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93 C. Cls. Reporter's Statement of the Case other schedule showing, however, the same departures from New York, ånd stating:
- As you will note, with one exception, the S. S. Antigua, scheduled to sail from New York on April 3, all sailings are at equal intervals. It is necessary to get this steamer away not later than April 3 in order to enable her to get in position for her regular sailing on F. O. M. Route No. 39, and I would like very much to have her approved for this one voyage on Route No. 40 inasmuch as the following sailing, that is, the S. S. Toloa from New York on April 7, is not eligible for mail pay under contract as this vessel was placed under the American flag subsequent to the passage of the Merchant Marine Act of 1928.
The fourth one of our new ships, the S. S. Quirigua, is expected to be delivered in time for the sailing of June 2, or June 9 at the latest, when the S. S. Toloa will be withdrawn from this route, leaving the service to be performed by the Quirigua, Calamares, and Pastores, all of which are eligible for mail pay under contract, until such time as the Veragua is delivered, about August 1, when she also will be assigned to this route and either the Calamares or Pastores withdrawn.
Our plans for re-shipping this route have been somewhat upset and delayed due to the destruction of the S. S. Segovia by fire at Newport News last December,
but I trust you will find the enclosed schedule satisfactory. On March 29, 1932, the Post Office Department approved the revised schedule and notified the plaintiff that it was satisfactory.
Return voyage schedules were not requested by the Department or submitted by the plaintiff
The S. S. Chiriqui and S. S. Antigua sailed from New York March 24 and April 3, 1932, respectively, according to the schedules previously approved by the Post Office Department, and performed the service required under the contract of March 21, 1930. They then proceeded from Port Limon to San Francisco, California, and operated on Route No. 39, which was out of San Francisco.
The mail service that would have been performed by S. S. Chiriqui and S. S. Antigua on a return to New York on Route No. 40, instead of their proceeding to San Francisco on Route No. 39, was performed by plaintiff's two vessels, the Calamares and Pastores.
Opinion of the Court
In order to determine the class to which the vessel belonged, it was necessary to have the log of the first voyage, since the classification depended upon actual speed. Upon receipt of this log the Post Office Department April 15 and 26, 1932, respectively, issued orders classifying S. S. Chiriqui and S. S. Antigua as vessels of Class 4 on Route No. 40, under Merchant Marine Act, 1928.
The plaintiff followed the sailings of the Chiriqui and Antigua from New York with three sailings of Class 5 vessels, when Class 4 vessels were substituted.
3. The distance covered by S. S. Chiriqui and S. S. Antigua was 2,381 miles. The Post Office Department certified to the Comptroller General $28,572.00 as payment due plaintiff for the two voyages, at the rate of $6 per nautical mile, which was the rate for Class 4 vessels. The Comptroller General October 25, 1932, allowed only $4 per nautical mile, which was the rate for Class 5 vessels, a total of $19,048.00 and reduction of $9,524.00.
Warrants aggregating $19,048.00 were transmitted to plaintiff in payment and were by plaintiff refused and returned, with request for reconsideration. The Comptroller General reconsidered the matter, canceled the warrants and issued a warrant in lieu thereof in the sum of $908.31, the calculation of which amount is on the poundage basis and transmitted the new warrant to the plaintiff.
The court decided that the plaintiff was entitled to recover. WHALEY, Chief Justice, delivered the opinion of the court:
This suit is for the recovery of the difference between compensation for transporting mails on a foreign ocean mail route computed under a contract therefor and the amount allowed and paid by the Comptroller General computed on a poundage basis.
Plaintiff and defendant entered into a contract dated March 21, 1930, whereby the plaintiff, among other things, agreed to carry ocean mails of the United States from New York by Havana, Cuba, and Cristobal, Canal Zone, to Port Limon, Costa Rica, “on a schedule approved by the Postmaster General, that shall include" certain approximate 93 C. Cls. Opinion of the Court annual trips. The route so described was known and designated as Route #40.
This contract was based on the Merchant Marine Act, 1928, 45 Stat. 689, chap. 675, which empowered the Postmaster General to enter into contracts, after advertisements and bids, to carry mails on certain designated routes between the United States and foreign countries. The act fixed certain rates to be allowed on vessels according to their speed and these vessels had to be built under the terms of the act, which specified in Section 405 (b) that the vessels should be constructed
(1) according to plans and specifications approved by the Secretary of the Navy, with particular reference to economical conversion into an auxiliary naval vessel, or (2) a vessel which will be otherwise useful to the United
States in time of national emergency. Under Section 402 of the act, the Postmaster General was required to certify to the United States Shipping Board what ocean mail routes should be established and have vessels documented under the laws of the United States to carry merchandise, distributed so as equitably to serve the Atlantic, Mexican Gulf, and Pacific coast ports.
In response to the advertisements by the Postmaster General, plaintiff entered a bid which was accepted on Route 40. Plaintiff had also entered into a contract with the Postmaster General for the carrying of the ocean mail on Route 39, commencing from a port on the west coast and continuing to South American ports.
Under the contract for service on Route 40, plaintiff agreed to operate vessels of Class 5 capable of a speed of 13 knots. Under paragraph (h) of Section 1, plaintiff was required to substitute as soon as practicable after the beginning of the service, and not later than three years from the date of the contract, three new combination passenger and cargo vessels of Class 4, capable of maintaining a speed of 16 knots. The contract provided also that vessels should be classified on the basis of speed without regard to tonnage with the consent of the Postmaster General. It further provided that the plaintiff might substitute and operate vessels in Class 4 and other classes in addition to those specified in Section 1, paragraphs
Opinion of the Court (g) and (h) of the contract in such way and for such purposes as might be agreed upon by the parties.
It appears from the evidence that the plaintiff had entered into a contract for the construction of six vessels to be built in the United States under the terms and conditions of the "Merchant Marine Act, 1928" and that on March 8 the Postmaster General requested plaintiff to furnish a list of the steamers which would operate on Route 40 at the commencement of service. At this time the plaintiff had had delivered to it, or about to be delivered to it, two new vessels of the six ordered to be constructed by plaintiff. By letter dated March 11, 1932, plaintiff notified the Post Office Department that it proposed to operate the new S. S. Chiriqui as the first sailing on this route to depart from New York on March 24 and at the completion of the outward bound trip to Port Limon this ship would proceed to San Francisco to begin operation on Route 39. Plaintiff also proposed the sailing on April 3 of the new S. S. Antigua on the same route for one voyage, this ship thereafter to be placed on Route 39. Both of these ships were new vessels and their actual speed was unknown. After the exchange of letters between the Post Office Department and plaintiff in which permission was asked for the approval of the sailing of these vessels on the outward bound voyage on Route 40 and their subsequent service on Route 39, the Department notified plaintiff that the final schedules as submitted by the plaintiff were satisfactory. Both of these vessels sailed on the dates furnished the Post Office Department and carried the ocean mail to the ports specified in the schedule and then proceeded to San Francisco, California, for service on Route 39.
The logs of the ships were submitted to the Post Office Department as the basis upon which to calculate the speed of the vessels and, upon this calculation, to fix the rate of pay for the ocean mail carried according to the schedule set out in the act of 1928 and the contract entered into between the plaintiff and the defendant. As a result of this calculation the Post Office Department certified to the General Accounting Office that the plaintiff was entitled to be paid on the basis of the rate fixed on Class 4 vessels with a speed of 16 knots, which carried the rate of $6.00 per nautical mile, and had 93 C. Cls. Opinion of the Court therefore earned the sum of $28,572.00, as payment for services rendered in carrying the ocean mail. The Comptroller General disregarded the classification on these vessels and treated them as Class 5 vessels, which allowed only $4.00 per nautical mile, and issued warrants aggregating $19,048.00 to the plaintiff in payment of the service rendered. Plaintiff refused to accept and asked for a reconsideration, returning the warrants. The Comptroller General reconsidered the matter, cancelled the warrants, and issued a new warrant in the sum of $908.31, based on poundage rates.
It is admitted by the defendant that the calculation on the poundage basis is erroneous. However, it is contended that the plaintiff is not entitled to receive payment under Class 4 but only on Class 5 with the rate of $4.00 per nautical mile instead of $6.00. This brings us to an interpretation of the contract.
Plaintiff was required under paragraph (h) of Section 1 to substitute as soon as practicable after the beginning of service specified in this contract, and no later than three years from the date on which the same was awarded, three new combination passenger and cargo vessels of Class 4 with a speed of 16 knots. The advertisements for bids referred to and made a part of the contract provided :
The contractor and the Postmaster General may agree upon the operation of additional vessels of Class 4
and/or other Classes. The evidence plainly shows that plaintiff was endeavouring to carry out the intent and purpose of the act of 1928 in having these two new ships constructed and that the Postmaster General had agreed that they be used on the outward bound voyage and carry the mail under the contract. As the actual speed of these vessels was unknown, it was necessary for their logs to be submitted to the Postmaster General and a calculation made as to the speed maintained on the voyage in order to fix the basis of the rate of pay as provided in the contract.
The Post Office Department found as a fact that these vessels belonged in Class 4 and that their speed, as shown by the logs, was 16 nautical knots, and therefore allowed the plaintiff the rate of pay as provided in the contract for