Edward C. Jones Co. v. Town of Guttenberg

• Decision Date: 19 February 1902
• Citation: 51 A. 274,66 N.J.L. 659
• Parties: EDWARD C. JONES CO. v. TOWN OF GUTTENBERG et al.
• Court: New Jersey Supreme Court

51 A. 274

66 N.J.L. 659

EDWARD C. JONES CO.

v. TOWN OF GUTTENBERG et al.

Court of Errors and Appeals of New Jersey.

Feb. 19, 1902.

(Syllabus by the Court.)

Error to supreme court.

Action by the Edward C. Jones Company against the town of Guttenberg and the board of councilmen of such town. Judgment for plaintiff. Defendants bring error. Affirmed.

Charles C. Black, for plaintiffs in error.

Charles I;. Corbin, for defendant in error.

GARRETSON, J. By an act of the legislature approved March 9, 1898 (P. L. 1898, p. 03), entitled "An act authorizing towns to issue bonds for the purpose of raising money to pay certain bonds and improvement certificates, and interest thereon and judgments recovered thereon, heretofore legally issued and now due," it was provided: "It shall be lawful for the town council or other governing body of any town in this state to provide for the payment of all bonds and improvement certificates heretofore legally issued by said town for or on account of any street improvement or improvements, and now remaining unpaid, and for the payment of interest due thereon and of any judgments recovered on any such bond or bonds, improvement certificate or certificates, by the issue and sale of the corporate bonds of such town in an amount not exceeding the total amount due by the town on and for the bonds, improvement certificates, interest and judgments aforesaid." The act also contained provisions as to the denomination of the bonds to be issued, the time they should run, date, rate of Interest, manner of execution, how the payment of principal and interest should be provided for, and how the bonds should be sold. In compliance with the provisions of this act the board of councilmen of the town of Guttenberg on March 21, 1898, resolved that pursuant to the act aforesaid, in order to provide for the payment of outstanding bonds, amounting to $26,000, with accrued interest thereon additional thereto, theretofore legally issued by said town, January 1, 1876, and which became due January 1, 1880, and outstanding improvement certificates legally Issued by said town, aggregating $12,025.30, and past due. and accrued interest, and judgments against said town upon bonds and interest due on bonds and unpaid improvement certificates legally issued by said town, aggregating $29,679.99, with interest thereon from the date of recovery thereof, they did determine that there be issued by said town of Guttenberg bonds to the amount of $90,000. The resolution also fixed the date of the bonds, denomination, rate of Interest, when and where payable, when the bonds should become due, how the bonds should be executed, and that they should be sold to the highest bidder, but not at less than par. The resolution also determined that the moneys derived from the sale of the bonds should be applied and used for the payment of the bonds, improvement certificates, interest, and judgments so as aforesaid legally issued, recovered, and unpaid, and further determined how moneys should be raised to pay the principal and interest of the bonds, following in all particulars the provisions of the act. The council, under the resolution, advertised for bids for these bonds, and, the relators being the highest bidders therefor, on the 8th day of April, 1898, by resolution awarded the bonds to them. This resolution to issue bonds was on the 28th of April 1898, removed into the supreme court by certiorari, and its legality assailed on the ground that the act authorizing it was unconstitutional. The supreme court held the act to be constitutional and affirmed the resolution (Herrman v. Town of Guttenberg, 62 N. J. Law, 605, 43 Atl. 703); and the judgment of the supreme court was affirmed by this court (Hermann v. Same, 63 N. J. Law, 616, 44 Atl. 758).

The town council, subsequent to the determination of the supreme court, refused to Issue the bonds to the relators, and a rule to show cause why a mandamus should not issue was obtained, and the supreme court ordered the alternative writ to issue. This writ, dated May 18, 1000, recites that on March 21, 1898, there were outstanding and unpaid bonds and improvement certificates of the town of Guttenberg, theretofore legally issued by said town on account of said improvements, and interest thereon, and sundry judgments recovered on certain of said bonds and improvement certificates, and interest thereon, all as set forth in the resolution, a copy of which was annexed to the writ; that the board of councilmen of the town of Guttenberg did, on the day and year last aforesaid, resolve and determine that there be issued by said town of Guttenberg bonds to the amount of $90,000, pursuant to the provisions of the act of the legislature above referred to, as appears by the same resolution; that the board of councilmen advertised for bids for said bonds, and the relators bid the highest bid therefor and complied with the terms of the sale, and on April 8, 1898, the board of council-men did resolve to award the bonds to the relators at the price bid, bonds to be delivered and paid for at the rate bid on or before the 1st of May then next; that a writ of certiorari was sued out of the supreme court April 18, 1898, to review the validity of the resolution and award, and on November 28, 1898, the resolution awarding the said bonds to the relators was affirmed, and the judgment of the supreme court affirming the resolution was also affirmed by the court of errors and appeals at the November term, 1890 (44 Atl. 758), and the record remitted to the supreme court; that after the affirmance by the supreme court, and before the issuing of the writ of error, the board of councilmen on February 9, 1899, did adopt a form for said bonds and enter the same in the minutes, and set forth at length the form of the bond and the coupon; that they did resolve that after the execution of the bonds they should be delivered, in accordance with the terms of sale, on receipt of the purchase price therefor, to the relators; that it appears that the relators did approve said bonds as to form, and on December 27, 1899, tendered themselves ready to take the said bonds and pay for the same at the price bid, nevertheless the defendants have refused, and still do refuse, to issue or deliver to the relators the said bonds,—and then commands the defendants to sign, seal, and deliver to the relators the said bonds to the par value of $90,000, in conformity to the award of said bonds, or cause to the contrary signify.

To this alternative writ of mandamus the defendants made return May 20, 1900, setting up the incorporation of the town of Guttenberg and a provision of the chatter for five councilmen, with their terms of office; that three of the councilmen were elected in April, 1899, and that the resolution set up in the writ was not passed by the present councilmen, but by their predecessors in the same office, and the present council was not bound to issue said bonds, because they were not authorized or ordered by the present board of councilmen, and it is not for the best interest of the town to issue said bonds, that commissioners of adjustment had been appointed and had qualified, and had made a report, and a rule to show cause why the report should not be confirmed was about to be granted; that when the amount of taxes as shown in the report of the adjustment commission should be collected there would be no necessity for issuing $00,000 worth of bonds, and, if any bonds were thereafter necessary to be issued, such bonds could be Issued on much more advantageous terms; that the town of Guttenberg does not owe $90,000 of debt, as stated in the resolution, and that it would not be to the best interest of the town to issue $00,000 worth of bonds; that January 8. 1900, the check of $500 deposited by the relators with the town, which was accompanied by their bid, was tendered back by the town to the relators and refused by them; that the statements set forth in the copy of the resolution annexed to the writ are true; that it is true on April 8, 1898, the then existing board of councilmen did resolve to award the bonds to the relators at the rate named, bonds to be delivered and paid for at the rate as stated in the writ, which resolution was affirmed as set forth in the writ: that the form of the bond set forth in the writ is a copy of the bond which was proposed to be issued by the then councilmen, together with the form of coupon; that the relators approved the form of the bond and December 27, 1899, tendered themselves ready to take the said bonds, which was refused by the present councilmen, and the said $500 deposited with them was tendered back to the relators, and they refused to accept the same.

This return was demurred to, and the supreme court held that the defendants were entitled to judgment on the demurrer, on the ground that, as the relators by demurring admitted the truth of the statement that the town did not owe $00,000, the municipality was without power to issue the bonds. Edward C. Jones Co. v. Town of Guttenburg (N. J. Sup.) 48 Atl. 537. While it may be that, under the rule that a pleading should be taken most strongly against the pleader, the defendants, by not...