J.B. McCrary Co. v. City of Glennville
| Decision Date | 03 September 1919 |
| Docket Number | 1075. |
| Citation | 100 S.E. 362,149 Ga. 431 |
| Parties | J. B. MCCRARY CO. v. CITY OF GLENNVILLE. |
| Court | Georgia Supreme Court |
Rehearing Denied Oct. 1, 1919.
Syllabus by the Court.
Where a contractor enters into a contract with a municipal corporation for the construction and equipment of a light and water plant under a written agreement whereby some of the contract price is to be paid in installments through a series of years after the contract is completed, the effect of such a contract is to create a "debt" within the meaning of article 7, § 7, par. 1, of the Constitution of this state (Civ. Code 1910, § 6563), which limits the power of municipalities to contract debts, and is prohibited by that provision of the Constitution. Renfroe v. Atlanta, 140 Ga. 81, 78 S.E. 449, 45 L.R.A. (N. S.) 1173.
Where the contract also provides for retention of title in the contractor until the contract price is fully paid, for delivery of the plant after its completion to the municipality as lessee, and for a rental of $1 per annum until all the deferred payments for the contract price have been made, which, when done, shall cause title to the property to vest immediately in the municipality, the contract is one of "conditional sale," as distinguished from a mere lease. Hays v. Jordan, 85 Ga. 741, 11 S.E. 833, 9 L.R.A. 373; Ross v McDuffie, 91 Ga. 120, 16 S.E. 648; North v Goebel, 138 Ga. 739, 76 S.E. 46.
Under former decisions of this court, where a contractor constructed and installed a light and water plant in pursuance of an executory conditional contract of sale as described in the preceding notes, and delivered physical possession to the municipality, his right of action to recover the property or to enforce the payment of the contract price by the city was necessarily dependent upon the agreement by which title was reserved in him, and that agreement, being contrary to the express provisions of the Constitution, was illegal and not enforceable in law or in equity. Abbott Furniture Co. v. Mobley, 141 Ga. 456 81 S.E. 196; Sewell v. Norris, 128 Ga. 824, 58 S.E 637, 13 L.R.A. (N. S.) 1118; Bugg v. Towner, 41 Ga. 315; Thompson v. Cummings, 68 Ga. 124 (2); Watkins v. Nugen, 118 Ga. 373, 45 S.E. 262; Butts County v. Jackson Bkg. Co., 129 Ga. 801, 811, 60 S.E. 149, 15 L.R.A. (N. S.) 567, 121 Am.St.Rep. 244; Garrison v. Perkins, 137 Ga. 744, 74 S.E. 541 (3).
(a) A contrary result was reached in the cases of Chapman v. Douglas County, 107 U.S. 348, 2 S.Ct. 62, 27 L.Ed. 378, City of Bardwell v. Southern Engine Boiler Works (Ky.) 113 S.W. 97, 20 L.R.A. (N. S.) 110, and cases in other jurisdictions; but they are not controlling.
Applying the principles above announced, there was no error in dismissing the petition on general demurrer.
Error from Superior Court, Tattnall County; W. W. Sheppard, Judge.
Action by the J. B. McCrary Company against the City of Glennville. Petition dismissed on general demurrer, and plaintiff brings error. Affirmed.
Where contractor constructs and installs light and water plant for city under an executory conditional contract of sale providing for deferred payments and delivers possession to city, his action to recover the property or enforce payment of price depends on the agreement reserving title which, being contrary to Const. art. 7, § 7, par. 1, relating to city's contraction of debts, is illegal and unenforceable in law or in equity.
The petition alleges that in 1913 the City of Glennville desired to procure a system of electric lights and waterworks. It contracted with the J. B. McCrary Company to construct the same. The contract provided that title to the system should be retained by the McCrary Company until it was fully paid for. On December 3, 1914, the city found it impracticable, or legally impossible, to make the payments required of it under the original contract. The McCrary Company was unwilling to complete and deliver the system without payment. At this point a second contract was made. It recites the making of the contract of December 23, 1913; that the McCrary Company has furnished material and proceeded with the erection of the system to a point nearing completion; that under the original contract the city agreed that payment should be made in part by the sale of bonds issued for that purpose by the city and the balance as set forth in the contract of December 23 1913; that it is impracticable to...
To continue reading
Request your trial