City of Bethany v. Howard

• Decision Date: 09 May 1899
• Parties: City of Bethany, Appellant, v. Howard et al
• Court: Missouri Supreme Court

51 S.W. 94

149 Mo. 504

City of Bethany, Appellant, v. Howard et al

Supreme Court of Missouri, Second Division

May 9, 1899

Transferred from Kansas City Court of Appeals.

Affirmed.

J. W Peery for appellant.

(1) The provisions of the contract requiring Howard to pay for all work and material and to furnish statements of the same, with receipted bills, to the city; and authorizing the city at any time to apply any part of the contract price to the payment of such claims, were legal and valid; and such provisions under the allegations of the petition, gave the materialmen an equitable lien upon the portion of the contract price yet remaining in the hands of the city, and which the city was about to apply under the provisions referred to. Luthy v Woods, 6 Mo.App. 67; St. Louis v. Keane, 27 Mo.App. 642; Casey v. Gunn, 29 Mo.App. 14; Kein v. School District, 42 Mo.App. 462; St. Louis v. Lumber Co., 42 Mo.App. 586; St. Louis v. Lumber Co., 114 Mo. 74. (2) The materialmen, having under the contract an equitable interest in or lien upon the part of the contract price reserved by the city for them, and the city having by the contract the right to apply any part of the contract price to the payment of these claims, it follows that the agreement between the city and the defendants, by which the balance was paid to the two sureties in settlement of the controversy, upon the distinct agreement to pay it over to the materialmen, was a legal and valid agreement, made by the plaintiff as the trustee of an express trust, for the benefit of the materialmen; and when these sureties misappropriated these trust funds, and refused to pay them, according to their agreement, to the materialmen, then a cause of action exists either in favor of the city, with whom the sureties and principal made the agreement, or in favor of the materialmen for whose benefit it was made. The rule is well settled that in such case, the cause of action exists in favor of either the party who made the contract or of the beneficiary. Rogers v. Gosnell, 51 Mo. 466; Bliss Code Plead., 45 and 46; Snider v. Express Co., 77 Mo. 523; Ellis v. Harrison, 104 Mo. 277. (3) * The settlement and agreement between the defendants and the city, stated in the petition, were perfectly valid and legal. The compromise or settlement of a controverted, or even doubtful claim, is a sufficient consideration for a promise. Mullanphy v. Riley, 10 Mo. 489; Reilly v. Choquette, 18 Mo. 220; Livingston v. Dugan, 20 Mo. 102; Rinehart v. Bill, 82 Mo. 534; Lawson on Contracts, sec. 99. (4) The defendant's having all appeared before the board of aldermen and admitted their liability for the payment of these claims, and having agreed with the city to apply the money, paid to them, to their payment, are now estopped to plead either a want of consideration, or the invalidity of the contract upon any other ground. Bigelow, Estop., 578 and 584; Imboden v. Ins. Co., 31 Mo.App. 321; Green v. Railroad, 82 Mo. 653; St. Louis v. Gas Co., 70 Mo. 69; Thomas v. Williams, 99 Mo. 298; Sewer Pipe Co. v. Smith, 36 Mo.App. 608; Truesdail v. Ward, 24 Mich. 117; Heyn v. O'Hagen, 60 Mich. 150. The agreement being executed, and the defendants being in the full enjoyment of the fruits of the contract, they can not now be heard to say that it was invalid. Winscott v. Ins. Co., 63 Mo.App. 367; Bryant v. Fairchild, 51 Me. 146; Wiggins Ferry Co. v. Railroad, 73 Mo. 411; Hatch v. Hanson, 46 Mo.App. 323; 2 Herman, Estop., secs. 1022 and 1023. One who has received money for another can not deny his authority to receive, or the principal's claim. McKee v. Monterey Co., 51 Cal. 275; Hungerford v. Moore, 65 Ala. 232; Keyser v. Simmons, 16 Fla. 268; Iberia v. Serrett, 31 La. Ann. 719; Grattan v. Ins. Co., 80 N.Y. 281; Morris v. State, 47 Tex. 583; Cavins v. O'Bleness, 40 Wis. 469. A trustee can not set up the invalidity of the trust or appointment. Harbin v. Bell, 54 Ala. 389; Damouth v. Klock, 29 Mich. 289; McClure v. Comm., 80 Pa. St. 167. (5) The promise and agreement of the defendants to discharge the claims for work and labor, made when they induced the city to accept the well and pay the balance of the contract price to the sureties, renders them liable for the same, no matter whether they were liable before or not. Glover v. Cheatham, 19 Mo.App. 656; Stebbins v. Crawford Co., 92 Pa. St. 289; Fitzpatrick v. Flannigan, 106 U.S. 648. (6) The cause of action is to be determined by the facts stated, and not by the prayer for relief. Kneale v. Price, 21 Mo.App. 295; Comings v. Railroad, 48 Mo. 512; Railroad v. Freeman, 61 Mo. 80; Hewitt v. Harvey, 46 Mo. 368; Easley v. Prewitt, 37 Mo. 361; Grau v. Railroad, 54 Mo. 240; Snider v. Coleman, 72 Mo. 568; Crosby v. Bank, 107 Mo. 436.

Sallee & Goodman and D. J. Heaston for respondents.

(1) The plaintiff is not entitled to recover on the bond sued on in this case, for the reason there is no breach of the bond shown, no damage to the city alleged, and no legal authority shown in the city for such proceeding, and the city has no authority under its charter to make contracts for the benefit of strangers or third parties, nor can the city be made a collection agency for their benefit. Sewer Co. v. Thompson, 120 Mo. 218; Kansas City ex rel. v. Carroll, 99 Mo. 360; Howsman v. Waterworks, 119 Mo. 304; Ins. Co. v. Waterworks, 42 Mo.App. 118; Lewis v. Land Co., 124 Mo. 672; State v. Railroad, 125 Mo. 596; Evans v. Grader, 125 Mo. 72; Vrooman v. Turner, 69 N.Y. 280; Counselman v. Henry, 75 N.Y. 102; Dunning v. Leavitt, 85 N.Y. 30; Carter v. Holahaw, 92 N.Y. 498; Wheat v. Rico, 97 N.Y. 295; Beveridge v. Railroad, 112 N.Y. 1; Frank v. Railway, 122 N.Y. 122; Lorilord v. Clyde, 122 N.Y. 498; Duraker v. Raw, 135 N.Y. 219; French v. Vix, 143 N.Y. 90; Bank v. Grand Lodge, 8 Otto 123; Davis v. Waterworks, 54 Ia. 59; Becker v. Waterworks, 79 Ia. 419; Welter v. Goble, 66 Ia. 113; Breen v. Kelly, 47 N.W. 1067; Keller v. Ashford, 133 U.S. 610; Vanhorn v. Des Moines, 63 Ia. 448. (2) A city has no authority except such as is conferred upon it by its charter, or such as is absolutely necessary to carry out the objects of its incorporation. A city only acts by ordinance, and ordinances, like private statutes, must be specially pleaded, otherwise courts do not take judicial notice of them. R. S. 1889, secs. 1589 and 1652; Knapp v. Kansas City, 48 Mo.App. 485; Sedalia Gas. Co. v. Mercer, 48 Mo.App. 644; St. Louis v. Roche, 128 Mo. 541; State ex rel. v. Sherman, 42 Mo. 210; Butler v. Robinson, 75 Mo. 192; Keane v. Klausman, 21 Mo.App. 485; Lamar v. Hewitt, 60 Mo.App. 314; R. S. 1889, sec. 2077; Mexico v. Cauthorn, 25 Mo.App. 285; Givens v. Van Studdiford, 86 Mo. 149.

GANTT, P. J. Sherwood and Burgess, JJ., concur.

OPINION

GANTT, P. J.

From a judgment sustaining a demurrer to plaintiff's petition, plaintiff appeals.

The cause is in this court on an order transferring it from the Kansas City Court of Appeals.

The petition is in these words:

"Plaintiff for amended petition for cause of action states that it is a municipal corporation duly and legally organized under the laws of the State of Missouri, as a city of the fourth class that on the 18th day of June, 1894, the plaintiff and the defendant L. W. Howard by authority of and in pursuance to an ordinance duly passed and approved, made and entered into a written contract, a copy of which is herewith filed and made a part hereof, which was signed by said L. W. Howard and by this plaintiff, and by the terms of which, said Howard agreed to dig and wall according to certain plans and specifications mentioned in said contract, a certain well for the plaintiff for the purpose of supplying water for its waterworks then in process of construction for the agreed price of eight hundred dollars; that it was provided in said contract that said Howard should furnish to plaintiff, weekly statements of the work done on, and material furnished for said well, and by whom done and furnished, and the amounts thereof and should also furnish to plaintiff receipted bills for said work and material, from the persons doing said work and furnishing said material; and it was expressly agreed in said contract that in consideration that said Howard should perform said work according to said plans and specifications and would also pay for all work and labor done and material furnished by any person, in the digging and walling of said well, said plaintiff would pay to said Howard said sum of eight hundred dollars and that the payment for all work and labor done or material furnished in the performance of said contract by said Howard was by the terms of said contract made a part of the consideration thereof, and such payment for all labor and material furnished in the construction of said well by said Howard was made a condition precedent to the payment of said sum of eight hundred dollars by plaintiff; that it was further provided by said contract that this plaintiff should have the right to apply any part of the amount which might be due said Howard from it, under said contract, to the payment of all claims for work done or material furnished and used in constructing said well. Plaintiff further states that at the same time, to wit, on said 18th day of June, 1894, and as a part of the same transaction, and for the purpose of securing the faithful performance of all of the conditions of said written contract on the part of said L. W. Howard, and for the purpose of securing payment by him for all work and labor done, and material furnished by any person or persons in the performance by said Howard of said contract, and in the construction by him of said well, the said Howard as principal and the said defendants Ashman H. Vandivert and Geo. L. Phillips as securities did then and there...