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U.S. Supreme Court

District of Columbia v. Bailey, 171 U.S. 161 (1898)

District of Columbia v. Bailey

Nos. 390, 420

Submitted January 10, 1898

Decided May 31, 1898

171 U.S. 161


The Commissioners of the District of Columbia have no power to agree to a common law submission of a claim against the District.

On July 30, 1879, a contract for resurfacing with asphaltum certain streets in the City of Washington was awarded to

Page 171 U. S. 162

the Bailey-French Paving Company. The agreement was embodied in a writing signed on the one part by Davis W. Bailey, as general agent of the company just named, and on the other part signed and sealed by the Commissioners of the District of Columbia. The price specified for the work aggregated a little less than $41,000. On February 12, 1880, when about three-fourths of the work to be done under this contract had been completed, and about $36,000 earned therefor, including $5,784.14 allowed for extra work, the Commissioners notified Bailey that no more work could be performed under the contract because of the fact that the appropriation made by Congress for the work in question was exhausted. Subsequently, on February 24, 1883, Davis W. Bailey, claiming that he was in fact the Bailey-French Paving Company, instituted an action at law in the Supreme Court of the District of Columbia against the District of Columbia to recover $25,000 as damages averred to have been sustained by the cessation of the work under the contract. The District, on April 4, 1883, filed pleas claiming a set-off of $1,312.30 for damages alleged to have been sustained by improper performance of the work of resurfacing, averring the termination of the contract by reason of the appropriation's having been exhausted and alleging that the time within which the contractor had stipulated to complete the work had expired long prior to the cancellation of the contract. The plaintiff joined issue and filed a replication on April 18, 1883.

On June 19, 1883, Bailey died. His widow was appointed administratrix, and the action against the District was revived in her name.

On September 16, 1891, the attorney for the claimant addressed a letter on behalf of the administratrix to the Commissioners of the District of Columbia calling attention to the pending case, stating that "the grounds of said suit is for breach of contract," reciting the facts as to the making of the contract and the mode by which it was terminated, and claiming that, at the time of such cancellation, Bailey had expended for machinery necessary to the performance of the contract $10,180; that he had at the time stock on hand,

Page 171 U. S. 163

$7,000; that the profit on the unexecuted balance of the work would have been $8,000; that there was due under the contract for an extra one-half inch of surfacing $5,000. These items were stated in the letter to amount to $31,180, but only aggregate $30,180. Without calling the attention of the Commissioners to the fact that the item of $5,000 for an extra half-inch of resurfacing was not asserted in the declaration in the pending suit, the attorney for the administratrix proceeded to refer to the defenses interposed in such suit on behalf of the District, and next stated the claim made by the contractor in his replication that the delay in the work was the fault of the District.The conclusion of the letter, omitting references to immaterial matters, was as follows:

"Now, having stated the principal facts which bear upon this case, that you may have sufficient knowledge to act in the premises, I write to ask if you will appoint some good man as a referee or arbitrator to whom this case may be referred, with power to hear the evidence and make an award which shall be accepted, whether for or against us, as a final settlement of this long and much litigated case."

This communication was referred by the Commissioners to the attorney for the District, who endorsed thereon under date of October 17, 1891:

"This is a case which has been pending in the court for a long time, and it ought to be disposed of. It if could be referred to some first-class referee, who will give us a full hearing; it would be a very good way of disposing of if, and I should favor such a reference, as we can then attend to it at our convenience."

A memorandum was also sent by one of the Commissioners to the assistant attorney for the District, which read as follows.

"Thomas: Think of some good names for a referee, and talk with us about this case."

"October 27, 1891. J.W.D."

A memorandum in pencil, evidently having reference to the foregoing, is as follows:

Page 171 U. S. 164

"Ans. Mr. Douglass. Comm'rs think this case should be settled in court."

On October 28, 1891, Assistant Attorney Thomas sent the following letter:

"To the Hon. Commissioners, etc., etc."

"Gentlemen: I return to you herewith a communication from W. Preston Williamson, Esq., relative to the case of Bailey v. The District of Columbia, referred to me with the request that I give you the name of some one who would make a good referee."

"I would suggest either Mr. A. B. Duvall or Mr. J. H. Lichliter, both members of the bar, and well qualified to decide the issues in that case."

"Very respectfully,"

"S. T. Thomas, Asst. Atty. D.C."

The next document referring to the matter is the following:

"Office of the "

"Commissioners of the District of Columbia"

"Washington, January 11, 1892."

"Ordered, that J. J. Johnson is hereby appointed referee in the matter of the suit of Bailey, Administratrix of Bailey, Deceased v. District of Columbia."

"Official copy furnished Mr. J. J. Johnson."

"By order: W. Tindall, Secretary"

Under this appointment, on February 17, 1892, the attorneys for the respective parties appeared before Mr. Johnson. It was claimed by witnesses for the plaintiff at the trial of the action subsequently brought to enforce the finding of the referee that, at the commencement of the hearing, the latter gentleman, as well as the attorney for the administratrix, raised the question whether or not, under the order of appointment, the decision of the referee was to be final, and were assured by the attorney for the District that the decision of Mr. Johnson was to be a final determination of the case.

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Such witnesses also testified that subsequently, when a question arose with respect to permitting an amended declaration to be filed setting up a claim for an extra half-inch of resurfacing, the referee and attorneys discussed as to whether the decision of the referee "was to wind up finally the whole matter," and an affirmative conclusion was arrived at. No attempt, however, was made to obtain from the Commissioners of the District any modification or amplification of the writing of January 11, 1892.

The hearing before the referee was concluded on July 18, 1892, when Mr. Johnson placed on the files of the Supreme Court of the District of Columbia, in action numbered 21,279, his report as referee. The report did not refer to the mode by which its author had become referee. It was entitled in the cause, purported to contain a synopsis of the pleadings, the plaintiff's claim, a statement of the facts, and the findings of "J. J. Johnson, Referee." The report concluded as follows:

"Upon the evidence and the law, I have allowed the plaintiff for the unexecuted balance of 11,385 square yards, $4,440.15, being the profit between the cost of resurfacing the streets at fifty cents per square yard and eighty-nine cents, the price received, and for the extra one-half inch I have allowed the plaintiff $6,079.05 at the contract price, aggregating the sum of $10,519.20. I do, therefore, find that there is due to the plaintiff from the defendant the sum of $10,519.20, besides costs."

The referee also fixed his fee at $550, which was paid by the administratrix.

On September 23, 1892, exceptions were filed on behalf of the District to this report. Upon the exceptions, the attorney for the plaintiff made the following endorsement: "I consent that these exceptions be filed nunc pro tunc." On March 10, 1893, a motion for judgment was filed on behalf of the plaintiff.

Without action's being had on the exceptions and motions referred to, the administratrix of Bailey, on August 8, 1893, instituted an action at law, numbered 34,564, in the Supreme

Page 171 U. S. 166

Court of the District of Columbia, seeking to recover from the District the sum of $10,519.20, basing the right to such recovery upon the claim that the finding of Mr. Johnson was in fact a final decision and award. In the affidavit filed with the declaration, as authorized by the rules of practice of the court, what purports to be a copy of the resolution appointing Mr. Johnson referee is set out, but the words "of the suit" are omitted from before the words "of Bailey, administratrix." On September 2, 1893, pleas were filed on behalf of the District denying that it had agreed to submit the matters of difference referred to in the declaration to the award and arbitrament of Johnson, and averring that Johnson had not made an award concerning the same. The various steps in the original action (No. 24,279) were stated, and it was alleged that motions to set aside said award and for judgment were still pending. It was also averred that the alleged award was not under seal, and was never delivered to the defendant; that the defendant never undertook and promised in the manner and form as alleged, and that the District was not indebted as alleged. The plaintiff joined issue. On October 8, 1895, on motion of the plaintiff, the two causes were consolidated. While the motion to consolidate was opposed by the District, no exception was taken to the entry of the order of consolidation.

The consolidated action came on for trial January 13, 1896. At the trial, W. Preston Williamson, a witness for the plaintiff, testified that he had sent to the Commissioners the communication of September 16, 1891. Under objection and exception, he was permitted to testify to conversations had separately with two of the Commissioners, which tended to show that in the event of the appointment of an arbitrator or referee, it was the intention of the Commissioners to submit to the individual selected as referee or arbitrator the final determination of the entire controversy referred to in Williamson's letter. Also, under objection and exception, the witness testified that after the order appointing Mr. Johnson referee was made by the Commissioners, he and the attorney for the District, in the presence of the referee, discussed the scope of

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the submission, and agreed that the decision of the referee was intended by the parties to the controversy to be a final disposition of the whole matter. The endorsements on the letter of Mr. Williamson, the letter of the assistant attorney of the District, and other memoranda heretofore set out were put in evidence on behalf of the plaintiff. Mr. Hazleton, a former attorney for the District, also testified for the plaintiff, in substance, under objection and exception, that it was the intention of the Commissioners, as he knew from oral statements made to him by two of the Commissioners, that the appointment of a referee would be for the purpose of ending the whole controversy, and that nothing occurred between the time of the appointment of the referee and the making of the report to change that understanding. He also testified as to the filing of the amended declaration before the referee, setting up the claim for an extra half-inch of resurfacing, which was not embraced in the pending suit at the time the referee or arbitrator was appointed.

J. J. Johnson also testified on behalf of the plaintiff, under objection and exception, as to the understanding had with him at the hearing before him as referee, by the counsel for the respective parties, regarding the finality of any decision made by him, and as to the filing of the amended declaration for the extra half-inch of resurfacing. He testified that he filed the report made by him in court of his own motion, and averred that certain written matter filed with his report was not a part of the report, and that it did not contain all the evidence, though it contained all the oral testimony given before him.

The report was next put in evidence, objections being first separately interposed to its introduction on the grounds (1) that the papers and evidence attached thereto should also be put in evidence, and (2) that the referee was without authority to make an award. To the overruling of each objection the defendant duly excepted.

John W. Douglass, one of the Commissioners for the District in office at the time of the appointment of the referee, testified on behalf of the plaintiff that the intention of the

Page 171 U. S. 168

Commissioners was to make the reference final. The evidence for the plaintiff was closed with the testimony of the plaintiff, who stated, in effect, that the letter of September 16, 1891, had been sent to the Commissioners with her approval, and that nothing had been paid her on account of the award. For the defendant, John W. Ross, who was a Commissioner at the time of the appointment of Mr. Johnson, testified that he was an attorney at law, knew the difference between an arbitration and order of reference for a report, and that his understanding when the appointment of Mr. Johnson as referee was made was that the appointment was not of an arbitrator, but was simply one of reference. He further testified "there was no record of the appointment of the referee, except the one in evidence, unless the pencil memorandum may be taken as a record." The witness denied that he made statements attributed to him by the witnesses for the plaintiff, to the effect that it was the intention of the Commissioners that the decision of Mr. Johnson should be final.

After Mr. Ross had concluded his testimony, the record and proceedings in action No. 24,279 were introduced in evidence on behalf of the defendant. On the settlement of the bill of exceptions, a dispute arose as to whether the papers attached to the report of the referee had been put in evidence by the offer made, but it is unnecessary to notice the action taken by the trial court with respect to that controversy.

In rebuttal, Mr. Williamson reiterated statements as to alleged declarations of Mr. Ross regarding the finality of the decision of the referee. On cross-examination, he said:

"That he wrote the letter of September 16, 1891 at his office, 912 F Street; that he did not know why the District filed exceptions, as it was understood that the report was to be final; that witness filed the motion to confirm the award because he thought it the best thing -- the only thing -- that could then be done, and that he thought it would be simply a matter of form, and he would have confirmation at once of the award, and that the money would be paid, but the District, instead of doing that, violated its agreement; that witness

Page 171 U. S. 169

did not remember ever consenting to the filing of exceptions to the award. Now that counsel shows him the paper which is the exception to the award, witness remembers that he signed the paper consenting that the exceptions should be filed nunc pro tunc. Mr. Richardson came to him, and asked him if he would make any special objection to the exceptions' being filed; that they ought to be filed, so that the District might make their objections, and for that purpose he did it, and did not consent to it because he thought it was not final; that there was not a copy of the award served by him on the Commissioners; that Mr. Johnson was their arbitrator, and it was not for witness to serve them with a copy."

The evidence was then closed. The trial judge granted a request of the defendant that the jury be instructed to render a verdict for the defendant in the first action, and an exception was duly noted on behalf of the administratrix. The trial judge also granted a request of counsel for the plaintiff, in substance that the jury be instructed to find for the plaintiff if they found from the evidence that the Commissioners accepted the proposition contained in Mr. Williamson's letter; that, in pursuance of such acceptance, the Commissioners made the order of January 11, 1892, and that the hearing before Mr. Johnson was proceeded with under such appointment, and the declaration amended at the hearing by consent of counsel. An exception was taken to the granting of this instruction.

The following requests for instructions were then asked on behalf of the defendant, which, being overruled, separate exceptions were noted:

"2. The jury are instructed, on the whole evidence in cause No. 34,564, they are to render a verdict for the defendant."

"3. The jury are instructed that the Commissioners of the District of Columbia were without authority to agree to submit the matters in controversy in the case of Bailey, Adm'r v. The District of Columbia at law, No. 24,279, to the final award of an arbitrator, but that said Commissioners had authority to agree to refer the case for the award and report of a referee, subject to the approval of the court."

"5. The jury are instructed that the plaintiff, as administratrix

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of the estate of her deceased husband, was without authority to agree to refer the claim of the estate to arbitration without the previous direction of the Supreme Court of the District of Columbia, holding a special term for orphans' court business."

The bill of exceptions also states that exceptions were taken on behalf of the District to portions of the general charge of the court contained in brackets, but no portion of the charge, as contained in the printed record, is so marked.

A verdict was returned finding in favor of the defendant in action No. 24,279, and in favor of the plaintiff for $10,519.20 and interest in action No. 24,564. Judgment was subsequently entered upon the verdict, and both parties prosecuted error. The Court of Appeals of the District having affirmed the judgment, 9 App.D.C. 360, each party obtained the allowance of a writ of error from the court, and the consolidated cause is now here for review.

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