Campbell Building Co. v. State Road Commission

• Decision Date: 03 August 1937
• Docket Number: 5803
• Court: Utah Supreme Court
• Parties: CAMPBELL BUILDING CO. v. STATE ROAD COMMISSION

70 P.2d 857

95 Utah 242

CAMPBELL BUILDING CO. v. STATE ROAD COMMISSION

No. 5803

Supreme Court of Utah

August 3, 1937

Rehearing Denied August 18, 1938.

Appeal from District Court, Third District, Salt Lake County; Allen G. Thurman, Judge.

Action by the Campbell Building Company against the State Road Commission of Utah. From an adverse judgment, the plaintiff appeals.

JUDGMENT AFFIRMED.

Allen T. Sanford and E. A. Rogers, both of Salt Lake City, for appellant.

Joseph Chez, Atty. Gen., and Wm. A. Hilton, of Salt Lake City, for respondent.

FOLLAND Chief Justice. EPHRAIM HANSON, MOFFAT, WOLFE, and LARSON JJ., concur.

OPINION

FOLLAND, Chief Justice.

This is an action for damages, for payment for extra work, and for balance claimed to be due arising out of the performance of a contract entered into between the State Road Commission of Utah and the Campbell Building Company for the construction of about 15 miles of road on the main state highway southerly from Kanosh in Millard county, Utah. The contract was let under the Emergency Work Program in August or September, 1932, and was known as Federal Aid Project 68-B. The work was completed in the spring of 1933. The project was financed by the federal government under an Act of Congress known as the Emergency Relief and Construction Act of 1932, 47 Stat. 709. It fixed the dead line of completion of projects under the act as July 1, 1933. The act required contracts under it to set forth special provisions for doing such work with minimum rates of wages and hours per week the men would be permitted to work. The maximum of hand labor and team use were also required. The purpose was to give work to the greatest number of persons possible. The complaint contains three causes of action and each cause of action covers a number of different items, so that there are 26 separate and distinct items or claims described by appellant as "each of itself an independent lawsuit." The estimated cost of the work was $ 68,834.10. The amount computed and allowed by the state after completion of the work was $ 72,978. The amount sued for in plaintiff's complaint is $ 43,980.21, including the sum of $ 7,297.80 withheld by the state for final settlement.

After trial to the court, sitting without a jury, the court made findings of fact and conclusions of law favorable to defendant's contentions and entered judgment for defendant and against plaintiff. The 112 assignments of error are to the making of findings of fact and conclusions of law, the entry of judgment, overruling plaintiff's motion for a new trial, and to the striking of certain testimony. Before discussing the separate items for which a money judgment is claimed, we shall address ourselves to the matters which involve the right of plaintiff to maintain the action.

It is contended by defendant that the action cannot be maintained for reasons which we shall presently set forth. It is further contended by defendant that should the court hold against its contention that the State Road Commission cannot be sued by the contractor in the present form of action, yet the findings and judgment must be sustained because there is substantial evidence in the record which supports each and all of the court's findings and that the judgment responds to such findings.

The reasons urged by defendant why this action cannot be maintained by plaintiff are as follows:

"(1) That all highways are owned by the State, and under the exclusive jurisdiction of the State, and that the legislative power over State highways is supreme. (2) That the construction of highways in Utah is a purely governmental function. (3) That the State Road Commission is a creature of statute or an arm or agency of the sovereign State of Utah and its officers are State officers. (4) That notwithstanding the State Road Commission can be sued, it can be sued only for specific performance of written contracts made by it or under its authority. (5) That the State Road Commission or the State of Utah is not liable for damages resulting from the misfeasance, malfeasance, laches, misconduct or unauthorized acts of its officers. (6) That the Constitution and laws of Utah provide an exclusive procedure for the filing of claims against the State. (7) That the State of Utah is not liable on its contracts as would be an individual."

The propositions contained under headings Nos. (1) and (2) are not disputed by plaintiff and for the purpose of this case may be taken as true. Elliott on Roads (4th Ed.) §§ 10, 465, 509, and 511; Union Trust Co. v. State of California, 154 Cal. 716, 99 P. 183, 24 L.R.A. (N.S.) 1111; Independence Trust Co. v. Porter, 190 N.C. 680, 130 S.E. 547. Proposition No. (3), to the affect that the State Road Commission is an arm or agency of the state, is also not disputed and may be affirmed. Indeed, the statute seems clearly to contemplate that this is true. R. S. Utah 1933, 36-2-3 and 36-2-4, as amended by chapter 28, Laws of Utah, 1933, p. 42, and chapter 36, Laws of Utah, 1935, p. 35, and chapter 39, Laws of Utah, 1937, p. 77. It is not a separate corporate or political body. Looney v. Stryker, 31 N.M. 557, 249 P. 112, 50 A.L.R. 1404; Independence Trust Co. v. Porter, supra; Gresty v. Darby, 146 Kan. 63, 68 P.2d 649. The members of the State Road Commission are state officers. Industrial Comm. of Arizona v. State Highway Commission, 40 Ariz. 163, 10 P.2d 1046; Arkansas State Highway Comm. v. Nelson Bros., 191 Ark. 629, 87 S.W.2d 394. It would follow, therefore, that where the State Road Commission is sued as in this case, not individually, but in its official capacity, the action is, in effect, one against the state. State Highway Comm. of Wyoming v. Utah Construction Co., 278 U.S. 194, 49 S.Ct. 104, 73 L.Ed. 262 (in District Court, 16 F.2d 322; [C.C.A.] 23 F.2d 638); Carpenter v. Atlanta & C. A. L. Ry. Co., 184 N.C. 400, 114 S.E. 693; State Highway Comm. v. Kansas City Bridge Co. (C.C.A.) 81 F.2d 689; United Contracting Co. v. Duby, 134 Ore. 1, 292 P. 309. In an action against the state board of land commissioners, where any recovery would affect state funds, the action was held to be one against the state. Wilkinson v. State, 42 Utah 483, 134 P. 626.

This action may not be maintained unless the state has, through legislative or constitutional action, given consent to be sued. Carpenter v. Atlanta & C. A. L. Ry. Co., supra; Looney v. Stryker, supra; Mills v. Stewart, 76 Mont. 429, 247 P. 332, 47 A.L.R. 424; Cassidy v. City of St. Joseph, 247 Mo. 197, 152 S.W. 306; Hampton v. State Board of Education, 90 Fla. 88, 105 So. 323, 42 A.L.R. 1456, and note at page 1464. Consent to suit has been given with respect to contracts of the State Road Commission in section 36-2-1, R. S. 1933, wherein the statute reads:

"By its name the commission may sue, and it may be sued only on written contracts made by it or under its authority."

The scope of this consent or waiver of immunity, we shall discuss under another head.

Proposition No. (6) may be accepted as true; that is, that the exclusive procedure for the filing of claims against the state is with the board of examiners as provided in the Constitution, art. 7, § 13, and by R. S. 1933, 26-0-1, 26-0-9, and 26-0-10. State ex rel Davis v. Edwards, 33 Utah 243, 93 P. 720; Uintah State Bank v. Ajax, Auditor, 77 Utah 455, 297 P. 434.

It is not now necessary for us to decide whether the only method by which plaintiff could satisfy any judgment it might obtain would be by filing the claim evidenced by the judgment with the board of examiners and, in the event there was no appropriation out of which it could be paid to then go to the Legislature for such appropriation. 59 C. J. 306. How the judgment may be enforced, if one is obtained, is quite another matter from the problem for us to decide, which is, whether plaintiff may proceed in the courts to have its claim liquidated.

The vital questions in dispute are those stated in defendant's propositions Nos. (4), (5), and (7), supra. These involve a determination of the meaning and scope of application that the "commission * * * may be sued only on written contracts made by it or under its authority."

The defendant contends, first, that it may be sued "only for specific performance of written contracts made by it or under its authority" and this case not being one for specific performance of the contract or to require payment of funds under it, but being for damages, extra work and balance due resulting from its performance, the action will not lie. It is also argued by defendant that the statute above quoted "does not create liability and a suit is maintainable thereunder only for liability authorized by law." This latter suggestion will be answered in the course of our discussion.

The statutory provision is twofold. First, it waives immunity from suit by saying "the commission * * * may be sued," and, second, a limitation is imposed by the following language: "only on written contracts made by it or under its authority." We have in a previous case held that the provision, "By its name the commission may sue, and it may be sued only on written contracts made by it or under its authority," is not open to the construction that the commission may sue only on its written contracts, and we have said that the qualifying phrase evidences a "wish by the lawmaking power" to limit actions against the commission to actions upon written contracts. Barnes v. Wade, 90 Utah 1, 58 P.2d 297, 298. It was there held that the commission may in its name sue to condemn property for road purposes and that by bringing the suit it assumes all liabilities incident to the proceedings.

The contract in question is one made by the commission under its authority. It is such a contract as...