470 Opinion of the Court toward the completion of the shipyards; it made advance payment against the cost of ship construction; and in some instances it replaced prerequisition ship contract prices with cost-plus arrangements. In effect the companies were only as strong as Christoffer Hannevig. That he had overextended himself is also apparent from the fact that other of his business enterprises were weakening during the war years. Without additional backing from Christoffer Hannevig, his American shipbuilding companies were stretched to the breaking point. The fact that they did not break sooner was due to the financial support of the United States. In deciding this arbitration we have found it unnecessary to pass on various technical objections raised by the United States, such as the Norwegian citizenship of Hannevig, the binding effect of his bankruptcy, the consequent assignment of his claims and the failure to exhaust local remedies. After a thorough search of the voluminous record presented and after listening to extensive oral arguments, we have endeavored to reach and feel we have reached a just conclusion. In doing so we wish to acknowledge the assistance we have received from the skilled counsel who ably represented the two great countries involved in this proceeding. Their complete analyses, orally and in writing, of the facts and issues presented by the record were unusually helpful. We conclude that Norway has no valid claim against the United States and, pursuant to Article II of the Convention of March 28, 1940, we so decide. The proceeding will be dismissed. It is so ordered. LARAMORE, Judge; MADDEN, Judge; WHITAKER, Judge, and LITTLETON, Judge (Ret.), concur. The names of various Hannevig companies which were unconnected with the United States' ship requisition program and the dates of their insolvency are listed as follows: Name of Concern Thor Iron Works Ltd. (Toronto). New Foundland Shipbuilding Co. Ltd.. Dominion Shipbuilding & Repair Co. Ltd.. Liberty Marine Insurance Co-. Date of Insolvency July 17, 1918 October 18, 1919 July 31, 1920 prior to February 1921 prior to February 1921 North Atlantic Insurance Co.. prior to February 1921 145 C. Cls. Syllabus FANSTEEL METALLURGICAL CORPORATION v. THE UNITED STATES [No. 170-58. Decided April 8, 1959] ON PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT AS TO Contract; counterclaim by Government for overpayments.-In an action by plaintiff to recover sums allegedly due it under a supply contract with the Government, plaintiff has moved for summary judgment dismissing defendant's counterclaim to recover alleged overpayments to plaintiff on the same contract, the plaintiff contending that under the provisions of the Uniform Sales Act of Illinois, Ill. Rev. Stat., ch. 1212, sec. 49 (1957), defendant cannot recover admitted overpayments because no timely notice was given to plaintiff; that because defendant accepted the shipments and made payments now alleged to be excessive, it is estopped to claim reimbursement, and that an account stated was reached by the parties. It it held (1) that Federal law and not State law applies to Government contracts and that under Federal law no Government contracting officer or official is authorized to waive overpayment and, when one is made, such official is under an obligation to seek refund; (2) that the doctrine of estoppel may not be invoked against the Government to prevent collection of illegal or erroneous overpayments under a Government contract regardless of the passage of time, and no precepts of honesty, fairness or good conscience require the application of the doctrine herein; and (3) since no agreement was reached by the parties that the amounts charged by and paid to the plaintiff under the invoices were correct, and, after the final audit which revealed the overpayments, the Government immediately notified plaintiff of the overpayment, there has been no account stated. Plaintiff's motion for summary judgment dismissing the counterclaim is denied. Account Stated 6(1) Estoppel 62(2) United States 118 Constitutional law; property of the United States; disposal of Federal property; Congress.-The power to release or otherwise dispose of rights or property of the United States is lodged in Congress by article IV, section 3, clause 2 of the Constitution, and where authority is neither found in a statute nor can be implied from other powers granted by statute, a Government agency which has made overpayments under a contract 496 Opinion of the Court must seek to recover such overpayments. Royal Indemnity Co. v. United States, 313 U.S. 289. United States 58, 118 Contract; interpretation; law applicable; Federal law. It is the Federal law, and not the law of a particular State, which governs the construction of contracts to which the United States is a party. Courts 359 Contract; interpretation; law applicable; Federal law; State statutes of limitations.-Section 49 of the Uniform Sales Act of Illinois, Ill. Rev. Stat. ch. 1212, is in the nature of a statute of limitations and State statutes of limitations are not binding upon the United States. United States v. Summerlin, Ancillary Administratrix, 310 U.S. 414. Limitation of Actions 11(1) Counterclaims; contracts; overpayment by Government; estoppel.— The Government is not estopped to sue to recover overpayments erroneously or illegally made under its contracts since a Government officer or agent cannot, without authority, waive or surrender a public right. United States v. Stewart, 311 U.S. 60. Estoppel 62(2) Contract; account stated; payments prior to final audit.-In the absence of an express or implied agreement by the parties to a contract that the balance shown on a statement of account is correct, there is no account stated, American Steam Conveyor Corp. v. United States, 81 C. Cls. 151, cert, denied 296 U.S. 599, and where no determination as to the correctness of a charge was made until a final Government audit, at which time the Government immediately charged the plaintiff with receiving an overpayment, there was no account stated. Account Stated 6(1) Mr. Frank Greenberg for the plaintiff. Mr. Marx Leva, Mr. Robert H. Ford, and Mr. Charles E. Zeitlin were on the briefs. Mr. Laurence H. Axman, with whom was Mr. Assistant Attorney General George Cochran Doub, for the defendant. LARAMORE, Judge, delivered the opinion of the court: In a suit by plaintiff Fansteel Metallurgical Corporation under a supply contract, the Government has counterclaimed for alleged overpayments to plaintiff. Plaintiff has filed motion for summary judgment dismissing the counterclaim on the ground that plaintiff's affirmative defenses to the counterclaim cannot be denied and are dispositive of de574580-61- -33 Opinion of the Court 145 C. Cls. fendant's counterclaim. The affirmative defenses are: (1) The defendant is precluded, as a matter of law, from recovering on its counterclaim because of the provisions of section 49 of the Uniform Sales Act, Ill. Rev. Stat., ch. 1212, § 49, (1957); (2) the defendant is estopped from asserting that the contract imposed upon plaintiff the obligation which is alleged to be breached; (3) that there has been an effective account stated between the parties with respect to each sale. The facts as disclosed by the pleadings, exhibits and affidavits which are necessary to this opinion are these: As of April 25, 1952, the plaintiff entered into a contract of sale with the defendant, whereby plaintiff undertook to expand its facilities for the production of crude columbium oxide and potassium tantalum fluoride. In return for plaintiff's expansion program, which was at its own expense, defendant obligated itself to purchase from plaintiff a limited quantity of the crude columbium oxide and potassium tantalum fluoride which might be produced by plaintiff. The contract provided a complex price formula, which the Government alleges was violated by plaintiff and resulted in overcharges by a plaintiff for which the Government counterclaims in this action. Plaintiff brings this action to recover $197,146.88 with interest arising under the contract. $94,325.97 thereof is alleged to be due because of nonpayment for materials shipped to the Government between August 27, 1957, and October 25, 1957. $102,820.91 is alleged to be due plaintiff for material tendered and invoiced but not shipped between November 22, 1957, and March 24, 1958. Defendant admits the receipt of the material and nonpayment of the invoices, but asserts overpayments in excess of the amounts for which suit is brought because of an alleged breach of the contract by plaintiff in prior shipments, thereby making it unnecessary for defendant to accept or pay for the material. Plaintiff, for the purpose of this motion, concedes "that in each of the quarters of the three years 1954-1956, it breached its promise to purchase in-range ores and that as a consequence of such breach, the price paid by the defendant for material purchased by it in the related quarters of the period 496 Opinion of the Court July 1, 1954-June 30, 1957, was higher than it would otherwise have been." Plaintiff further admits, for the purpose of its motion, that the defendant suffered damage in consequence of its (plaintiff's) breach. Thus the situation is that plaintiff admits a breach and damage to the defendant but argues that defendant cannot possibly recover for reasons set forth in its affirmative defenses, and therefore the counterclaim should be dismissed. Section 49 of the Uniform Sales Act, upon which plaintiff relies, provides as follows: In the absence of express or implied agreement of the parties, acceptance of the goods by the buyer shall not discharge the seller from liability in damages or other legal remedy for breach of any promise or warranty in the contract to sell or the sale. But, if, after acceptance of the goods, the buyer fails to give notice to the seller of the breach of any promise or warranty within a reasonable time after the buyer knows, or ought to know of such breach, the seller shall not be liable therefor. Plaintiff then argues that no timely notice was given by defendant of a breach of the contract and the defendant may not now recover or counterclaim for damages on account thereof. Many cases are cited by plaintiff in support of this contention, and while we do not dispute the correctness of them, it is at least interesting to note that in all the cited cases a breach of warranty was involved. No cases are cited which specifically hold that the Uniform Sales Act bars recovery by the Government for overpayments made by it. It seems clear that no officer or agent of the Government is clothed with authority to disburse money belonging in the public treasury without authority so to do. Heidt v. United States, 56 F. 2d 559, 560; Royal Indemnity Co. v. United States, 313 U.S. 289. Nor can an officer or agent act beyond the limits of his authority. Wisconsin Central Railroad Co. v. United States, 164 U.S. 190. In the instant case the overpayment is admitted and no act of Congress or amendment of the contract exists under which plaintiff could retain the overpayment. The law is well settled that a contracting officer can change the terms of a contract to the benefit of the Government but is not given |