Waller v. United States

• Decision Date: 28 June 1948
• Docket Number: No. 48602.,48602.
• Citation: 78 F. Supp. 816
• Parties: WALLER v. UNITED STATES.
• Court: U.S. Claims Court

78 F. Supp. 816

WALLER v. UNITED STATES.

No. 48602.

Court of Claims.

June 28, 1948.

Henry J. Fox, of Washington, D. C. (Posner, Berge, Fox & Arent, and A. Alvis Layne, Jr., all of Washington, D. C., on the brief), for plaintiff.

Kendall M. Barnes, of New York City, and H. G. Morison, Asst. Atty. Gen., for defendant.

Before JONES, Chief Justice, and WHITAKER, HOWELL, MADDEN, and LITTLETON, Judges.

WHITAKER, Judge.

Plaintiff entered into contracts with the defendant to furnish it certain petroleum products to be delivered between August 1, 1946 and July 31, 1947. One contract covering a portion of the products was dated July 10, 1946 and another contract covering the balance was dated July 19, 1946. However, invitation for bids had been issued by the defendant on June 17, 1946, and plaintiff's bid was submitted on June 26, 1946.

On July 1, 1946, the petroleum products, for the furnishing of which plaintiff had submitted a bid, ceased to be subject to price control. With the lifting of controls the price of the products to be furnished by plaintiff rose substantially. Plaintiff was a distributor of these products, purchasing them from producers and refiners. Plaintiff, therefore, was compelled to pay for the articles to be furnished under his contracts substantially more than the prices charged therefor at the time he put in his bid. Then the defendant's representative, Harry B. Dyche, who was Assistant to the Director, Bureau of Federal Supply, Treasury Department, executed an amendment to to plaintiff's contracts, substantially increasing the price to be paid plaintiff for the products to be furnished. Payments at the increased prices were made plaintiff, but later the Comptroller General held that these increases had been made without authority of law and he directed that all amounts paid in excess of the amounts originally contracted for be deducted from amounts due under subsequent contracts. Plaintiff sues for the amounts so deducted.

The amendments to the contracts calling for the additional payments are alleged to have been executed under the authority of section 201 of the First War Powers Act of December 18, 1941, 55 Stat. 838, 839, 50 U.S.C.A.Appendix, § 611 which provides:

"The President may authorize any department or agency of the Government exercising functions in connection with the prosecution of the war effort * * * to enter into contracts and into amendments or modifications of contracts heretofore or hereafter made and to make advance, progress and other payments thereon, without regard to the provisions of law relating to the making, performance, amendment, or modification of contracts whenever he deems such action would facilitate the prosecution of the war * * *."

Section 401 of the same Act, 50 U.S.C.A. Appendix, § 621, provides:

"Titles I and II of this Act of which section 201 is a part shall remain in force during the continuance of the present war and for six months after the termination of the war, or until such earlier times as the Congress by concurrent resolution or the President may designate."

By Executive Orders 9001 and 9023, 50 U.S.C.A. Appendix, § 611 note, the Treasury Department was given the authority to amend contracts "whenever, in the judgment of the War Department, the Navy Department, or the United States Maritime Commission respectively later extended to the Treasury Department by Executive Order 9023, the prosecution of the war is thereby facilitated."

The validity of the action of defendant's representative in amending these contracts depends upon the clause, "whenever he deems such action would facilitate the prosecution of the war." So long as such an amendment would, in the judgment of the contracting officer, facilitate the prosecution of the war it was within his power to make it.

Defendant, however, says that this amendment could not "facilitate the prosecution of the war" because the war had long since ceased. We are unable to agree with this contention. No treaty of peace has been signed with either Germany or Japan, our troops were in occupation of these countries in whole or in part, and the administration of their governmental affairs were either wholly or in part subject to the control of our forces. It cannot be said that the war is over so long as the enemy countries are occupied by our troops.

As early as Stewart v. Kahn, 11 Wall. 493, 507, 20 L.Ed. 176, it was said:

"* * * the power referring to the war power is not limited to victories in the field and the dispersion of the insurgent forces. It carries with it inherently the power to guard against the immediate renewal of the conflict, and to remedy the evils which have arisen from its rise and progress."

This has been quoted a number of times with approval. Hamilton v. Kentucky Distilleries & Warehouse Co., 251 U.S. 146, 40 S.Ct. 106, 64 L.Ed. 194; Fleming v. Mohawk Wrecking & Lumber Co., 331 U.S. 111, 116, 67 S.Ct. 1129, 91 L.Ed. 1375; Woods v. Cloyd W. Miller Co., 333 U.S. 138, 142, 68 S.Ct. 421.

In Hamilton v. Kentucky Distilleries & Warehouse Co., supra, there was involved the power of Congress to enact a wartime prohibition Act after the Armistice with Germany had been signed on November 11, 1918. At the time suit was brought on October 10, 1919 to enjoin the enforcement of the Act, it appeared that the President had declared that the war had ended and that peace had come; that many war agencies and activities had been discontinued; that the President had declared our enemies were impotent to renew hostilities; and that the Army had been almost wholly demobilized. Peace treaties, however, had not been signed, and certain war measures continued in existence, among others, the operation of the railroads by the President. Under these circumstances the court held that the enactment of the Act on November 21, 1918, and its enforcement on October 10, 1919, was a valid exercise of the war power.

In Kahn v. Anderson, 255 U.S. 1, 41 S.Ct. 224, 65 L.Ed. 469, the court held that a soldier could be tried for murder before a court martial on November 25, 1918, notwithstanding the signing of the Armistice on November 11, 1918, and notwithstanding the provision of the Articles of War that "No person shall be tried by court-martial for murder or rape committed within the geographical limits of the States of the Union and the District of Columbia in time of peace." Art. 92, 10 U.S.C.A. § 1564. (Italics supplied.)

More recently the Supreme Court in Fleming v. Mohawk Co., supra, held that the provisions of the First War Powers Act, 50 U.S.C.A. Appendix, § 601, authorizing the President to redistribute functions among the executive agencies "in matters relating to the conduct of the present war" were still in effect on December 12, 1946, when he transferred the functions of the Price Administrator to the Temporary Controls Administrator.

Also, in Woods v. Miller Co., supra 333 U.S. 138, 142, 68 S.Ct. 425, the court held that the Housing and Rent Act of June 30, 1947, c. 163, Public Law 129, 80th Congress, 1st Session, 50 U.S.C.A. Appendix, § 1891 et seq., was a valid exercise of the war power, notwithstanding the presidential proclamation of December 31, 1946, declaring the termination of hostilities.

Justice Jackson, in his concurring opinion in the last-mentioned case, stated:

"* * * I find no reason to conclude that we could find fairly that the present state of war is merely technical. We have armies abroad exercising our war power and have made no peace terms with our allies not to mention our principal enemies. I think the conclusion that the war power has been applicable during the lifetime of this legislation is unavoidable."

On July 25, 1947, Congress passed Public Law 239, 80th Congress, 1st Session, 61 Stat. 449, which terminated a large number of wartime and emergency statutes. The Judiciary Committee of the Senate reported that the Act effected immediate repeal of certain statutes, future repeal of others, and left unaffected still others. Accompanying the report was a list of the wartime and emergency statutes and a statement indicating the...