United States v. Standard Rice Co., Inc.
323 U.S. 106 (1944)

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U.S. Supreme Court

United States v. Standard Rice Co., Inc., 323 U.S. 106 (1944)

United States v. Standard Rice Co., Inc.

No. 72

Argued November 16, 1944

Decided December 4, 1944

323 U.S. 106



1. A contract for the sale of material to the United States contained the following provision:

"Prices bid herein include any federal tax heretofore imposed by the Congress which is applicable to the material on this bid. Any sales tax, duties, imposts, revenues, excise or other taxes which may hereafter (the date set for the opening of this bid) be imposed by the Congress and made applicable to the material on this bid will be charged to the Government and entered on invoices as a separate item."

Held, that the United States was not entitled to recover from the contractor processing taxes imposed by the Agricultural Adjustment Act, which taxes

Page 323 U. S. 107

were "applicable" to the material within the meaning of the contract, but which, because subsequently adjudged invalid, were never collected from the contractor. United States v. Kansas Flour Mills Corp.,314 U. S. 212, distinguished. P. 323 U. S. 110.

2. Generally the United States as a contractor is to be treated as other contractors, and a contract which it draws is not to be judicially revised because it may have been improvident. P. 323 U. S. 111.

101 Ct.Cls. 85 affirmed.

Certiorari, 322 U.S. 725, to review a judgment denying an offset to a claim against the United States.

MR. JUSTICE DOUGLAS delivered the opinion of the Court.

This suit was brought in the Court of Claims to recover an overpayment of income taxes made by respondent. The United States conceded that the amount claimed was owed. But the Comptroller General, pursuant to his power under § 305 of the Budget and Accounting Act of 1921, 42 Stat. 20, 31 U.S.C. § 71, settled and adjusted the claim by offsetting against it an amount which he concluded respondent owed the United States under a contract. Since the latter claim equaled the overassessment on the income taxes, the Comptroller General refused to authorize a refund to respondent. This suit followed. The Court of Claims denied the offset and entered judgment for respondent in the amount claimed, with interest. 53 F.Supp. 717. The case is here on a petition for a writ of certiorari [Footnote 1] which we

Page 323 U. S. 108

granted because of an asserted conflict of the decision below with United States v. American Packing & Provision Co., 122 F.2d 445 and United States v. Kansas Flour Corp.,314 U. S. 212.

The contract under which the claim against respondent was asserted was made in November, 1935. Respondent agreed to supply rice to the Navy Department at the bid prices specified in the contract. A typical price provision listed 290,000 pounds of rice at a unit price (per pound) of .046

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