sions, 185. The St. Joseph, 186. Mississippi - Cassell v. Bachrach, 187. Ir is sometimes said that the same principles are applicable alike to government contracts and the undertakings of private individuals. Regarding this subject, however, in its legal and practical bearings, and not from an ethical standpoint, it will be seen that this statement admits of several important qualifications. In the first place, usage sanctions among individuals what it may not when Government is concerned. Thus the payment of interest, which will be enforced on ordinary contracts, cannot be claimed from the United States, unless expressly stipulated; for the mercantile custom of paying interest is the foundation of such a demand, and no such custom was ever recognized by this Government where it was the party delinquent.1 And in general terms it may be said, that, while usage shapes much of the law relating to contracts, usage among business men is one thing, and the usage of Government another. And again, while the contracts of individuals make up an almost infinite variety, and are in general restrained only by the universal principles of morality and public policy, government contracts exist for specific purposes only, are limited in their scope by the statutes which give them validity, and are peculiarly affected by considerations of public policy. For instance, by the laws of the United States, no public contract can be made with a member of Congress. Whoever, then, proposes to enter into an agreement 17 Att. Gen. Opin. 523; Todd v. United States, Dev. C. Cl. 93. 1 VOL. IV. with the Government should examine the statutes first, and the common law afterwards. So, too, it is to be considered that public contracts are made, not by a person in his own right, but by a public agent who professes to represent the Government. Unlike the agent of an individual or private corporation, his power to bind his principal is very strictly limited to the extent of power actually conferred upon him. The investigation of a public officer's authority sometimes involves important constitutional questions, and the want of such authority is fatal to the contract. And in respect to remedies, there is a wide distinction between the contracts of Government and the contracts of individuals. It is a principle, recognized the world over, that the sovereign is not accountable before any tribunal for his acts, save so far as he chooses to part with his sovereignty; and nations have ever been prone to display more of a sensitive pride than a tender conscience. On the other hand, mutual responsibility, wherever there is a mutual undertaking, equal justice for all before the law, - these are rights which the Anglo-Saxon race was never slow in asserting, where individuals were involved. Though still in theory the king can do no wrong, the chancery courts of England long since interposed to aid the subject. In this country, within a few years, a tribunal has been established to afford relief to the citizen for breach of contracts on the part of Government. In matters beyond its jurisdiction, the only relief is to be found in Congress. Incidental to the consideration of remedies, the reader will observe that a distinction arises between public and private contractors, wherever the law of contracts has been affected by statutes relating to remedies. Thus the Statute of Limitations, so generally applied to the latter, does not necessarily and suâ vi operate upon the rights of the former. So, too, the right of set-off, by which the defendant in a suit may recover a balance found in his favor, cannot be asserted when the United States sues an individual, further than to discharge him from liability.1 With these qualifications, the proposition is correct that public and private contracts are to be tested by the same principles of law. And it will be perceived that this rule is founded on sound reasoning, and exists whether the remedy for its enforcement is or is not sufficient. 1 Tillon v. United States, U. S. Supreme Court. (Unpublished.) A government or public contract is any undertaking to which the Government becomes a party. The term may be applied in three different senses, varying only in scope. In the first, or largest sense, it embraces contracts with foreign governments, and with States or the people at large under the fundamental law. In the second, or more restricted sense, it is confined to agreements with individuals, firms, or corporations, but includes all of these, whether the contract be expressed or implied; as grants, franchises, and salaries. In the third, or narrowest sense, the term signifies certain bargains made with private parties for well-recognized purposes; such as supplies for the army and navy, transportation of the mails, and work and materials furnished for public buildings. These are usually in writing; and the public acts frequently refer to them as "contracts" simply: the party who stipulates with the Government being known as the "contractor." It is to this last class of government contracts, and to such as are made with the United States, that our attention will be confined in these pages. The first question to be asked by one who purposes contracting with the Government, is, whether the officer has full power to make a binding agreement; - not merely whether he is a public officer, but whether, as a public officer, he is authorized to make this particular contract upon the terms proposed. Private agents, who as agents are held out to the public by a well-known principle of law, will bind their principals when they act apparently within the scope of their authority. Those who deal with them are not bound in every case to examine their instructions; the presumption is that the contract was properly made, and it rests upon the principal to give notice to third persons when he means to limit his own liability. But with public agents it is essentially different. Their fundamental duties are defined by statute, and all are bound to notice the limitations to their authority. And in contracts of importance, the statute prescribes provisions and limits the expenditure. Of all this the contractor is conclusively presumed to be informed; and wherever the public agent exceeds his authority, the Government is not bound by his acts. This principle was laid down in 7 Cranch, 366, where the plaintiffs sought to recover damages from a public officer nominally, though in reality from the United States, on account of certain misrepresentations, by which they had suffered considerable loss. The court held that there was no ground of relief, because public and private agents were on a different footing, and it did not appear in this case that the agent was making authorized declarations.1 It is obvious that, in many cases, contracts must be made by sub-agents, whose instructions are not completely set forth by statute. Here the rule should be more favorable to the contractor. So, too, a large discretion is vested in the head of a department. Where Congress has omitted to prescribe details, he is at liberty to make regulations in conformity with law; and his authority, if clearly traced, is sufficient to bind the United States. The same principle extends to all subordinate officials deriving authority from a higher source. "It is a presumption of law," said Mr. Justice Story," that all public officers, and especially such high functionaries, perform their official duties until the contrary is proved."2 But this is but a presumption after all; and if it be shown that no such authority actually existed, even though the officer be the head of a department, the contract will not bind the United States. In the important case of the Floyd acceptances, the question arose whether the Secretary of War could bind the United States by accepting bills of exchange without authority. This was a fraudulent transaction on his part, with the intent of embarrassing the Government. The bills were drawn by army contractors, and passed into the hands of third parties without notice of the fraud. It was customary for other army contractors to draw such bills upon the Government for funds, but the custom was illegal. The Court of Claims pronounced the acceptances worthless, so far as the United States was concerned.3 This decision has recently been sustained by the Supreme Court on appeal. In this case the question of agency was discussed; it was held that the want of authority in the Secretary of War affected all parties involved in the transaction, as it was their duty to make inquiry. The rule, as concisely stated in the Court of Claims, was this: that, while private agents bind to the extent of the power 1 Lee v. Munroe, 7 Cr. 366. 2 Phila. & Trenton R. R. Co. v. Stimpson, 14 Pet. 448. The officers here referred to are the President and Secretary of State. 3 Pierce v. United States, 1 C. Cl. 270. |