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The CHAIRMAN. What authority was there for contracting for the obligations in the first instance!

Mr. ABEL. The work was done under direct appropriations for school and home gardening and for 1 register of teachers.

Mr. Byrxs. Were these payments made for manuscripts prepared by these various individuals?

Mr. ABEL. Yes, sir.

Mr. Byrns. It was for the preparation of manuscripts which were put out in the form of bulletins ?

Mr. ABEL. Yes, sir.
Mr. Byrns. Prepared by persons not employed in the bureau ?

Mr. ABEL. They were not employed at the time they did this work, but they had been.

The CHAIRMAN. Is it true that the appropriation did not authorize the employment of people who were not engaged as regular employees in the service of the bureau !

Nr. ABEL. Undoubtedly it did authorize making contracts with such people.

The CHAIRMAX. I do not understand it, and I am trying to find out what you want.

Mr. ABEL. The Auditor for the Interior Department in the Treas. ury Department held up those claims after Mr. Evans had paid them. He held them up upon the ground that the Interior Department was required to make its contracts on a special form. I believe the Navy Department and the War Department must also use this form. We had not been using it and did not use it for these claims.

The CHAIRMAN. You had not made any contracts at all, but simply allowed them to prepare manuscripts or articles, for which you paid them?

Mr. ABEL. We had contracts in the form of proposals.

Mr. Sissox. Did you have any authority of law to pay for such manus ripts under any conditions ?

Mr. ABEL. Yes, sir.

Mr. Sissox. Where is the statute that authorized the Bureau of Education to do that?

Mr. ABEL. This particular one is the act of March 1, 1919– For investigation of school and home gardening in cities and manufacturing towns, including personal services in the District of Columbia and elsewhere. $25,000.

The CHAIRMAN. That was for an investigation, and they went to writing manuscripts?

Mr. ABEL. The investigation would not have been very helpful to us if the results had not been written up, I think.

The CHAIRMAN. They might have been written up by those who were in the service of the Government.

Mr. Sisson. Is there any other authority for this?

Mr. Abel. I think the act creating the bureau gives authority for it. The CHAIRMAN. That is not any authority.

Mr. Sisson. You are asking here for certain sums that were denied by the auditor.

Mr. ABEL. Yes, sir.

Mr. Sisson. Did they seek to pay it out of this $25,000?
Mr. ABEL. Yes, sir.

Mr. Sisson. Was there a balance left in this appropriation of $25,000 that went back into the Treasury, or a sufficient balance to cover these amounts ?

Mr. ABEL. Yes, sir; there was.

Mr. Sisson. These amounts here, then, are within the $25,000 appropriation?

Mr. ABEL. Yes, sir.
Mr. Sisson. The parties who did the work got their money?
Mr. ABEL. Yes, sir.

Mr. Sisson. Then the proper authorities of the Treasury Department charged this sum up to Mr. Evans, the disbursing clerk?

Mr. ABEL. Yes, sir.

Mr. Sisson. Because he disbursed money which the Treasury Department contended he had no authority to disburse?

Mr. ABEL. They contended that the contract was not in right form.

Mr. Sisson. They contended that the money was improperly paid out, and charged it up to Mr. Evans, the disbursing clerk?

Mr. ABEL. Yes, sir.

Mr. Sisson. Is there any statute which requires these contracts to be made in a certain form, or was that simply a regulation of the department?

Mr. ABEL. There is a statute that requires the Interior Department, the Navy Department, and the War Department to have these contracts made up on a certain form.

Mr. Sisson. As I understand it, in making a contract that would be binding upon the Government, they were required to comply with certain conditions set out in the statute?

Mr. ABEL. Yes, sir.

Mr. Sisson. You must have a proposal made and the proposal accepted, and then the proposal and acceptance must be reduced to the form of a contract?

Mr. ABEL. Yes, sir.

Mr. Sisson. That is the way it is in the Navy Department, and I presume the same provision applies here. You got it up to the point of the proposal, or the meeting of minds, but you did not complete it by putting it in the contract form required by the statute.

Mr. ABEL. No, sir; we had the proposal.
Mr. Sisson. You had the proposal and acceptance?
Mr. TBEL. We had the proposal, acceptance, and agreement.

Mr. Sisson. You had the proposal and acceptance, but you did not have it in the form of a written contract agreement?

Mr. ABEL. We did not put it in the form of another contract.

Mr. Sisson. You did not put it in the form of a contract at all, because if you had, you would have complied with the statute.

Mr. ABEL. The proposal and agreement which we had used had been accepted as a contract for a number of years.

Mr. Sisson. But you did not have a legal contract, or the Treasury Department would not have turned it down. In other words, you failed to comply with the statutory regulations, which required you to put that contract into a certain form and to have it signed by the proper parties?

Mr. ABEL. Yes, sir; that is true..

Mr. Byrns. The service was rendered and was perfectly satisfactory? Mr. ABEL. Yes, sir; and was paid for.

Mr. Sisson. In other words, while it is an equitable claim against the Treasury, it is not a legal one, because, while the work was performed, there is no such thing as a quantum meruit as between an individual and the Government, but he must comply with the “ Thus saith the law." I think I understand it, but I would like very much to see in what form you were required to make a contract. In other words, I would like to have the record show the statute under which the Treasury Department turned down the account.

Mr. ABEL, It is section 3744 of the Revised Statutes.

Mr. Fox is somewhat better informed on the legal side than I am. • Mr. Fox. My name is Edward B. Fox, and I am deputy chief disbursing clerk of the Department of the Interior.

The CHAIRMAN. Where is the disbursing clerk, Mr. Evans ?

Mr. Fox. Mr. Evans is not able to be here to-day. I am his deputy.

The CHAIRMAX. Section 3744 of the Revised Statutes reads as follows:

It shall be the duty of the Secretary of War, of the Secretary of the Navy, and of the Secretary of the Interior, to cause and require every contract made by them severally on behalf of the Government, or by their officers under them appointed to make such contracts, to be reduced to writing and signed by the contracting parties with their names at the end thereof; a copy of which shall be filed by the officer making and signing the contract in the returns office of the Department of the Interior, as soon after the contract is made as possible, and within 30 days, together with all bids, offers, and proposals to him made by persons to obtain the same, and with a copy of any advertisement he may have published inviting bids, offers, or proposals for the same. All the copies and papers in relation to each contract shall be attached together by a ribbon and seal, and marked by numbers in regular order, according to the number of papers composing the whole return.

Section 3745 reads:

It shall be the further duty of the officer, before making his return, according to the preceding section, to affix to the same his affidavit in the following form. sworn to before some magistrate having authority to administer oaths: “I do solemnly swear (or affirm) that the copy of contract hereto annexed is an exact copy of a contract made by me personally with

--; that I made the same fairly without any benefit or advantage to myself, or allowing any such benefit or advantage corruptly to the said

-, or any other person ; and that the papers accompanying include all those relating to said contract, as required by the statute in such case made and provided.

Section 3746 reads:

Every officer who make any contract, and fails or neglects to make return of same, according to the provisions of the two preceding sections, unless from unavoidable accident or causes not within his control, shall be deemed guilty of a misdemeanor, and shall be fined not less than $200 nor more than 8500, and imprisoned not more than six months.

Section 3747 reads:

It shall be the duty of the Secretary of War, of the Secretary of the Navy, and of the Secretary of the Interior to furnish every officer appointed by them with authority to make contracts on behalf of the Government with a printeil letter of instructions, setting forth the duties of such officer, under the two

preceding sections, and also to furnish therewith forms, printed in blank, of contracts to be made, and the affidavit of returns required to be affixed thereto, so that all the instruments may be as nearly uniform as possible.

Mr. CANNON. Is that all the law there is?
Mr. Sisson. That is enough.

Mr. CANNON. But you can not make contracts about things that are not authorized by law.

The CHAIRMAN. No; but these men

Mr. CANNON (interposing). Where is the authority for making this contract?

The CHAIRMAN. The authority for making the contract is in that law, but they did not carry out the law.

Mr. Sisson. They did not make the contract in accordance with the law and did not comply with its terms.

The CHAIRMAN. The Accounting Office rendered a decision in this case which reads like this:

These vouchers have been designated for payment, and paid by the disbursing officer from the appropriation for “ investigation of school and home gardening, Bureau of Education, 1920," the auditor disallowed credit on the ground that this appropriation was not available therefor during the fiscal year 1921 for the reasons set forth in 27 Comp. Dec., 970. The application for revision of the auditor's action was in effect a request that these payments be charged to the appropriation for “investigation of rural and industrial education, 1921," there having been submitted to the auditor by the disbursing officer a copy of a letter dated June 1, 1921, from the Commissioner of Education to the Secretary of the Interior, stating that these vouchers might be properly charged to that appropriation. In the former decision now sought to be reconsidered the auditor's action was affirmed on the sole ground that the balance apparently remaining to the credit of the appropriation for “ investigation of rural and industrial education, 1921," was insufficient to cover the vouchers in question. Through the redeposit of funds placed to the credit of this disbursing officer on account of this appropriation the apparent balance on the books of the Treasury to the credit of this appropriation is now greater than the amount involved in these vouchers, and the request for reconsideration is based upon that fact. The disbursing officer's appeal will, therefore, be now considered upon its merit.

The General Accounting Office ruled that they had no right to make payments out of the appropriation for 1921, and does not say it was because the form of the contract was not carried out.

Mr. Fox. I think the gist of the comptroller's decision was that the proposal and acceptance did not constitute a binding contract; that it was not a formal contract under section 3744 of the Revised Statutes. He held, in effect, that it was not such a contract as would make the balance of the appropriation available for expenditure during a subsequent year. It was largely on that ground that he made the disallowance.

The CHAIRMAN. He did not hold that it was on account of the failure to make a contract in proper form, but he held that you had no authority to pay it out of the appropriation. That is the effect of his decision. Is there any place where he says anything about the contract ?

Mr. Fox. I only base my opinion on his decision, that where there is a formal contract made under the statute it will bind the appropriation.

The CHAIRMAN. But he did not refer to the contract in his decision, did he?

Mr. Fox. I think he did, sir.
Mr. Sisson. This appears on page 13:

The papers in the form of accepted proposals filed with these vouchers as authority for their payment are not such contracts as are required by this statute. Without considering the propriety of these transactions from any other point of view, but assuming for the purposes of this decision that they were properly within the purview of the appropriation so that binding contracts for the payments in question might have been entered into during the fiscal year for which the appropriation was made, it was necessary that such contracts should be executed in the manner prescribed by section 3744 of the Revised Statutes if, in view of the provisions of section 3690 of the Revised Statutes, payments thereunder were to be made after the expiration of the fiscal year for which the appropriation was made.

Now, when the Commissioner of Education was turned down on that demand he then sought to have it paid out of another fund, a different fund than the one out of which he first attempted to have it paid, and he could not have it paid out of that fund because he had not complied with the statute the chairman just read. Now, when he seeks to have it paid out of this other fund then the comptroller in his decision specifically holds that he can not have it paid out of that other fund and declines to allow the payment. The last opinion in this decision seems to have reference to his second application to have it paid out of this other fund.

Mr. Fox. We took the position that if these contracts would not bind

Mr. Sisson (interposing). Unquestionably you had no authority if the comptroller has properly quoted the statute. The comptroller says in the first part of this opinion that if he had had his contracts in proper form it should have been paid. Mr. Fox. Absolutely.

Mr. Sisson. So I understand there were two applications for this money. The first one was where he sought to get it under the proper item of appropriation, but he had not complied with the statute that required it to be put in writing.

Mr. BYRNs. Without passing on the question of the allowance of this appropriation by the committee, I do not think Mr. Warwick. the comptroller, held specifically as you say, because he says:

Without considering the propriety of these transactions from any other point of view, but assuming for the purposes of this decision that they were properly within the purview of the appropriation so that binding contracts for the payments in question might have been entered into during the fiscal year for which the appropriation was made, it was necessary that such contracts should be executed in the manner prescribed by section 3744 of the Revised Statutes if, in view of the provisions of section 3690 of the Revised Statutes, payments thereunder were to be made after the expiration of the fiscal year for which the appropriation was made.

Mr. Fox. I desire to make this general statement: These payments. aggregating $2.700, were made by the chief disbursing clerk, Mr. Evans, on vouchers certified to him as correct and just by the then Commissioner of Education, Dr. P. P. Claxton. Subsequently, other vouchers of the same nature were transmitted by the Bureau of Education to the Auditor for the Interior Department for direct settlement. Three of the vouchers transmitted to the anitor were paid by him without question. Thereafter, on May 13. 1921, the Comptroller of the Treasury revised and disallowed these three auditor's settlements, and on August 1, 1921, he likewise disallowed

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