Clough v. Verrette

• Decision Date: 03 February 1920
• Citation: 109 A. 78
• Parties: CLOUGH et al. v. VERRETTE et al.
• Court: New Hampshire Supreme Court

109 A. 78

CLOUGH et al.

v. VERRETTE et al.

Supreme Court of New Hampshire. Hillsborough.

Feb. 3, 1920.

Transferred from Superior Court, Hillsborough County; Allen, Judge.

Suit by Albert L. Clough and others against Moise Verrette and one Laflamme. On transfer, after ruling on demurrer to the answer, to which ruling Laflamme excepted, from the superior to the Supreme Court. Exception sustained, and case discharged.

Bill in equity by certain taxpayers of Manchester against the mayor and treasurer of the city and one Laflamme to enjoin the payment of a claim by Laflamme against the city which on the 17th day of December, 1918, the board of mayor and aldermen of the city had voted to pay.

The complainants are members of said board and voted against the payment of the claim. The bill alleged that in 1914 the city proposed to build an addition to its police station, and duy advertised for proposals for furnishing labor and materials for the same according to certain specifications; that Laflamme in August, 1914, duly submitted a bid in accordance with said advertisement, and filed therewith a certified check for $1,000 as security for the performance of his bid if the same should be accepted; that said bid was accepted by the city, but Laflamme refused to carry out the same; that the claim of Laflamme for $1,000, the payment of which the plaintiffs seek to enjoin, was for the return to him of the $1,000 deposited by him as security.

The defendants, in answering the bill, alleged that Laflamme's bid was made in reliance upon figures as to the cost of material and labor required furnished him by direction of the chairman of the committee of the aldermen having in charge the building proposed; that after the acceptance of his bid Laflamme ascertained that the figures so furnished upon which he had relied in making his bid were incorrect to the amount of over $2,000; that he so notified the city and offered to do the work and furnish the material required if the city would pay the difference between said figures and the actual cost of material; that the city refused so to do, and ever since Laflamme has endeavored to secure the return to him of said $1,000.

The answer further alleged that the claim of Laflamme was one as to which there was an honest dispute, and that, in the exercise of a sound discretion, the board of mayor and aldermen voted to pay the same, and that their action was not subject to control or revision by the court.

The plaintiffs demurred to the answer. The court sustained the demurrer as to the last allegation of the answer, but overruled it otherwise, holding, however, that if Laflamme's claim proved invalid, the plaintiffs were entitled to an injunction. To the order and ruling Laflamme excepted.

Taggart, Tuttle, Wynian & Starr, of Manchester, for plaintiffs.

Thomas H. Madigan, Jr., Irving E. Forbes, and Warren, Howe & Wilson, all of Manchester, for defendants.

PARSONS, C. J. When in August, 1914, Laflamme refused to carry out his bid except upon promise of additional payment, the city could have agreed to his proposition and contracted on the basis proposed by him. Meech v. Buffalo, 29 N. Y. 198. This was not done, and Laflamme has ever since endeavored to get the city to pay back the money which he had deposited as security. In December, 1918, the board of mayor and aldermen voted to pay him the face of his claim. These facts permit the inference that payment was ordered in compromise of a disputed claim. The plaintiffs having been outvoted as aldermen, now as taxpayers seek to enjoin the settlement voted by the board. While a municipality may not make a gift under the guise of a compromise of an entirely unfounded claim, its power to compromise a claim without reference to its ultimate validity is undoubted. Kinsley v. Norris, 62 N. H. 652; Portsmouth v. Bank, 76 X. H. 577, 83 Atl. 459; Wells v. Putnam, 169 Mass. 226, 47 N. E. 1005.

"The general power to compromise doubtful and disputed claims is necessarily incident to the power to sue and the liability to be sued. If a claim against the defendant cannot be adjusted by way of compromise, neither could a claim in its favor. If this doctrine were applied generally to all claims, the result would be that in all disputed cases the defendant must perforce engage in a litigation, the expense of which would be certain, but the result doubtful. The defendant would be under the necessity of insisting at all hazards upon a judicial...