United States v. Title Guaranty & Surety Co.

36 App. D.C. 85, 1910 U.S. App. LEXIS 5955

• Court: Court of Appeals for the D.C. Circuit
• Decided: December 5, 1910
• Docket: No. 2180
• Status: Published

Opinion

Mr. Justice Van Orsdel

delivered the opinion of the Court :

The act of Congress xxnder which the United States and Du Perow were proceeding is sec. 3709 of the Revised Statutes, as amended by the act of January 27, 1894 (28 Stat. at L. 33, chap. 22, U. S. Comp. Stat. 1901, p. 2484), which is as follows: “All purchases and contracts-for supplies and services in any of the departments of the government, except for personal services, shall be made by advertising a sufficient time previously for proposals respecting the same, when the public exigencies do not require the immediate delivery of the articles, or performance of the service. When immediate delivery or performance is required by the public exigency, the articles or service required may be procured by open purchase or contract, at the places and in the manner in which such articles are usually bought and sold, or such services engaged between individuals. And the advertisement for such proposals shall be made by all the executive departments, including the Department of Labor, the United States Fish Commission, the Interstate Commerce Commission, the Smithsonian Institution, the Government Printing Office, the government of the District of Columbia, and the Superintendent of the State, War, and Navy Building, except for paper and materials for use of the Government Printing Office, and materials used in the work of the Bureau of Engraving and Printing, which shall continue to be advertised for and purchased as now provided by law, on the same days, and shall each designate 2 o’clock post meridian of such days for the opening of all such proposals in each department and other government establishment in the city of Washington; and the Secretary of the Treasury shall designate the day or days in each year for the opening of such proposals, and give due notice thereof to the other departments and government establishments. Such proposals shall be opened in the usual way and schedules thereof duly prepared, and, together with the statement of the proposed action of each department and government establishment thereon, shall be submitted to a board consisting of one of the Assistant Secretaries of the Treasury and Interior Departments and one of the Assistant Postmasters-General, who shall be designated by the heads of said departments and the Postmaster-General respectively, at a meeting to be called by the official of the Treasury Department, who shall be chairman thereof, and said board shall carefully examine and compare all the proposals so submitted, and recommend the acceptance or rejection of any or all of said proposals. And if any or all of such proposals shall be rejected, advertisements for proposals shall again be invited and proceeded with in the same manner.”

It was undoubtedly the intention of Congress by this act to impose upon the assistant secretaries named therein, known as the board of awards, the duty of inquiring into the merits of the respective bids. For some reason, this system seems to have proved impracticable, and an executive order was issued on May 13, 1909, for the purpose of more effectively carrying into effect the spirit of the act. The order provided that a committee to be composed of one representative from each of the departments of the government and from “the following government establishments, to wit: Government Printing-Office, Interstate Commerce Commission, Smithsonian Institution, Superintendent of State, War, and Navy Building, and the government of the District of Columbia, appointed by the head of each department and establishment, pursuant to the recommendation of the board of awards, be and is hereby created a body to be known as the general supply committee, of which the secretary of the board of awards shall be chairman; and the said committee shall adopt its own rules for organization and the transaction of business, subject to the directions herein specifically set forth; and while the members of said committee shall advise together collectively, yet each member shall, in performing the several acts hereinafter directed, act as the separate agent and representative of the particular department or establishment from which he is appointed.” After thus defining the organization of the general supply committee, the order required this committee, after ascertaining the supplies necessary for the various departments or establishments of the government, to advertise for proposals to furnish said supplies, in accordance with the provisions of the act of Congress. These proposals were required to be submitted to the board of awards, and the recommendation of the board was to be acted upon in accordance witb the provisions of the act of Congress.

It appears that in this instance the general supply committee called for bids, and upon the day set open the same, and agreed upon the bids that should be accepted, submitting their action to the board of awards for approval. The action of the committee with respect to the Du Perow bid was approved. He was duly notified of the acceptance and approval. A contract in the usual form was presented to Du Perow for his signature. The contract provided the blank space or spaces for the contractor to sign, and below were spaces in blank for the secretary of the various departments of the government to sign in execution of the contract on behalf of the United States. When the contract was presented Du Perow refused to sign it, and this action was brought upon the bond given to secure the government against his failure to so execute the contract.

The sole defense to this action is that the general supply committee had no authority to accept the bid of Du Perow, and, therefore, Du Perow was not obliged to enter into the contract. It is contended that the acceptance of the bid or proposal was a duty imposed by law upon the board of awards, and could not lawfully be delegated to the general supply committee. On this point it is alleged in the declaration “that thereafter certain of the proposals as contained in the bid of the said' M. Du Perow as aforesaid, for supplying articles to the several executive departments and independent establishments of the United States government for the fiscal year ending June 30th, a. d. 1910, were accepted by the said general supply committee, acting as aforesaid, and the said action was approved by the legally constituted board authorized to approve the same, commonly known as the board of awards, of which said acceptance and approval the said M. Du Perow was duly notified by the said general supply committee.” The notice addressed to M. Du Perow was headed, “Office of the General Supply Committee, United States Executive Departments and Independent-Establishments,” and signed by T. C. S. Marshall, vice-chairman, .in which notice Du Perow was informed that his proposals for certain articles therein specified had “been accepted by the general supply committee, and such action approved by the board of awards. ” It will be observed that the acceptance was in reality the act of the board of awards, the general supply committee performing the mere ministerial duty of working-out the details and submitting them for the approval of the board.

Unquestionably where powers requiring the exercise of judgment and discretion are conferred upon executive officers, they cannot be delegated. It follows, therefore, that neither the head of a department nor the board of awards could have delegated to the general supply committee full power to advertise for bids, accept proposals, and enter into contracts. But that is not what was done in this case. By direction of the board of awards, the body in which this power resided under the act of Congress, the general supply Committee advertised for bids for the furnishing of supplies for the use of the various departments and establishments of the government. This was a mere ministerial act, which required neither the exercise of judgment or of discretion. When the proposals or bids were submitted, Du Perow’s among others, the general supply committee examined them and made a recommendation in reference thereto to the board of awards. The board was then called upon to exercise the power of decision vested in it to either approve or disapprove the recommendation. An approval constituted an acceptance by the board, and the mere ministerial act of notifying Du Perow of its acceptance could be accomplished through any agency the board might choose to select. The acceptance was the act of the board, and the contract submitted to Du Perow for execution must, according to the declaration, be presumed to have in every respect complied with the law.

It will hardly be denied that, under this state of facts, had the United States refused to enter into the contract, Du Perow would have had a cause of action in the court of claims. The submission of the bid, and its approval and acceptance, constituted a binding contract, from which the government could not escape merely because the bidder had been notified of its acceptance by an agent of the officer or officers authorized to approve and accept the proposal. If the contract was one from which the United States could not escape, it is not apparent how Du Perow, under the terms of acceptance and notice here alleged and admitted to be true, can find an avenue of escape. He submitted his proposal to furnish the supplies with his eyes open. The transaction was in all respects at arm’s length. His proposal was submitted by the intermediary agent, the general supply committee, to the legally authorized authority, the board of awards, for its approval. The proposal was approved; and because the general supply committee, instead of the board of awards, notified Du Perow of the acceptance, he seeks to escape from his obligation.

The difficulty here is that too much dignity has been accorded to the work performed by the general supply committee. It did the detail work for the board of awards, such as might have been accomplished by clerks employed for that purpose. Its acts had no force until approved by the board, as was done in this instance.

The defense here interposed is not well founded. The point is too technical to appeal to a sense of justice, certainly in the absence of any possible damage that could accrue to the contractor by reason of the source from which the notice of acceptance emanated. The contract submitted for Du Perow’s signature was in all respects in accord with his proposal and bid. It contained the blank spaces for the proper heads of the various departments of the government for which supplies were to be furnished to sign on behalf of the United States. It was Du Perow’s duty when this contract was presented to sign it and execute a bond for its faithful performance. His failure to do so gave the United States a cause of action against his bondsman.

It is hardly necessary to suggest that the defendant bonding company can rise no higher than Du Perow. In this case it cannot avail itself of any defense that would not be open to Du Perow were he a party defendant. The judgment is reversed with costs, and the cause remanded for further proceedings not inconsistent with this opinion. Reversed.