Hudson County Nat. Bank v. City of Bayonne

• Decision Date: 14 August 1934
• Docket Number: No. 246.,246.
• Citation: 174 A. 241
• Parties: HUDSON COUNTY NAT. BANK v. CITY OF BAYONNE et al.
• Court: New Jersey Supreme Court

174 A. 241

HUDSON COUNTY NAT. BANK

v. CITY OF BAYONNE et al.

No. 246.

Supreme Court of New Jersey.

Aug. 14, 1934.

Mandamus by the Hudson County National Bank, as assignee of Edward P. Stout, against the City of Bayonne and others to require payment to relator, as assignee of Edward P. Stout, of $24,000 in payment of the claims of Stout for professional services rendered for respondents, with lawful interest thereon.

Peremptory writ allowed.

Argued May term, 1934, before TRENCHARD, HEHER, and PERSKIE, JJ.

Benny & Cruden, of Bayonne, for relator.

Alfred Brenner, of Bayonne, for respondents.

PERSKIE, Justice.

Relator's statement of facts, conceded by respondents to be substantially correct, are as follows: On July 1, 1930, Edward P. Stout, an attorney and counselor at law of the state of New Jersey, by reason of his experience in railroad tax litigation and his special knowledge of the law in respect to valuing and appraising railroad property, was, by resolution, at the instance of the commissioner of revenue and finance of the city of Bayonne (with the consent of its solicitor), deputized as Special Attorney General by the Attorney General of the State of New Jersey, to attend the meetings and represent the city's interest at the hearings before the State Board of Taxes and Assessment on complaints of the Attorney General that, for the year 1930 the properties of the Central Railroad Company of New Jersey, Lehigh Valley Railroad Company of New Jersey, East Jersey Railroad & Terminal Company, and Pennsylvania Railroad Company, used for railroad purposes (including first and second class railroad properties) situate in the taxing district of the city of Bayonne, were assessed far below their true value and to have the State Board of Taxes and Assessment review the assessments and correct them.

Respondents agreed to pay Stout a just compensation for his services. Stout performed the undertaking on his part. Thereafter, he rendered itemized bills on March 18, 1932, for the work done in each case. They totaled $24,000. No question is raised as to services rendered or the reasonableness of the charges made. His services were productive of substantial results for the city. On April 19, 1932, Stout personally appeared before the commissioners and again demanded payment. The mayor, in answer to a question of Commissioner Daly, stated that the reason the bill was not paid was that the city did not have the funds with which to pay it. Whereupon, on April 19, 1932, a resolution was adopted that the bill should be paid as soon as funds were available.

On January 11, 1933, Stout assigned this claim to the Hudson County National Bank to further secure certain of his loans with that institution.

Annually, in 1932, 1933, and 1934, the city in its tax ordinances for said years provided for this item.

On February 10, 1934, the commissioners of the city passed a resolution that a warrant be ordered drawn to the order of Stout and Hudson County National Bank in payment of the $24,000.

The procedure for the payment of an approved bill in the city of Bayonne appears to be as follows: A warrant for the bill is, in the first instance, drawn and signed by the city clerk; then it is signed by the city comptroller; then by the director of revenue and finance and lastly by the city treasurer.

On February 10, 1934, the city clerk, William P. Lee, drew and signed a warrant, No. 40,206, as directed, and delivered it to Frederick Krum, city comptroller. It was drawn on the current account.

The city comptroller testified, when asked if he had received from the city clerk the said warrant for $24,000, that he "received all these warrants in bulk. I don't recall singly whether I received it or not. But in all probability he had. That he did not have the warrant; that when he signed the warrants he gave them to the commissioner of revenue and finance for his approval; that if he did not sign the warrant he would in all probability have it; that he handed it to the commissioner of revenue and finance, together with all other checks in all probability; that he would not hand the warrant over to the commissioner of revenue and finance, or any one else, without having attached his signature; that the fact that he has not the check in his possession would indicate that he signed it and handed it to some one; that he put it in the office of the commissioner of revenue and finance."

The city treasurer, John Ryan, testified that he never received the warrant for $24,000. He also testified as to the amount of the balances in the "Current Account," upon which the said warrant for $24,000 was drawn, as of the first day of each and every month from May 1, 1932, to April, 1934, inclusive.

From the statement of the city treasurer it appeared that the monthly balances amounted to various sums ranging from $1,677,983.02 on June 1, 1932, to $11,059.01 on February 1, 1934; that all but four of said monthly balances were in excess of $100,000; and that on March 1, 1934, the balance was $45,737.02, and on April 1, 1934, it was $190,767.12.

The treasurer further testified that the city of Bayonne has a borrowing capacity for the year 1934 on $2,061,121.98 on tax revenue notes and a borrowing capacity of $4,032,228.56 on tax anticipation notes, or a total borrowing capacity in the neighborhood of $6,000,000. That the total amount borrowed on tax revenue notes is $500,000 and on tax anticipation notes $250,000. It also appears that although the item of $24,000, as above indicated, was included in the appropriation of "Tax Litigation and Special Service Taxation" in the tax ordinances of 1932 and 1933, and that it was intended to provide for the payment of this item, nevertheless the appropriations of $77,075.00 for 1932 and the appropriation of $30,000 for 1933 were practically exhausted without the payment of this particular bill.

The respondent's offered no direct testimony. Their cross-examination of the relator's witnesses, however, tended to indicate that this court had...