Having given bond to secure a contract with the Navy Department,
claimant paid premiums after alleged compliance with the condition,
and sued to recover the amount, contending that the Secretary of
the Navy should have cancelled the bond and notified the surety. It
not appearing that claimant had bound itself to continue paying
premiums until the Secretary so acted,
held that the
payment was voluntary, and gave no cause of action in the Court of
Claims.
51 Ct.Clms. 394 affirmed.
The case is stated in the opinion.
MR. JUSTICE BRANDEIS delivered the opinion of the Court.
The Bethlehem Steel Company entered into a contract, dated
September 27, 1909, with the United States to manufacture and
deliver for the Navy large quantities of several groups of armor
plates, and agreed to replace any accepted
Page 246 U. S. 524
armor which should prove defective within six months after it
had been fastened on the ship. The contract required the company to
furnish a bond with sureties in a sum equal to ten percent of the
total cost of all groups, and provided that, "at the end of each
calendar year, the amount of said bond may be reduced to correspond
to the estimated cost of armor then undelivered." The bond was
furnished, and delivery of all the armor originally specified was
completed May 2, 1911. But on March 26, 1912, plates aggregating at
cost prices more than the penalty of the bond were found to be
defective, and a part of this was not replaced until November 22,
1912. On January 27, 1912, the company formally requested the
Secretary of the Navy to cancel the bond and notify the surety, but
he refused to do so except upon certain conditions which were not
complied with until May 15, 1912, when the bond was cancelled. The
company had expended $5,509.62 in payment of premiums on the bond
from May 3, 1911, until May 15, 1912, and demanded reimbursement by
the government. Payment being refused, suit was brought in the
Court of Claims to recover this amount and also a balance of
$3,170.69 for plate delivered. Judgment for the latter sum was
entered, but the court held that the company was not entitled to
recover for the premiums paid. The case comes here under § 242
of the Judicial Code.
The lower court held that the bond covered merely the original
delivery of the armor plate, and not the replacement of defective
plates, but it refused recovery of the amount paid for premiums
after May 3, 1911, on the ground that the payment thereof was
voluntary, because the condition of the bond had then been complied
with. The government contends that the bond covered the replacement
also, that the contract made reduction of the bond permissive, not
mandatory, and that the Secretary was, in any event, under no
obligation to cancel the
Page 246 U. S. 525
bond prior to the request made January 27, 1912. We have no
occasion to consider any of these contentions. It nowhere appears
that the company had bound itself to continue to pay premiums until
the Secretary cancelled the bond and gave the surety notice
thereof. So far as disclosed by the record, the payment of premiums
was voluntary.
The judgment of the Court of Claim is
Affirmed.
MR. JUSTICE McKENNA dissents.