thousand dollars. It was held that the statute limiting the amount of expenditure was notice in law and in fact to the contractor, and that relief could be afforded to the extent of three hundred thousand dollars, and no more. "Were such statutory provisions, to be disregarded," is the language of the court, "and were judg ment to be given whenever a claimant shall prove that he has done work or rendered service under the direction of an executive officer, it would enable the executive branch of the government. with the aid of this court, to annul a law of Congress, and to throw down any limitation which Congress might impose upon the cost of our public works." The Act of 1820 excepts from its provisions certain contracts for the army and navy, giving to the respective heads of the departments discretionary powers. So the Act of March 2, 1861, excepts contracts "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." The propriety of leaving to the Executive a liberal control over the land and naval forces of the United States with large powers for sudden emergencies, is manifest. Another cardinal rule to be observed in contracts with the United States, is, that all purchases and contracts for supplies or services are to be made either by open purchase or by previously advertising for proposals. This was first prescribed by the Act of March 3, 1809, ch. 28. As construed by Attorney-General Berrien, the rule is, that when the public exigencies do not require the immediate delivery of the articles or performance of the service, advertisement for proposals is necessary; but if such exigencies require immediate delivery, then the articles must be obtained by open purchase; that is, by purchase at the places where articles of the description wanted are usually bought and sold, and in the mode in which such purchases are ordinarily made between man and man.1 sors. The Berrien exposition of the Act of 1809 was adopted by Gorernment, and has since been constantly recognized by his succesThe purpose of Congress was to put a stop to contracts for the benefit of individuals, awarded through favoritism or corruption, and to invite free and open competition. The Act of March 2, 1861, ch. 84, reaffirms the same rule in less ambiguous lan 1 2 Att. Gen. Opin. 257. guage, expressly excepting contracts for personal services, and extending the provisions of the law to all the departments of gov ernment. In these acts there are no words of nullity, the expression being that contracts "shall be made" in this manner. An important question is therefore raised, viz., whether the omission to advertise in ordinary cases is a mere irregularity, or goes to the essence of the contract; whether, in fact, the law itself is directory or absolute. We do not find that the earlier legal advisers of the Government considered this question. It was admitted, however, that some contracts were not within the reason of the Act of 1809, and might be made without advertisement; as, for instance, where some specific purchase was authorized by law, or where the work could only be performed by trained experts. For in such cases the lowest bids were not the most desirable.1 But otherwise the requirements of the law have been held positive, so far as government officers were concerned. But are they equally so with reference to the contractor? Attorney-General Cushing incidentally considered this important question, but not directly. His opinion was, that if the provisions of law requiring advertisement had been disregarded by the public officer, the contract, while it remained executory and without commencement of performance, might properly be rescinded. But he refrained from expressing more than a doubt as to the validity of such contract after partial performance. It may be added that he also questioned whether the words "purchases and contracts for supplies or services," included labor and materials for the public works; but special enactments, government usage, and the weight of authority, fully bring such contracts within the same principle.2 Attorney-General Bates first gave a direct opinion to the effect that contracts could be avoided as illegal for want of advertisement, before rights had grown out of them, but not afterwards. "After a party has entered into a contract with the Government in good faith," he says, "and has so far performed his part of it, that to rescind it or declare it illegal, and so incapable of execution, would subject him to a loss and injury, whilst the Government would yet enjoy the benefit of his labor or expenditure, I do not think that such an irregularity can be set up against it." 8 1 2 Att. Gen. Opin. 437. 26 Att. Gen. Opin. 26, 406. The same question has come up before the Court of Claims, and occasions that tribunal much perplexity. In the Fremont contract cases, to which we have already referred, Judge Nott expressed an opinion that the statute of 1809 was directory only, and that a general holding an important command might properly determine the question of exigency. Chief Justice Casey discussed the topic more at length: "What is that public exigency which requires immediate delivery of articles, or performance of service, which justifies dispensing with the advertisement? Who is to decide whether it exists? When the Secretary of War or a commanding general goes into the market to buy supplies, must every seller of a horse, a bale of hay, or a barrel of beef, decide at his peril whether the exigency exists or does not? . . . To form a correct conclusion upon the question of whether the exigency exists or does not, would require an amount and accuracy of information possessed only by a few of the high officers of the government. That exigency, too, in time of war, when it would be most likely to occur, might be founded upon information and facts which it would be hazardous or disastrous to reveal. The safety of the army, or the highest considerations of public policy and welfare, might require this information to be kept secret." 1 In this case, it was clear that an emergency actually existed. So, too, in the case of Crowell v. United States, where ice had been purchased for troops in the field, without advertisement.2 But in Fowler v. United States, no such necessity could be shown.3 Here the Secretary of the Interior, being authorized to superintend the work of enlarging the library of Congress, addressed letters to certain builders, inviting their bids. This was a plain departure from the policy of Government. But the court rested their decision upon other grounds, and held that where Congress had specially intrusted an expenditure to the head of a department, as in this case, he might award a contract without advertising. It appears from the published opinions in this and other cases, that judges of the Court of Claims differ as to the necessity of advertisement in government contracts. While those to whom we have already referred are disposed to leave the question of exigency to executive discretion; a third judge holds advertising indispensable, unless an exigency arises under circumstances which the court 1 Reeside v. United States, 2 C. Cl. 1. 3 3 C. Cl. 43. 2 2 C. Cl. 501. may deem sufficient; and a fourth says that the commanding general may purchase in open market, "unless it is shown that the emergency was not real, or that the transaction was not one of good faith, and the result of necessity."1 This want of harmony on a subject so vital to government contractors, and so purely within the jurisdiction of this court, is unfortunate. Nor do we find that the Supreme Court, on appeal, has. yet encountered the question. It will be perceived that the Act of 1809 has been discussed by the Court of Claims more particularly with reference to the existence of an exigency. Whether the head of a department or a commanding general may decide when that exigency exists which will justify purchase in open market, seems to us a question to be considered under two different aspects: first, as between himself and Government; second, as between Government and the contractor. To hold that any public officer may judge absolutely when proposals are unnecessary, is to protect him from responsibility for misconduct, to substitute executive caprice for a law of Congress, to place temptations in his path which a wise policy undertakes to remove. Hence, between himself and Government his decision is liable to review. But as to third persons, the public officer may properly determine whether an exigency exists, provided the Act of 1809 be declaratory only, and not imperative; they wish to know simply whether Government is bound, whatever be the conduct of the officer, or whether they must also examine for themselves and assume the risk of irregularities. Let us consider the subject in this second aspect. On one side, is the palpable injustice of taking benefits from a private citizen, and then setting up the wrongful acts of a public agent to defeat his just claims; on the other, the danger of official favoritism, to the detriment of the public interests and the injury of honest parties making proposals. If it be said that General Fremont, in time of public peril, knew better than civilian contractors why an exigency existed, we reply that the exigency was, nevertheless, patent enough to them and the rest of the community. In doubtful cases, the individual who has made due inquiry will always be protected; and fraud is a more reasonable presumption than necessity, where a cabinet officer 1 See Floyd v. United States, 2 C. Cl. 429; Stevens v. United States, ib. 95; Fowler v. United States (Loring, J., diss.), 3 C. Cl. 43. omits to advertise for his annual supplies of stationery. Yet the language of a statute, prescribing certain formalities, is not to be readily construed as imperative, without express words to this effect, or unless, in the case of public agents, their sole authority is derived from it. It is admitted that, prior to the Act of 1809, the heads of departments could purchase according to such regulations as they saw fit to adopt; that their right to make contracts is complete wherever there is a law or an adequate appropriation; and that the Act of 1809 relates to the method, and not to the right itself. This act simply says that contracts "shall be made," either by open purchase or previously advertising, and does not even indicate which method is to be preferred. The rule of exigency, as we have already stated, was one of construction, adopted by the Executive Department, with the sanction of the Attorney-General, gradually acquiring the force of usage, and in 1861, enacted in formal language. The law limiting the right of making contracts, uses words of express prohibition; not so with the law of advertisement. On the whole, therefore, the latter appears to us simply mandatory upon the executive departments, and not so absolute in its terms as to render void the contract of an individual with the United States, performed in good faith and free from fraud. But until the Supreme Court sets this question at rest, or Congress frames a law more precise, the prudent contractor will insist upon the letter of statute requirements.1 The party proposing to Government usually furnishes security, and binds himself for the performance of his bid, if accepted; and in such case the contract becomes mutual and binding from the moment of its acceptance, although there be delay in executing the formal contract. Nor has the government officer any right to modify the terms after such acceptance, in any material respect, such as the time of delivery. And where it is stipulated that the articles delivered shall be inspected at a particular place, or by a particular officer, no variance from the contract can be made. without mutual consent, and the inspection once made, no new inspection can be ordered. The head of a department is said to be the sole judge of matters of fact involved in the acceptance or re 1 Cf. different sentences in Act March 2, 1861, ch. 84, § 10. And see also Act June 23, 1866, ch. 138, § 2, which has not yet received judicial interpretation. |