manifested itself. The difficulty was that | we shall be obliged to make them and charge you when the brakes were so adjusted that they with the expense. There are some other could be used to stop the car on a straight, things about the cars which are not as they level track, in passing around a curve or up a should be, but which do not interfere with the grade they would bind against the wheels, operation of them. Many of the panels are causing them to slip, and at times throwing badly cracked, and the painting on part of the car from the track. If the brakes were so the cars at least is very poorly done. The atadjusted that they would not bind on the tention of your engineer was called to these curves or grades, then they would not work points, and he admitted that the work was on a straight, level track so as to stop the not as it should be. I have no desire to delay the settlement of your bills, and would gladly approve your vouchers for them to-day if we could use the cars, as it is costing the company a very large amount of money every day that we cannot operate with a full equipment. Let me hear from you in regard to what action you will take as to the brake repairs at your earliest convenience.

cars.

On the 23d of March the defendant, by its superintendent, wrote to the general manager of the plaintiff. We tried one of your cars over the line yesterday and found that the brakes would not work satisfactorily; in fact, were perfectly useless. I think the reasons for this are: There being so many connec tions, and consequently so much lost motion, that before the shoes hug the wheels the brake lever comes to the limit of the quadrant. Before starting out with the car we adjusted the brakes so that the shoes touched the wheels, but notwithstanding this we could not lock the wheels, or even hold the cars on the lightest grades. As a perfect working brake is an imperative matter with us, I would like to hear from you on the subject and what remedy you propose."

In response to this letter Twyman, the plaintiff's engineer, came at once to Kansas City and attempted to remedy the trouble with the brake, and on leaving claimed that he had done so.

On the 5th of April, 1888, the manager of the plaintiff wrote to the defendant's president: "The entire lot of twenty-five cars have been delivered, thirteen of them having been shipped in February. Bills have been rendered your company for the amount of $50,000, being the original contract price without extras, bills for which will be sent your auditor in a few days. Will you kindly direct a prompt remittance for the bills already rendered?"

To this latter the plaintiff, under the date of April 13th, 1888, replied: "Your favor of the 11th instant received and noted. I regret to hear that you are having any further trouble with the brakes on the combination cars, as our engineer reported on his return that the trial made on the brakes on one of the cars while he was there, after some slight changes had been made, proved entirely satisfactory, and there was every reason to suppose that with these little changes the brakes *would [101 work well on the remaining cars. I regret that your engineer or superintendent did not wire us of the situation as indicated in your letter, as we would have sent our engineer over immediately. As it is he will leave for Kansas City to-night, and I trust that, in conjunction with your people the defects reported can be easily remedied. Our engineer did report on his return that the paint was acting badly on a portion of the new cars, and we are sending out two experienced men to attend to the paint work on such of the cars as require it. It is proper to explain just here that the defect seems to be with the middle panel, which is painted with what is called 'crimson lake,' and which is one of the most difficult colors to hold. We regret exceedingly that there has been any trouble in this regard, and you may rest assured that the defects will be remedied without expense to your company. Speaking of the paint reminds me that our people report that the alkali water is very severe on the finish of your cars, as we know from our own experience with sleeping cars, where alkali water is used. Another suggestion in this connection I beg to make is that, if your people would take the new cars in shop within about four or five months after they are received and give the paint a thorough cleaning, and then two coats of varnish, they would run for at least a year without having to be varnished again, and it would also preserve the life of the paint."

The defendant's whole line was ready to be opened on or about the 7th or 10th day of April, 1888, when the cars for the first time were placed on its road. This was shortly after Mr. Twyman had left Kansas City. 100] *Upon the recurrence of the trouble in operating the cars, the defendant, under date of April 11th, 1888, wrote to plaintiff: "I have delayed answering your letter of April 5th for some days, as I wished to see your cars in practical operation before making a reply. The Twelfth street cable line has been running since Saturday, and we should now be operating with a full equipment if we had not been obliged to make constant repairs and changes to the car brakes. These are very unsatisfactory, and we have hardly been able to make a round trip with a car without stop- Immediately there after the plaintiff's engi ping to make repairs, and on several occa- neer Twyman, came to Kansas City to look after sions have been obliged to run over a consid- the trouble in question, and did some work on erable portion of the line with no power to set the brakes while there, but being called away the brakes. I will make no attempt to go into by letter or telegram, he left for Chicago, statthis matter in detail, but wish to say that I ing that he would soon return and complete shall insist on these cars being made right in the work. Instead of so doing he wrote a this respect before I should be willing to ap- letter, saying: "I am sorry not to be able to prove your bills. If you will send a practi- return to Kansas City as quickly as I antici cal man here to take charge of these neces-pated. We have, however, arranged to send sary changes it will be the best plan, otherwise you a man immediately, who will take charge of

by the court:

the necessary alterations of your cars. There "The following additional facts were found will be no necessity of his leaving Kansas City until everything is arranged to your satisfaction, and I will probably come out there again towards the end of the week."

102] *Immediately following this letter the plaintiff's mechanic, one Overton, came with type-written instructions from Twyman, and went to work to remedy the defect in the brakes. He went over the cars one by one and pronounced them ready for service. This mechanic stated that he had done all he could do to remedy the difficulty in question, and if it did not accomplish that end he did not know how to remedy it. Notwithstanding the work and effort of this mechanic the same difficulty thereafter continued to manifest itself in the operation of the cars as to the working of the brakes.

The defendant's president then wrote to the plaintiff under date of May 12th, 1888: "I have delayed corresponding with you further in regard to the Twelfth street cars until your mechanic had finished his work. The result of his work has been very little material improvement in the action of the brakes, and the cars at no time during the progress of the repairs have been in a satisfactory condition to operate, and are not in such condition now. This fact has been reported to the board of directors, which has to-day passed a resolution rejecting the twenty-five cars furnished by your company for Twelfth street on account of the imperfect brakes and other seriously objectionable features, and has instructed me to notify you to this effect, and that the cars are subject to your order."

"The cars could not be operated successfully on defendant's railroad track for which they were designed with this brake, nor upon similar lines, and this defect or inability in the brake was not apparent nor discoverable upon any reasonable inspection made at the place of their manufacture, and could not be discovered without a practical test on the defendant's railroad track or over a like track. The defect in the brake was a latent one, which did not and could not develop to the observation on inspection, and was only discoverable when put into use on the defendant's track or similar track.

"The defendant paid the freight and drayage on said cars from Chicago to Kansas City the sum of $1088.50, and paid for building house in which to store the rejected cars $1850.

"After the sending of the letter by defendant's president to the plaintiff informing it that the cars were rejected and were at plaintiff's disposal, the defendant built a car-house at or near Kansas City and stored therein these cars, where they have ever since remained.

"The defendant operated upon its said road combination cars of a similar character, weighing about six hundred pounds less than the cars in controversy, which were manufactured by the Laclede Car Company of St. Louis, Missouri, and were operated by a brake of a different pattern, costing from seventyfive to one hundred dollars apiece.

The defendant did not use and oper-[104 ate the cars in question longer than was reasonably necessary to ascertain whether they could be successfully operated with the brake furnished therewith.

"During the time defendant run the cars on its road, during the tests made, as herein before found, passengers were received thereon and fares collected from them by defendant. The successful running of the trains was frequently interrupted by breaking of the cable and the locking of the car wheels, in consequence of the defective construction of the brakes, and defendant so continued in the attempt to run said cars during the time of plaintiff's promises to repair the alleged defect, and on such trips received on board of said cars passengers, and collected from them the customary fare. On the trial defendant offered to prove that owing to the insufficiency of the brakes the cars were run at a loss, and that no profit resulted from collection of fares. On plaintiff's objection this testimony was by the court excluded.

To this letter the plaintiff replied, under date of May 17th, 1888: "Your letter of the 12th instant, relating to the twenty-five combination cars built by this company for your company, has been received and noted. You are cog. nizant of the fact that the cars were built according to plans approved by your chief engineer, the material used, as well as the workmanship, being first class in all respects. The cars before shipment were inspected and accepted by your general superintendent. The cars were then shipped to, received, and put in use by you. Subsequently you made complaint that the brakes did not in all respects work satisfactorily, and a competent mechanic was promptly sent to examine the brakes and make any adjustment found necessary. When the brakes were examined and adjusted on one car your officers pronounced them satisfactory; thereupon the brakes were in like manner ex103] amined *and adjusted on the remaining cars, all the cars then being in use by your comtime in question two engineers of skill and expany. In view of the facts your present statement to the effect that you reject the cars on account of 'imperfect brakes and other seriously objectionable features' is quite astonishing, and I must assume that you have been misinformed as to the condition of the cars, as I am unwilling to believe that you would knowingly allow Upon the foregoing facts the court on its yourself to be a party to such an unreasonable own motion declared the law to be that the and unfounded claim. I have to request, there- defendant had the legal right to rescind the fore, that you will without further delay remit contract for the purchase of said cars in the the amount due this company for said cars, time and manner above set out, and that the as per bills heretofore rendered, and thus defendant rescinded the contract in accordance avoid the necessity of any action on our part with its legal right so to do, made a lawful to enforce the payment of the amount due us." | tender of the cars to the plaintiff, and was not

"Defendant had in its employ during the

perience, one of whom, Mr. Lawless, the same person who went to Chicago to inspect the cars at plaintiff's yards, had experience in the construction and practical operation of cable cars in San Francisco, California, prior to the time of taking service from defendant."

liable for the contract price of them, or any other sum, and that the defendant was entitled to recover from the said plaintiff the freight and drayage on said cars from Chicago to Kansas City, amounting to the sum of $1088.50, for which judgment was entered.

The facts found by the court below, as above detailed, bring this case within a very narrow 108] compass, and render it unnecessary *to make an extended review of the very large number of adjudged cases, American and English, cited in argument.

same way and forward them. Clearly, upon such inspection and acceptance, the title as to those cars passed to the defendant company. There is no claim that the remainder of the cars were not finished in the same manner as the first lot inspected by Lawless. As to these, the title certainly passed to the defendant when they were put on the cars at Pullman Junction to be forwarded, if it did not pass before and as each lot was completed under the order to make them like those that had been personally inspected and accepted at the works of the plaintiff. Halliday v. Hamilton, 78 U. S. 11 Wall. 560, 564 [20: 214, 215]; and authorities cited; The Mary and Susan, 14 U. S. 1 Wheat. 25, 35 [4: 27, 29]; Stack v. Ingles, L. R. 12 Q. B. Div. 564.

To what extent was the defendant concluded by the actual inspection and acceptance of the first lot of cars, and of the acceptance, in advance of their completion, of the remaining cars when finished or constructed in the same way?

The court below found that the cars could not be operated successfully with the brakes that were put upon them by the plaintiff, and that this fact was not apparent nor discoverable upon any reasonable inspection at the place of manufacture, and could not be discovered until after a pracical test upon the road.

The subject of implied warranty in sales of personal property was examined by this court in Kellogg Bridge Co. v. Hamilton, 110 U. S. 108, 116 [28: 86, 89], and, subsequently, in Seitz v. Brewers Refrigerating Mack. Co. 141 U. S. 510, 518 [35: 837, 840]. In the first of those cases it was said that "when the seller is the maker or manufacturer of the thing sold, the fair presumption is that he understood the process of its manufacture, and was cognizant of any latent defect caused by such process, and against which reasonable diligence might have guarded. This presumption is justified, in part, by the fact that the manufacturer or maker, by his occupation, holds himself out as competent to make articles reasonably adapted to the purposes for which such or similar articles are designed. When, therefore, the buyer has no opportunity to inspect the article, or when, from the situation, inspection is impracticable or useless, it is unreasonable to suppose that he bought on his own judginent, or that he did not rely on the judgment of the seller as to latent defects of which the latter, if he used due care, must have been informed during the process of manufacture. If the buyer relied, and under the circumstances had reason to rely, on the judgment of the seller, who was the manufacturer or maker of the article, the law implies a warranty that it is reasonably fit for the use for which it was de-ing from curves and grades; especially as one signed, the seller at the time being informed of the purpose to devote it to that use. This principle was reaffirmed in the other case above cited, and it was there said: "But it is also the rule, as expressed in the text-books and sustained by authority, that where a known, described and definite article is ordered of a manufacturer, although it is stated by the purchaser to be required for a particular purpose, still, if the known, described and definite article be actually supplied, there is no warranty that it shall answer the particular purpose intended by the buyer."

These cases were much commented on in argument, and, for that reason, we have deemed it proper to indicate the principal ground upon which each was determined.'

The present case has some features that were 109] not in either *of the others. By the written contract between the parties the cars that the plaintiff agreed to construct were to be inspected and accepted at the works of the plaintiff, after which they were to be delivered by the plaintiff, free on board the cars, at Pullman Junction, Kensington, Illinois. After ten or twelve cars were completed, and were inspected at the works of the plaintiff by the superintendent of the defendant, the latter expressed himself satisfied with them, and requested the plaintiff to finish the others in the

The contention, therefore, of the defendant is that the plaintiff, having knowledge that the cars were to be used on the defendant's road, impliedly warranted that the brakes placed on them would be sufficient for the purposes for which they were designed. The plaintiff insists that the provision in the contract for inspection and acceptance of the cars at the place of manufacture is inconsistent with any idea of implied warranty upon its [110 part of the sufficiency of the brakes to meet peculiar difficulties on defendant's road aris

of the defendant's engineers had experience in the construction and operation of street cars, and was at least as well informed upon that subject as the plaintiff's officers could possibly have been.

If it be assumed that the plaintiff, notwithstanding the provision for inspection and acceptance of the cars before their delivery, impliedly warranted the sufficiency of any brakes placed by it on cars to be used on the defendant's road, and even if it be assumed that the defendant had the right, after title passed, to rescind the contract within a reasonable time after discovering the insufficiency of the brakes the result for which the defendant contends will by no means follow.

The defendant became aware of insufficiency of the brakes as early as the 22d day of March 1888, and notice of that fact was given to the plaintiff. The defendant did not then rescind the contract nor intimate any purpose of so doing. It sought to know what remedy the plaintiff would suggest to meet the difficulty, and demanded that the plaintiff should make the brakes sufficient. It warned the plaintiff that if it did not send a practical man to Kansas City to take charge of the necessary changes, such changes would be made by the defendant at the plaintiff's expense. The lat ter promptly replied that it would do what was

could not be obtained for that amount, that fact is not shown. The ends of justice will be met by a judgment in favor of the plaintiff for the contract price of the cars constructed by it and now in the possession of the defendant, lessened by the sum of $2500 the amount which we must assume, under the findings, it would cost the defendant to replace the brakes furnished by plaintiff with other brakes suthcient for the cars in question.

necessary in order to make the brakes suffi- | than the last named sum. If brakes, adequate ciert. But what it did failed to accomplish for use on the cars constructed by the plaintiff. the desired result. The outcome of the matter was the refusal of the defendant to pay for the cars "on account of the inperfect brakes and other serious objectionable features." Notice of the determination not to retain the cars or pay for them was not given by the plaintiff to the defendant until the 12th of May, 1888. We dismiss any consideration of the "other serious objectionable features" referred to, be cause we are not informed by the record that any such existed. On the contrary, the defendant stated that the defects in the cars, independently of the brakes, did not interfere with their operation. The case is then to be disposed of upon the basis that the cars, apartnection with the contract for building the cars. from the brakes, were in every substantial 111]respect what *the contract contemplated, and the only ground upon which the defendant placed its refusal to pay for them was the insufficiency of the brakes.

The plaintiff included in its petition claims for different sums of money aggregating $4219.70, which it claimed to have expended for the use of the defendant in con

But the allegations in respect to those claims are traversed by the answer and there is no finding in reference to them. Indeed, no finding in respect to them was asked. The judg ment cannot therefore embrace them. We can We are of opinion that the demand of the only direct such judgment as is authorized by defendant that plaintiff make the brakes suf- the facts specially found by the court below. ficient, in connection with its expressed will-Rev. Stat. § 701; Fort Scott v. Hickman, 112 inguess prior to its notice of May 12th (no inti- U. S. 150, 164 [28: 636, 641], and authorities mation being previously given of any desire cited. or purpose to rescind the contract) to approve the plaintiff's bill, as soon as the brakes were made sufficient for use on its road, and the expressed willingness of the plaintiff, after notice from the defendant that the brakes were insuficient, to put them in proper condition (without claiming that it was under no legal obligation to incur expense to that end) so far changed the relation of the parties to each other that the defendant lost the right, if it had such right, to rescind the contract and return the cars; and the plaintiff must be held to have admitted or recognized its obligation to put the brakes in such condition that they would be adequate for use on the defendant's road.

While it must be taken upon the record before us that the brakes in question were entirely useless for the defendant's road, it is not specifically found, nor do the facts found justify conclusion, that other brakes could not have been supplied for use on the cars constructed by the defendant. If, at trifling expense or without unreasonable exertions, the defendant could have supplied the cars in question with other brakes that were sufficient, the utmost that under all the circumstances it could claim, in reduction of the amount it agreed to pay for the cars, would be the reasonable cost of obtaining new brakes adapted for use on such cars. Stillwell & B. Mfg. Co. v. Phelps, 130 U. S. 520, 527 [32: 1035, 1037]; Miller v. Mariners Church Trustees, 7 Me. 51, 20 Am. Dec. 341; Davis v. Fish, 1 G. Greene, 407, 48 Am. Dec. 387; Sedgwick, Damages (6th ed.) 106,

107.

It is found that the defendant operated upon its road combination cars purchased from another company, of a similar character with those constructed by the plaintiff; weighing about six hundred pounds less, and used a brake of a different pattern, costing

The judgment is reversed with directions to enter judgment in favor of the plaintiff for the sum of $47,500, with interest thereon from the 30th day of March, 1888, at the rate allowed by the laws of Illinois. Reversed. Mr. Justice Brewer took no part in the consideration or decision of this case.

1.

2.

UNITED STATES, Piff. in Err.,[113

2.

GEORGE H. PIATT ET AL.

(See S. C. Reporter's ed. 113 121.)

U. S. Rev. Stat. § 3961—suit by United States to recover money wrongly paid-joint suit— improper dismissal.

The term "stock and carriers" in section 3961, U. S. Rev. Stat. includes within it "men and horses," and where the Postmaster General allowed defendants additional compensation, under that section, upon the sworn statement that additional men and horses were required for the mail service under their contract, they are estopped from asserting that such statement was not intended to bring the contract within the statute.

Under section 4057, U. S. Rev. Stat. where money has been paid out of the funds of the Postolice Department without consideration, for pretended service that has not been performed, suit may be brought by the United States to recover such wrong payment.

3. A contractor for transporting the mail who has sublet the contract, is still liable for its performance, and where such contractor and the person to whom he has sublet are both parties to the fraudulent transaction whereby the United States is wrongly induced to make an increased compensation to them for the service, they may be sued jointly to recover the same back.

from seventy-five to one hundred dollars. It 4. Where, in an action to recover back money

112]*may well be assumed from the findings that the cars in question can be successfully operated with proper brakes costing not more

fraudulently obtained for mail service not þerformed, against two defendants, one is not served with process and does not appear or plead, it is

improper to dismiss the action as to him upon the 15th, 1879, increased the service to seven demurrer of the other to the complaint. trips a week from August 1st, 1879, for which the additional sum of $48,723.89 per

[No. 166.] Submitted Jan. 23, 1895. Decided March 4, annum was allowed upon the same basis of

1895.

'N Circuit Court of the United

compensation. Both Piatt and Salisbury

INERROR to the Northern District of Cal-orders amending the original contract. They

ifornia, to review a judgment in favor of defendants, dismissing a suit brought by the United States, plaintiff, against George H. Piatt, and Monroe Salisbury, defendants, to recover moneys claimed to have been paid to them for services in carrying the mail in excess of the amount to which they were legally entitled. Reversed, and cause remanded for further proceedings

The facts are stated in the opinion. Mr. Lawrence Maxwell, Solicitor Gen., for plaintiff in error.

Mr. Monroe Salisbury, defendant in error, pro se.

Mr. Justice Harlan delivered the opinion of the court:

This action was instituted by the United States to recover from the defendants in error certain moneys claimed to have been paid to them for services in carrying the mail, in excess of the amount to which they were legally entitled.

The first count alleges in substance that on March 15th, 1878, the defendant Piatt contracted in writing with the United States, through the Postmaster General, to carry the mail three times a week for four years from July 1st, 1878, for a consideration of $16,500 per annum, on the route then known as No. 36, 107, between Bozeman, Montana, by way of Shields River, Crow Agency, Stillwater, Head of Navigation, Pompey's Pillar, Fort Peace, and Big Horn City, to Tongue river and back. By power of attorney, dated August 15th, 1878,ˆ Piatt authorized the defendant Salisbury to collect from the Auditor of the Treasury for the Postoffice Department all pay to become due for carrying the mails upon that route; and subsequently, on Dccember 13th, 1878, with the permission of the Postoffice Department, he sublet his contract to Salisbury. Piatt entered upon and continued the performance of this service from July 1st, 1878, until December 13th, 1878, from which date the service was performed by Salisbury.

consented to the conditions of these orders. Piatt procured the issuing of the above were issued solely upon the basis of certain representations made in his sworn statement dated August 16th, 1878, to the effect that to carry the mail upon said route three times a week, on a schedule of 132 hours, required 26 men and 90 horses, while the proposed expedited schedule of 72 hours in summer and 96 hours in winter would require 48 men and 200 horses. This statement was wholly false and fraudulent in that it alleged an increase of 22 men and 110 horses necessary to perform the expedited schedule, whereas in fact neither Piatt nor Salisbury ever required or used in performing the mail service, three times a week or seven times a week, more than 34 men and 100 horses, being 14 men and 100 horses less than Piatt alleged in his sworn statement were necessary for performing said expedited service three times a week. By means of such fraudulent representations by Piatt, and by means of false vouchers presented to the Postoflice Department, Piatt and Salisbury received from the plaintiff a larger sum of money than they were lawfully entitled to receive. The sum so received by them during the period of their service, by means of such false statements and fraudulent vouchers, was $261,016.50, being $99,556.20 in excess of the amount that could, after certain reductions and remissions, be lawfully paid to them. The false statements above referred to were designed to mislead and did mislead the Postoffice Department of the United States, and the defendants were entitled to receive from the United States for such service the sum of $148,438.23 and no more.

Payment of such excess having been demanded and refused, *judgment was [116 asked against the defendants for $99,556.20. with interest from August 21st, 1882, and costs of suit.

The second count is the common law count for money had and received.

The third count sets forth the same facts as are embodied in the first count, and alleges that plaintiff's officers were induced to pay the $99,556.20 in mistake of fact, and that that sum was received by defendants contrary to section 3961 of the Revised Statutes of the United States.

The payments referred to are set out in full in an exhibit showing the amounts defendants were lawfully entitled to receive on the basis of the actual increase of stock and carriers consequent upon the reduction in running time as before mentioned.

For the purpose of expediting the service, the Postoffice Department, by order dated December 5th, 1878, on agreement with Piatt shortened the schedule of departures and arrivals on the above route after December 16th, 1878, by reducing the time from 132 hours to 72 hours in summer and 96 hours in winter, allowing therefor additional compensation of $16,500 per annum, in supposed accordance with the provisions of section 3961 of the Revised Statutes of the United 115]States. A similar order was made January 17th, 1879, allowing an additional annual sum of $3542.92 from January 25th, 1879, for an increased distance on the route of 35 miles, such allowance being computed pro The court below sustained the demurrer rata upon the basis of the compensation pre- and dismissed the complaint as to both deviously allowed. A further order dated July ❘ fendants. Each defendant is cited in the

Piatt was not served with process, nor did he appear or plead. Service of process was had upon Salisbury, who appeared and demurred both generally and specially to the complaint.