O'Dowd v. Waters

• Decision Date: 10 December 1924
• Docket Number: 11628.
• Citation: 125 S.E. 644,130 S.C. 232
• Parties: O'DOWD v. WATERS, MAYOR, ET AL.
• Court: South Carolina Supreme Court

125 S.E. 644

130 S.C. 232

O'DOWD v. WATERS, MAYOR, ET AL.

No. 11628.

Supreme Court of South Carolina

December 10, 1924

Appeal from Common Pleas Circuit Court of Florence County; E. C Dennis, Judge.

Action by J. M. O'Dowd against W. M. Waters as Mayor, and others as Councilmen, of the City Council of Florence, for specific performance of alleged contract and for an injunction. From so much of decree as refused specific performance, plaintiff appeals; and from so much of decree as awarded injunction, defendants appeal. Judgment reversed and complaint dismissed.

Defendant's exceptions are as follows:

"Exceptions of City Council.

(1) The court erred in holding that the defendants had no right to reject the higher and accept the lower bid for the lease of the municipal theater; the error being that the leasing of such building rested solely within the discretion of the defendants as the city council and their determination could not be interfered with by the court without proof that they had acted in bad faith.

(2) The court erred in substituting its opinion as to the proper terms of leasing the municipal theater for the discretion vested by law in the defendants as the city council, without any proof that such discretion had been exercised arbitrarily or in bad faith.

(3) The court erred in holding that, while the plaintiff had no contract with the city, he, as a taxpayer, could enjoin the city council from accepting other than the highest bid for the lease of the municipal theater; the error being that a taxpayer has no such right to interfere with the discretion as to the proper handling of municipal property lodged in the city council by law.

(4) The court erred in holding in effect that a city council in leasing municipal property must accept the highest offer therefor, thereby depriving it of the exercise of any discretion in regard thereto, and thus allowing the court and not the council to make municipal contracts.

(5) The court erred in holding that the refusal of the defendants to accept plaintiff's bid on the ground that it would create a monopoly in favor of plaintiff to the detriment of the citizens of the community was not a valid reason.

(6) The court erred in enjoining the defendants from accepting the offer of Messrs. Schnibben & Howard for the lease of the theater when it was an admitted fact that the offer had already been accepted and the contract thereby completed, and an injunction would not lie against such completed contract."

Cochran J., dissenting, and Morgan, A. A. J., dissenting in part.

Philip H. Arrowsmith, of Florence, for appellant.

James M. Lynch and Henry E. Davis, both of Florence, for respondents.

WATTS J.

I do not concur in the opinion of Mr. Justice COTHRAN. As to the plaintiff's appeal, I think his honor was correct in finding and holding that the negotiations between him and the defendants did not amount to a contract and that the plaintiff had no cause of action for specific performance. Wilie v. Price, 5 Rich. Eq. 91; Harmon v. Tel. Co., 65 S.C. 490, 43 S.E. 959; Holliday v. Pegram, 89 S.C. 73, 71 S.E. 367, Ann. Cas. 1913A, 33.

I think the exceptions of the defendants should be sustained on the ground that the city council of Florence is the instrumentality through which the corporation exercises its powers and performs its duties, and the statute expressly gives to such council plenary authority to act, respecting any subject that shall appear to them necessary and proper for the welfare of the city.

The city council of Florence is vested not alone with the power to make contracts concerning the property owned by the city, but in addition with full discretion in regard thereto, and under the facts of this case the court has no right and authority to interfere with this discretion by substituting its opinion for the discretion of the council. City Council v. Ahrens, 4 Strob. 241; Darlington v. Ward, 48 S.C. 570, 26 S.E. 906, 38 L. R. A. 326; Thomasson v. Ry. Co., 72 S.C. 1, 51 S.E. 443; Dillingham v. Spartanburg, 75 S.C. 549, 56 S.E. 381, 8 L. R. A. (N. S.) 412, 117 Am. St. Rep. 917, 9 Ann. Cas. 829; Jones v. Camden, 44 S.C. 319, 23 S.E. 141, 51 Am. St. Rep. 819; Haesloop v. City Council of Charleston, 123 S.C. 272, 115 S.E. 596.

I think the judgment should be reversed and complaint dismissed.

A majority of the court having concurred in this opinion, the judgment of the circuit court is reversed and complaint dismissed.

FRASER and MARION, JJ., concur.

MORGAN, A. A. J., concurs in part.

GARY, C.J., did not participate.

COTHRAN J. (dissenting).

Action by the plaintiff, individually and as a citizen and taxpayer of the city of Florence, for the double purpose of compelling specific performance of an alleged contract with the city to lease to him the theater auditorium, owned by the city, a part of the city hall, and to enjoin the city from executing a lease thereof to another party, Schnibben & Howard, whose bid at a lower figure has been accepted. The date of the commencement of the action is September 6, 1923, and on that day, upon the verified complaint, a temporary restraining order, with a rule to show cause, was issued by his honor, Judge De Vore, returnable before his honor, Judge Shipp, at Florence, on September 14, 1923. By agreement of counsel the cause was heard on the merits, upon the complaint and exhibits, the return and answer, and a traverse to the return, at the fall term, 1923, by his honor, Judge Dennis, presiding judge, who filed a decree dated January 12, 1924, holding that the plaintiff had failed to establish a contract for a lease with the city, and was not therefore entitled to a decree of specific performance, but that as a taxpayer he was entitled to relief against the action of the city council, in accepting the lower bid submitted by Schnibben & Howard, and issued an injunction accordingly. The plaintiff has appealed from so much of the decree as refused specific performance of the alleged contract, and the city council has appealed from so much of it as awarded the injunction.

The facts underlying the controversy, as best we have been able to gather them from the record for appeal, appear to be as follows:

The city of Florence owns a city hall, in which building is an opera house, which for many years has been leased by successive city councils to private persons upon competitive bids, at steadily increasing rentals. In the year 1911, the plaintiff located at Florence for the purpose of operating a moving picture theater, and acquired an unexpired lease of the opera house which ended with that year. He then acquired a lease of it for three years, 1912 to 1914, inclusive, in his own name, at an annual rental of $900. The lease was renewed for three years and eight months, at an annual rental of $1,800. This lease expired in 1919, whereupon the opera house was leased to other parties, Schnibben & Howard, for three years, upon competitive bids, at an annual rental of $3,150. This lease was renewed for three years and expires during this year, 1924. In the meantime the plaintiff established his business at another location.

In June, 1923, it appears that a renewal of the lease to Schnibben & Howard, which was to expire in May, 1924, was under consideration by the council; whereupon the plaintiff addressed a communication to the mayor, dated June 22, 1923, protesting against the premature consideration of the matter and expressing his willingness, should it be gone into, to submit a proposition, and insisting that the matter should be conducted under sealed bids as had invariably been the custom theretofore. Receiving no reply, he again wrote the mayor on June 30th, to the same effect, and offered to pay an annual rental of $5,000 upon certain conditions. On July 12th, the mayor answered the two letters of the plaintiff, stating that "at the next full meeting of the city council I will present your proposition and advise you." On August 31st, a meeting of the city council was held, attended by the plaintiff, one of the then lessees, Schnibben, and two others apparently interested. After a discussion of the matter the visitors retired and the city attorney, by direction of the council, prepared and mailed to each one of the four a declaration, addressed, "To Whom It May Concern," that the city proposed to lease the opera house for a term of three years, beginning at the expiration of the unexpired lease in 1924, upon certain conditions, and advising that proposals would be received by the city clerk September 5, 1923. Within the time stated the plaintiff submitted a proposition, under the terms of said declaration, to lease the opera house for a term of three years at $5,304 per annum, payable monthly. The next highest bid was submitted by Schnibben & Howard, the then lessees, at $4,350.

On September 5th, the city council met, and after consideration of the two bids decided to accept the bid of Schnibben & Howard, at $4,350, claiming to have acted in their discretion for the best interests of the city, particularly in preventing a monopoly of the moving picture business by the plaintiff

The plaintiff then instituted this action, as stated, for the double purpose: (1) As an individual, of obtaining a decree of specific performance of a contract of lease at $5,304; and (2) as a taxpayer, of enjoining the city council from consummating the proposed lease to Schnibben & Howard at $4,350.

Supporting his demand, as an individual, for specific performance, the contention of the plaintiff is that the call for bids submitted by the city council, interpreted by its terms in connection with the attendant circumstances, and followed by his submission of the highest bid, amounted to an acceptance of his bid by the...