Elkhart County Lodge v. Crary

• Decision Date: 13 November 1884
• Docket Number: 11,535
• Parties: Elkhart County Lodge et al. v. Crary
• Court: Indiana Supreme Court

98 Ind. 238

Elkhart County Lodge et al. v. Crary

No. 11,535

Supreme Court of Indiana

November 13, 1884

From the Elkhart Circuit Court.

Judgment affirmed.

A. D Wilson, -- Davis, J. H. Baker and J. A. S. Mitchell, for appellants.

W. L Stonex, for appellee.

OPINION

Elliott, C. J.

The material facts of this case are these: In October, 1878, the post-office in Goshen was kept in a room not affording suitable accommodations for the public, and there was a necessity for its removal. The postmaster was required by the government to furnish a room for the office and the rent was payable out of his salary. The value of adjacent property was enhanced by the location of the post-office and its rental value increased. The citizens of Goshen requested that the location of the office should be changed, and thereupon a competition arose between property owners of two localities, and property owners on Main street made a proposition to the department that they would furnish a suitable building for the office, and this proposition was made known to the appellants who were property owners on Market street, and were desirous of having the post-office located on that street. The appellants were the owners of a brick building on Market street, in course of erection, which was suitably located for the post-office; the appellee was the owner of real estate in the vicinity of appellants' building and was desirous of having the post-office located near his property. The appellants proposed to the appellee and other property owners, that they would fit up a room in their building with all suitable conveniences and equipments for a post-office and tender it to the government, rent free or for a nominal rent for ten years, on condition that the post-office should be maintained in the room for that period. A verbal preliminary agreement was made, wherein the property owners agreed that they would each pay to the appellants a certain sum yearly for ten years, provided the appellants would propose to the government to yield their room for a post-office at a nominal rent for ten years, and that "they would use all proper persuasion to secure the location of the post-office in their room." The notes in suit were executed pursuant to this agreement, and for the consideration therein specified. One of the appellants was a personal friend of the Postmaster General, and represented to that officer that the location was a suitable one, and urged upon him the propriety of placing the office in appellants' building. The representation that the location was a suitable one was true. The proposition made by the appellants was accepted by the government and the nominal rent of $ 12 per annum was agreed upon, and the room leased for a period of ten years for a post-office.

The material deduction of fact from these subsidiary facts is that the parties formed a combination for the purpose of securing the location of a public office, and as part of the plan the appellants undertook that certain individuals of their number should use their influence with the government officers to effect the purpose of the combination, and that the agreement to pay for such services was contingent upon the success of the scheme.

It has long been established that a contract against public policy will not be enforced. This principle is firmly fixed and has often been applied to contracts. There can, therefore, be no doubt as to the existence of the rule; the only question is as to its applicability to the facts of this case.

Where the general public has an interest in the location of an office, a railroad station, or the like, a contract to secure its location at a particular place is held to be against public policy and not enforceable. There are very many cases holding that an agreement to locate a railroad station at a designated place is not enforceable because against public policy. St. Louis, etc., R. R. Co. v. Mathers, 104 Ill. 257; Williamson v. Chicago, etc., R. R. Co., 53 Iowa 126; S. C., 36 Am. R. 206, vide authorities n. 214. The principle upon which these cases proceed is that the public good, and not private interest, should control in the location of railroad depots, and this principle certainly applies with full force to an office of a purely public character, such as a post-office. We find in these railroad cases, and there are very many of them, a principle which supplies a rule governing such a case as the present. It is true that there is some difference in the views of the courts upon the question whether an agreement for the location of a depot is valid when it does not restrict the location to the place named, and no other, but upon the general principle there is entire harmony. In the present case the difference in the opinions of the courts is an unimportant consideration, for here the location is restricted to one place, and no other, for a period of ten years, and the case, therefore, falls within the holding of the cases most favorable to the appellants. We say that the location is restricted to one place, for the reason that it is matter of judicial knowledge that but one post-office can be located in the city of Goshen. While the cases of which we have spoken establish a principle which rules this case, there are others which, in their general features, more nearly resemble the one at bar. Closely analogous in principle are those cases which hold that contracts which may tend to the injury of the public service are void. Card v. Hope, 2 B. & C. 661; Wells v. Foster, 8 M. & W. 149; Blachford v. Preston, 8 T. R. 89; Tool Co. v. Norris, 2 Wall. 45; Ashburner v. Parrish, 81 Pa. 52.

There are many phases of injury to the public service, and we do not deem it necessary to examine the cases upon the subject, for we think it quite clear that a contract which is made for the purpose of securing the location of an important office connected with the public service for individual benefit, rather than for the public good, tends to the injury of the public service. The case made by the evidence falls fully within the principle that contracts which tend to improperly influence those engaged in the public service, or which tend to subordinate the public welfare to individual gain, are not enforceable in any court of justice. Pollock Prin. of Cont. 279; Anson Cont. 175; 1 Whart. Cont., sections 402 to 414 inclusive. A wholesome rule of law is that parties should not be permitted to make contracts which are likely to set private interests in opposition to public duty or to the public welfare. This rule is recognized in our own case of Maguire v. Smock, 42 Ind. 1 (13 Am. R. 353), where it was held that an agreement to pay a consideration to a property-owner for signing a petition to secure the improvement of a street was void, although there was no fraud, and although the person to whom the promise was made was really in favor of the improvement.

It is not necessary that actual fraud should be shown, for a contract which tends to the...