Slavens v. United States

Background

A private contractor held mail-carrying contracts for routes in several cities. The Postmaster General introduced street railway pickup that reduced the contractor’s original workload. The Government cut back the old service, offered the contractor a reduced contract at lower pay, and, when the contractor declined, ended the original contracts while paying one month’s extra compensation. The contractor sued, claiming wrongful termination and extra pay for new or different tasks, including carrying mail from streetcars and a separate Boston-to-Brookline run ordered by the local postmaster.

Reasoning

The main question was whether the Postmaster General could lawfully change or stop the contracted mail service and whether the new streetcar pickups or the Boston-Brookline run required extra pay. The Court explained the contract and the postal rules gave the Postmaster General broad authority to vary, reduce, or end service when the public interest required it, with the agreed one-month payment as full indemnity. The Court found the streetcar pickup was effectively the same kind of service and reduced the contractor’s burden, so it fell within the contract and did not require extra pay. The Boston-to-Brookline work was ordered only by the local postmaster, who lacked authority to bind the Government for extra compensation, so that claim also failed. The Court affirmed the lower court’s decision.

Real world impact

The ruling means the national postal official can change how mail is carried and end existing contracts with the agreed one-month payment. Contractors who decline reduced contracts may not recover more, and local officials cannot obligate the Government to pay extra for unauthorized services.