Merriam v. United States/Opinion of the Court

The contention of the appellant is that under that clause of the contract sued on which provided as follows: 'said Merriam shall supply 600,000 pounds, more or less, of oats, * *  * or such other quantity, more or less, as may be required from time to time for the wants of such station between the first day of July, 1877, and the thirty-first day of December, 1877, in such quantities and at such times as the receiving officer may require,'-he was bound to deliver, and the United States to receive, in addition to the 1,600,000 for which his bid was accepted, all the oats needed for the wants of the station between the dates mentioned. And as it appears from the finding of the court of claims that a large quantity of oats over and above that received from the appellant was received at Bismarck between the dates mentioned, under the contract made with Hall, and that appellant's offer to furnish a quantity of oats in addition to the amount specifically mentioned in his contract was declined, that a breach of his contract is shown, for which he is entitled to damages. It is contended on behalf of the United States that under the contract sued on the appellant was bound to deliver, and the United States to receive, 1,600,000 pounds of oats, and no more, unless required to do so by the quartermaster. The only question presented by the record is which of these two constructions of the contract is the true one.

It is a fundamental rule that in the construction of contracts the courts may look not only to the language employed, but to the subject-matter and the surrounding circumstances, and may avail themselves of the same light which the parties possessed when the contract was made. Nash v. Towne, 5 Wall. 689; Barreda v. Silsbee, 21 How. 146; Shore v. Wilson, 9 Clark & F. * 353, * 555; McDonald v. Longbottom, 1 El. & El. 987; Munford v. Gething, 29 Law J. C. P. 110; Carr v. Mantefiore, 5 B. & S. 408; Brawley v. U.S. 96 U.S. 168.

Thus, in the case of Doe v. Burt, 1 Term R. 701, where a lease had been made by the plaintiff to the defendant of part of a messuage, together with a piece of ground thereunto adjoining, which piece of ground was used as a yard, and beneath the yard was a cellar occupied by a third party under a lease previously granted to him by the plaintiff, and the occupant of the celler continued to reside in it and to pay rent to the plaintiff for three or four years after the latter had demised the yard to the defendant, but his lease having expired, and he having quitted the cellar, the defendant took possession of it, contending that the cellar had passed to him by the demise of the yard, the court held that parol evidence of the surrounding circumstances was admissible to show that it did not pass.

Availing ourselves of the light thrown on the contract in this case by the circumstances under which it was made, we are of opinion that the construction claimed for it by the appellant cannot be sustained.

The specific quantity of oats to be delivered at Bismarck, for which the circular for the information of bidders invited proposals, was 4,464,700 pounds. The appellant made bids for 6,400,000 pounds; 1,600,000 pounds of which were at the price of $2.23 7-16 per hundred pounds, 1,600,000 at $2.28 1/8 per hundred pounds, and the residue at still higher prices. His bid for 1,600,000 pounds at $2.23 7-16 per hundred pounds was the only bid made by him which was accepted. The bid of Hall was at the same time accepted for 2,620,000 pounds at $2.25 per hundred pounds, and contracts were made with him for the delivery of that amount. It thus appears that the lowest bids were accepted and contracts made in accordance therewith. The contracts made with both the appellant and Hall were identical in form. The bids accepted fell a little short of the entire quantity for which bids were asked. The appellant now insists that by reason of the clause in his second contract, by which, in addition to the specific quantity of oats therein mentioned, he agreed to supply such other quantity, more or less, as might be required for the wants of said station, and which also was found in the second contract made with Hall, the United States were bound to receive from him oats for which his bid was not accepted, and for the delivery of which the bid of Hall, lower than his own, was accepted. It is perfectly clear, from these circumstances, that the officers of the United States who had this matter in charge did not understand the contract with appellant as he now claims to construe it. In other words, they did not intend to contract with two different persons for twice the quantity of oats needed for the wants of the station. Nor did they intend, after making awards to two different bidders for specific quantities of oats, to disregard the awards and enter into contracts by which the higher bidder should supply all the oats.

We think the facts found by the court of claims show also that the construction now claimed by the appellant could not have been his understanding of the contract when it was made. The advertisement calling for bids announced that they would be opened in the presence of bidders. The appellant bid to furnish 6,400,000 pounds of oats. His bid was accepted for only 1,600,000 pounds out of the 4,464,700 pounds for which bids were specifically invited. On the same day on which the contract sued on was executed, the same quartermaster executed two contracts with Hall for the oats, the furnishing of which had been awarded to him.

It is not specifically found by the court of claims that the appellant knew that the bids of Hall for nearly all the oats needed at the station, not awarded the appellant, had been accepted, nor that he knew that contracts had been made with Hall for the delivery of the oats in accordance with the awards made to him. But he knew that his own bid was accepted for less than half the quantity for which bids were invited. He must have known, therefore, that he had a successful competitor in the biddings, and he must have known that a contract had been made with his successful competitor for the delivery of the oats, for which the bid of the latter was accepted; for the printed circular informed him that the bidder whose proposal was accepted would be required to enter into a contract to perform his bid, and he himself had been required to execute a contract to deliver the oats which it was awarded to him to furnish.

These facts being known to appellant, he could not have understood the contract sued on, which was made on the same day as the contract with Hall, as he now contends it should be interpreted. If, therefore, the circumstances surrounding the making of the contract were such that neither party to it could have construed it as the appellant now claims it should have been construed, we must reject that construction and seek one fairly justified by the language of the contract, more consistent with the circumstances of the case. Under the light of these circumstances it is clear that the contract bound the appellant to deliver, in addition to the specific quantity named, such other quantity, more or less, of oats as might be needed from time to time for the wants of the station, and as he might be required to deliver. That such was the appellant's understanding of the contract is evident from the further fact found by the court of claims, that the appellant never asked to be informed whether or not any other oats above the quantity specifically mentioned in his contract would be required; and when he offered the nine car-loads of oats to the receiving officer he requested him to take them in order to clear up all he had at Bismarck and get the railroad company's cars unloaded, but never claimed that he had the right to deliver the oats under his contract. It is, therefore, plain that the interpretation he now puts on his contract is an after-thought, and is not the interpretation put upon it by the parties when it was executed.

The construction we have put upon the contract does no violence to its language. The provision that the oats required for the wants of the station, over and above the quantity specifically mentioned in the contract, were to be delivered in such quantities and at such times as the receiving officer might require, may well be construed to leave with that officer a discretion to call for the additional oats or not, as in his judgment they were or were not necessary for the wants of the station; and if he required none the appellant was bound to deliver and the United States to receive none.

We are of opinion that the court of claims was right in dismissing the petition of the appellant. Its judgment must, therefore, be affirmed.