196 U. S.

Statement of the Case.

SLAVENS v. UNITED STATES.

APPEAL FROM THE COURT OF CLAIMS.

No. 228. Argued December 7, 8, 1904.-Decided January 9, 1905.

Under the mail contract in this case, which was made in pursuance of the Postal Laws and Regulations, and after the service had materially decreased by changed methods of transporting mail and the Postmaster General had offered the contractor, who had refused to accept it, the remaining work at a lower compensation, it was within the power of the Postmaster General to put an end to the contract by order of discontinuance, allowing one month's pay as indemnity, and to relet the remaining service; the power to terminate the contract on allowing a month's pay as indemnity was not predicated on an abandonment of the entire service.

While the provisions in a similar contract that the contractor should perform without additional compensation all new or changed service that the Postmaster General should order, might not be construed as extending to services of different character and not within the terms of the contract, where the changed service is to take the mail to and from street cars, met at crossings, instead of landings and stations, it comes within the power reserved to the Postmaster General and the contractor is not entitled to additional compensation therefor.

In the absence of authority shown, a local postmaster has no power or authority to contract in respect to mail messenger service, and is not the agent of nor can he bind the Government for that purpose, and if a contractor performs services which he protests against as not being within his contract, solely on the postmaster's order, he is not entitled to extra compensation therefor after his protest has been sustained and the serIvice let to others.

THE appellant filed his petition in the Court of Claims to recover for the alleged wrongful termination of certain mail contracts in the cities of Boston, Brooklyn and Omaha; and, also, for extra services performed in connection therewith. The Court of Claims, in disposing of the case, made separate findings of fact and conclusions of law. The findings of fact may be abridged for the purpose of this case, reference being made for fuller details to the findings in the Court of Claims. 38 C. Cl. 574. In pursuance of an advertisement for proposals for transporting the mails-"covered regulation wagon, mail,

messenger and mail station service"-the appellant entered into contracts for four years each for the cities of Boston and Brooklyn, and two years for the city of Omaha. The Boston and Brooklyn contracts began on July 1, 1893, and the Omaha contract on July 1, 1894. Compensation for the Boston contract was at the rate of $49,516 per annum; for the Brooklyn contract, $18,934 per annum, and for the Omaha contract at $3,780 per annum. During the terms of the Boston and Brooklyn contracts the Postmaster General determined to carry certain of the mails within the district contracted for on electric street railway lines. In both cases the appellant was offered the privilege of continuing the contract for the reduced service, but refused to do so in each case. The Postmaster General terminated the Boston and Brooklyn contracts, above referred to, the former on February 1, 1896, the latter on March 1, 1896, acting, as he avers, under the authority vested in him by law and the contract between the parties, but not because of any negligence or default on the part of the contractor. He afterwards relet the same service, as thus reduced, to another contractor, for the remaining period of the contract of the seventeen months of the Boston contract, at the compensation of $37,000 per annum. The difference between the contract price and the amount it would cost the appellant to furnish the service in Boston during said seventeen months would be $18,884.14. The service of the Brooklyn contract for the remaining period of sixteen months was let to another contractor at a compensation of $9,720 per annum. The court did not find the amount of the loss to the appellant by reason of the termination of this contract. The contracts contained certain stipulations, as set forth in the opinion.

The contracts covered certain specified stations, landings and mail stations from which the contractor was required to carry the mail, and during the terms of such contracts he was required to perform certain services, which he alleges to be extra services, and for which he was entitled to extra compensation-in the Boston contract, carrying the mails from the gen

eral post office in the city of Boston to the stopping places of the street car lines of the railway company from May 1, 1895, until February 1, 1896. Also, carrying the mails between the Back Bay post office and the Brookline office, a distance of from two and a half to three miles, which services were not included in the terms of the contract, but which he was required to perform by the postmaster of the city of Boston, against his protest. The contractor did not protest to the Postmaster General or any officer of the Post Office Department until August 14, 1899. Whereupon the Postmaster General dispensed with the service by the appellant, and entered into a contract with another contractor to perform the service.

Under the Brooklyn contract, which contained specifications as to the places between which the mail had to be carried during the term of the contract, the contractor was required to perform service between the Brooklyn post office and the mail routes established on the street car lines, and between the motor routes and the mail stations. Under the Omaha contract appellant was required, in addition to the places specifically named in the contract, to carry the mail to and from street cars of the Omaha Street Railway at its crossings. It also appears that under the three contracts the new service required, in lieu of the service specified in the contract, was much less in mileage required than was the service stipulated by the original contract. The Court of Claims dismissed the petition, 38 C. Cl. 574, and the claimant appeals to this court. Mr. A. A. Hoehling, Jr., for appellant.

Mr. Special Attorney Joseph Stewart, with whom Mr. Assistant Attorney General Pradt was on the brief, for the United States.

MR. JUSTICE DAY, after making the foregoing statement, delivered the opinion of the court.

From the foregoing statement of facts it is evident that the

case resolves itself into three propositions: (1) Can the appellant recover for the alleged wrongful termination of his contracts by the Postmaster General? (2) Under the contracts were the services performed in carrying mails from the street cars, at the places designated, extra services for which compensation outside of the contract should be awarded? (3) Under the Boston contract did the service required in carrying the mails to and from Brookline constitute extra service, for which compensation should be awarded?

To determine the first proposition it is essential to have in mind certain provisions of the statute, the preliminary notice to bidders, and, most important of all, the terms of the contract itself. In the notice to bidders it is said:

"There will be no diminution of compensation for partial discontinuance of service or increase of compensation for new, additional or changed service that may be ordered during the contract term; but the Postmaster General may discontinue the entire service on any route whenever the public interest, in his judgment, shall require such discontinuance, he allowing, as full indemnity to the contractor, one month's extra pay."

In the contract it is stipulated:

"It is hereby stipulated and agreed by the said contractor and his sureties that the Postmaster General may change the schedule and termini of the route, vary the routes, increase, decrease, or extend the service thereon, without change of pay; and that the Postmaster General may discontinue the entire service whenever the public interest, in his judgment, shall require such discontinuance; but for a total discontinuance of service the contractor shall be allowed one month's extra pay as full indemnity."

Section 817, Revised Statutes, Postal Laws and Regulations, 1887, provides:

"The Postmaster General may discontinue or curtail the service on any route, in whole or in part, in order to place on the route superior service, or whenever the public interests,

in his judgment, shall require such discontinuance or curtailment for any other cause, he allowing as full indemnity to the contractor one month's extra pay on the amount of service dispensed with, and a pro rata compensation for the amount of service retained and continued."

Under the power supposed to be conferred upon him by the terms of the contract, made in pursuance of the preliminary advertisement and the authority vested in him by the Postal Laws and Regulations, above cited, the Postmaster General, having decreased the service under the contract, by reason of the introduction of the method of carrying the mails on the street railways, until the service required originally would be much more than paid for by the compensation agreed upon, discontinued the original service, and, the contractor declining to perform the work remaining at the lower compensation, put an end to the contract by an order of discontinuance, allowing the contractor one month's extra pay as full indemnity. It is contended by the appellant that this contract, properly construed, while it permits the Postmaster General to make changes in the schedule and termini of the route, to reduce the same, to increase, decrease or extend the service, without change of pay, does not confer the right to cancel the contract except upon abandoning the entire service, which may be done with the allowance of one month's extra pay to the contractor. But, it is insisted, so long as any part of the service remains to be performed, it is not within the power of the Postmaster General to put an end to the service of the contractor and relet a part of it to another, substituting a different character of service for a part of the field theretofore covered by the contract. In other words, it is contended that the total discontinuance of service, which only can terminate the contract, must not leave any service to be performed in the district covered.

We cannot accede to this narrow construction of the powers given the Postmaster General by the terms of this contract. He is given general power to increase, decrease or extend the