Sutton v. United States

• Decision Date: 01 June 1921
• Docket Number: No. 307,307
• Citation: 256 U.S. 575,19 A. L. R. 403,65 L.Ed. 1099,41 S.Ct. 563
• Parties: SUTTON v. UNITED STATES
• Court: U.S. Supreme Court

256 U.S. 575

41 S.Ct. 563

65 L.Ed. 1099

SUTTON

v UNITED STATES.

No. 307.

Argued April 29, 1921.

Decided June 1, 1921.

[Syllabus from pages 575-576 intentionally omitted] Messrs. John B. Sutton, of Tampa, Fia., and M. Walton Hendry, of Washington, D. C., for appellant.

Mr. Frank Davis, Jr., of Columbus, Ohio, for the United States.

Mr. Justice BRANDEIS delivered the opinion of the Court.

The River and Harbor Act of July 25, 1912, c. 253, 37 Stat. 201, 209, made this appropriation:

'Improving channel from Clearwater Harbor through Boca Ceiga Bay to Tampa Bay, Florida. Completing improvement and for maintenance, twenty thousand dollars.'

Sealed proposals were solicited, and on January 21, 1913, a contract was made by the War Department with the Hillsboro Dredging Company to do work at unit rates for dredging soft material and for excavating rock. The appropriation was ample to defray the cost at these rates, assuming that the quantities of material to be removed did not greatly exceed the estimates presented by the specifications. It was provided by the contract that United States 'inspectors will keep a record of the work done' and also that, 'within the limits of available funds the United States reserves the right to require the removal of such yardage as will complete the work, * * * be it more or less than the quantities above estimated. * * *'

Work was begun under the contract in June, 1913, and payments were made monthly on estimates of the government inspector. Upon these estimates both the government and the contractor relied. About May 15, 1914, it was discovered that through a mistake of the inspector so much work had already been done that, if paid for at the unit rates, it would call for an amount far in excess of the appropriation available. The government engineer in charge ordered operations discontinued immediately, and this contractor had no further connection with the work. The work already done amounted at the unit price to $25,032.31. The aggregate appropriation available for the improvement—including an additional $3,000 made by Act of March 4, 1913, c. 144, 37 Stat. 801, 809—was $23,000. Against this appropriation the government charged $1,732.90 for superintendence and office expenses. The balance—$21,267.10—it paid to the contractor, leaving unsatisfied a claim, at the unit rates, of $3,042.74, for material dredged or excavated, and as further claim of $1,551 for the cost of blasting rock which was not removed because of the order to cease work. To recover these sums the assignee in bankruptcy of the Hillsboro Company brought this suit in the Court of Claims. That court entered judgment for the government, 55 Ct. Cl. 193; and the case is here on appeal.

First. It is urged that the Secretary of War was authorized by Congress to make, and that he did make, a contract with the Hillsboro Company not only to proceed with the work, but for its completion, and that the United States is, therefore, liable, even though the appropriation proved to be insufficient. Two appropriations had been made for this project before the Act of 1912 above referred to; one by Act of June 25, 1910, c. 382, 36 Stat. 630, 644, of $29,500, for 'improving channel from Clearwater Harbor'; the other by Act of February 27, 1911, c. 166, 36 Stat. 933, 941, of a like amount for 'completing improvement.' The Act of 1912 provided by section 8 (37 Stat. 233; Comp. St. § 9888) that——

'Whenever the appropriations made, or authorized to be made, for the completion of any river and harbor work shall prove insufficient therefor, the Secretary of War may, in his discretion, on the recommendation of the Chief of Engineers, apply the funds so appropriated or authorized to the prosecution of such work.'

But by none of these acts was any authority conferred upon the Secretary of War to complete the improvement or to contract to expend more than the amount then appropriated. On the other hand, section 3733 of the Revised Statutes (Comp. St. § 6886) provides that no contract 'for any public improvement shall bind the government to pay a larger sum than the amount in the treasury appropriated for the specific purpose.' See also sections 3732 and 5503 (Comp. St. §§ 6884, 10266). And the Act of June 30, 1906, c. 3914, provides by section 9 (34 Stat. 697, 764; Comp. St. § 6763) that——

'No act of Congress hereafter passed shall be construed * * * to authorize the execution of a contract involving the payment of money in excess of appropriations made by law, unless such act shall in specific terms declare an appropriation to be made or that a contract may be executed.'

The Secretary of War was, therefore, without power to make a contract binding the government to pay more than the amount appropriated. See Bradley v. United States, 98 U. S. 104, 113, 114, 25 L. Ed. 105. Those dealing with him must be held to have had notice of the limitations upon his authority. But there is nothing in the contract indicating a purpose to bind the government for any amount in excess of the appropriation. On the contrary, it limits to the amount of the appropriation the work which may be done.

By Act of October 2, 1914, c. 313, 38 Stat. 725, Congress appropriated the sum of $20,000,000——

'to be expended under the direction of the Secretary of War and the supervision of the Chief of Engineers, for the preservation and maintenance of existing river and harbor works, and for the prosecution of such projects heretofore authorized as may be most desirable in the interests of commerce and navigation, and most economical and advantageous in the execution of the work.'

Out of the sum so appropriated $12,000 was allotted by the Secretary for completing the Clearwater Harbor improvement; and out of this sum there was paid to the contractor in November, 1914, $3,046.44, being the unpaid balance at unit prices for the material removed prior to May 15, 1914. This payment was later disallowed by the Comptroller of the War Department and the Comptroller of the Treasury, and was deducted from payments made to the contractor under a wholly different contract for work in North and South Carolina. It is clear that the Act of 1914 did not authorize the application of any...