, on or about November 27, 1918, the price of copper began to decline from 26 cents per pound, the price which had been fixed by the Government. The price of copper dropped to 15 cents per pound, and the plaintiff disposed of most of its copper which it had on hand at that price, but the evidence does not disclose how much of plaintiff’s copper was disposed of at that price.
    XII. In rolling sheet copper from raw copper by the plaintiff the copper was unloaded from the cars into the plant and carried from the piles where • it was placed to the mill. Service connected with this part of the process is known as a-handling charge. The actual cost of handling 4,043,410 pounds of copper is $1.65 per ton, or $3,335.81. The contracts of the Governjnent with the Romo Manufacturing Company do not require the Government to pay any handling charge. The orders to the plaintiff came from the Rome Manufacturing Company. The Government had no contract of any sort with the plaintiff.
    XIII. Prior to June 30, 1919, and on or about the 6th day of May, 1919, plaintiff filed a claim before the Ordnance Department for adjustment under the act of Congress approved March 2, 1919, 40 Stat. 1272. The Ordnance Department upon the statement of claim with the supporting documents prepared a form of contract dating same as of September 4, 1919, and attached its certificate (Form C) upon the same, indicating that the documents thereto attached constituted a detailed statement shoAving the nature, terms, and conditions of said agreement and recommended that the Secretary of War proceed to adjust, pay, or discharge the said agreement. This certificate was approved and signed July 10, 1918. The form of contract thus prepared was not signed.
    On August 12, 1919, the Rochester District Claims Board made a recommendation to the Ordnance Claims Board of an award of $209,648. The amount being unsatisfactory plaintiff appealed to the Ordnance Claims Board. On No-A^ember 19, 1919, the Rochester District Claims Board rescinded its recommendation for an aAvard and recommended a total disallowance. Plaintiff appealed from this action. On May 15, 1920, a hearing was held in Washington before MerA^yn Ap Rice, as special master of the War Department Claims Board, to hear the evidence and make such recommendations to the War Department Claims Board as in his judgment might appear wise and equitable.
    The recommendations made by Mr. Rice, of a basis for settlement, were later before the appeal section of the War Department Claims Board, which board on August 18, 1920, entered a final order denying relief. Plaintiff appealed from this decision to the Secretary of War, who, on December 20, 1920, affirmed the decision of the appeal section.
    The court decided that plaintiff was not entitled to recover.
   Hat, Judge,

delivered the opinion of the court:

This is a suit brought by the plaintiff against the United States to recover the sum of $450,840.22. The plaintiff alleges that it furnished the Tbuited States 4,043,410 pounds of copper worth 26.15 cents per pound, or $1,057,351.72, and that the United States replaced the said copper with copper worth only 15 cents per pound or $606,511.50, and it alleges that it is entitled to be paid the difference in the value of the copper so furnished by it and that furnished by the United States, which difference it alleges to be $450,840.72.

The basis of this claim is a conversation had between Lieutenant Lincoln of the Procurement Division of the Ordnance Department, U. S. A., and a representative of the plaintiff, in which conversation Lieutenant Lincoln said that if the plaintiff furnished copper to the Rome Manufacturing Company, which company had a contract with the United States, he, Lincoln, would see to it that the plaintiff should suffer no loss by so doing. And the claim is further based upon a request made by Captain Brown, also of the Procurement Division of the Ordnance Department, U. S. A., that the plaintiff furnish its own copper if it was unable to get the copper from the Government. In both instances it was understood between the parties that whatever quantity of copper was furnished by the plaintiff was to be replaced by the Government. There was nothing said as to the quantity of the copper to be furnished by the plaintiff, nor as to the price of said copper.

The facts show that the plaintiff was very much interested in the contracts which the Rome Manufacturing Company had with the United States, and that in order to begin on the contracts promptly copper had to be furnished at once. The Government, at the moment, had no copper available at Rome; the plaintiff had on hand a large supply of copper, which it could use in no other way, and it, in fact, urged the Rome Manufacturing Company to give it the order for copper, as if it did not. receive the order it might have to shut down.

Apart from the question as to whether or not Lieutenant Lincoln and Captain Brown had authority to purchase copper for the Government, or to oblige the plaintiff to furnish copper for use on a Government contract, the facts show that the Government returned, every pound of copper to the plaintiff which it had furnished for these contracts, and that the copper so returned, was of equal value with that which the plaintiff had furnished. The facts further show that at the time when the copper was so returned it was accepted by the plaintiff without protest; that nothing was said by the plaintiff as to any difference in value of the copper furnished and that which was returned; and that no claim was made against the Government then or thereafter, until May 6, 1919, a month after the last delivery of copper by the Government. On the contrary, the plaintiff made strenuous efforts to get the Government to purchase 7,000,000 pounds of copper which it had on hand at the time the price of copper began to decline, and never suggested at that time that it had any claim for the difference of value in copper furnished by it and replaced by the Government. At the time of the replacement of the copper by the Government and its unqualified acceptance by the plaintiff there was no suggestion or intimation on the part of the plaintiff that there was any difference in value.

This claim was presented to the War Department Claims Board, and relief was denied by that board. The decision of the board was affirmed by the Secretary of War. Decisions of the War Department Appeal Section, War Department Claims Board, vol. 7, p. 327.

The plaintiff claims that it is entitled to recover either under the general jurisdiction of this court or under the national defense act, 39 Stat., chapter 134, sec. 120, or under the Dent Act, 40 Stat. 1272.

The plaintiff is not entitled to recover under section 145 of the Judicial Code because there is no contract express or implied between the plaintiff and the United States. Neither Lieutenant Lincoln nor Captain Brown had any authority to purchase copper for the United States, nor did they have authority to enter into any contract with the plaintiff to furnish copper to the Rome Manufacturing Company on behalf of the United States, and even if they had such authority the contract would not have been binding on the United States unless the same had been “ reduced to writing and, signed by the contracting parties, with their names at the end thereof.” Section 3744;, Revised Statutes.

Nor can the plaintiff recover under section 120 of'1 the national defense act. No order was placed with the plaintiff by the President or the Secretary of War, or by any one under their authority, for the copper which the plaintiff furnished. Th'e plaintiff’s plant was not taken.. The restrictions of the War Industries Board placed upon the production and distribution of copper was a lawful governmental action, and can not be construed into a taking of plaintiff’s plant, nor from them can there arise any claim against the United States for the furnishing of materials to the Government by the plaintiff or any one else.

Nor can the plaintiff recover under the Dent Act. The contract upon which the plaintiff relies, if contract it can be called, is that officers of the United States told the plaintiff to use its copper on the Borne Manufacturing Company contracts until Government copper was received to replace it. From this the plaintiff deduces that a contract to purchase was entered into, or if hot a contract to purchase, then a promise was implied that the United States in replacing the copper was to replace copper of equal value with the copper furnished by the plaintiff. These officers had no authority to enter into any contract for the purchase of copper, nor to bind the Government as to the price of copper, and so informed the plaintiff. These officers were not acting under the authority of the Secretary of War or of the President. They were acting outside of the scope of their authority, which was to ascertain whether it would be proper to place a contract with the Borne Manufacturing Company. Their promises to the plaintiff, or their assurance that it would suffer no loss if it furnished to the Government its own copper until it could be replaced by the Government, can not be construed into “an agreement, express or implied,” that the United States would pay it a certain price for the copper so furnished or that the United States would pay it the difference in value of the copper furnished and the copper replaced. However, the facts show that the plaintiff suffered no loss by its furnishing the copper, and that the United States replaced copper of equal value with the value of the copper furnished by the plaintiff.

The petition of the plaintiff is dismissed. It is so ordered.

GRAi-iam, Judge; Dowhey, Judge; Booth, Judge, and Campbell, Chief Justice, concur.  