ant is not liable in a suit for a breach of contract,
and plaintiff is not entitled to recover in a suit
for damages. Id.
LX. It cannot be held that in the instant case the
hospital agreed to become liable as an insurer.
Id.
LXI. Where upon presentation to the contracting officer
of plaintiff's claim for damages due to delay,
plaintiff, contractor, was informed by the con-
tracting officer that the department was unable
to pass upon the claim and that it should be
submitted to the Comptroller General, which
was done, and the claim thereupon was denied
by the Comptroller General; and where there-
upon the contractor wrote the Secretary, as
head of the department, and was again informed
that the department did not have jurisdiction
but that jurisdiction was vested in the Comp-
troller General, and that since the Comptroller
General had made his decision the department
was without authority to take further action;
it is held that plaintiff lost no rights by a failure
to file formal appeal to the head of the depart-
ment from a "decision" of the contracting
officer, in accordance with the provision of the
contract providing for such appeal. Thomas
Earle & Sons, Inc., 494.
LXII. The contracting officer's reply to the contractor,
stating that the claim should be presented to
the Comptroller General, was not a decision on
the merits of the claim but a disclaimer of
LXIII. Where, in a contract for repair of a Government
pier, it was provided that "should a greater or
less number of bearing piles be necessary ad-
justment in the contract price will be made,"
this provision in connection with other pro-
visions of the contract would convey to the
mind of a bidder the impression that any and
all additional costs to him, of whatever charac-
ter, arising out of the necessity for the placing
of additional piles would be paid for, including
the cost of the necessary suspension of work
pending decision as to contemplated changes
in the contract, which changes were subse-
quently made to the advantage of the Govern-
ment, and plaintiff is accordingly entitled to
recover. Id.
LXIV. The Government does not have the right to settle
the unpaid balance due to a contractor by
setting off that balance against a tax debt which
the contractor owes to the Government, no
tax lien having been perfected, when there is a
surety which has been obliged under its payment
bond to pay the debts of the contractor for
materials and labor used by the contractor in
the performance of its contract. Maryland
Casualty Company, 513.
LXV. The provisions of section 3466, Revised Statutes,
giving the United States as a creditor priority
over other creditors of an insolvent debtor are
applicable in the case of a living debtor only
where his insolvency is a formal one, evidenced
by a bankruptcy, receivership or assignment for
the benefit of creditors. See United States v.
State of Oklahoma, 261 U. S. 253. Id.
LXVI. In the instant case, the Government had no
statutory preference which would give its tax
claim priority over the plaintiff's claim as surety.
Id.
LXVII. Where the plaintiff, as surety on a payment bond,
paid the debts of its principal, a contractor,
for labor and materials, it is entitled to collect
so much of the unpaid balance due its principal
from the other contracting party as is necessary
to make it whole for payments made by plaintiff
under its bond. Globe Indemnity Co. v. United
States, 84 C. Cls. 587, distinguished. Prairie
State Bank et al v. United States, 27 C. Cls.
185, affirmed 164 U. S. 227, cited. Id.
LXVIII. It has been generally held that in the case of the
"performance" bond required by the Govern-
ment of contractors, the money retained by the
Government until performance is completed is
retained for the purpose of securing perform-
ance and the contractor's right to that money
upon completion belongs to the surety so far as
it is necessary to make him whole and his claim
to it has priority over claims of other creditors,
including claims of the Government which are
unrelated to the contract. U. S. Fidelity &
Guaranty Company v. United States, 92 C. Cls.
144. Id.
LXIX. In the instant case under its payment bond it was
not intended by plaintiff and it was not expected
by the Government or by the other contracting
party, that plaintiff was taking the risk, besides
other risks, that any part, or perhaps the whole,
of the price which the Government promised to
pay upon performance, would be "paid" not in
money but by a bookkeeping process of crediting
these sums against taxes or other debts of the
contractor not related to the contract, to the
prejudice of the surety. Id.
LXX. The court construes the bond and the transaction
as a whole as implying a promise on the part of
the Government to the surety that the Govern-
ment would not so settle the accounts of the
contractor as to leave the surety in the position
of paying the contractor's taxes, which it had
not agreed to pay. Id.
LXXI. The fact that the Comptroller General, without
knowledge of its effect upon the surety's interest,
had set off the balance due under the contract
against taxes due to the Government from the
contractor, had no final effect upon rights of
plaintiff, surety, which is entitled to recover an
amount sufficient to make it whole for the
amounts paid by it under its bond. Id.
See also Special Jurisdictional Act Invalid.
Actual damages must be definitely proven.
Eastern Contracting Company v. United States,
97 C. Cls. 341. Langevin, 15.
See also Contracts XXVII; Eminent Domain III.
DEFERRED PAYMENTS.
See Taxes I, II, III.
DELAY, NOTICE OF.
See Contracts IX, X, XI, XIII.
DEPENDENCY.
See Pay and Allowances XI.
DISCHARGE BY TRANSFER.
See Pay and Allowances XIII, XIV, XV, XVI.
ECONOMY ACT.
See Contracts XXXIII, XXXIV.
EDUCATIONAL FAIR.
See Taxes XXVII.
EMINENT DOMAIN.
I. The Government has the right to take such
measures as to it may seem proper for the im-
provement of navigation without liability for
injury to property except that located above
ordinary high watermark. Marret, Admr., et al.
EMINENT DOMAIN-Continued.
v. United States, 82 C. Cls. 1, 13; 299 U. S. 545,
cited. Kelley's Creek and Northwestern Rail-
road, et al., 396.
II. The high watermark is the line where the water
stands sufficiently long to destroy vegetation
below it; and it is not to be determined by
arithmetical calculation but is a physical fact
to be determined by inspection of the river
bank. Union Sand & Gravel Co. v. Northcott,
et al., 102 W. Va. 519; 135 S. E. 592, cited. Id.
III. Only damages which accrue as the result of a
taking can be recovered in a suit against the
Government growing out of improvement of
river navigation. United States v. Grizzard,
219 U. S. 180, 183. Id.
IV. Under the law of West Virginia a riparian owner
on a navigable stream owns the land to low
watermark; the title to the bed of the stream
beyond low watermark is in the State but the
title to the bed of the stream up to ordinary
high watermark is subject to a paramount
servitude in favor of the United States authoriz-
ing it to take all necessary and proper steps in
the interest of navigation. Brown Oil Co. v.
Caldwell, 35 W. Va. 95; 13 S. E. 43; Gibson v.
United States, 166 U. S. 269, 272, and similar
cases cited.
V. Any structure erected in the bed of the stream is
erected there at the peril of him who erects it,
and with the knowledge, actual or constructive,
that the Government in the improvement of
navigation may so raise the high watermark
as to destroy or impair the utility of the struc-
ture. Hood v. United States, 49 C. Cls. 669, and
other cases cited. Id.
VI. The decision of the Supreme Court in United
States v. Chicago, Milwaukee, St. Paul &
Pacific Railroad Company, 312 U. S. 592 (over-
ruling United States v. Lynah, 188 U. S. 445),
holding the United States is not liable for
damages to a railroad embankment whose base
was in the bed of the stream, is controlling in
the instant case, where a colliery company had
located a tipple and ice breaker in the bed of a
navigable stream under license from the Secre-
tary of War. Id.
EQUALIZATION AGREEMENT.
See Transportation of Government Property I, IV, V.
EQUITABLE ADJUSTMENT.
See Contracts IV, XIX, XXI.
ESTATE OF DECEDENT.
See Taxes XX, XXI, XXII, XXIII.
EXTENSION OF TIME.
See National Industrial Recovery Administration Act VIII, IX,
X, XIII.
EXTRA PAY.
See Contracts L.
EXTRA WORK.
See Contracts L.
FAILURE TO MAKE DECISIONS.
See Contracts II.
"FLYING OFFICER."
The expression "nonflying officer" as used in the Appropriation
Act of April 26, 1934 (48 Stat. 614, 618), in the absence of any
indication that Congress had in mind any other meaning, may
be interpreted in accordance with the definition of a "flying
officer" given in Section 2 of the Act of July 2, 1926 (44 Stat.
780,781), which provided that "wherever used in this Act a flying
officer in time of peace is defined as one who has received an aero-
nautical rating as a pilot of service types of aircraft." Baker, 212.
I. "Misstatements" alleged to have been made by
plaintiffs in connection with vouchers for goods
sold, previously presented by plaintiffs to the
Government and duly paid, do not constitute
fraud within the contemplation of section 1086
of the Revised Statutes where such alleged
"misstatements" were not made for the purpose
of securing the payment of the claim in suit
but were made, if at all, with reference to
another, previous transaction. Crovo, 368.
II. Although it is not necessary to show a pecuniary
loss to defeat a fraudulent claim, under section
1086 of the Revised Statutes, it is necessary
to show such loss when a claim has been paid
and an action is brought to recover the amount
paid; and in such case recovery can be had
only to the extent of the pecuniary loss sus-
tained. Charles v. United States, 19 C. Cls.
316, distinguished. Id.
III. In order to sustain a plea of set-off for fraud com-
mitted in connection with a prior transaction,
it is necessary to show a pecuniary loss was
sustained by the commission of the fraud. Id.
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