panies. Upon the informal opinion of the assistant attorney general for the post-office department, the postmaster general issued an order, June 2, 1880, directing that from July 1, 1879, the pay should only be at the rate provided by congress for land-grant roads, namely 80 per cent. of the full amount. January 26, 1881, upon a reconsideration, orders were issued recalling the order of June 2, 1880, whereupon the department returned to the earlier practice, and paid full rates for the carriage of the mails until January 8, 1884, when Postmaster General Gresham again adopted the construction of June 2, 1880, and applied the same to the compensation of these roads from and after July 1, 1883; and that construction has been applied from thence hitherto, and payment made at the rate of 80 per cent. of the amount paid non land-grant roads.

In addition to reducing the pay for carrying the mails for the current and subsequent years, namely, from July 1, 1883, the postmaster general restated the account for the carriage of the mails prior to July 1, 1883, both during the period when they were carried by the construction company, and during the period from about December, 1877, to July 1, 1883, in which they were carried by the Wisconsin Central Railroad Company, and deducted out of moneys which had been earned since July 1, 1883, the excess over the 80 per cent. rate which had been paid during the previous years.

Suit was brought in the court of claims May 26, 1887, by the Wisconsin Central Railroad Company against the United States, to recover an alleged balance due as compensation for carrying the mails. The court of claims allowed the railroad company $6.448.80, as being the amount deducted from the claimant's earnings in 1886 and 1887 for payments in excess of the 80 per cent. rate made to the construction company while that company was operating the roads; but the court of claims held that Postmaster General Gresham's construction was correct, and that the claimant was restricted to the 80 per cent. rate, and therefore disallowed the claim for the money withheld against the excess, and also the amount of the claim for the period subsequent to July 1, 1883. The sums which had been paid to claimant in excess of the 80 per cent. rate, and which were deducted from subsequently earned pay, amounted to $12,532.43. The 20 per rent. subsequent to July 1, 1883, was $10,343.58.

The court of claims gave judgment in favor of the Wisconsin Central Railroad Company for $6,448.80, and the railroad company appealed. The United States did not appeal.

The opinion of the court, by Nott, J., is reported 27 Ct. Cl. 440.

Louis D. Brandeis, for appellant. Asst. Atty. Gen. Dodge, for the United States.

*Mr. Chief Justice FULLER, after stating. the facts in the foregoing language, delivered the opinion of the court.

Appellant contends that it was not subject to the 80 per cent. rate, and hence that? it is entitled to recover both the items disallowed by the court of claims, and also that, even if this position be untenable, it should not have been charged with amounts which had already been settled and paid under the view that the company was not so restricted, and should have been awarded the sum of $12,532.43 withheld.

The act of 1864 expressly provided that the grant was made upon "the same terms and conditions as are contained in the act granting lands to said state to aid in the construction of railroads in said state, approved June three, eighteen hundred and fifty-six"; and that act contained in its fifth section the following: "That the United States mail shall be transported over said roads under the direction of the post office department at such price as congress may by law direct, provided that until such price is fixed by law, the postmaster-general shall have the power to determine the same."

But it is argued that the "terms and conditions" referred to do not embrace the terms and conditions prescribed by section 5, because the general subject-matter of every other section of the act of 1856 was expressly re-enacted, and therefore it must be inferred that congress intended to express in the act of 1864 all the terms and conditions which were imposed upon the grant thereby made, or that, in any event, the words should be limited to the terms and conditions of section 1 of the act of 1856.

The difficulty is that to hold that all the terms and conditions imposed upon the grant were specifically expressed in the act of 1864 itself would be to render the reference to the act of 1856 meaningless, and to eliminate, by interpretation, the words "upon the same terms and conditions as are contained in" that act; and we are of opinion that the explicit language of the statute cannot thus be done away with.

The existence of terms and conditions in the act of 1856 left wholly unmodified by the re-enactments of the act of 1864 preclude the argument that the words so used are without meaning; and, moreover, the settled rule is that statutes granting privileges, or relinquishing rights of the public, are to be strictly construed against the grantee.

Reference to the two acts will show that the changes in the new grant rendered necessary some modification of the first and third provisos of the first section, and of sections 2, 3, and 4 of the act of 1856 (which embody some, but not all, of the terms and conditions), and they were accordingly reenacted in homologous provisos and sections of the act of 1864; but, as the second proviso of section 1 and section 5 required no.

modification, they were not re-enacted, and the terms and conditions contained therein were carried forward by reference.

Thus, for the first proviso of section 1 of the act of 1856, the first proviso of the third section of the act of 1864 was substituted, in order to enlarge the 15-mile limit to 20; and section 6 of the act of 1864 was substituted for the third proviso, in order to provide for the exclusion of mineral lands from the grant. So the second section of the act of 1856 was re-enacted in the fourth section of the act of 1864 to change the 6 miles on each side of the road to 10; and section 3 of the act of 1856 was re-enacted in section 8 of the act of 1864 to provide for the difference between the patenting to the state under the earlier act, and the patenting direct to the companies under the last act, while section 4 of the act of 1856 was reproduced in section 7 of the act of 1864 with the alterations rendered necessary, not only by the change in patenting, but by the increased dimensions of the grant. The fact that the provision for the free transportation of troops and property of the United States contained in section 3 of the first act appeared substantially unchanged in the eighth section of the last act is of no significance, as the purpose of the re-enactment had no relation to that requirement. The second proviso of section 1 and section 5 of the act of 1856 were not re-enacted, manifestly, because no change was required; and the provision of section 3 of the act of 1864, that the grant should be subjected to the same terms and conditions as the grant by the act of 1856, dispensed with the necessity of repetition. Giving this operation to the plain language of that provision, as we must, involves no inconsistency in respect of the terms and conditions contained in the provisos and sections which were re-enacted, since the re-enactment was due to the necessity of modification arising under the new grant, and indicated no intention to withdraw any of the original terms and conditions.

An intention to surrender the right to demand the carriage of the mails over the subsidized roads at reasonable charges would be opposed to the policy established by wellnigh uniform congressional legislation on the subject, and although there may have been departures from that policy in a few instances, under exceptional circumstances, none of them justify the contention that such departure was intended here.

We think it follows, also, that there is no room for concluding that the words "the same terms and conditions as are contained in" the act of 1856 should be confined to the terms and conditions contained in the first section of that act, or rather in its second proviso, as the first and third provisos were re-enacted. The three provisos of the granting section of the act of 1856 did not embody all the terms and conditions imposed v.17s.c.-4

on that grant, and as the grant of the act of 1864 was subjected to the same terms and conditions as those of the prior act, and it was as true of the re-enacted sections as it was of the re-enacted provisos, that they were alike re-enacted to adapt the last act to the changes in the extent and manner of the new grant, we regard the suggestion which would restrict the words used to the second proviso and exclude the fifth section as obviously inadmissible.

Nor are we able to concur in the view that the general policy of the act of 1864 was inconsistent with the imposition of the duty of transporting the mails. The argument is that the grant of 1856 was not sufficiently favorable to induce the building of the roads, and that, therefore, congress in 1864 deemed it proper and necessary to make a more favorable grant, and did so in part by dispensing with this duty; but this will not do, for the inducements were made greater by adding two-thirds more land, and at the same time it was expressly provided that the increased grant should be subject to the same terms and conditions as the earlier one. We find nothing in the record to give color to the suggestion that, in addition to the increase of the grant, congress intended to surrender the rights of the government in respect of mail *transportation. Wisconsin Cent. R. Co. v. Forsythe, 159 U. S. 47, 15 Sup. Ct. 1020.

Some reliance is placed by appellant on departmental construction, bat we may dismiss that contention with the observation that we do not consider the true construction as doubtful, and that the departmental construction referred to was neither contemporaneous nor continuous. U. S. v. Alabama G. S. R. Co., 142 U. S. 615, 12 Sup. Ct. 306; U. S. v. Healey, 160 U. S. 136, 16 Sup. Ct. 247. We agree entirely with the court of claims that the terms and conditions imposed on this grant embraced the condition that the mail should be carried at such rates as congress might fix, and that section 13 of the act of July 12, 1876 (19 Stat. 78, c. 179), was applicable. The item of $16,343.48 was properly disallowed, as was also the item of $12,532.43, unless the latter was recoverable by reason of some ground of objection to its extinguishment by the application of the sums unlawfully paid to and received by the company.

And as to that it is insisted that such application cannot be made, because it was not competent for the postmaster general to withhold the moneys thus paid without authority of law, as the previous directions to make the payments were decisions binding on the department, because the payments were voluntarily made on due consideration and debliberation, and the accounts settled, and because no counterclaim was filed.

The postmaster general, in directing payment of compensation for mail transportation, under the statutes providing the rate and basis there

of, does not act judicially; and whatever the conclusiveness of executive acts, so far as executive departments are concerned, as a rule of administration, it has long been settled that the action of executive officers in matters of account and payment cannot be regarded as a conclusive determination, when brought in question in a court of justice. U. S. v. Harmon, 43 Fed. 560, by Mr. Justice Gray; Id., 147 U. S. 268, 13 Sup. Ct. 327: Hunter v. U. S., 5 Pet. 173; U. S. v. Jones, 8 Pet. 175; U. S. v. Bank of Metropolis, 15 Pet. 377.

*In the latter case, which was a suit upon negotiable drafts accepted by the postmaster general (the authority to do so being assumed for the purposes of the case), and which was decided after the passage of the act of July 2, 1836 (5 Stat. 80, 83, c. 270), whose seventeenth section was carried forward as section 4057 of the Revised Statutes, Mr. Justice Wayne, delivering the opinion of the court, discussed the power of a succeeding postmaster general to revise the action of his predecessor as to credits, as follows:

"The third instruction asked the court to say, among other things, if the credits given by Mr. Barry were for extra allowances, which the said postmaster general was not legally authorized to allow, then it was the duty of the present postmaster general to disallow such items of credit. The successor of Mr. Barry had the same power, and no more, than his predecessor; and the power of the former did not extend to the recall of credits or allowances made by Mr. Barry, if he acted within the scope of official authority given by law to the head of the department. This right in an incumbent of reviewing a predecessor's decisions extends to mistakes in matters of fact arising from errors in calculation, and to cases of rejected claims in which material testimony is afterwards discovered and produced. But if a credit has been given, or an allowance made, as these were, by the head of a department, and it is alleged to be an illegal allowance, the judicial tribunals of the country must be resorted to, to construe the law under which the allowance was made, and to settle the rights be tween the United States and the party to whom the credit was given.

under that section. His duty is to cause a suit to be brought. Additional allowances the postmaster general could make under the fortythird section of the act of March 3, 1825 (3 Story's Laws, 1985); and we presume it was because allowances were supposed to have been made contrary to that law that the seventeenth section of the act of 2d July, 1836, was passed. In this last, the extent of the postmaster general's power in respect to allowances is too plain to be mistaken.

"We cannot say that either of the sections of the acts of 1825 and 1836 just alluded to covers the allowances made by Mr. Barry to Reeside. But if the postmaster general thought they did, and that such a defense could have availed against the rights of the bank to claim these acceptances as credits in this suit, the same proof which would have justified a recovery in an action by the United States would have justified the rejection of them as credits when they are claimed as a set-off."

The view thus indicated, that executive decisions in cases like the present are not binding on the courts, has been repeatedly affirmed and steadily adhered to. Gordon v. U. S., 1 Ct. Cl. 1; McElrath v. U. S., 12 Ct. Cl. 201; Duval v. U. S., 25 Ct. Cl. 46; Steele v. U. S., 113 U. S. 128, 5 Sup. Ct. 396; U. S. v. Burchard, 125 U. S. 176, 8 Sup. Ct. 832; U. S. v. Stahl, 151 U. S. 366, 14 Sup. Ct. 347. And it has been often applied in the instance of the improvident issue of patents. U. S. v. Stone, 2 Wall. 525; U. S. v. Minor, 114 U. S. 233, 5 Sup. Ct. 836; Mullan v. U. S., 118 U. S. 271, 6 Sup. Ct. 1041; Wisconsin Cent. R. Co. v. Forsythe, 159 U. S. 46, 15 Sup. Ct. 1020.

In Steele v. U. S. the navy department, in contracting with the claimant for certain work upon vessels, delivered to him certain old materials at the agreed price of $2,000, which was considerably less than the true value. In his suit for payment on the contract it was contended that the delivery of these materials; to him at an agreed price was without warrant of law, and that the materials, having been disposed of, should be accounted for by the claimant at their true value. This contention was sustained, and this court said: "The fact that the account of the appellant was settled by the officers of the navy department by charging him with the value of the old material at $2,000 is no bar to the recovery of its real value by the government. The whole transaction was illegal, and appellant is chargeable with knowledge of the fact." In U. S. v. Burchard the claimant, an en

titled to half sea pay, was paid from said date up to April 1, 1878, at a higher rate, whereby he received $425 in excess of that allowed by law, his pay at that rate being passed from time to time by both the disbursing officers in the navy department and by the accounting officers. After April 1, 1878, he was paid at a lower rate, which this court held to be the legal rate. He brought suit for the difference after 1878, and the government counterclaimed

for the $425 paid to him prior to that time. His petition was dismissed, and the court held the government could recover the overpayment for the prior period. Mr. Chief Justice Waite, speaking for the court, observed that in no event was he entitled to more than half sea pay, and that all over that which he got was by a mistake of the accounting officers, and said: "It only remains to consider whether the amount which has thus been paid, or as much thereof as is embraced in the counterclaim, can be recovered back in this action, and we are of the opinion that it can. The action was brought by Burchard to recover a balance claimed to be due on pay account from the date of his retirement. He had been paid according to his present claim until April 1, 1878, and consequently there was nothing to complain of back of that date. But in reality the account had never been closed, and was always open to adjustment. Overpayments made at one time by mistake could be corrected and properly charged against credits coming in afterwards. His pay was fixed by law, and the disbursing officers of the department had no authority to allow him any more. If they did, it was in violation of the law, and he has no right to keep what he thus obtained. Whether the government can in any case be precluded from reclaiming money which has been paid by its disbursing and accounting officers under a mistake of law is a question which it is not now necessary to decide, any more than it was in McElrath v. U. S., 102 U. S. 426, 441, when it was suggested. This is a case where the disbursing officers, supposing that a retired officer of the navy was entitled to more than it turns out the law allowed, have overpaid him. Certainly, under such circumstances, the mistake may be corrected."

In U. S. v. Stahl the claimant, a naval officer, upon a difference of opinion as to the law, had been overpaid in the grade then occupied by him, and sued for a deficiency claimed to exist in his previous grade. This court sustained his contention as to the previous grade, and held that he had been entitled in that grade to the increased compensation, but that the excessive payments which had been made to him in the latter grade should be deducted from any sum which might be found due him in the former.

selection by the state; but this does not alter the case. The list was certified without authority of law, and therefore by a mistake against which relief in equity may be afforded. As was said in U. S. v. Stone, 2 Wall. 525, 535: "The patent is but evidence of a grant, and the officer who issues it acts ministerially, and not judicially. If he issues a patent for land reserved from sale by law, such patent* is void for want of authority. But one officer of the land office is not competent to cancel or annul the act of his predecessor. That is a judicial act, and requires the judgment of a court.''

In Wisconsin Cent. R. Co. v. Forsythe, which was an action of ejectment to recover certain lands claimed to have been included within its grant, but which defendant insisted were outside of its grant, and subject to private entry, this court said: "But, further, it is urged that this question of title has been determined in the land department adversely to the claim of the plaintiff. This is doubtless true, but it was so determined, not upon any question of fact, but upon the construction of the law; and such matter, as we have repeatedly held, is not concluded by the decision of the land department."

As a general rule, and on grounds of public policy, the government cannot be bound by the action of its officers, who must be held to the performance of their duties within the strict limits of their legal authority, where, by misconstruction of the law under which they have assumed to act, unauthorized payments are made. Whiteside v. U. S., 93 U. S. 247; Hawkins v. U. S., 96 U. S. 89; and cases before cited. The question is not presented as between the government and its officer, or between the officer and the recipient of such payments, but as between the government and the recipient, and is then a question whether the latter can be allowed to retain the fruits of action not authorized by law, resulting from an erroneous conclusion by the agent of the government as to the legal effect of the particular statutory law under or in reference to which he is proceeding.

Section 4057 of the Revised Statutes reads: "In all cases where money has been paid out of the funds of the post office department under the pretense that service had been performed therefor, when, in fact, such service has not been performed, or as additional allowance for increased service actually rendered, when the additional allowance exceeds the sum which, according to law, might rightfully have been allowed therefor, and in all other cases where money of the department has been paid to any person in consequence of fraudulent representations, or by the mistake, collusion, or misconduct of any officer or other employé in the postal service, the postmaster-general shall cause suit to be brought to recover such wrong or fraudulent payment or excess, with Interest thereon."

sion in the construction or application of a statute. And, this being so, as the duty is devolved on the postmaster general to cause suit to be brought where money has been illegally paid by reason of misconstruction or misapprehension of the applicable law, it follows that he must be regarded as empowered to reconsider prior decisions, to determine whether such a mistake has been committed or not. If, in his judgment, money has been paid without authority of law, and he has money of the recipient in his hands, he is not compelled to pay such money over, and sue to recover the illegal payments, but may hold it subject to the decision of the court when the claimant sues. U. S. v. Carr. 132 U. S. 644, 10 Sup. Ct. 182; Gratiot v. U. S., 15 Pet. 336; Steele v. U. S., U. S. v. Burchard, U. S. v. Stahl, supra. And in that way multiplicity of suits and circuity of action are avoided.

It is unnecessary to go into a discussion of the exceptions which may exist between private parties to the rule that moneys paid through mistake of law cannot be recovered back.

This branch of the case was disposed of by the court of claims on the authority of Duval v. U. S., 25 Ct. Cl. 46. It was there held that "the items of the several statements upon which the sixth auditor certifies balances due for carrying the mails ordinarily, and in the absence of special circumstances, may be regarded as running accounts, at least while the parties continue the same dealings between themselves, and that money paid in violation of law upon balances certified by the accounting officers generally may be recovered back, by counterclaim or otherwise, where no peculiar circumstances appear to make such recovery inequitable and unjust." The mistake was, indeed, treated as one of fact, the post-office officials erroneously assuming, through oversight, that the road in question had not been aided by grants of land; but the governing principle in the case before us is the same.

Reference was made to Barnes v. District of Columbia, 22 Ct. Cl. 366, 394, wherein it was ruled (Richardson, C. J., delivering the opinion) that "the doctrine that money paid can be recovered back when paid in mistake of fact, and not of law, does not have so general application to public officers using the funds of the people as to individuals dealing with their own money, where nobody but themselves suffers for their ignorance, carelessness, or indiscretion, because in the former case the elements of agency and the authority and duty of officers, and their obligations to the public, of which all persons dealing with them are bound to take notice, are always involved." We concur in these views, and are of opinion that there is nothing on this record to take the case out of the scope of the principle that parties receiving moneys illegally paid by a public officer are liable ex æquo et bono to refund them.

The petition sets forth, among other things, that the postmaster general wrongfully and unlawfully withheld the $12,532.43 out of moneys

due petitioner, which was therefore entitled to recover the full amount, and to each and every allegation of the petition the government interposed a general traverse. It is now said that a counterclaim or set-off should have been pleaded, but the record does not disclose that this objection was raised below, while the findings of fact show that the entire matter was before the court for, and received, adjudication. Moreover, it has been repeatedly held that the forms of pleading in the court of claims are not of so strict a character as to require omissions of this kind to be held fatal to the rendition of such judgment as the facts demand. U. S. v. Burns, 12 Wall. 246, 254; Clark v. U. S., 95 U. S. 539, 543; U. S. v. Behan, 110 U. S. 338. 347, 4 Sup. Ct. 81; U. S. v. Carr, 132 U. S. 644, 650, 10 Sup. Ct. 182.

Judgment affirmed.

Mr. Justice PECKHAM dissented on the question of the right of the government to offset the alleged overpayments prior to July 1, 1883.

(164 U. S. 179)

TREGEA 7. BOARD OF DIRECTORS OF MODESTO IRRIGATION DIST.

JURISDICTION

(November 16, 1896.) No. 13.

IRRIGATION

- FEDERAL QUESTION DISTRICTS-PROCEEDING TO SECURE EVIDENCE. 1. A decision by the supreme court of a state, adverse to the claim made in that court by one of the parties to the action, that proceedings by the board of supervisors in organizing an irrigation district in accordance with the statute operated to deprive him of his property without due process of law, involves a federal question.

2. The directors of an irrigation district, having determined, in accordance with the statute, to issue bonds of the district to a certain amount, filed a petition asking that the proposed bonds be declared valid, to which petition a resident of the district filed an answer, claiming, in substance, that the proceedings under the statute operated to deprive him of property without due process of law. The decree of the court confirming these proceedings was modified and affirmed by the supreme court of the state. Held, that the proceeding by the directors was, in effect, only one to secure evidence of the regularity of the steps taken relative to the issue of the bonds, and it might well be doubted whether the judg ment of the court was binding on any one; and, as no constitutional right had been invaded by the proceeding, the writ of error should be disInissed. Mr. Justice Harlan, Mr. Justice Gray, and Mr. Justice Brown dissenting.

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

On March 7, 1887, the legislature of the state of California passed an act (St. Cal. 1887, p. 29) whose scope and purpose were disclosed in the first section:

"Section 1. Whenever fifty, or a majority of freeholders owning lands susceptible of one mode of irrigation from a common source, and by the same system of works, desire to provide for the irrigation of the same, they may propose the organization of an irrigation district under the provisions of this act, and when so organized such dis

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