have been adopted in silence, by the later statutes. But the exercise of power in the way deemed just while the conditions stated to have existed in and after 1873 continued was not a construction but the exercise of discretion in determining the amount of pay-a discretion which, as we have seen, undeniably was given in the form of a right

333

to regulate *rates, and which therefore there could be no reason for withholding, beyond the express words of the act, at the other end. It is true that in 1884 an Assistant Attorney General gave an opinion that any departure from the practice would defeat the intention of the law and cause no little embarrassment and that thereafter an order made by a previous Postmaster for taking the number of weighing days as the divisor was revoked. But the letter of the Postmaster General thus answered merely stated what had been the practice as to the divisor and asked whether it was in violation of law. It did not state that the Post Office considered itself bound to follow that way. The order that was revoked only purported to affect seven-day routes and is of little or no importance to the question before us now.

It is said that the rate was fixed by the Act of March 2, 1907, c. 2513, 34 Stat. 1205, 1212, if not before, by a reduction to "five per centum less than the present rates" on certain routes. But as we have stated we understand this to mean a reduction of the rates fixed by statute, that is the maximum rates. We do not understand it to refer to rates specifically allowed. It is not likely that Congress considered the latter in detail. Finally much is made of the fact that before the passage of the Act of March 3, 1905, and again before the passage of the Act of March 2, 1907, provisos were stricken out that in effect required the divisor to be the number of the weighing days. A similar thing happened before the passage of the act making appropriations for the fiscal year ending June 30, 1909. We do not go into the particulars of these matters because whatever may have been said by individuals the provisos might as well have been rejected for the purpose of leaving the choice between the two divisors to the judgment of the Postmaster General as for any other reason. On the other hand we are not dis

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posed to lay much stress on the fact that the appropriations by Congress accepted the Postmaster General's estimates even when it had been notified that the Railroads were dissatisfied with Order No. 412. The Act of March 3, 1875, с. 128, 18 Stat. 340, 341, ordered the Postmaster General to have the weighing done thereafter by the employés of the Post Office Department, and to "have the weights stated and verified to him by said employés under such instructions as he may consider just to the Post Office Department and the railroad companies." Possi

power now in dispute but this suggestion also we are content to leave on one side. We also leave unconsidered the great difficulties that the Railroads encounter in the effort to show that their conduct did not amount to an acceptance of the Postmaster General's terms within the decision in New York, New Haven & Hartford R. R. Co. v. United States, Dec. 8, 1919, 251 U. S. 123, 40 Sup. Ct. 67, 64 L. Ed. The construction of the statutes disposes of all the cases without the need of going into further details.

Judgments affirmed.

Mr. Justice DAY and Mr. Justice VAN DEVANTER dissent. Mr. Justice MCREYNOLDS took no part in the decision of the cases.

Mr. Justice PITNEY, with whom concurred Mr. Justice MCKENNA.

I concur in the affirmance of the judgments of the Court of Claims in these cases, but upon grounds somewhat different from those expressed in the opinion of Mr. Justice HOLMES.

All the claims arose under the law as it stood after the Act of March 2, 1907 (chapter 2513, 34 Stat. 1205, 1212), and before that of July 28, 1916 (chapter 261, 39 Stat. 412, 429), by which the carriage of mail matter by the railways was made compulsory. The Act

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335

about which the principal controversy turns is that of March 3, 1873 (chapter 231, 17 Stat. 556, 558), the disputed portion of which was carried into section 4002, Rev. Stat. U. S. By it the Postmaster General was "authorized and directed to readjust the compensation hereafter to be paid for the transportation of mails on railroad routes upon the conditions and at the rates hereinafter mentioned: Second. That the pay per mile per annum shall not exceed the following rates, namely: On routes carrying their whole length an average weight of mails per day of two hundred pounds, fifty dollars; five thousand pounds, two hundred dollars, and twenty-five dollars additional for every additional two thousand pounds, the average weight to be ascertained, in every case, by the actual weighing of the mails for such a number of successive working days, not less than thirty, at such times, and not less frequently than once in every four years, and the result to be stated and verified in such form and manner as the Postmaster General may direct."

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In my opinion, the rates of pay per mile per annum were maximum rates, and the Postmaster General had a discretion to contract at less if the railroads agreed; but under section 210 of the Act of June 8, 1872 (chapter 335, 17 Stat. 283, 309; Rev. Stat. U. S. § 3997), he was under a duty to arrange the routes into classes according to the size of the mail, and the speed, frequency, and importance of the service, "so that each railway company shall receive, as far as practicable, a proportionate and just rate of compensation, according to the service performed."

But I think that in the clause "the average weight to be ascertained, in every case, by the actual weighing of the mails for such a number of successive working days, not less than thirty," etc., the words "successive working days," by proper interpretation mean successive week days; and since the aggregate weight for the weighing period must be subjected to division in order to

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ascertain the average weight per day, it naturally follows that the divisor should be the same number of "working days" (that is, week days) that are included in the period. The previous history of the mail service shows abundant reason for this, and for more than thirty years thereafter the provision was uniformly so construed by the Department. Upon a large number of the railway routes, mails were carried six days each week, none being carried on Sunday; while on other routes they were carried on every day in the week. The aggregate weight of mails carried was not affected by the frequency of the service, since the six-day routes carried the Sunday accumulations on Mondays. This explains why a certain number of "working days" (week days) was made the measure of the weighing period, and at the same time shows that the week-day divisor was necessary in order to deal equitably with both the six-day and the sevenday routes. From the passage of the act of 1873 down to the promulgation of Order No. 412 in the year 1907, the practice of the Department was in accord with the above interpretation. It was explained in a communication from the Postmaster General to the Senate January 21, 1885 (Senate Ex. Doc. No. 40, 48th Cong., 2d Sess., p. 68):

"The present rule is, on those roads carrying the mails six times a week, to weigh the mails on thirty consecutive days on which the mails are carried, which would cover a period of thirty-five days; dividing the aggregate thirty weighings by thirty will give the daily average. On those roads carrying the mails seven times per week the weighing is done for thirtyfive consecutive days (including Sundays) and the aggregate divided by thirty for a basis of pay. It is evident that the period during which the weighing is continued covers, in both cases, all the mails carried for thirty-five days. If, in the second case, we should take our basis from an average obtained by dividing the aggregate weight by thirty-five we should commit

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the absurdity of putting a *premium upon inefficiency, for evidently if the Sunday train were cut off we should virtually have the same mails less frequently carried, and therefore with a higher daily average, and therefore a higher pay

basis than in the case where the seventh train was run and the greater accommodation rendered. The present method gives no additional pay for the additional seventh train, but the other method would cause a reduction on account of better service, and practically would

operate as a fine on all those roads carrying the mails daily, including Sunday."

The Act of March 3, 1905 (chapter 1480, 33 Stat. 1082, 1088), changed the minimum weighing period so as to require the inclusion of at least ninety, instead of thirty, successive working days, but made no other change. Under this act 105 calendar days necessarily were included in the weighing period in order to take in 90 successive working days. In my opinion, this act, like that of 1873, by fair construction required that the week-day divisor be employed. And so it was officially construed until 1907.

But, while I regard this method of determining the average weight to have been prescribed, and not left to the discretion of the Postmaster General, still I think the statute in this respect was only directory, and not mandatory. Considering the provision in its relation to the context and subjectmatter, it will be seen to be but an aid to the making of fair contracts within the maximum rates allowed, and an aid to the Postmaster General in fixing the rate of compensation upon land grant routes, and in so arranging routes that each railway company shall receive a proportionate and just rate of compensation according to the service performed. Hence it seems to me that a failure strictly to comply with the prescribed method of ascertaining the average weight did not of itself render the action of the Postmaster General ultra vires and void.

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*The principal controversy in the present cases is over his Order No. 412 (June 7, 1907), which provided:

"That when the weight of mail is taken on railroad routes the whole number of days included in the weighing period shall be used as a divisor for obtaining the average weight per day."

While I regard it as embodying an erroneous view of the statute, this is not sufficient, in my opinion, to vitiate a contract voluntarily made by a railway mail carrier based upon a calculation of average weight made and known to have been made in conformity with the order. All the present claims originated after the promulgation of the order, and arose out of the carriage of mails under arrangements made with the Postmaster General after express notice of its provisions.

It is contended that, although the act of 1873 (Rev. Stat. U. S. § 4002 [Comp. St. § 7483]), in providing that the pay per mile per annum should "not exceed" the specified rates, conferred upon the Postmaster General a discretion to pay less rates, this was modified by the language of the Act of July 12, 1876 (chapter 179, 19 Stat. 78, 79), which reduced the compensation 10 per centum from

within the maxima prescribed therein and in the amendatory acts of 1876, 1878, and 1907, above mentioned, and had provided by section 13 of the Act of July 12, 1876 (chapter 179, 19 Stat. 78, 82 [Comp. St. § 7485]), "That railroad companies whose railroad was constructed in whole or in part by a land grant made by Congress on the condition that the mails should be transported over their road at such price as Congress should by law direct shall receive only eighty per centum of the compensation authorized by this Act," besides other legislation concerning the land grant routes that may be referred to, but need not be recited. Acts of March 2, 1907 (chapter 2513, 34 Stat. 1205, 1212); May 12, 1910 (chapter 230, 36 Stat. 355, 362); July 28, 1916 (chapter 261, 39 Stat. 412, 426). Assuming, therefore, that there was no contract affecting the land grant lines of the Northern Pacific, their compensation must be at the rate fixed by

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the Postmaster General in the exercise of the

power and discretion conferred upon him by this legislation; and so long as he exercised this power and discretion reasonably, not fixing a noncompensatory rate or otherwise acting arbitrarily, the carrier was concluded by his action. There is no finding that he acted arbitrarily; on the contrary, he had in support of Order 412 a considered opinion of the Attorney General under date September 27, 1907 (26 Ops. Atty. Gen. 390); and, so far as appears, he treated the land grant routes like others, not reducing them below the 80 per centum contemplated by section 13 of the act of 1876, or otherwise violating the statutes. There is no finding nor any contention that the amounts allowed them were not compensatory; and, upon the whole, it seems to me that, although he erred in failing to apply the week-day divisor to the weighings, this did not render the readjustment based thereon wholly void, or permit the carrier, after transporting the mails and accepting the stated compensation without further objection, afterwards to treat the readjustment orders as nullities.

Mr. Justice MCKENNA concurs in this opinion.

(251 U. S. 315)

WESTERN UNION TELEGRAPH CO. v.

BOEGLI. (Submitted Dec. 19, 1919. Decided Jan. 12,

1920.) No. 83.

PRECLUDING EXERCISE OF REGULATIVE POWER BY STATES.

The provisions of Act June 18, 1910, amending the Act to Regulate Commerce, to bring telegraph companies under the act, as well as

to place them under the administrative control of the Interstate Commerce Commission, so clearly established the purpose of Congress to subject such companies to a uniform national rule as to render it certain there was no room subsequently for exercise by a state of regulative power, by penalizing any negligent failure to deliver promptly an interstate telegram.

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

Action by Peter Boegli against the Western Union Telegraph Company. From a judgment for plaintiff, defendant appealed to the Supreme Court of Indiana, which affirmed (115 N. E. 773), and defendant brings error. Reversed and remanded for further proceedings not inconsistent with the opinion.

Messrs. Rush Taggart and Francis Raymond Stark, both of New York City, Samuel O. Pickens, Charles W. Moores, and Robert Franklin Davidson, all of Indianapolis, Ind., for plaintiff in error.

Mr. Arthur W. Parry, of Ft. Wayne, Ind., for defendant in error.

Mr. Chief Justice WHITE delivered the opinion of the Court.

The Telegraph Company challenged the right to subject it to a penalty fixed by a law of Indiana for failure to deliver promptly in that state a telegram sent there from a point in Illinois, on the ground that the Act of Congress of June 18, 1910 (36 Stat. 539, 545, c. 309), amending the Act to Regulate Commerce (Act Feb. 4, 1887, c. 104, 24 Stat. 379), had deprived the state of all power in the premises. The court conceding that if

316

the act of Congress dealt with the subject the state statute would be inoperative, imposed the penalty on the ground that the act of 1910 did not extend to that field. The correctness of this conclusion is the one controversy with which the arguments are concerned.

[1] The proposition that the act of 1910 must be narrowly construed so as to preserve the reserved power of the state over the subject in hand, although it is admitted that that power is in its nature federal and may be exercised by the state only because of nonaction by Congress, is obviously too conflicting and unsound to require further no

ACT NOT CONSTRUED TO PRESERVE POWER OF

STATES.

Act June 18, 1910, amending the Act to Regulate Commerce, is not to be narrowly construed, so as to preserve any reserved power of the states; such power being in its nature federal, and open to exercise by the states only because of inaction by Congress.

them under the administrative control of the Interstate Commerce Commission so clearly establish the purpose of Congress to subject such companies to a uniform national rule as to cause it to be certain that there was no room thereafter for the exercise by the several states of power to regulate, by penalizing the negligent failure to deliver promptly, an Interstate telegram and that the court below erred therefore in imposing the penalty fixed by the state statute.

We do not pursue the subject further since the effect of the act of 1910 in taking possession of the field was recently determined in exact accordance with the conclusion we have just stated. Postal Telegraph Cable Co. v. Warren-Godwin Lumber Co., 251 U. S. 27, 40 Sup. Ct. 69, 64 L. Ed. -. That case, indeed, was concerned only with the operation, after the passage of the act of 1910, of a state statute rendering illegal a clause of a contract for sending an interstate telegram limiting the amount of recovery under the conditions stated in case of an unrepeated

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message; but the *ruling that the effect of the act of 1910 was to exclude the possibility thereafter of applying the state law was rested, not alone upon the special provisions of the act of 1910 relating to unrepeated messages, but upon the necessary effect of the general provisions of that act bringing tele

pany itself as due from it, and the company also prepared statement of account showing a false balance favorable to the United States, which balance was accepted by the treasurer of the Philippine government, organized pursuant to Act July 1, 1902, the United States was not under obligation to pay the Spanish subsidy to the company on any principle of undue enrichment, of implied obligation from acceptance of taxes, or from acceptance of balance of account.

2. COURTS449(1)-UNITED STATES 69 CONTRACT LIABILITY ENFORCEABLE IN COURT OF CLAIMS CAN ONLY BE CREATED BY PROPER OFFICER.

A contract liability, express or implied, judicially enforceable by the Court of Claims against the United States, can be created only by some officer of the government lawfully invested with power to make such contracts, or to perform acts from which they may be lawfully implied.

Appeal from the Court of Claims.

Claim by the Eastern Extension, Australasia & China Telegraph Company, Limited, against the United States. From an adverse judgment, claimant appeals. Affirmed.

See, also, 231 U. S. 326, 34 Sup. Ct. 57, 58 L. Ed. 250.

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*Messrs. Louis Marshall and Samuel Unter

Interstate Commerce Act. The contention as to the continuance of state power here made is therefore adversely foreclosed. Indeed, in the previous case the principal authorities here relied upon to sustain the continued right to exert state power after the passage of the act of 1910 were disapproved and various decisions of state courts of last resort to the contrary, one or more dealing with the subject now in hand, were approvingly cited.

Reversed and remanded for further proceedings not inconsistent with this opinion.

Mr. Assistant Attorney General Davis, for the United States.

Mr. Justice CLARKE delivered the opinion of the Court.

The appellant, claimant, is the grantee from the government of Spain of three concessions to lay down and operate submarine cables. The first one, in 1879, was for the exclusive privilege, for 40 years, of constructing and operating a cable between the Island of Luzon and Hongkong. It was landed at Bolinao on the northerly coast of Luzon, and dispatches were transmitted to Manila and other places by government owned land lines, which were subject to interruption. This concession required that official messages be

CHINA TELEGRAPH CO., Limited,

v. UNITED STATES.

(Argued Dec. 15, 1919. Decided Jan. 12, 1920.)

No. 357.

1. UNITED STATES 69-No IMPLIED OBLIGATION TO PAY SPANISH SUBSIDY TO PHILIP

PINE CABLE COMPANY.

Where a cable company operated in the Philippine Islands under concession and subsidy from the Spanish government, and the United States government, when it assumed jurisdiction over the Islands, availed itself of the cables, paying rates demanded, while, after urging from the company, the Philippine gov

1898 a second concession, supplemental to the first, empowered the claimant to extend its cable to Manila, and the term of the prior exclusive grant was extended 20 years, with the same priority for official dispatches, but