Barber Asphalt Paving Co. v. Webster Cnty.
| Decision Date | 01 July 1909 |
| Parties | BARBER ASPHALT PAVING CO. v. WEBSTER COUNTY ET AL. |
| Court | Iowa Supreme Court |
OPINION TEXT STARTS HERE
Appeal from District Court, Webster County; W. D. Evans, Judge.
The opinion states the nature of the case and the material facts. Affirmed.B. J. Price and Mitchell & Hackler, for appellants.
Read & Read, for appellee.
The plaintiff, a contractor, constructed a pavement under a written contract with the city of Ft. Dodge. By the terms of this agreement, it was provided that, upon completion of the work, the city should proceed to assess the cost thereof, except for street and alley intersections, upon the abutting property, and that the certificates of such special assessments, payable if requested in installments with interest at 6 per cent. per annum, should be accepted by the contractor in satisfaction for the paving done along such abutting property. By ordinance of the city it was also provided that, where the owners of the property failed to take advantage of the offered plan of payment in installments, the whole amount should become due and payable “at the same time and in the same manner as the March semiannual payment of ordinary taxes.” The same provision was made as to maturing installments where that plan was adopted. Plaintiff's work having been completed, the certificates were issued and delivered to it according to the requirements of the contract. The taxes thus assessed, levied, and certified were duly entered upon the county treasurer's books. In some instances they were allowed by the property owners to become delinquent, and on such taxes the treasurer collected the usual penalties as provided by statute. Code, § 1413; Code, § 825. The principal sum of the taxes thus collected with the certificate rate of 6 per cent. interest has been paid over to plaintiff by the treasurer, who withholds the penalties charged and received by him on the theory that they are due and payable to the county or to the city, each of which appears and contests the right of the plaintiff to the fund in controversy. The trial court found for the plaintiff and entered judgment in its favor. The defendants appeal.
We find no ground on which to question the correctness of the judgment. To permit the plaintiff to recover the penalties collected is in no manner to disregard the statutory provision which limits the interest on special assessments to 6 per cent. per annum. Code, § 825. Nor is it inconsistent with the stipulation for interest contained in the contract or in the form of certificate issued. The excess collected beyond the statutory or contract limit is not interest (which is a premium paid for the use of money), but is a penalty which a party to whom the debt or tax is due is entitled to exact both as a stimulant to prompt payment and as compensation for possible injuries which the latter may suffer by reason of the delay. The aggregate of all the taxes thus levied is ordinarily a large sum, and its value to the contractor will evidently be diminished, if, instead of receiving it promptly when due, it is left outstanding for a long time until collected in...
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