Gosnell, Etc., v. City of Louisville, Etc.
| Decision Date | 21 June 1898 |
| Citation | 104 Ky. 201 |
| Court | Kentucky Court of Appeals |
| Parties | Gosnell, etc., v. City of Louisville, etc. |
APPEAL FROM JEFFERSON CIRCUIT COURT, COMMON PLEAS DIVISION.
F. W. MORANCY FOR APPELLANTS. (GRUBBS & MORANCY OF COUNSEL.)
SAME ATTORNEY IN A SUPPLEMENTAL BRIEF FOR APPELLANTS.
LANE & BURNETT ALSO FOR APPELLANTS.
JOHN ROBERTS FOR APPELLEES, FEHLER, &C. (JOHN BARRET OF COUNSEL.)
SAME COUNSEL IN A SUPPLEMENTAL BRIEF FOR APPELLEES, FEHLER, &C.:
H. L. STONE FOR APPELLEE, CITY OF LOUISVILLE.
Upon the former appeal of this case (Fehler v. Gosnell, 99 Ky. 394 ), the court held that the contract sued on for street improvements not only embraced a guaranty of faithful work, but also provision for repairs rendered necessary by other causes than defects in the contractor's work, and that these provisions caused the bids for the work to be higher than they would have been without such provisions, but that the contractor was still entitled to recover, except to the extent the defendant's assessment had been increased on that account. As to the increase thus caused this court there held: "The city had authority to contract for the repairs of streets, provided such contracts were not made in violation of other requirements of the statute; and the contractor can recover of the city such portion of the contract price as was for repairs to the streets." On the trial of the case the appellees other than the city, which was not a party defendant at that time, filed a supplemental answer, by which it was alleged that vitrified brick streets were inferior, were not expected to last more than five years before a renewal would be required; that it would require fifty per cent. of the original cost of construction to keep such streets in repair five years, and that the contract on that account was increased fifty per cent. above what would have been a reasonable compensation for construction merely. It was further pleaded that the contract was secretly and fraudulently made, and the contractor fraudulently obtained information that his sealed proposal would be accepted before it was opened, and commenced work, and hauled and dumped from two hundred to three hundred loads of dirt upon the street before the proposal was opened. It may be stated here that upon the issue of fraud thus tendered the evidence was, by the trial court, considered insufficient, and in that finding we are disposed to concur. By an amended answer it was alleged that the making of streets with vitrified brick was an experiment; that no such streets had been in existence as long as five years, and nothing was known of their durability; and the right of the council to experiment, and put the burden thereof upon appellees, was denied. By a second amended answer it was alleged that the amounts apportioned against appellees were greatly more than fifty cents on the $100 worth of property within the fourths of squares upon which the assessment was made; that some of the land assessed was improved and some unimproved; that there was personal property within the limits of the assessment which was taxable; that the ordinance and contract relieved from the taxation imposed all such improvements and personalty; and that sections 71 and 75 of the act for the government of cities of the first class, approved July 1, 1893, are in violation of section 3 of the bill of rights of the Constitution and of sections 157, 171, 172, 174 and 181 of the present Constitution, in not providing for an assessment of all taxable property within the taxing district according to its fair cash value, the entire expense of the street construction being assessed upon the land alone; and that the exemption from this assessment of the improvements the personal property within the taxing district is in violation of the fourteenth amendment of the Federal Constitution. After the case had been submitted, the submission was set aside, and an amended petition permitted to be filed, making the city of Louisville a party defendant, alleging that by the contract sued on the city obligated itself that the contractor, Gosnell, should be paid in accordance with the terms thereof, and seeking to recover against the city for the amount of the original apportionment warrants, to the extent that they might be held not enforcible against the property holders. The city filed demurrer to the petition as amended, and by the judgment the demurrer was sustained. The court made a reduction of 20 per cent. of the apportionment warrants, and gave judgment to the contractor for 80 per cent. thereof, with interest from the date of the warrants. From this judgment an appeal was taken, both by the contractor and the property holder.
On behalf of the contractor it is claimed that, whatever rule might be adopted in estimating the amount of the contract which was for repairs, judgment should have been given against the city for that amount, in accordance with the expression quoted from the opinion upon the former appeal. On behalf of the city it is insisted that in no event can any judgment be rendered against it for that portion of the contract price which might be determined to have been for repairs, but that, if the city is liable at all for repairs, the contract must be so construed as to fix the amount for that purpose at not exceeding 10 per cent. of the entire contract price. On behalf of the property holders it is claimed: First, that the contract was fraudulent; second, that it was error to allow interest from the date of the original apportionment, but interest should not have gone except from the date of the reapportionment, when correctly made; third, that it should have been adjudged that 45 per cent. of the contract price was for the repairs contracted to be made during the five years; and, fourth, that the charter provisions in reference to assessments for street improvements are in conflict with both the State and Federal Constitutions, and void.
The question of fraud has been already considered. By section 2832, Ky. Stat., the board of public works was required to make the apportionment, and by section 2839 it was provided that a lien existed from the date of the warrant. The apportionment, as we have held, was erroneous; and until corrected by the courts or the council it was impossible for the property holder to ascertain for what amount he was liable. It is manifest, therefore, that it was inequitable to charge the property holder with interest until there was an ascertained liability against him or his property, by the payment of which the lien could be discharged. In Conner v. Clark, 15 Ky. Law Rep. 126, it was held that parties ought not to be held liable for interest until the amount they owe is ascertained with certainty; and in that case, as the amount which the appellants should pay was not ascertained until judgment rendered, it was not error to refuse to adjudge interest against them. And in Boone v. Gleason, 4 Ky. Law Rep., 1001, the Superior Court held that the property holder was liable for neither interest nor costs until the apportionment had been made according to the principles established by law. In this view we concur. Neither interest nor costs should have been allowed against the property holder, except from the time the amount he was required to pay was so fixed that he could discharge it. Nor should interest upon the whole amount of the contract price be allowed against the city, for, while the rule may seem harsh, the contractor must be assumed to have entered into the contract with his eyes open as to its provisions and their enforcibility. The contract was not made by the property holder, but for him. As to that portion of the contract price for which he is responsible, his debt was not matured by reason of an erroneous apportionment, and was not payable until maturity. But for that portion which was properly assessable against the property holder the contractor must look to him alone. We think the same reasoning is applicable to interest upon such part of the contract price as the city may be held responsible for, though not to the costs of ascertainment of the amount, i. e. of obtaining a reapportionment by the courts, for the city became a party to the contract of its own will, and not in invitum, as in the case of the property holder.
A large amount of testimony has been taken upon the question of what proportion of the contract price was for the repairs for five years, the estimates given in the evidence varying from nothing to fifty per cent. The contractor himself testifies that he made no allowance for repairs. Other witnesses, more or less expert, make widely varying...
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