*63

On August 15, 1908, Ceballos & Company, been carried to Spain, and that it had recommenced this action in the court of claims fused payment as to the remaining 24, beto recover a balance alleged to be due under cause twice counted. the Philippine contracts for the carriage of 3,445 cabin passengers, at $215 each; 415 minor children, carried in cabin at half rate, $107.50; 13,647 steerage passengers at $73.75 each, and 20 minor children carried in steerage at half steerage rate, $36.75 each. For this service it was averred $1,792,491.25 had been earned, and after deducting payments of $1,544,595 there was still due Ceballos & Company, $247,896.25. Subsequently an amended petition was filed, in which full adult cabin and steerage rates were demanded for minor children, increasing the alleged indebtedness of the United States to the sum of $293,246.25.

A counterclaim, contained in three numbered paragraphs, was filed on behalf of the United States. In paragraph first it was in substance averred that the United States was entitled to recover back from the claimants the sum of $371,988.75, paid for the transportation of persons under the alleged oral contract in November and December, 1898, and January, 1899, because the same was paid without authority of law, prior to the execution of any contract, expressed or implied, between the United States and Ceballos & Company, or anyone in its behalf. In paragraph second an indebted ness from Ceballos & Company of $12,788.75 was alleged, because of moneys paid to the firm for the transportation of persons who were not actually landed in Spain, as required by the contract. In paragraph third it was averred that as to two shipments made on November 25, 1899, and December 18, 1899, the claimants, by means of a supplemental bill, had collected a second time transportation charges for fourteen military officers (at the rate of $215 each) and 91 enlisted men (at the rate of $73.75 each), whereby $9,721.25 had been overpaid by the United States to Ceballos & Company.

The dispute as to compensation arose from the contention by Ceballos & Company that it had carried the wives and children of Spanish military officers and civil officials in the cabin, and the cabin rate was properly chargeable, while the government insisted that the steerage rate applied and had been paid. Ceballos & Company also contended that, for the carriage of other noncombatants, who were entitled to be considered prisoners of war, the cabin rate applied, whereas the government contended that all noncombatants were embraced within the category of "other persons," who, under the contract, were to be carried in the steerage and paid for at the steerage rate.

The court rejected the first and second counterclaims of the government, and allowed the third. It sustained the contention of the United States as to the number of persons carried to Spain, and the rate of transportation which governed, except it was held that Ceballos & Company, instead of being paid half adult steerage rate for the transportation of minor children, should have been allowed the full adult rate for each child, and judgment was entered on that basis, in favor of Ceballos & Company for the sum of $5,391.25. 42 Ct. Cl. 318.

Without hereafter reproducing the findings verbatim, we shall state, în a condensed form, such of the facts found as we think material to be recited.

Ceballos & Company alone have appealed, and the argument at bar on their behalf has been confined to two questions: 1, The construction of the contract in respect to the persons entitled to be carried at cabin rates; 2, the correctness of the action of the court below in disallowing the claim for the alleged transportation of 198 persons, asserted to have been actually carried under the contracts.

The court below substantially followed the construction of the contract adopted by the Attorney General, and decided that the "higher rate" specified in the contract related to one class, and the lower rate to another class, and within the second class the contract embraced priests, nuns, sisters of charity, all women and children, and every other person designated within the term "prisoners" by the United States, and whether carried in the cabin or steerage.. Civil officials were held entitled to be classi

*There was contention then in the court below in regard to the number of persons carried from the Philippines to Spain, and as to the compensation to be paid. For the government it was urged that, deducting the overcharge covered by the third counterclaim for the transportation of 105 persons, payment in full had been made for all persons legally shown to have been transported; viz., 17,305. On the other hand, the appellants contended that 17,527 persons had been carried,-a difference of 222 persons. As to such excess, the govern-fied with military officers, and their transment alleged it had refused payment as to 198 persons because it had not been shown by the evidence stipulated for in the contract that such persons had embarked and

portation properly chargeable at the cabin rate.

In disposing of the questions arising for consideration we will first consider that re

lating to the 198 persons claimed by the, included in the count at the time and place appellants to have been transported to of embarkation. The accounts presented to Spain, but for whose transportation the the Treasury for payment asked compensaUnited States refused to make payment. As tion for the transportation of such persons, already mentioned, for the first twenty-five based upon certificates signed by the Amerishipments of prisoners of war from the can consul at the landing place in Spain, Philippine Islands to Spain payment was to the effect "that the following Spanish made by the government of the United prisoners," classifying the persons subStates upon the certificates of the masters stantially as in the requisitions above reof the respective ships on which said ferred to, had been "furnished transportaprisoners of war and other persons were tion from Manila, Philippine Islands, to transported, showing the different classes Spain," by the appellants on a * named of passengers certified to be correct at the steamship. For the reason that the method place of landing. prescribed by the contract for determining the initial fact that the persons had been taken on board in the Philippine Islands by the appellants had not been pursued, and further, because the evidence did not establish to the satisfaction of the court that said 198 persons, although certified by the counsel to have been landed in Spain, were entitled to transportation under the contract, the court of claims refused to make any allowance for the transportation of such persons. The passages of the contract relating to this branch of the contro

The method of determining the persons entitled to transportation under the written contract was, however, changed as to the last fifteen shipments,-running from February 20, 1900, to July 14, 1901, during which time it is claimed said 198 persons were carried to Spain, so that requests for transportation with reference to available space were required to be made upon the appellants. Thereupon the United States quartermaster at Manila made demand upon the appellants in writing to furnish transportation "to the following Spanish prison-versy are as follows: ers," separately enumerating, as the case might be, the number of commissioned officers, the number of enlisted men, the number of civil officials, the number of wives of officers and officials, the number of children under three years of age, the number of children between three and ten years of age, the number of children over ten years of age, etc.

Pursuant to the requisition of the Quartermaster General, all the men who were placed on the list of passengers for each shipment were required to be at a particular place at a certain time in the morning, and they were counted by an officer of the Quartermaster's Department, and taken aboard launches, and carried out to the Spanish vessel, ready to sail; and, as they went on board, the persons mentioned in the requisitions were counted by another United States officer, accompanied with the officer who represented the steamship company. Occasionally permission was given to officers of considerable rank to go aboard in their own conveyances, and these were checked off when they went aboard by an officer representing the government and an officer representing Ceballos & Company, and were thereby included in the numbers called for by the requisitions.

No objections were offered by Ceballos & Company at the time of the change in the method of computing the number of persons to go aboard.

The 198 persons in question were not embraced in the requests sent by the quartermaster for transportation, nor were they

"An account of the number of officers, enlisted men, or other persons to be taken at the time of embarkation by a representative of the government of the United States and a representative of the said J. M. Ceballos & Company, and payment to the said company shall be made upon the basis of the number of officers, enlisted men, and persons counted on each ship."

After reciting the compensation to be paid, the contract recited:

"The said sums to be due and payable upon evidence that said officers, enlisted men, or persons have been transported, subsisted, and delivered on shore in Spain."

In refusing to make any allowance for the asserted transportation of these 198 persons, we cannot say, in view of the findings of the court below, that error was committed.

We come to consider the remaining subject of contention, which is thus succinctly stated in the third specification of error made in the brief of counsel for Ceballos & Company: "The court erred in holding that the wives and children of Spanish officers, civil and military, and other noncombatant prisoners of war, although transported as first-class passengers, and afforded cabin accommodations aboard ship, were to be paid for at the third-class rate specified in the contract, to wit, $73.75."

The principal question involved in this assignment is whether the United States shall pay cabin rates for the transportation of the wives and children of Spanish officers, and other officials of equal rank, who

67

"All questions relating to the repatriation of officers and men of the Spanish forces, and of their families, and of the expenses which said repatriation may occasion, shall be referred to the government of the United States at Washington."

were in fact returned to *Spain with such | the appellants intended to commit such an officers as cabin passengers. As stated in act of inhumanity as would necessarily the findings, the oral agreement made in have arisen if the written contract required October or November, 1898, between Cebal- that the family of an officer should be los & Company and the Secretary of War, separated from the husband and father on was "to transport such of the Philippine shipboard, and be relegated to the discomprisoners as the United States desired to re- forts of the steerage and the society of enturn to Spain," the compensation therefor listed men and other persons. Clearly, the to be fixed by the written contract which spirit of the contract is opposed to any was expected to be thereafter entered into. such conception. The wives and children There was no substantial change in the of the officers and enlisted men were assomethod of carrying out this oral contract ciated with them in the written terms of from that pursued with respect to the capitulation of the Spanish forces at MaCuban contract. In the Philippines, as in nila, signed August 14, 1898, the 5th article Cuba, the United States tendered with the which, again reproduced, is as follows: military officers and civil officials which it desired carried to Spain their wives and children. The proposals invited as the basis of a written contract were couched in similar phraseology to that employed in the Cuban contract, and called for proposals for the transportation "of the Spanish prisoners of war now in the Philippine Islands in number estimated as about 16,000 officers and enlisted men." When, therefore, Ceballos & Company submitted a bid for furnishing such transportation, in reason they held themselves out as ready, if the United States tendered for transportation the wives and children of the officers and enlisted men of the Spanish forces, to regard them as entitled to the same treatment required by the government for the head of the family. We cannot impute to the parties to the contract an intention to condemn and refuse to give effect to the practice which had been pursued in carrying out the oral agreement, that is, the treating the wives and children as entitled to transportation, and as being, for the purpose of the accommodations to be furnished, of the class to which the government had in effect assigned their male relatives. That the classification referred to as "such other persons as may be designated by the Secretary of War" was not intended to embrace the wives and children of officers is, it seems to us, manifest from the entire text. government was concerned not only with the furnishing of safe but of comfortable accommodation to those were to be carried on the long voyage from Manila to Spain. It exacted from* Ceballos & Company a stipulation that it should provide "safe and comfortable transportation" for those to be carried; the officers with "cabin accommoda-enlisted men were concerned, should receive tion that it should provide "safe and comdations, space, and ventilation to be supplied for the enlisted men and other persons on board each ship." It is to be presumed that the agents of the United States in the Philippines saw to it that this stipulation of the contract was observed. It is inconceivable, however, that the government or

*68

The

Just as,

Under the Cuban contract, the wives and children of officers were treated as entitled to be classed with the head of the family in respect to the accommodation to be supplied, and, in the performance of the Philippine oral contract, a like practice was pursued. In effect, therefore, by a course of conduct, the United States had associated the wives and children of the officers and enlisted men with such officers and men for the purpose of the transportation to be furnished and the treatment to be accorded them on the homeward voyage. in the opinion rendered by the Attorney General, civil officials of equal grade with military officers were assimilated to such officers in construing the terms of the contract, so we think an enlarged meaning must be taken as intended by the terms "officers and enlisted men" where employed in the written contract. As observed by the Attorney General, in the light of the purpose of the contract, which was to carry out the engagements made by this government with Spain, a liberal construction should be accorded to the terms employed, in order to effectuate to the fullest extent the purposes intended by the treaty. Construing the written contract of March 4, 1908, according to its manifest spirit, and looking to the prior conduct of the parties, we are of opinion that such contract, and the oral contract which was dependent upon it, so far as the wives and children of officers and

the same construction as under the Cuban contract; viz., that the wives and children of Spanish officers tendered by the United States for transportation were to be classed with such officers, and the wives and children of enlisted men were to receive like accommodations as were given to enlisted

men.

⚫70

As it is not questioned by the United States that civil officials representing the Spanish government in the Philippines were entitled, both under the oral and written contracts, to cabin accommodations, we have assumed that construction to be well founded. It follows from the reasoning heretofore employed that the wives and children of such officials were likewise entitled, when tendered by the agents of the United States for transportation, to receive cabin accommodations, and Ceballos & Company, on furnishing such accommodations, were entitled to compensation at the rate stipulated for cabin service. In view, however, of the distinction shown to have been made in the requisitions for space between adults and minor children, the practice shown as to payments made under the contract, and the original demand of Ceballos & Company in the court below, we think it results that the parties, in actual practice, treated the full rate for children under ten years as but half the adult rate specified in the contract, and we think that rate ought to have been applied by the court below for each minor child, whether carried in the cabin or in the steerage.

*We are unable to yield our assent to the contention that other noncombatants than the wives and children of officers, enlisted men, and officials of the government of Spain, should be embraced in the class entitled as of right to cabin accommodations, for which appellants were entitled to be compensated at cabin rates. The mere circumstance that a particular person, although a noncombatant, was a constructive prisoner, did not-at least, in the absence of evidence that the United States tendered such person as a cabin passenger-serve to take the person out of the category of persons whom the Secretary of War might designate to receive transportation in the steerage at third-class rates.

for such service to a further payment as to each child of $70.62%, aggregating for the 395 children $27,896.87. From the total of these sums, viz., $215,335.62, must, however, be deducted the overpayment recited in the third counterclaim (which counterclaim the court below sustained), viz., $9,721.25, leaving due to Ceballos & Company the sum, $205,614.37.

It results that the judgment of the Court of Claims must be reversed, with instructions to enter a judgment in favor of the appellants for the sum of $205,614.37; and it is so ordered.

(214 U. S. 33) MERCHANTS NATIONAL BANK OF BALTIMORE, Appt.,

V.

UNITED STATES.

INTERNAL REVENUE (§ 9*)-TAXATION OF
NATIONAL BANK CIRCULATION.

A national bank whose outstanding circulating notes amount to less than 5 per cent of its capital is not exempted from the payment of the half-yearly duty imposed by U. S. Rev. Stat. § 5214, U. S. Comp. Stat. 1901, p. 3500, upon the average amount of its notes in circulation, by the provision of § 3411 (U. S. Comp. Stat. 1901, p. 2248), that the outstanding circulation of any bank, association, corporation, company, or person shall be free from taxation when reduced to an amount not exceeding 5 per cent of its capital, although the latter section is, by § 3417 (U. S. Comp. Stat. 1901, p. 2251), expressly made since it was so made applicable, as clearly applicable to national banking associations, appears from the legislation from which its provisions were drawn, in order to give national banks representing state banks the benefit of the presumption of loss or inability to retire the circulation of the state bank when 95 per cent thereof had been actually retired.

[Ed. Note. For other cases, see Internal Revenue, Dec. Dig. § 9.*]

A

[No. 20.]

17, 1909.

From finding 14 it appears that the wives and children above the age of ten years of military officers and civil officials aggregated 1,327, and that the appellants were paid for the transportation of each the steer- Argued March 12, 15, 1909. Decided May age rate of $73.75, instead of the cabin rate of $215 each. The appellants are, therefore, entitled to a further payment on account of the transportation of such persons of $141.25 each, in all, $187,438.75. It is also shown in such finding that the number of children of Spanish military officers and civil officials who were carried to Spain and were under the age of ten years aggregated 395, and that Ceballos & Company were paid for their transportation $36.87% each, one half the adult steerage rate, instead of $107.50 each, one half the adult cabin rates. Ceballos & Company were therefore entitled

PPEAL from the Court of Claims to review a judgment denying the right of a national bank to be exempted from the statutory tax on its outstanding cir culation where the amount of such circu lation was less than 5 per cent of its capital. Affirmed.

See same case below, 42 Ct. Cl. 6.
The facts are stated in the opinion.

Messrs. R. E. Lee Marshall, James H. Hayden, and J. Hanson Thomas for appellant.

For other cases see same topic & NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes

29 S. C.-38.

Mr. Justice White delivered the opinion had ceased to exist, or had been converted of the court:

+Sec. 5218. In all cases where an associa-doubt, considering the text of the two section has paid or may pay in excess of what may be or has been found due from it, on account of the duty required to be paid to the Treasurer of the United States, the association may state an account therefor, which, on being certified by the Treasurer of the United States, and found correct by the First Comptroller of the Treasurer, shall be refunded in the ordinary manner by warrant on the Treasury.