1. Where there are no findings of the Court of Claims that
claimant suffered any loss or damage under, or by reason of the
cancellation of his contract with the War Department, it is
unnecessary to consider whether an award, made by the Secretary of
War and accepted by the claimant, was binding on the latter. P.
270 U. S.
377.
2. Where claimant entered into two contracts, one to supply
goods to the government and the other, later, by which the
government advanced money to carry out the first and took his note,
upon which were to be credited deductions from payments falling due
under the first, an award to the claimant on the first (after its
cancellation) did not bar the government's counterclaim on the
note, and the award was properly credited as of its date, rather
than the date when the earlier contract was cancelled. P.
270 U. S.
377.
59 Ct.Cls. 841 affirmed.
Appeal from a judgment of the Court of Claims dismissing
claimant's petition and awarding recovery to the United States on a
counterclaim.
Page 270 U. S. 376
MR. JUSTICE STONE delivered the opinion of the Court.
This appeal was taken from a judgment of the Court of Claims
(Jud.Code ยง 242, before its repeal by Act Feb. 13, 1925 (43 Stat.
941)), dismissing appellant's petition and adjudging that the
United States was entitled to recover on a counterclaim set up in
its answer in that court.
The appellant entered into a contract with the government dated
June 24, 1918, to supply it with a quantity of cloth at a specified
price. It was provided by the contract that the government might,
in the event of the termination of the war, cancel the contract
with respect to cloth not delivered. The contract contained a
clause for ascertaining the balance due and payable to the
appellant in case of cancellation. By a second contract of July 6,
1918, the government undertook to advance money to appellant for
the purchase of machinery, equipment, and raw material required for
the performance of its original contract. Appellant gave its demand
note for the principal sum advanced, with interest at 6 percent,
and it was provided by the contract that specified deductions from
payments, as they became due from the government for the cloth
delivered, should be credited on the note.
On November 15, 1918, the government cancelled the original
contract after 19.02 percent of the deliveries stipulated for had
been made. Appellant presented a claim to the War Department for
the amount due under this contract, and after proceedings had
before the Purchase Claims Board and an appeal to the Board of
Contract Adjustment, an award was made to appellant by authority of
the Secretary of War in the sum of $14,054.59, which was stated by
its terms to be "in full adjustment, payment, and discharge of said
agreement" of June 24, 1918.
On June 3, 1920, appellant accepted the award by a formal
statement to that effect, written at the end of it and signed by
the appellant, by its treasurer.
Page 270 U. S. 377
The cause of action stated by appellant is upon its first
contract of June 24, 1918, and, as the Court of Claims found, all
of the items set up by appellant in this suit were embodied in its
claim to the War Department on which the award was made. The
government pleaded, by way of counterclaim, the balance due upon
the appellant's promissory note, less the amount of the award, and
judgment was given against the appellant for this amount, with
accrued interest.
Appellant, notwithstanding such cases as
United
States v. Adams, 7 Wall. 463;
Savage, Executrix
v. United States, 92 U. S. 382,
92 U. S. 388;
United States v. Child &
Co., 12 Wall. 232,
79 U. S. 243;
United States v.
Justice, 14 Wall. 535;
Mason v.
United States, 17 Wall. 67, seeks to avoid the
effect of the accepted award by setting up that the Secretary of
War was without authority to make it and, upon various technical
grounds, that appellant's acceptance was not binding.
It is unnecessary for us to consider these contentions, for
there are no findings by the Court of Claims that appellant
suffered any loss or damage by reason of the cancellation of the
contract, and in fact no findings which would support a judgment in
its favor on any theory.
The appellant also objects that, if the award is valid, it is a
bar to the government's counterclaim. But an examination of the
award, which is set out in detail in the findings, shows that the
award was concerned only with the first contract of June 24, 1918,
and that the items and computations which entered into it related
only to that contract. The amount due from the government upon
appellant's note and second contract was unaffected by it.
There is no merit in the objection that the amount of the award
should have been credited on appellant's note as of the date of the
cancellation of the first contract, thus reducing the amount of
interest payable on the note. If the award was valid, it was
properly credited as of its
Page 270 U. S. 378
date. If it was invalid, appellant, as already pointed out, has
laid no foundation for any offset to the amount due on the
note.
Judgment affirmed.