A. and the Postmaster General executed an indenture whereby the
former leased to the United States, for the use of the Post Office
Department, at an annual rent of $4,200, payable quarterly, a
building in Washington for three years from and after June 5, 1873,
with the privilege of renewing the term for the further period of
two years. It was thereby "understood and agreed" by the parties
that the indenture was made subject to an appropriation by Congress
for the payment of the stipulated rent, and that no payment should
be made to A. on account thereof until such appropriation should be
available, when the arrears then due would be paid in full, and
thereafter the payments be made at the time and in the manner
stipulated. Congress made the requisite appropriations to pay the
specified rent to the end of the second year of the term. By the
Act of March 3, 1875, 18 Stat. 367, making appropriations for the
fiscal year ending June 30, 1870, Congress appropriated for the
rent $1,800, with a proviso
"that the above sum shall not be deemed to be paid on account of
any lease for years of said building,
provided, however,
that at the end of the present fiscal year, the Postmaster General
be directed, upon the demand of the lessor, to deliver up the
possession of said premises."
No such demand by the lessor was made. A. having received no
rent for the third year, sued the United States therefor and
claimed $4,200.
Held:
1. That the parties to the indenture, by their expressed
understanding and agreement, intended to incorporate into the
instrument the substance of the act of Congress which prohibits any
department from "involving the government in any contract for the
future payment of money in excess of the appropriations."
2. That the appropriations for two years of the term were not
such a recognition by Congress of the validity of the contract as
bound the United States to pay the stipulated rent for the third
year.
3. That by the said proviso, A. had seasonable notice that no
more than $1,800 would be paid to him as rent for the third year,
and that he, not having demanded the possession of the premises,
must be held to have assented to the terms offered by said act.
Page 98 U. S. 105
This was an action by Andrew C. Bradley for the use of George
Taylor, Samuel Cross, and Peter F. Bacon, trustees, to recover the
sum of $4,200 rent claimed to be due from the United States for the
premises No. 915 E Street, in the City of Washington, for the
fiscal year ending June 30, 1876.
The court below found the following facts:
1. On the 6th of June, 1873, the Postmaster General and the
claimant, Bradley, made and executed an indenture, of which the
following is a copy:
"This indenture, made this sixth day of June, in the year one
thousand eight hundred and seventy-three, by and between Andrew C.
Bradley, of Washington, D.C., of the first part, and John A. J.
Creswell, Postmaster General, for and in behalf of the United
States of America, of the second part, witnesseth that the said
party of the first part, for and in consideration of the rents,
covenants, and agreements to be paid, kept, and performed by the
party of the second part, doth hereby demise and lease unto the
said party of the second part those certain premises, with the
four-story brick house and brick stable thereon, situated on the
north side of E Street, between 9th and 10th Streets, in the City
of Washington, in the District of Columbia, and known as house
numbered 915 on said E Street Northwest, to have and to hold to the
party of the second part, for the term of three years from and
after the fifth day of June, Anno Domini one thousand eight hundred
and seventy-three, with the privilege to the said party of the
second part of a renewal of the said term for the further period of
two years."
"The said party of the second part yielding and paying therefor
the annual rent, during the said term and a subsequent renewal
thereof, as aforesaid, of four thousand two hundred dollars
($4,200), payable quarterly, on the thirtieth day of September, the
thirty-first day of December, the thirty-first day of March, and
the thirtieth day of June."
"And it is hereby mutually understood and agreed, by and between
the parties hereto, that this lease is made subject to an
appropriation by Congress for the payment of the rental herein
stipulated for, and that no payment shall be made to said party of
the first part on account of such rental until such
appropriation
Page 98 U. S. 106
shall be available, and that as soon as practicable after such
appropriation shall become available the arrears of the rent then
due shall be paid in full, and thereafter payment shall be made at
the times and in the manner hereinbefore stipulated."
"And it is hereby agreed by said party of the first part that he
will, at his own expense, remove such partitions and construct such
partitions, with necessary doorways and doors, in said building,
and construct such water closets, with the necessary water
connections, as may be required by the supervising architect of the
Treasury Department, and that he will leave in good order all gas
fixtures now in said building for the use of the said party of the
second part; and the party of the second part will keep the said
premises in good repair during the continuance of this lease and
any renewed term thereof, and the expenses of any alterations of or
additions to the interior, not herein otherwise provided for, so as
to adapt it to the use of the United States, and not calculated to
damage the premises, are to be borne by the party of the second
part, and all taxes and assessments legally levied or charged upon
the property are to be paid by the party of the first part."
"And it is hereby further provided that in case the premises, or
any part thereof, during said term, or the renewal thereof, be
destroyed or injured by fire or other unavoidable casualty, so that
the same shall be thereby rendered unfit for use, then the rent
hereinbefore reserved, or a just and proportionable part thereof,
according to the extent and nature of the injury sustained, shall
be suspended or abated until the said premises shall have been put
in proper condition for use by and at the expense of the said party
of the first part; and the said party of the second part covenants
to deliver up the said premises to the party of the first part at
the determination of this lease, or at the end of any renewal of
the term thereof, in good order and condition, reasonable wear and
use thereof and injury by unavoidable fire or other casualty
excepted."
"And it is further stipulated that the party of the second part
may, at or before the delivery of the premises aforesaid, remove
such additions to or improvements of the same, placed on the
premises by the said party of the second part, the removal of
which, as aforesaid, will not injure the premises, as he, the said
party of the second part, may elect so to do. "
Page 98 U. S. 107
"In witness whereof, the parties hereto have hereunto set their
hands and seals the day and year first above written."
"A. C. BRADLEY [SEAL]"
"JNO. A. J. CRESWELL [SEAL]"
"
Postmaster General"
"Signed, sealed, and delivered in presence of"
"T. A. SPENCE"
"A. G. MILLS"
2. The premises described in said indenture were sold and
conveyed, and the lease was assigned, by said Bradley to Alexander
R. Shepherd, and by him conveyed and assigned to George Taylor,
Samuel Cross, and Peter F. Bacon, as alleged in the petition and in
the amendment thereof.
3. Said premises were used and occupied for the uses and
purposes of the Post Office Department, and for the benefit of the
United States, under the direction of the Postmaster General, from
the time of executing said indenture until and including June 30,
1876, as well as subsequently thereto.
4. The claimants have been paid the rent of said premises,
through special appropriations of Congress, up to and including
June 30, 1875, but have been paid nothing for the year ending June
30, 1876.
5. It does not appear that demand has ever been made upon the
Postmaster General on the part of the claimants for delivery up of
the possession of the premises.
On the foregoing facts and the statutes in relation thereto, the
court concluded as matter of law that the claimants were entitled
to recover the sum of $1,800. Judgment having been rendered for
that amount, the claimants appealed to this court.
When the indenture was executed, two statutes were in force.
"No contract or purchase shall hereafter be made unless the same
be authorized by law, or be under an appropriation adequate to its
fulfillment, except in the War and Navy Departments, for clothing,
subsistence, forage, fuel, quarters, or transportation, which,
however, shall not exceed the necessities of the current year."
Act of March 2, 1861, sec. 10, 12 Stat. 220; Rev.Stat., sec.
3732.
"It shall not be lawful for any department of the government to
expend in any one fiscal year any sum in excess of appropriations
made by Congress for that fiscal year, or to involve the
government
Page 98 U. S. 108
in any contract for the future payment of money in excess of
such appropriations."
Act of July 12, 1870, sec. 7, 16 Stat. 251; Rev.Stat., sec.
3679.
The deficiency bill for the fiscal years ending June 30, 1873
and 1874, contained the following provision:
"For rent of house numbered nine hundred and fifteen E Street
Northwest, for further accommodation of the clerical force of the
department, from June sixth, eighteen hundred and seventy-three, to
June thirtieth, eighteen hundred and seventy-four, four thousand
four hundred and eighty-eight dollars and eighty-six cents, and
hereafter no contract shall be made for the rent of any building,
or part of any building in Washington, not now in use by the
government, to be used for the purposes of the government, until an
appropriation therefor shall have been made in terms by
Congress."
18 Stat. 144.
The act making appropriations for the legislative, executive,
and judicial expenses of the government for the year ending June
30, 1875, appropriated $4,200 "for rent of house numbered nine
hundred and fifteen E Street Northwest."
Id., 107.
The Act of March 3, 1875,
id., 367, making
appropriations for the fiscal year ending June 30, 1876, contains
the following:
"For rent of house numbered nine hundred and fifteen E Street
Northwest, eighteen hundred dollars,
provided that the
above sum shall not be deemed to be paid on account of any lease
for years of said building.
provided, however, that at the
end of the present fiscal year the Postmaster General be directed,
upon the demand of the lessor, to deliver up the possession of said
premises. "
Page 98 U. S. 111
MR. JUSTICE CLIFFORD delivered the opinion of the Court.
Leases, like deeds or other written instruments, must receive a
reasonable construction, as derived from the language employed,
without the aid of extrinsic evidence beyond what may be necessary
to identify the premises and to disclose the circumstances
surrounding the transaction when the instrument was executed.
Quackenboss v. Lansing, 6 Johns. (N.Y.) 49; Taylor,
Landlord and Tenant, sec. 160, note.
Sufficient appears from the findings of the court below to show
that, on the 6th of June, 1873, an indenture of lease was executed
by the appellant to the United States, whereby the former, in
consideration of the rents, covenants, and agreements in the
instrument specified, demised and leased to the United States the
premises described in the petition for the term of three years from
and after June 5, 1873, with the privileges to the lessees of a
renewal of the term for the further period of two years, at and for
the annual rent, during the said term and subsequent renewal
thereof, of $4,200, payable quarterly on the days specified in the
indenture of lease exhibited in the record.
Both sides concede what the lease and record show, that the
premises were leased by the United States for the convenience of
the Post Office Department, and that the Postmaster General took
immediate possession of the same, and that the premises have ever
since been used for the purposes of his department.
Four other findings of the court below should be noticed in this
connection:
1. That the lessor sold and conveyed the
Page 98 U. S. 112
premises to Alexander R. Shepherd and assigned the lease to him,
and that he, the assignee, conveyed and assigned the same to the
other persons named in the petition.
2. That the premises were used by the United States for the
purposes mentioned for the whole period alleged.
3. That the holders of the lease have been paid the whole rent,
except for the last year, for which they have been paid
nothing.
4. Adequate appropriations were made by Congress authorizing the
payments which have been made, but Congress refused to appropriate
more than $1,800 for the last year.
Pursuant to those findings, the court below held that the
plaintiffs could only recover the sum appropriated, and rendered
judgment in their favor for that amount, from which judgment the
plaintiffs appealed to this court. Since the appeal was entered
here, the appellants assign for error that the court below erred in
the construction given to the indenture of lease, and to the two
acts of Congress referred to in the findings of fact.
Due appropriation of the sum of $1,800 was made by Congress to
pay the rental for the last year; and the court below rendered
judgment in favor of the appellants for that sum, which exhausts
the appropriation made by Congress for that purpose, the only
question for decision being whether the appellants can recover in
this case the balance of their claim which has never been
appropriated by Congress.
Moneys not appropriated cannot be drawn from the treasury, and
it is equally clear that the parties, by the terms of the lease,
understood and agreed with each other that the lease was made
subject to an appropriation by Congress for the payment of the
stipulated rental, and "that no payment shall be made" to the
lessor "on account of such rental until such an appropriation shall
become available;" that as soon as practicable after such an
appropriation shall become available, the arrears of rent then due
shall be paid in full, and that payment thereafter shall be made at
the times and in the manner stipulated in the indenture of
lease.
Prior to that time, Congress had enacted that it shall not be
lawful for any department of the government to expend in any one
fiscal year any sum in excess of the appropriation made by
Page 98 U. S. 113
Congress for that fiscal year, or to involve the government in
any contract for the future payment of money in excess of such
appropriation, and both parties concur in the proposition that that
provision was in full force and operation at the time the indenture
of lease under consideration was executed. 16 Stat. 231; Rev.Stat.,
sec. 3679.
Such contracts or purchases for the future were forbidden by the
Act of the 2d of March, 1861, unless the same were authorized by
law or were made under an appropriation adequate to their
fulfillment, except for clothing, subsistence, forage, fuel,
quarters, or transportation, in the War or Navy Department; nor
could those departments make any such contracts, even for those
purposes, beyond the necessities of the current year. 12 Stat. 220;
Rev.Stat., sec. 3732.
Forty years earlier, Congress enacted that neither the Secretary
of State or of the Treasury or of War or Navy Department should
thereafter make any contract other than such as were necessary for
the subsistence and clothing of the army and navy, and contracts
for the quartermaster's department, except under a law authorizing
the same, or under an appropriation adequate to its fulfillment. 3
Stat. 768.
Congress passed an act directing the Secretary of the Navy to
cause floating dry-docks to be constructed at three of the national
navy yards, and specified appropriations were made towards
constructing the several docks. Proper measures were adopted by the
Secretary to ascertain what each structure would cost, from which
it appeared that the appropriation for each was greatly
insufficient. In view of these facts, the Secretary doubted whether
he could lawfully contract to have the work done, and submitted the
question to the Attorney General, who decided that the facts as
stated brought the case directly within the prohibition of the act
last named, and that the contracts could not lawfully be made. 4
Op.Atty.Gen. 600.
Cases arise, as there stated, where the authority to contract
for the work is expressly given in the appropriation act, and in
such cases it is clear, as there admitted, that the power to
contract exists even though the price to be paid exceeds the amount
appropriated. Examples of the kind are given in that
Page 98 U. S. 114
opinion, to which many more might be added, but when no such
authority is given and nothing is contained in the act
appropriating the money from which such an authority may be
implied, it is clear that the head of the department cannot involve
the government in an obligation to pay anything in excess of the
appropriation.
Argument to show that money cannot be drawn from the treasury
before it is appropriated is unnecessary, as the Constitution
provides that "no money shall be drawn from the treasury but in
consequence of an appropriation made by law;" nor is it necessary
to enter into much discussion to show that the act of Congress
making it unlawful for the head of a department to involve the
government in any contract for the future payment of money in
excess of an appropriation is a valid act, and of binding
obligation, as such regulations and prohibitions in one form or
another have been in operation without question throughout nearly
the whole period since the adoption of the Constitution.
Acts of Congress of the kind, it must be admitted, are both
valid and salutary in their operation; and it is equally clear that
the party who drafted the indenture of lease intended to
incorporate into the instrument the substance of the provision
which prohibits the head of a department from involving the
government in any contract for the future payment of money in
excess of the appropriation made for its fulfillment. Well founded
doubt upon that subject cannot be entertained, and the court is of
the opinion that the words of the indenture are amply sufficient to
effect the object which the person who drafted the instrument
intended to accomplish.
Both parties agreed that the indenture was subject to an
appropriation to be made by Congress for the payment of the rental,
and that no payment should be made to the lessor on account of such
rental until such an appropriation should become available. Concede
that these stipulations are valid, of which there can be no doubt,
and it is clear to a demonstration that the claim of the appellants
in excess of the amount allowed by the court below is utterly
groundless.
Even suppose that is so, still it is insisted by the appellants
that Congress, by subsequent legislation, has committed the
Page 98 U. S. 115
United States to the annual payment of the stipulated rental for
the whole term of three years specified in the indenture of lease,
and that they are entitled to judgment for the entire rental of the
third year which remained unpaid when the suit was commenced,
irrespective of the fact that the judgment rendered in their favor
by the court below exhausts the whole amount of the money
appropriated by Congress for that purpose.
Two annual appropriations were made by Congress, which in the
aggregate were sufficient to pay the stipulated rental of the
premises for the first two years; and the findings of the court
below show that the payments for those two years were duly made,
and that nothing more is claimed by the appellants in that regard.
Of these, the first was simply an appropriation of the amount
required to pay the stipulated annual rental, without any
explanation whatever beyond what was necessary to describe the
premises leased, from which it is plain that nothing can be
inferred from that act to support the theory of the appellants. 18
Stat. 107.
Annexed to the second appropriation, which is for the sum of
$4,488.86, is the following proviso, to-wit, that hereafter no
contract shall be made for the rent of any building or part of any
building in Washington not now in use by the government to be used
for the purposes of the government until an appropriation therefor
shall have been made in terms by Congress.
Id., 144.
Specific appropriations by these two acts were made available to
pay the rental of the premises leased for the first two years; but
it is clear as anything in legal decision can be that they furnish
no ground whatever to support the theory that Congress entered into
any legal obligation to make such an appropriation for the third
year. Instead of that, the inference, if any, to be drawn from the
last act tends to negative the appellants' theory, and to show that
Congress intended to adhere to the stipulations of the lease --
that it was made subject to an appropriation by Congress for the
payment of the rental stipulated, and that no payment should be
made to the lessor on account of such rental until such an
appropriation should become available.
Page 98 U. S. 116
Unsupported as that theory is by those two appropriation acts or
by anything else exhibited in the record, it may well be dismissed
as destitute of merit without further consideration.
If the indenture of lease had been for three years without any
covenant that it was made subject to an appropriation by Congress,
and that no payment on account of rental should be made until such
an appropriation became available, it may be that the theory of the
appellants, that the contract was for three years as an entire
term, might be maintained, or if not, that it might perhaps be held
that Congress had ratified the instrument by appropriating money to
pay the rental for the first two years. Be that as it may, it is
still true that no ratification of the present indenture by any
such act would benefit the appellants in that regard, so long as it
contains the covenant that no payment of the rental shall be made
until an appropriation for the purpose becomes available.
Viewed in that light, as the case should be, a few observations
will be sufficient to show that nothing is found in the remaining
appropriation act to warrant a judgment in favor of the appellants
for any sum beyond what was allowed by the court below.
Eighteen hundred dollars were appropriated by Congress for the
third year, several months before the second year expired. Appended
to that appropriation is the proviso that the above sum shall not
be deemed to be paid on account of any lease for years of said
building, which shows conclusively that Congress intended to
negative the theory of the appellants that the indenture gave them
the right to recover any thing of the United States beyond the sum
appropriated by Congress.
Confirmation of that proposition is also derived from a second
proviso annexed to the same appropriation, by which it is enacted
that at the end of the present fiscal year the Postmaster General
be directed, upon demand of the lessor, to deliver up the
possession of the said premises.
Id., 367.
Construed as those provisions should be, in view of the
subject-matter and the surrounding circumstances, it is clear that
Congress intended to give seasonable notice to the lessor of the
premises that no more than the sum appropriated would be paid as
rental of the same for the third year, and that he might
Page 98 U. S. 117
take possession of the same if he did not see fit to accept the
sum appropriated for their use and occupation.
Corresponding views were expressed by the court below, and they
held, and well held, that inasmuch as the appellants never demanded
the redelivery of the premises, it must be determined that they
acquiesced in and assented to the terms of rent offered by Congress
for the third year.
Public officers, in such a case, having no funds in the treasury
and being without authority to bind the United States, can only
agree to pay the stipulated rental, provided the money is
appropriated by Congress, and if the lessor, voluntarily and
without any misrepresentation or deception, enters into a lease on
those terms, he must rely upon the justice of Congress; nor do the
circumstances in this case disclose any hardship, as the appellants
were seasonably notified that they would not be paid for the third
year any greater rent than the sum appropriated for the purpose.
Churchward v. The Queen, Law Rep. 1 Q.B. 199.
For these reasons, the Court is of the opinion that there is no
error in the record.
Judgment affirmed.
MR. JUSTICE MILLER, with whom concurred MR. JUSTICE FIELD, MR.
JUSTICE STRONG, and MR. JUSTICE HARLAN, dissenting.
I am of opinion that the two annual appropriations expressly for
the sum due for each year's rent, according to the terms of the
lease, were recognitions of the validity of that contract which
bind the United States, and that the claimant was entitled to
recover the same amount for the third year.
