U S v. UTAH, NEVADA & CALIFORNIA STAGE CO(1905)
[199 U.S. 414, 415] This is an appeal and cross appeal from a judgment of the court of claims upon a demand for extra compensation in the performance of a contract made on December 21, 1892, between the United States, represented by the Postmaster General, and the Utah, Nevada, & California Stage Company, for the rendition of certain covered regulation wagon, mail messenger, transfer, and station service on mail route number 207,003, in the city of New York, for a term from July 1, 1893, to June 30, 1897. The advertisement contained certain instructions to bidders, a part of which is as follows:
The stage company, having submitted a proposal under this advertisement, was awarded the contract, and the same was duly entered into. Among other things it was stipulated:
After the contract was entered into, Congress having made an appropriation for the purpose, a new distribution station was established at Forty-fourth street and Lexington avenue, in the city of New York, known as the Industrial building station. At the time of the advertisement for proposals, [199 U.S. 414, 417] which resulted in the contract, to wit, on September 15, 1892, the service therein referred to involved the carrying of the mails for approximately 973,674.22 miles per annum. In the advertisement bidders were notified that the probable annual increase in such service would amount to 6,718.40 miles. Between the time of the advertisement and the time when complainant entered upon the performance of his contract, additional service was required which increased the amount of annual mileage to 1,012,604.54 miles. On August 22, 1893, an order was made by the Second Assistant Postmaster General, requiring additional mail service to supply the mail station at Forty-fourth street and Lexington avenue, as per certain statements attached to the order, and a further order was made on October 23, 1893, for additional mail station service. Under the arrangement ordered by the Department, all first-class matter (letters) previously collected in the district of Station H (removed into the Industrial building from 156 East Fourth street) continued to be received and handled there; massed matter made up by the states for the East, North, and West, which had previously been sent to the general postoffice for distribution, was sent to the Industrial branch to be distributed. South and West mail was taken there during the period within suit and assorted, and all of the second-class bulky matter of publishers above Fourteenth street, which had formerly been received at the general postoffice and Station O, was delivered at the Industrial building; also, all third and fourth class matter, mailed in uptown stations, which had previously come to the general postoffice, was sent to the Industrial building, relieving the general postoffice from handling that matter. The result of the orders aforesaid was that claimant was compelled to increase the number of wagon trips from October 25, 1893, to February 6, 1895, over and above what would have been the normal increase, and increased the distance to be traveled by the wagons, over and above the normal increase, 311,939 miles for the period from October 5, 1893, to February 6, 1895. [199 U.S. 414, 418] The Industrial building was rented in March, 1893, for postal purposes, in order to relieve the general postoffice, which had become inadequate to accommodate the increased volume of business. Station H, on May 1, 1893, was moved from 156 East Fifty-fourth street into the Industrial building. In connection with Station H, there were inauguraged in the premises the district departments, variously known as district stations.
By establishing the distribution station in the Industrial building, and issuing the orders above set forth, there was no diminution in the number and character of the runs to and from the general postoffice, nor was the mileage at said general postoffice thereby diminished. To perform this extra service to and from the Industrial building the claimant was required to purchase from 80 to 100 additional horses, and from 32 to 33 additional wagons; to put on from 45 to 46 new runs, and to employ from 33 to 50 additional men,-drivers, hostlers, etc. The orders resulted in such increased speed in carrying the mails from the Industrial building to some of the railroad stations that in obeying them it was necessary to violate the city ordinances as to the rate of speed; it largely increased the wear and tear on the wagons; it injured and shortened the period of usefulness of the horses, some of them dying from overexertion in hot weather by reason of the fast driving, made necessary by the short time allowed to make the various trips.
The increase of runs to the railroad stations outside of the city of New York, made necessary by the establishment of the extra service from the Industrial building, increased the necessary expenditure by the claimant, in the matter of ferry tolls, in the sum of $9,950.22.
At no time prior to the making of said bid, or prior to entering into said contract, was any intimation or information given by the defendants' officers to claimant that they contemplated or intended the establishment of a service at the Industrial building. [199 U.S. 414, 419] A postal station was established in the Industrial building, and the contractor was required to transport the mails between it and the various railroad stations and some postal stations. This postal station was constituted as follows:
The advertisement of September 15, 1892, containing provision for covered regulation wagon, mail messenger, transfer, and station service, which was made a part of the contract, undertook to give a schedule of service probably required in the city as the same existed and was in operation on August 15, 1892, as stated in the advertisement, 'so that bidders might be as fully advised as possible of the amount of service likely to be required.' The advertisement inadvertently stated the service between the Manhattan Elevated Railroad station and the general postoffice and certain branch stations at one half of the number of transfers actually required, consequently the stage company was required to perform, and did perform, double the number of trips specified.
In the performance of the contract certain foot service was required, which, it is contended, was not included in the contract, which necessitated 479,875 trips going up and down steps in making delivery of mail to messengers on elevated trains, the service requiring the employment of additional men at each station.
From the findings of fact the court of claims held the complainant [199 U.S. 414, 421] entitled to recover the sum of $68,483 as compensation for the additional service under the orders of the Department, made necessary by the establishment of the extra service in connection with the Industrial building, the sum including $9,950.22 expenses incurred by the stage company in the matter of ferry tolls; also $14,538 because of the double service required between the Manhattan Elevated Railroad and the general postoffice and certain branch postoffices, growing out of the mistake in the advertisement in stating the number of trips required at one half the actual number. It disallowed the claim for extra compensation on account of the 'foot service' required in delivering the mail upstairs at the elevated railway stations. 39 Ct. Cl. 440.
Assistant Attorney General Pradt and Mr. Joseph Stewart for the United states.
Messrs. A. A. Hoehling, Jr., and J. H. McGowan for the stage company.
Statement by Mr. Justice Day:
Mr. Justice Day delivered the opinion of the court:
It is the contention of the government that, under the authority of the Postmaster General to require new or additional mail messenger or transfer service, without additional compensation, the contractor might be required to perform the additional service made necessary by the establishment of the Industrial building branch under the authority of the act of Congress of March 3, 1893 (27 Stat. at L. 732, chap. 213), authorizing the renting of the building to be used for general postoffice purposes in the city of New York. The findings of fact establish that this Industrial building branch was more than 3 miles distant from the general postoffice, and was intended to and did transact nearly all of the business north of Fourteenth street. This necessitated the carrying of the mails, not only from the [199 U.S. 414, 422] general postoffice to the railroad stations, but to and from the branch station established at the Industrial building. In order to perform this service under the directions of the Department, complainant was required to furnish 80 additional horses, more than 30 additional wagons, and from 33 to 50 additional men, requiring an additional distance to be traveled in wagons, over and above the normal increase, of 311,939 miles for the period from October 5, 1893, to February 6, 1895, and to pay an increased sum for ferrying the wagons across the North and East rivers of $9,950.22. Can such enormous increase of the service required and the expense entailed be exacted of a contractor who had agreed to perform new or additional service of the kind specified without additional compensation? There can be no doubt that the purpose of placing this stipulation in the contract was to require the performance, without additional compensation, of new or additional service which might arise from improved methods in the transaction of the business of the Postoffice Department and in the increased demand for service resulting from the growth and developments of towns and cities. The contract gave to the Postmaster General very considerable discretion in calling for additional service which might result from these causes, without compensation. This was well illustrated in the case of Slavens v. United States, 196 U.S. 229 , 49 L. ed. 457, 25 Sup. Ct. Rep. 229, in which it was held that while the Postmaster General might not order, under such a contract, service of a different character not within the contractual arrangement, he might order, without additional compensation, a change in the service which required the mail to be taken to and from street cars, met at crossings instead of landings and stations. In that case it happened the burden upon the contractor was not increased. But in the present case we find more service required, amounting to additional mileage of hundreds of thousands of miles, and the payment of a large additional sum of money for ferrying wagons to deliver the mails. There must be some limit to the service which can be required without additional compensation, under [199 U.S. 414, 423] the authority vested in the Postmaster General by the contract, to call for new or additional service of the same character. Otherwise it is within the power of the government to ruin a contractor by new and wholly unanticipated demands, which caution and prudence, however great, could not have forseen. If this were a contract between individuals, a claim of the right to require this vast amount of additional work-evidently no within the contemplation of the parties-without additional compensation would hardly be seriously entertained. The same principles of right and justice which prevail between individuals should control in the construction and carrying out of contracts between the government and individuals. The phrase 'new or additional service' is not one of exact meaning, defining the precise extent of the obligation incurred, and permits the court to give it a reasonable construction with a view to doing justice between the parties. In giving a proper construction, the court is required to examine the entire contract, to consider the relation of the parties, and the circumstances under which it was signed. Chicago, R. I. & P. R. Co. v. Denver & R. G. R. Co. 143 U.S. 596, 609 , 36 S. L. ed. 277, 281, 12 Sup. Ct. Rep. 479. It was said by Mr. Justice White, in O'Brien v. Miller, 168 U.S. 287, 297 , 42 S. L. ed. 469, 473, 18 Sup. Ct. Rep. 140, 144:
And, upon the same subject, Mr. Justice Bradley, in the case of Chesapeake & O. Canal Co. v. Hill, 15 Wall. 94, 99, 21 L. ed. 64, 67, said:
We cannot believe it possible that the parties to this contract contemplated the establishment of a new postal department [199 U.S. 414, 424] in the city of New York not then authorized by any act of Congress, which should so greatly increase the service, requiring more than 300,000 miles of additional transfer service and nearly $10,000 of additional expense for ferrying during the time covered in the suit. The government, in its advertisement, had stated the probable additional annual mileage at 6,718. 40 miles. This may be presumed to have been a fair and impartial estimate, made for the benefit of those with whom the government was about to contract, notwithstanding they were warned that it was not conclusive. There is nothing in the record to show that it was not a reasonable estimate in the light of the facts then known. In this case, after the contract was entered into, this enormous new service, clearly not intended by either of the parties to be rendered, was required. In this instance we think the limit of reasonable requirement under the new and additional service clause was exceeded, and the service required cannot be held to be within the terms of the contract. We find no error in the court of claims reaching this conclusion.
2. The second question involved is as to the right of the contractor to recover because the government's advertisement for proposals, instead of stating the number of elevated stations to be served at four, which was, in fact, the number, gave the number of stations at two, thus doubling the number of trips necessary. It is true that the advertisement required the bidders to inform themselves as to the facts, and stated that additional compensation would not be allowed for mistakes; but, in the present instance, the government, in its advertisement, had positively stated the number of stations at two. The contractor had a right to presume that the government knew how many stations were to be served; it was a fact peculiarly within the knowledge of the government agents, and upon which, in the advertisement, it spoke with certainty. We do not think, when the statement was thus unequivocal, and the document was prepared for the guidance of bidders for government service, that the general statement that the contractor must investigate [199 U.S. 414, 425] for himself, and of nonresponsibility for mistakes, would require an independent investigation of a fact which the government had left in no doubt. We think the court of claims correctly allowed this item.
3. As to the compensation for the socalled 'foot service,' for carrying the mails up and down the steps at the elevated railroad stations, the delivery of the mail at the foot of the steps would not have been sufficient, and the contractor agreed to deliver the mail into the postoffices, mail stations, and cars. The statement of facts shows that the preceding contractor had delivered the mail on the platform of the stations, at the door of the cars. We think the contract was not exclusively for wagon service, but, reasonably construed, required the delivery of the mail into the elevated stations in such wise as to be placed in the cars, and consequently required it to be carried upstairs without extra allowance of pay. We find no error in disallowing this claim for extra compensation.
The judgment of the Court of Claims is affirmed.