First Wis. Nat. Bank of Milwaukee v. Town of Catawba

• Citation: 183 Wis. 220,197 N.W. 1013
• Parties: FIRST WISCONSIN NAT. BANK OF MILWAUKEE v. TOWN OF CATAWBA.
• Decision Date: 31 March 1924
• Court: United States State Supreme Court of Wisconsin

183 Wis. 220

197 N.W. 1013

FIRST WISCONSIN NAT. BANK OF MILWAUKEE

v.TOWN OF CATAWBA.

Supreme Court of Wisconsin.

March 11, 1924.

Dissenting Opinion March 31, 1924.

Appeal from Circuit Court, Price County; Emery W. Crosby, Judge.

Action by the First Wisconsin National Bank of Milwaukee against the Town of Catawba. Judgment for plaintiff, and defendant appeals. Affirmed.

Eschweiler, J., dissenting.

W. K. Parkinson, of Phillips, for appellant.

Miller, Mack & Fairchild and Paul R. Newcomb, all of Milwaukee, for respondent.

JONES, J.

This is an action brought by the plaintiff to recover on a note for $11,000 loaned to the defendant on the representation that the money was to be expended in building a town hall.

At the annual town meeting of the defendant in April, 1920, a motion was passed authorizing the construction of a new town hall to cost approximately $10,000, and the town board was authorized to make the loan. The building was not constructed during that year, and at the town meeting of 1921 the minutes of the last town meeting were approved and a motion was passed authorizing the town board to procure a loan of $11,000 for one year to obtain money to be used in building a town hall. The motion contemplated a loan from the state trust fund, but that a temporary loan of $11,000 be made.

Proceeding under section 60.18(9), Stats., a request of the requisite number of freeholders was delivered to the town clerk asking that a special meeting of electors be called for the purpose of submitting the proposition of raising the money. Notice of the special meeting was duly given. The proposition to procure a loan of $11,000 was adopted by the electors. The referendum ballot fully stated the purpose of the loan.

After the annual town meeting of 1920, a building committee was appointed to investigate, in conjunction with the board of supervisors, the kind of town hall which should be built, and it was decided to build one similar to the town hall of Downing, Wis. As found by the trial court:

“They adopted plans for the building of a town hall 90 feet long and 36 feet wide, to be of brick veneer construction. The building consists of a basement and main floor. In the basement is a council room, fire hall, storeroom, banquet hall, and kitchen. The main floor has an assembly hall with a seating capacity of 300 and a gallery with a seating capacity of 65. At the front of the assembly hall is a stage, and off of the stage are two dressing rooms and a storeroom. Toilets are provided in the building, and in front of the building or entrance to the auditorium there is a ticket office and cloak room. The town built a town hall in accordance with these plans, but all of the interior work has not been completed.”

At the annual town meeting in April, 1922, the minutes of the annual town meeting of 1921 and of a special meeting were approved, and a motion was passed appropriating $1,500 for equipping the new town hall. The original note was twice renewed by giving new obligations.

The complaint was in two counts; one was an action for money had and received, and the other on the note. The answer alleged that the loan was obtained by the town officers without authority; that no provision was made for its payment as required by the Constitution and statutes, and the money was expended for purposes beyond the authority of the officers and the town.

The court submitted the following question to the jury and the answer was, “No”:

“Was the primary object in building the town hall in question to subserve a public municipal purpose?”

On motions, the court determined to decide the case “without reference to the special verdict returned by the jury, for the reason that the issue presented in this case is one of fact and law to be determined by the court,” and the court rendered judgment for the plaintiff in the sum of $11,000 and interest.

[1][2][3] We agree with counsel for defendant that the action for money had and received is an action at law. Although the implied contract in such actions arises out of equitable considerations, the action is legal and not in equity. From this premise counsel argue that since there was submitted to the jury the question whether the primary object in building the town hall was to subserve a public municipal purpose, the court was bound by the answer.

There was practically no conflict in the evidence. Although there was some testimony that some persons expected that the building would be used for purposes of recreation as well as for the official business of the town, this was apparent from the nature of the building itself.

At all town meetings the vote was for a town hall. The request by freeholders for a special meeting related to the building of a town hall. The officers of the town represented to plaintiff that the building was to be a town hall. The equipment was voted for a town hall.

The trial court had all the records before him as well as the plans for the building, and other facts, and we do not consider that he was bound by the testimony of witnesses given after the building was erected as to the primary object of its construction. This was largely a question of mixed law and fact involving consideration of the statutes as well as the nature of the building.

We conclude that the court was justified in making the finding as to the primary object in erecting the building notwithstanding the verdict of the jury. In so holding we are following the rule often declared that the decision of the trial court should stand unless we are clearly convinced that it was wrong. Kanass v. Chicago, M. & St. P. R. Co., 180 Wis. 49, 192 N. W. 383;Smiegil v. Great Northern R. Co., 165 Wis. 57, 160 N. W. 1057;Slam v. Lake Superior T. & T. Co., 152 Wis. 426, 140 N. W. 30;Riger v Chicago & N. W. R. Co., 156 Wis. 86, 144 N. W. 204;Powell v. Ashland I. & S. Co., 98 Wis. 35, 73 N. W. 573.

[4][5] One of the most important questions in the case is whether under the statutes the town had the power to construct the building in question. It is well settled that municipal corporations have no powers except those expressly conferred or necessarily implied from the power conferred, and since towns are only quasi corporations the rule applies to them with especial force. But when the statutes have expressly conferred powers upon towns or other municipal corporations, those statutes should be so construed as to carry out the legislative purpose.

The two following statutes are relied on by plaintiff's counsel as conferring this power:

“Each organized town is a body corporate and empowered to sue and be sued; to purchase, take and hold real and personal property for public uses and convey and dispose of the same; and to make all contracts necessary and convenient for the exercise of its corporate powers and any order for the sale or disposal of its corporate property which the inhabitants thereof may deem expedient. It shall be designated in all actions and proceedings by its name as ‘Town of * * *.’ ” Section 60.01, Stats.

“The qualified electors of each town shall have power at any annual town meeting by vote: To raise money to purchase or build a town hall or other building for the use of the town, or to unite the same with the money of any corporation or society doing business or located in such town, for the purpose of building or purchasing such hall or building; but no such vote shall be taken except by ballot nor unless a request in writing signed by at least twelve freeholders of such town shall have been delivered to the town clerk twenty days before the holding of such meeting, asking that such proposition be submitted to a vote of the electors of the town at such town meeting, and setting forth the amount of money which they desire shall be raised by the town for that purpose and whether the same shall be raised by a direct tax or the issue of bonds, and if the proposition be to issue bonds it shall state the denomination thereof, the time and place of the payment of the principal and interest, and the manner in which and by whom the same shall be negotiated. * * *” Section 60.18 (9), Stats.

The second of these statutes was the one under which the town proceeded in borrowing the money and erecting the building.

Counsel for defendant earnestly argues that neither of these statutes affords authority for the action of the town; that the plans and mode of construction clearly show that the main purpose was, not the erection of a hall for the uses of the town, but the erection of a building for public entertainment and amusement.

To maintain this contention counsel cites the following authorities: 1 Beach, Public Corporations, § 646; Brooks v. Town of Brooklyn, 146 Iowa, 136, 124 N. W 868, 26 L. R. A. (N. S.) 425;Wheelock v. City of Lowell, 196 Mass. 220, 81 N. E. 977, 124 Am. St. Rep. 543, 12 Ann. Cas. 1109;Smith v City of Raton, 18 N. M. 613, 140 Pac. 109. The following is the quotation from the first authority above cited:

“* * * If the primary object of a public expenditure is to subserve a public municipal purpose, the expenditure is legal notwithstanding it also involves as an incident an expense which, standing alone, would not be lawful. But if the primary object is to promote some private end, the expenditure is illegal even though it may incidentally serve some public purpose. It is proper in constructing buildings to make suitable provision for prospective wants. Proceedings in raising and expending money within the limits of the corporate powers in these particulars will not be collaterally impeached and held void because in the opinion of a court and jury a less sum would have answered the immediate necessities of the corporation or the money might have been more judiciously and economically expended.”

The authority cited from Iowa is especially relied on. In that case it was held that a town has no authority to construct a building for an opera house or assembly hall where the form of...