Carter v. Bradley County Road Improvement Districts 1 and 2

• Citation: 246 S.W. 9,155 Ark. 288
• Decision Date: 16 October 1923
• Docket Number: 200
• Parties: CARTER v. BRADLEY COUNTY ROAD IMPROVEMENT DISTRICTS 1 AND 2
• Court: Supreme Court of Arkansas

246 S.W. 9

155 Ark. 288

CARTER v. BRADLEY COUNTY ROAD IMPROVEMENT DISTRICTS 1 AND 2

No. 200

Supreme Court of Arkansas

October 16, 1923

Appeal from Bradley Chancery Court; E. G. Hammock, Chancellor affirmed.

Decree affirmed.

Coleman Robinson & House and D. K. Hawthorne, for appellant.

Appellees' attack upon the validity of the contract is not justified by the facts and circumstances under which it was entered into between Carter and the commissioners of the road improvement district. In the light of these facts and circumstances there is nothing in Carter's oath of office, act 302 Acts 1913, § 10, to prohibit the contract. If, in fact, the contract was prohibited by the oath, and therefore void, Carter is nevertheless entitled to recover upon a quantum meruit.

If the contract was not binding on the district, the mere fact that it was prohibited would not prevent a recovery quantum meruit, where, by its terms, the contract was not to take effect until the relationship out of which the prohibition grew had been dissolved, and where no service was performed until after that event. 232 S.W. 434; 235 S.W. 339; 238 S.W. 69; 37 N.E. 96. If parties enter into a contract that is malum prohibitum, and one of the parties has done work thereunder which the other has accepted, and he can make out his cause of action without reference to the illegal contract, he is entitled to recover the value of the work done and accepted. 6 R. C. L. 821; 29 Ark. 386; 91 Ark. 209; 16 Wall. 483; 33 F. 440; 44 Ark. 74; 106 Ark. 568; Greenwood on Public Policy, 7; 41 P. 133; 45 N.W. 242; 60 Ga. 222; 109 Cal. 140; 26 Neb. 149; 33 Mich. 61.

J. C. Clary and R. W. Wilson, for appellee.

Appellant is barred from any recovery at all, because his claims are either founded upon the contract or grew out of it, and that contract is void because it affects public service, and is against public policy. 6 R. C. L., par. 136, pp. 730-31; 47 Ark. 384; 81 Id. 41-45; 34 Id. 765; 81 Id. 602; 6 R. C. L. 712; 124 Ark. 6; 146 Id. 61-64; Elliott on Contracts, vol. 2, §§ 649, 706; 24 L. R. A. 206. It is prohibited by the statute. 73 Am. St. Rep. 31; 124 Ark. 6; 7 Wall. 542, 18 L. Ed., 244; 35 Am. St. Rep. 793; 29 Ark. 388; 146 Id. 63.

The fact that Carter did not execute the bond required by the contract until after the appointment and qualification of his successor, does not affect the case, for when he did execute it and it was approved, the contract became retroactive and dated back to the time the contract was executed.

The question as to when the contract became binding is immaterial, because the act which prescribes the oath of the Highway Engineer prohibits officials from becoming interested, either directly or indirectly, in any contract during their connection with the Department of the State Highways and Improvements, and makes no mention of when such a contract becomes effective or binding.

SMITH J. MCCULLOCH, C.J., and HUMPHREYS, J., dissent.

OPINION

SMITH, J.

Appellant H. R. Carter filed his complaint in the Bradley Chancery Court, and alleged as his cause of action the following facts: That Bradley County Road Improvement District No. 1 was organized under act 237 of the Acts of 1919 for the purpose of constructing and improving certain roads in Bradley County, and that on March 19, 1919, the commissioners of said district, therein named, entered into a written contract with him whereby he was employed as the engineer of the district. That, after the execution of the contract, a map of the district was prepared and certain preliminary surveys made, but full performance of the contract was prevented by litigation instituted by landowners in the district, and by act 74, passed at the 1921 session of the General Assembly, repealing act 237 of the Acts of 1919, and vesting the chancery court of Bradley County with jurisdiction to adjudicate and adjust the claims of all parties against the district arising out of contract or otherwise, and providing that all claims not so presented within six months should be barred. Pursuant to this act this suit was filed, the contract being made an exhibit to the complaint.

The complaint sets out the terms of the contract and recites the services which were performed under the authority thereof, and compensation was prayed therefor, pursuant to its provisions on that subject.

The contract provided that all plans should be prepared and work done by Carter in accordance with the regulations prescribed by the Federal Government and the State Highway Department, in order that the district might be entitled to all contributions of road aid funds that might be available from the United States or the State of Arkansas, and that in all instances, when required by law or order of the commission, the plans or any details thereof should be submitted to the State Highway Department for its approval. It was provided that if any of these duties were not performed by the engineer, the State Highway Department should have the right to terminate the contract, in which event Carter's compensation should be the amount earned by him at the time of its termination, and the contract contained stipulations governing time and terms of payment. There was also a provision that, if the improvement was not completed within a time limit of eighteen months, the district should pay Carter the sum of $ 10 per day for each day beyond that time as additional compensation. The contract further recited that it was made pursuant to the regulations of the State Highway Department, as authorized by act 105 of the Acts of 1917, and that the contract was made out in the form and contained the provisions approved by the State Highway Commission. The contract was duly approved by the Commission of the State Highway Department.

Performance is alleged of all conditions imposed on the engineer by the contract, and the sums of money are stated which are alleged to be due under the contract, and judgment therefor was prayed.

A similar case was stated against Road Improvement District No. 2 of Bradley County, and, as the facts are identical, the cases are briefed as a single one, and we shall so treat them.

Testimony was taken showing that Carter rendered services under his contract of value to the district.

Certain owners of land within the district made themselves parties and filed pleadings, the recitals of which need not be stated, as they were overruled by the court below. An answer was then filed containing certain allegations raising issues which have been decided against them. Bradley County Rd. Imp. Dists. No. 1 and 2 v. Jarratt, 144 Ark. 260, 222 S.W. 14; Johns v. Road Imp. Districts of Bradley County, 142 Ark. 73, 218 S.W. 389.

The answer, however, put in issue all the allegations of the complaint, denied the contract's execution and validity, and denied that services performed thereunder were of value, and alleged that the contract was void as contravening public policy for reasons hereinafter appearing.

In a written opinion the court below made the finding that the contract sued on contravened public policy, and dismissed the complaint, and this appeal is from that decree.

The testimony established the following facts: Carter was appointed State Highway Engineer and served a term expiring in 1915. He was reappointed in 1915, 1917, and 1919. At the beginning of his last term, about January 1, 1919, he took the oath of office prescribed by the statute. Carter tendered his resignation in February, 1919, but because of the inability of the highway commission to secure a successor he agreed to serve until a successor could be secured, and he did serve until the 1st of April, 1919, at which time his successor was appointed and qualified. Carter discharged the duties of State Highway Engineer during the month of March and drew from the State pay for services for the entire month.

The contract contained a stipulation to the effect that it should not become effective until Carter had made and filed with the commissioners of the road improvement district a bond for the faithful performance of the contract upon his part. This bond was not filed until the 1st of June, and Carter claims no compensation for services prior to that time.

For the reversal of the decree of the court below it is insisted, first, that the contract does not fall within the terms of the statute prohibiting the State Highway Engineer from being interested in road building contracts; second, that, if prohibited, the contract was nevertheless valid, because, by the intention of the parties as well as by the express stipulation of the contract itself, it was not to take effect, and did not take effect, until the conditions were such that Carter was in a position to make a contract with the road district; third, that, if the contract was void because prohibited, Carter is entitled to recover quantum meruit, because the malum prohibitum had been raised before anything was done under the contract; fourth, because, at the date of the contract, no assessment of benefits had been made by the road district, and the district was not therefore in a position to make contract for engineering services covering the construction of the road. Are any of these positions correct?

The official oath taken by Carter appears at section 5178, C. & M. Digest, and reads as follows:

"All officers and employees of the Department of State Lands Highways and Improvement shall take such oath of office as is provided in the Constitution, and in addition thereto they shall take and subscribe the following oath before entering on the discharge of their duties: 'I do solemnly swear, or affirm, that I am not now interested in nor will I become interested, either directly or indirectly, during...