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that this construction must be taken to have been adopted in silence, by the later statutes. But the exercise of power in the way deemed just while the conditions stated to have existed in and after 1873 continued was not a construction but the exercise of discretion in determining the amount of pay-a discretion which, as we have seen, undeniably was given in the form of a right

*333

to regulate *rates, and which therefore there could be no reason for withholding, beyond the express words of the act, at the other end. It is true that in 1884 an Assistant Attorney General gave an opinion that any departure from the practice would defeat the intention of the law and cause no little embarrassment and that thereafter an order made by a previous Postmaster for taking the number of weighing days as the divisor was revoked. But the letter of the Postmaster General thus answered merely stated what had been the practice as to the divisor and asked whether it was in violation of law. It did not state that the Post Office considered itself bound to follow that way; The order that was revoked only purported to affect seven-day routes and is of little or no importance to the question before us now. It is said that the rate was fixed by the Act of March 2, 1907, c. 2513, 34 Stat. 1205, 1212, if not before, by a reduction to "five

per centum less than the present rates" on certain routes. But as we have stated we understand this to mean a reduction of the rates fixed by statute, that is the maximum rates. We do not understand it to refer to rates specifically allowed. It is not likely that Congress considered the latter in detail. Finally much is made of the fact that before the passage of the Act of March 3, 1905, and again before the passage of the Act of March 2, 1907, provisos were stricken out that in effect required the divisor to be the number of the weighing days. A similar thing happened before the passage of the act making appropriations for the fiscal year ending June 30, 1909. We do not go into the particulars of these matters because whatever may have been said by individuals the provisos might as well have been rejected for the purpose of leaving the choice between the two divisors to the judgment of the Postmaster General as for any other reason. On the other hand we are not dis

#334

bly this might be construed to recognize the
power now in dispute but this suggestion
also we are content to leave on one side.
We also leave unconsidered the great diffi-
culties that the Railroads encounter in the
effort to show that their conduct did not
amount to an acceptance of the Postmaster
General's terms within the decision in New
York, New Haven & Hartford R. R. Co. v.
United States, Dec. 8, 1919, 251 U. S. 123,
40 Sup. Ct. 67, 64 L. Ed.
- The con-
struction of the statutes disposes of all the
cases without the need of going into further
details.

Judgments affirmed.

Mr. Justice DAY and Mr. Justice VAN DEVANTER dissent. Mr. Justice McREYNOLDS took no part in the decision of the cases.

Mr. Justice PITNEY, with whom concurred Mr. Justice McKENNA.

I concur in the affirmance of the judgments of the Court of Claims in these cases, those expressed in the opinion of Mr. Justice but upon grounds somewhat different from

HOLMES.

All the claims arose under the law as it

stood after the Act of March 2, 1907 (chapter 2513, 34 Stat. 1205, 1212), and before that of July 28, 1916 (chapter 261, 39 Stat. 412, 429),

*335

by which the carriage of mail matter by the railways was made compulsory. The Act about which the principal controversy turns is that of March 3, 1873 (chapter 231, 17 Stat. 556, 558), the disputed portion of which was carried into section 4002, Rev. Stat. U. S. By it the Postmaster General was "authorized and directed to readjust the compensation hereafter to be paid for the transportation of mails on railroad routes upon the conditions and at the rates hereinafter mentioned: * * * Second. That the pay per mile per annum shall not exceed the following rates, namely: On routes carrying their whole length an average weight of mails per day of two hundred pounds, fifty dollars;

*

*

*

five thousand pounds, two hundred dollars, and twenty-five dollars additional for every additional two thousand pounds, the average weight to be ascertained, in every case, by the actual weighing of the mails for such a number of successive working days, not less than thirty, at such times, and not less frequently than once posed to lay much stress on the fact *that in every four years, and the result to be statthe appropriations by Congress accepted the ed and verified in such form and manner as Postmaster General's estimates even when it the Postmaster General may direct." had been notified that the Railroads were dissatisfied with Order No. 412. The Act of March 3, 1875, c. 128, 18 Stat. 340, 341, ordered the Postmaster General to have the weighing done thereafter by the employés of the Post Office Department, and to "have the weights stated and verified to him by said employés under such instructions as he may consider just to the Post Office Department and the railroad companies." Possi

In my opinion, the rates of pay per mile per annum were maximum rates, and the Postmaster General had a discretion to contract at less if the railroads agreed; but under section 210 of the Act of June 8, 1872 (chapter 335, 17 Stat. 283, 309; Rev. Stat. U. S. § 3997), he was under a duty to arrange the routes into classes according to the size of the mail, and the speed, frequency, and importance of the service, "so that each

(40 Sup.Ct.)

railway company shall receive, as far as | operate as a fine on all those roads carrying practicable, a proportionate and just rate of the mails daily, including Sunday." compensation, according to the service performed."

But I think that in the clause "the average weight to be ascertained, in every case, by the actual weighing of the mails for such a number of successive working days, not less than thirty," etc., the words "successive working days," by proper interpretation mean successive week days; and since the aggregate weight for the weighing period must be subjected to division in order to

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The Act of March 3, 1905 (chapter 1480, 33 Stat. 1082, 1088), changed the minimum weighing period so as to require the inclusion of at least ninety, instead of thirty, successive working days, but made no other change. Under this act 105 calendar days necessarily were included in the weighing period in order to take in 90 successive working days. In my opinion, this act, like that of 1873, by fair construction required that the week-day divisor be employed. And so it was officially construed until 1907.

ascertain the *average weight per day, it naturally follows that the divisor should be But, while I regard this method of deterthe same number of "working days" (that mining the average weight to have been preis, week days) that are included in the period. scribed, and not left to the discretion of the The previous history of the mail service Postmaster General, still I think the statshows abundant reason for this, and for ute in this respect was only directory, and more than thirty years thereafter the pro- not mandatory. Considering the provision vision was uniformly so construed by the De- in its relation to the context and subjectpartment. Upon a large number of the rail- | matter, it will be seen to be but an aid to the way routes, mails were carried six days each making of fair contracts within the maxiweek, none being carried on Sunday; while | mum rates allowed, and an aid to the Poston other routes they were carried on every master General in fixing the rate of compenday in the week. The aggregate weight of sation upon land grant routes, and in so mails carried was not affected by the frearranging routes that each railway company quency of the service, since the six-day routes carried the Sunday accumulations on Mondays. This explains why a certain number of "working days" (week days) was made the measure of the weighing period, and at the same time shows that the week-day divisor was necessary in order to deal equitably with both the six-day and the sevenday routes. From the passage of the act of 1873 down to the promulgation of Order No. 412 in the year 1907, the practice of the Department was in accord with the above interpretation. It was explained in a communication from the Postmaster General to the Senate January 21, 1885 (Senate Ex. Doc. No. 40, 48th Cong., 2d Sess., p. 68):

"The present rule is, on those roads carrying the mails six times a week, to weigh the mails on thirty consecutive days on which the mails are carried, which would cover a period of thirty-five days; dividing the aggregate thirty weighings by thirty will give the daily average. On those roads carrying the mails seven times per week the weighing is done for thirtyfive consecutive days (including Sundays) and the aggregate divided by thirty for a basis of pay. It is evident that the period during which the weighing is continued covers, in both cases, all the mails carried for thirty-five days. If, in the second case, we should take our basis from an average obtained by dividing the ag: gregate weight by thirty-five we should commit

*337

the absurdity of putting a *premium upon inefficiency, for evidently if the Sunday train were cut off we should virtually have the same mails less frequently carried, and therefore with a higher daily average, and therefore a higher pay basis than in the case where the seventh train was run and the greater accommodation rendered. The present method gives no additional pay for the additional seventh train, but the other method would cause a reduction on account of better service, and practically would

shall receive a proportionate and just rate of compensation according to the service performed. Hence it seems to me that a failure strictly to comply with the prescribed method of ascertaining the average weight did not of itself render the action of the Postmaster General ultra vires and void.

*338

*The principal controversy in the present cases is over his Order No. 412 (June 7, 1907), which provided:

"That when the weight of mail is taken on railroad routes the whole number of days included in the weighing period shall be used as a divisor for obtaining the average weight per day."

While I regard it as embodying an erroneous view of the statute, this is not sufficient, in my opinion, to vitiate a contract voluntarily made by a railway mail carrier based upon a calculation of average weight made and known to have been made in conformity with the order. All the present claims originated after the promulgation of the order, and arose out of the carriage of mails under arrangements made with the Postmaster General after express notice of its provisions.

It is contended that, although the act of 1873 (Rev. Stat. U. S. § 4002 [Comp. St. § 7483]), in providing that the pay per mile per annum should "not exceed" the specified rates, conferred upon the Postmaster General a discretion to pay less rates, this was modified by the language of the Act of July 12, 1876 (chapter 179, 19 Stat. 78, 79), which reduced the compensation 10 per centum from "the rates fixed and allowed the act of 1873] for the transportation of mails on the basis of the average weight"; by that of the Act of June 17, 1878 (chapter 259, 20 Stat. 140, 142), where, however, the

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expression is, "by reducing the compensation | certain amounts thus arrived at as the comto all railroad companies for the transporta-pensation for the service, and gave notice tion of mails five per centum per annum in proper form to the carriers specifying in from the rates for the transportation of terms the readjusted pay that would be almails, on the basis of the average weight lowed, "subject to future orders and to fines fixed and allowed," etc.; or by the provision and deductions.” Thereafter the carriers of the Act of March 2, 1907 (chapter 2513, received and transported the mails as offered, 34 Stat. 1205, 1212), readjusting compensa- periodically accepted compensation in accordtion on railroad routes carrying an average ance with the readjustment notices, and proweight per day exceeding 5,000 pounds, "by ceeded thus without further objection or promaking the following changes in the present test until the end of the respective quadrenrates per mile per annum for the transporta- nial periods. In short, although in some tion of mail on such routes, and hereafter cases they declared they would not consent the rates on such routes shall be as follows," to the ascertainment of average weights on etc. I am not convinced that these amend- the basis of Order No. 412, they did not insist upon their objection in the face of the ments, or any of them, had *the effect of im- Postmaster General's declaration that he pliedly repealing that part of the act of 1873 would not accede to it. Had they refused (Rev. Stat. U. S. § 4002) "shall not exceed," to carry the mails on the terms proposed, he etc., from which alone, in my view, the Post-might have exercised his discretion as to the master General derived any serviceable discretion about readjusting the compensation.

*339

Therefore he still had liberty of action

within the maximum rates prescribed. And the railroad companies, other than such as had been aided by grants of lands or otherwise, were free to carry the mails at rates offered, or refuse them, as they chose. Eastern R. R. Co. v. United States, 129 U. S. 391,

396, 9 Sup. Ct. 320, 32 L. Ed. 730; Atchison,

T. & S. F. Ry. v. United States, 225 U. S. 640, 650, 32 Sup. Ct. 702, 56 L. Ed. 1236; Delaware, L. & W. R. K. Co. v. United States, 249 U. S. 385, 388, 39 Sup. Ct. 348, 63 L. Ed. 659; New York, New Haven & Hartford R. R. Co. v. United States (December 8, 1919) 251 U. S. 123, 40 Sup. Ct. 67, 64 L. Ed.

Furthermore, by section 212 of the Act of June 8, 1872 (chapter 335, 17 Stat. 283, 309; Rev. Stat. U. S. § 3999), if, because of the refusal of the railway companies, the Postmaster General was unable to make con

tracts at a compensation "not exceeding the

maximum rates," or for what he deemed a reasonable and fair compensation, he was at liberty to use other means of carriage. From the findings of the Court of Claims it appears that in all of these cases there were express contracts; and I concur in the view of that court (53 Ct. Cl. 258, 308, 315, 318, 319) that the contracts arose, not out of the Distance Circular, in which the Postmaster General specially called notice to Order No. 412, and to which some of the claimants responded with protests, more or less explicit, that they would not be bound by that order, but arose out of what subsequently happened. The Postmaster General in every case informed the protesting carriers that he would not enter into contract with any railroad company excepting it from the operation of any postal law or regulation. The mails were weighed and the average weight ascertained in accordance with Order No.

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rate of pay per mile, so that, instead of

agreeing to give them, as he did, the maxi

mum pay based on the average weight ascertained under Order No. 412, he might have acceded to their contention by employing the week-day divisor, but have carried

into effect his own view as to the amount

that ought to be allowed by reducing the rate
of pay per mile Or, as already shown, he
might have refused to make the contracts
and have proceeded under section 3999.
I deem it clear, therefore, that the claim-
ants in fact accepted the Postmaster Gen-
eral's offers as contained in the readjustment
notices, by proceeding to perform the pre-

scribed service in accordance therewith and
accepting the compensation due to them
therefor. And so the Court of Claims held

(53 Ct. Cl. 258, 308, 313, 315, 318, 319).

Some of the routes of the Seaboard Air Line and of the Northern Pacific Railway

Company were over lines that had been aided by government land grants, and hence

*341

*were subject to provisions of law summed
up in section 214 of the Act of June 8, 1872
(Rev. Stat. U. S. § 4001 [Comp. St. § 7482]),
by which they were obliged to "carry the
mail at such prices as Congress may by law
provide; and, until such price is fixed by
law, the Postmaster General may fix the
The Seaboard Air
rate of compensation."
Line makes no point of this; but in behalf
of the Northern Pacific it is contended that
claimant, not being in the position of a free
agent, ought not to be regarded as having
voluntarily accepted the terms proposed by
the Postmaster General. But the effect of
the findings is that it did so accept; and this
result cannot be overturned by raising an
argument about the circumstances that went
to make up the evidence upon which the find-
ings were based, and the present contention
amounts to no more than this.

Were it otherwise, nevertheless it appears that Congress had not provided the compensation for the land grant routes, except that it had authorized and directed the Postmaster General to readjust all railway mail pay

(40 Sup.Ct.)

in the manner set forth in section 4002 and within the maxima prescribed therein and in the amendatory acts of 1876, 1878, and 1907, above mentioned, and had provided by section 13 of the Act of July 12, 1876 (chapter 179, 19 Stat. 78, 82 [Comp. St. § 7485]), "That railroad companies whose railroad was constructed in whole or in part by a land grant made by Congress on the condition that the mails should be transported over their road at such price as Congress should by law direct shall receive only eighty per centum of the compensation authorized by this Act," besides other legislation concerning the land grant routes that may be referred to, but need not be recited. Acts of March 2, 1907 (chapter 2513, 34 Stat. 1205, 1212); May 12, 1910 (chapter 230, 36 Stat. 355, 362); July 28, 1916 (chapter 261, 39 Stat. 412, 426). Assuming, therefore, that there was no contract affecting the land grant lines of the Northern Pacific, their compensation must be at the rate fixed by

⚫342

2. COMMERCE 12 FEDERAL ENACTMENT PRECLUDING EXERCISE OF REGULATIVE POWER BY STATES.

The provisions of Act June 18, 1910, amending the Act to Regulate Commerce, to bring telegraph companies under the act, as well as of the Interstate Commerce Commission, so to place them under the administrative control clearly established the purpose of Congress to subject such companies to a uniform national rule as to render it certain there was no room subsequently for exercise by a state of regulative power, by penalizing any negligent failure to deliver promptly an interstate telegram.

In Error to the Supreme Court of the State of Indiana.

Action by Peter Boegli against the Western Union Telegraph Company. From a judgment for plaintiff, defendant appealed to the Supreme Court of Indiana, which affirmed (115 N. E. 773), and defendant brings error. Reversed and remanded for further proceedings not inconsistent with the opinion.

Messrs. Rush Taggart and Francis Raymond Stark, both of New York City, Samuel O. Pickens, Charles W. Moores, and Robert Franklin Davidson, all of Indianapolis, Ind., for plaintiff in error.

Mr. Arthur W. Parry, of Ft. Wayne, Ind., for defendant in error.

Mr. Chief Justice WHITE delivered the opinion of the Court.

the Postmaster General in the exercise of the power and discretion conferred upon him by this legislation; and so long as he exercised this power and discretion reasonably, not fixing a noncompensatory rate or otherwise acting arbitrarily, the carrier was conIcluded by his action. There is no finding that he acted arbitrarily; on the contrary, he had in support of Order 412 a considered opinion of the Attorney General under date September 27, 1907 (26 Ops. Atty. Gen. 390); The Telegraph Company challenged the and, so far as appears, he treated the land right to subject it to a penalty fixed by a grant routes like others, not reducing them law of Indiana for failure to deliver promptbelow the 80 per centum contemplated by sec-ly in that state a telegram sent there from a tion 13 of the act of 1876, or otherwise violating the statutes. There is no finding nor any contention that the amounts allowed them were not compensatory; and, upon the whole, it seems to me that, although he erred in failing to apply the week-day divisor to the weighings, this did not render the readjustment based thereon wholly void, or permit the carrier, after transporting the mails and accepting the stated compensation without further objection, afterwards to treat the readjustment orders as nullities.

point in Illinois, on the ground that the Act of Congress of June 18, 1910 (36 Stat. 539, 545, c. 309), amending the Act to Regulate Commerce (Act Feb. 4, 1887, c. 104, 24 Stat. 379), had deprived the state of all power in the premises. The court conceding that if

*316

the act of Con*gress dealt with the subject the state statute would be inoperative, imposed the penalty on the ground that the act of 1910 did not extend to that field. The correctness of this conclusion is the one contro

Mr. Justice MCKENNA concurs in this versy with which the arguments are conopinion.

(251 U. S. 315)

cerned.

[1] The proposition that the act of 1910 must be narrowly construed so as to preserve

WESTERN UNION TELEGRAPH CO. v. the reserved power of the state over the sub

BOEGLI.

(Submitted Dec. 19, 1919.

1920.) No. 83.

ject in hand, although it is admitted that Decided Jan. 12, that power is in its nature federal and may

be exercised by the state only because of nonaction by Congress, is obviously too conflicting and unsound to require further no1. COMMERCE 12-INTERSTATE COMMERCE tice. We therefore consider the statute in

ACT NOT CONSTRUED TO PRESERVE POWER OF
STATES.

Act June 18, 1910, amending the Act to Regulate Commerce, is not to be narrowly construed, so as to preserve any reserved power of the states; such power being in its nature federal, and open to exercise by the states only because of inaction by Congress.

the light of its text and, if there be ambiguity, of its context, in order to give effect to the intent of Congress as manifested in its

enactment.

[2] As the result of doing so, we are of opinion that the provisions of the statute bringing telegraph companies under the Act

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

to Regulate Commerce as well as placing | ernment accepted taxes calculated by the comthem under the administrative control of the pany itself as due from it, and the company Interstate Commerce Commission so clearly also prepared statement of account showing a establish the purpose of Congress to subject false balance favorable to the United States, such companies to a uniform national rule which balance was accepted by the treasurer of the Philippine government, organized puras to cause it to be certain that there was no suant to Act July 1, 1902, the United States room thereafter for the exercise by the several states of power to regulate, by penalizing subsidy to the company on any principle of was not under obligation to pay the Spanish the negligent failure to deliver promptly, an undue enrichment, of implied obligation from Interstate telegram and that the court below acceptance of taxes, or from acceptance of erred therefore in imposing the penalty fixed balance of account. by the state statute.

We do not pursue the subject further since the effect of the act of 1910 in taking possession of the field was recently determined in exact accordance with the conclusion we have just stated. Postal Telegraph Cable Co. V. Warren-Godwin Lumber Co., 251 U. S. 27, 40 Sup. Ct. 69, 64 L. Ed. —. That case, indeed, was concerned only with the operation, after the passage of the act of 1910, of a state statute rendering illegal a clause of a contract for sending an interstate telegram limiting the amount of recovery under the conditions stated in case of an unrepeated *317 message; but the *ruling that the effect of the act of 1910 was to exclude the possibility thereafter of applying the state law was rested, not alone upon the special provisions of the act of 1910 relating to unrepeated messages, but upon the necessary effect of the general provisions of that act bringing telegraph companies under the control of the

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69

2. COURTS 449(1)—UNITED STATES
CONTRACT LIABILITY ENFORCEABLE IN COURT
OF CLAIMS CAN ONLY BE CREATED BY PROP-
ER OFFICER.

judicially enforceable by the Court of Claims
A contract liability, express or implied,
against the United States, can be created only
by some officer of the government lawfully in-
vested with power to make such contracts, or
to perform acts from which they may be law-
fully implied.

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Mr. Justice CLARKE delivered the opinion of the Court.

The appellant, claimant, is the grantee from the government of Spain of three concessions to lay down and operate submarine cables. The first one, in 1879, was for the exclusive privilege, for 40 years, of constructing and operating a cable between the Island of Luzon and Hongkong. It was landed at Bolinao on the northerly coast of Luzon, and dispatches were transmitted to Manila and other places by government owned land lines, which were subject to interruption. This concession required that official messages be

EASTERN EXTENSION, AUSTRALASIA & transmitted free and be given precedence. In CHINA TELEGRAPH CO., Limited, v. UNITED STATES.

(Argued Dec. 15, 1919. Decided Jan. 12, 1920.)

No. 357.

1898 a second concession, supplemental to the first, empowered the claimant to extend its cable to Manila, and the term of the prior exclusive grant was extended 20 years, with the same priority for official dispatches, but

*357

1. UNITED STATES 69-NO IMPLIED OBLI- with the provision that they were to be *transGATION TO PAY SPANISH SUBSIDY TO PHILIP-mitted free only for the first 10 years from the date of this second grant.

PINE CABLE COMPANY.

Where a cable company operated in the In 1897 a third concession, the one with Philippine Islands under concession and subsidy from the Spanish government, and the Which this case is chiefly concerned, authorUnited States government, when it assumed ized the claimant to lay down and operate jurisdiction over the Islands, availed itself of three submarine cables, connecting the Isthe cables, paying rates demanded, while, after land of Luzon with three Visayas Islandsurging from the company, the Philippine gov-Panay, Negros, and Cebu. This grant re

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

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