City of Trenton v. Fowler-Thorne Co.

• Decision Date: 10 September 1959
• Docket Number: No. A--114,FOWLER-THORNE,A--114
• Citation: 154 A.2d 369,57 N.J.Super. 196
• Parties: CITY OF TRENTON, a Municipal Corporation, Plaintiff-Cross-Appellant, v.COMPANY, a corporation, and Seaboard Surety Company, a corporation, Defendants-Appellants.
• Court: New Jersey Superior Court — Appellate Division

Page 196

57 N.J.Super. 196

154 A.2d 369

CITY OF TRENTON, a Municipal Corporation, Plaintiff-Cross-Appellant, v. FOWLER-THORNE COMPANY, a corporation, and Seaboard Surety Company, a corporation, Defendants-Appellants.

No. A--114.

Superior Court of New Jersey Appellate Division.

Argued April 20, 1959.

Decided Sept. 10, 1959.

Richard J. Casey, Trenton, argued the cause for defendants-appellants (Frank I. Casey, Trenton, attorney).

Harvey L. Stern, Trenton, argued the cause for respondent, cross-appellant (Louis Josephson, Trenton, attorney).

Before Judges CONFORD, FREUND and HANEMAN.

The opinion of the court was delivered by

CONFORD, J.A.D.

This matter comes before us on appeal and cross-appeal taken by leave of the Appellate Division from an order of the Superior Court denying defendants' motion to dismiss the action as barred by the statute of limitations. The parties have filed an agreed statement in lieu of record, and we consider the cause on the basis thereof, pursuant to R.R. 1:6--2.

The action was brought by the City of Trenton on June 27, 1957 against the defendant Fowler-Thorne Company, as contractor, and against the defendant Seaboard Surety Company, as surety on a public construction performance bond, in connection with a claimed breach of contract by Fowler-Thorne in the performance of an agreement with the city for the erection of an addition to a municipal hospital building. The contract was executed September 15, 1949, and the work accepted and final payment ordered by resolution of the board of commissioners of the city on August 2 1951. The action is based upon alleged defects in the building which became manifest some time later.

The defendants answered jointly August 14, 1957, denying liability for the condition of the building and raising the defense among others, that 'the suit was improperly started in the name of the City of Trenton in that it was started on the instructions of a single Commissioner rather than the Board of Commissioners, as required by' a 1947 resolution of the then city commission. On May 15, 1958 the board of commissioners adopted a resolution by which 'the suit heretofore authorized and commenced by the City of Trenton * * *' was 'authorized, ratified and confirmed.' Thereafter, when the action was called for trial, defendants were granted leave to amend their answer to include the defense of statute of limitations, and the court ordered that this issue be resolved by motion in advance of trial. In the course of argument and briefs on the motion, the city argued: (1) the incidence of the six-year limitations statute covering ordinary contractual causes (N.J.S. 2A:14--1, N.J.S.A.) is here immaterial as the bond executed by the defendants was an 'obligation under seal conditioned for the payment of money only,' in respect to which the period of limitations is 16 years (N.J.S. 2A:14--4, N.J.S.A.); (2) the six-year limitations period is inapplicable in any case as the action, which was concededly instituted within six years of the accrual of the cause of action, was properly brought in the name of the city on the authorization of the director of public affairs; or, in the alternative, that any lack of authority in that regard was cured by the ratifying resolution of the city commission.

The trial court in oral conclusions held: (1) the institution of the action was not legally authorized; (2) the ratification of the action by resolution of the commission could not legally relate back to the date of institution of the action so as to preclude the 'intervening' defense of limitations, if, as a matter of law, the six-year period was applicable to the case; (3) the six-year period was not applicable as the action was upon a sealed instrument, covered by the 16-year period. The motion for dismissal was accordingly denied.

A preliminary procedural point must be noticed. As the order of the trial court on the motion was in favor of the plaintiff, it was technically not aggrieved thereby and would have no right of appeal merely because the opinion of the court ruled against its position on some of the points argued, since appeals are taken from judgments and orders (where otherwise appealable, either as of right or by leave of court), not from opinions. Hughes v. Eisner, 8 N.J. 228, 84 A.2d 626 (1951). However, in the order granting defendants leave to appeal, this court included a provision giving plaintiff leave to cross-appeal. We take it the intention of the order in the latter respect was to enable this court to deal with the entirety of the dispute dealt with by the trial court on its merits, whether the issues were raised by plaintiff or defendants. That objective being a salutary one, and no objection having been offered, we will deal with the meritorious questions raised in the plaintiff's purported 'cross-appeal.' Indeed, we have found that we need consider only those in order to dispose of the defendants' appeal.

I.

Attention is first directed to the city's contention that the action was properly instituted on the authorization of the director of public affairs, Commissioner Holland. Were it not for the implication of the issue of limitations, this question would not be important, since an action instituted by an agent without proper authorization from the plaintiff will not, for that reason, be dismissed in the face of subsequent ratification by the principal. See Sayre v. City of Orange, 67 A. 933 (Sup.Ct.1907) (not officially reported). Although, for reasons set forth in Point II of this opinion, we have concluded that there was ratification sufficient to bar the defense of limitations, we address ourselves first to the disposition of the argument of the city that the motion is disposable on the ground of sufficient authorization of the action in the first instance.

The City of Trenton is a municipality governed and operating under the commission from of government, pursuant to the Walsh Act, N.J.S.A. 40:72--1 et seq. Under that act (R.S. 40:72--5, N.J.S.A.) it is provided that the elected board of commissioners 'shall determine the powers and duties to be performed by each department and shall assign such powers and duties to each department as it may deem appropriate.'

The argument of the city rests upon the ground that by a resolution of a former city commission, adopted in 1943 (Resolution No. 4378) and never altered thereafter, authority to institute an action involving the subject matter of a particular department, as here a hospital building allocated for administration to the director of public affairs, resides in the same official. The claimed authorization is concededly not expressed in the resolution but is argued to be sufficiently implied therein. We pass the question, not argued, as to whether an allocation of departmental subject matter survives the life of the then incumbent commission, at least until contrary action by a later-elected commission. Cf. Oliver v. Daly, 4 N.J.Misc. 80, 131 A. 678 (Sup.Ct.1926), modified on another ground, 103 N.J.L. 52, 134 A. 870 (E. & A.1926).

We do not find the city's argument sustained by the language of the resolution. It gives each director 'charge and supervision' over all lands and buildings devoted to the use of his department 'and the improvement, construction and repair thereof * * * and the replacement thereof,' subject to the provisions of any law, ordinance or city regulation, and directs him to 'approve and recommend to the Board of Commissioners the acceptance of any building or other improvement constructed under his supervision before final payment is made therefor.' We cannot read this language fairly to imply an allocation to the sole discretion of the director of a single department of the determination of whether an action should be brought by the city for breach of contract in relation to the construction of a building merely on the basis of the devotion of that building to the uses of the particular department. The resolution plainly implies that the director may not even accept such a building, but may only recommend acceptance. He certainly could not authorize construction of the building in the first instance. See Simon v. O'Toole, 108 N.J.L. 32, 44--46, 155 A. 449 (Sup.Ct.1931), affirmed, o.b., 108 N.J.L. 548, 158 A. 543 (E. & A.1931). That right is, moreover, expressly reserved to the commission elsewhere in the same resolution. There is no merit in the argument erected upon the 1947 resolution.

The city also argues that a commissioner 'acting singly within the administration of the duties assigned to him can do an affirmative act in the name of the city, unless prohibited by statute or ordinance, or where the action to be taken requires the passage of an ordinance.' We might be inclined to agree with this abstract statement if it were understood that the statutory prohibition is applicable by implication as well as express statement. See Simon v. O'Toole, supra (108 N.J.L. at page 45, 155 A. at page 454). But we do not agree that the proposition stated covers the case before us. We do not find that Director Holland was acting in the administration of the duties assigned to him when he directed the institution of this action.

We note, parenthetically, the recent sweeping Dictum of the Supreme Court in Slurzberg v. City of Bayonne, 29 N.J. 106, 110, 148 A.2d 171, 173, (1959), that there could 'be no doubt' that the decision of a Walsh Act governing body to invoke the judicial process to settle the municipality's controversy over its water rights with the North Jersey Water Supply Commission 'was the exclusive province of the board of commissioners as the city's governing body.' Although the holding in that case did not require a decision on the point mentioned, and there was apparently no argument thereon, a considered Dictum of that tribunal is to be accorded great weight in this court. However, we are not called upon here to decide whether a Walsh Act city...