US SUPREME COURT DECISIONS

Where a contractor has large claims on different accounts against the United States, and the United States have a counterclaim of fixed though of much less amount against him, and arrest him and put him in jail, and then by an act passed for his relief direct the accounting officers of the government to "settle" his accounts on just and equitable principles, giving all due weight and consideration to certain settlements and allowances already made, and to certain assurances and decisions of one of the executive departments which the party alleged to have been made to him,

"provided that the sum allowed under the said assurances shall not exceed the amount claimed by the united States and for which suits have

Page 89 U. S. 497

been commenced,"

a settlement by the accounting officers and a reception by the party of the amount fixed will not, in the absence of words to show that it is meant as a payment in full, prevent his recovering any further balance due, and which the proviso in italics prevented the accounting officers of the government from allowing. The case distinguished from United States v. Child, 12 Wall. 232, and United States v. Justice, 14 Wall. 535, and Mason v. United States, 17 Wall. 70.

J. H. Piatt, on the 26th of January, 1814 -- during our second war with Great Britain -- by a written contract with the then Secretary of War, General Armstrong, became a contractor of supplies for the Northwestern Army for one year, to begin on the 1st day of June, 1814, and end on the 31st day of May, 1815, at an average rate of twenty cents the ration; and as the usage then was to make advances in money to contractors, he retained in his hands, as an advance from the department, the balance of the commissariat fund, which at the close of his engagements amounted to $48,230.77.

On the 26th of January, 1814, when the contract was made, the government was in good credit and paying its debts in gold and silver. By the 1st of June following, when it was to take effect, the gold and silver were exhausted and the government had resorted to Treasury notes, which passed at a discount. In the month of August, 1814, the enemy captured Washington and burnt the capitol, an event which assisted to depress the business of the country. All the banks south and west of New York suspended specie payments. The currency soon became the irredeemable paper of state banks. Its value went down and the price of produce went up, till supplies could not be had for less than forty-five cents the ration.

By the 1st of January, 1815, after expending the balance of the commissariat fund and all other funds he had received, the United States owed him, for supplies already delivered, a large sum of money, and his drafts on the government lay under protest for the want of funds in the Treasury to pay them. chanrobles.com-red

Page 89 U. S. 498

In this condition of things, and in an exigent moment, on the 26th of December, 1814 -- the army in the Northwest being about to make a move -- requisition was made on him for a large further supply of rations. He went, on the 1st of January, 1815, to Washington to lay matters before the War Department, and, as the Court of Claims found as facts of the case, at a personal interview there with him, notified to Mr. Monroe, then Secretary of War, that he would furnish no more rations under the contract. Secretary Monroe admitted to Piatt the inability of the government to comply with the terms of the contract on their part, both as to money already due and as to money which might become due for future supplies. But the military exigency then rendering it necessary that a large quantity of rations should be furnished immediately for the Northwestern Army, it was thereupon agreed by parol between Piatt and the Secretary, that if Piatt would furnish the rations which might be required, he should receive for them whatever price they should be reasonably worth at the time and place of delivery, and that the defendants, instead of paying as required by the terms of the original contract, should defer payment until such time or times as they should have the requisite funds.

Under the parol agreement, Piatt furnished

and delivered to the government 73,007,010 rations,

the reasonable value of which, at the times and

places at which they were furnished, was 45 cents

per ration, amounting in the aggregate to . . . . . . . $328,531.54

But, on the settlement of Piatt's account at

the close of the war, the officers of the Treasury,

having no knowledge or evidence of the parol agreement

under which the rations were furnished, allowed and

paid to him only the price designated in the original

written contract, amounting in the aggregate to. . . . . 148,791.87

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And leaving due a balance of. . . . . . . . . . . . . $179,739.67

chanrobles.com-red

Page 89 U. S. 499

Piatt performed, as he alleged, other valuable

services for the government -- transportation &c., to

friendly Indians and to distressed refugees of

Michigan -- (confessedly outside of those contem-

plated by either the original or the parol

agreement), to the value of. . . . . . . . . . . . . . . $ 63,620.48

In September, 1819, an action was brought by the United States against him, and he was arrested on a capias ad respondendum for an alleged balance of $48,230.77, due from him as commissary of subsistence. He how brought his claim before Congress, but the Judiciary Committee of the Senate reported against it. However, while the suit was still pending, and he on bail, Congress (8th May, 1820) passed a private act for his relief, as follows:

"Be it enacted that the proper accounting officers of the Treasury Department be and they are hereby authorized and required to settle the accounts of J. H. Piatt, including his accounts for transportation, on just and equitable principles, giving all due weight and consideration to the settlements and allowances already made and to the assurances and decisions of the War Department:"

"Provided that the sum allowed under the said assurances shall not exceed the amount now claimed by the United States, and for which suits have been commenced against the said Piatt."

Under this act, the accounting officers of the Treasury settled the accounts of Piatt thus:

1st. They allowed him a credit of $63,620.48 for the transportation &c., furnished by him for the use of the Indians and refugees, not embraced within either of the agreements before described.

2d. They allowed him a credit upon a certain specified portion of the rations delivered upon the parol agreement, equal to the amount then claimed by the United States in the suit against him, to-wit, the sum of $48,230.77. The credit was thus ascertained: they first estimated the reasonable value of the specific portion of the rations thus chanrobles.com-red

Page 89 U. S. 500

referred to; they then deducted therefrom the price per ration already paid to him; and from the balance thus ascertained, they made a further deduction sufficient to reduce the amount of the credit to the said sum of $48,230.77, as required by the proviso to the Act of Congress mentioned on the preceding page.

The allowance of the $48,230.77, which did not require the payment of money, was passed to his credit, and the action against him dismissed.

The $63,620.48 allowed for the transportation &c. to the Indians and refugees was not paid, there having been no appropriation applicable to that claim. His creditors became impatient and put him into prison, and he died in the prison bounds in the City of Washington on the 12th of February, 1822.

Congress subsequently (24th May, 1824) passed an act making an appropriation for this last-mentioned account, and there was paid under the act to the administrator of Piatt the sum of $63,620.48, the same being for the transportation &c., furnished to Indians and refugees, and not for army supplies.

But the balance of his original claim under

the parol contract for . . . . . . . . . . . $179,739.67

having been reduced by only. . . . . . . . . 48,230.77

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his administrator now alleged that his

estate was entitled to . . . . . . . . . . . $131,508.90

and for this sum filed a petition -- the petition in the present case -- in the Court of Claims.

The petition set out with circumstance and color a case which in its essence was the same as above given, and after stating the interview with Mr. Monroe and that Mr. Monroe admitted that the right of the United States to enforce the original written contract had been forfeited by its failure to make payment according to its contract, and that Piatt had a right to refuse to furnish rations under the call made December 26th, 1814, alleged that Mr. Monroe had

"appealed to him as a patriot not to desert his country in that

Page 89 U. S. 501

day of its trial, assuring him that he should be fully indemnified, and should not be a loser."

The petition then alleged that on the faith of these assurances, he, Piatt, had gone on and furnished the subsequently required rations to the amount stated.

Though it did not seem to have been doubted that the rations actually cost the amount claimed, the officers of the Treasury, feeling themselves bound only by what appeared of record in the department, allowed in the settlement of the account for rations furnished after the 1st day of January, 1815, no more than the original contract price per ration. The petition then said:

"Under these circumstances, Piatt brought his claim before the Secretary of War, Mr. Crawford, who would have settled it on the principles for which the said Piatt then contended, and which your petitioner now claims to be legal and just, but that, by reason of what he considered countervailing evidence, he had doubts whether such assurances had ever been given. [Footnote 1]"

The Court of Claims, however, as already stated, found as a fact of the case that they had been given.

Being equally divided upon the right of the claimant to recover, the court could only give a judgment pro forma, and for the purposes of an appeal to the Supreme Court, decided accordingly as conclusions of law:

I. That the parol agreement entered into by Piatt and Mr. Monroe, then Secretary of War, after the forfeiture and abandonment of the original written contract, being a new contract upon a new consideration, was valid, and under such agreement, the government became indebted to Piatt for the reasonable value of the rations furnished under it and for the balance of $131,508.90.

II. But that this action was barred by the allowance made by the accounting officers of the Treasury under the private act of May 8, 1820, which must be construed to have been intended by Congress as a settlement of all claims against the defendants. chanrobles.com-red

Page 89 U. S. 502

The petition was accordingly dismissed, and Piatt's administrator appealed, assigning this second conclusion of law for error.