Lucas v. Town Of Belhaven

• Decision Date: 20 February 1918
• Docket Number: (No. 15.)
• Citation: 95 S.E. 41
• Court: North Carolina Supreme Court
• Parties: LUCAS. v. TOWN OF BELHAVEN. BUTT. v. SAME.

95 S.E. 41

LUCAS.

v.TOWN OF BELHAVEN.

BUTT.

v.SAME.

(No. 15.)

Supreme Court of North Carolina.

Feb. 20, 1918.

Appeal from Superior Court, Beaufort County; Kerr, Judge.

Two actions, one by R. W. Lucas, the other by H. R Butt, against the Town of Belhaven and others, consolidated and tried together. From an order, Lucas appeals, and from a judgment, the Town appeals. Reversed.

Prior to May, 1917, W. B. Tooly was mayor and C. T. Windley, W. D. Morrison, A. Miller, F. M. Bishop, and J. W. Smith were aldermen of the town of Belhaven. On September 20, 1916, these aldermen duly passed certain ordinances declaring that systems of electric lights, waterworks, and sewerage were necessary to the town, and provided for an issue of $60,000 in bonds to install these utilities. At the same time a proposition was made by J. B. McCrary Company, contractors, to do the work, which proposition was made and accepted to become effective "when funds are provided"; that is, contingent upon receiving funds from a sale of the bonds.

On February 22, 1917, the aldermen passed a resolution that the bonds be readvertised for sale on March 28, 1917, in accordance with the resolution of September 20, 1916, which resolution provided that the bonds should "be sold when issued for not less than par at public sale, after advertisement and competitive bids." On March 28, 1917, W. L. Slayton & Co., of Toledo, Ohio, having bid par and more, and being the highest bidder, a resolution was adopted reciting said facts and directing the acceptance of their bid and execution and delivery of the bonds. During April, 1917, and before final acceptance of the bonds by Slayton & Co., the regular municipal election for mayor and aldermen was held in the town of Belhaven, and the question of issuing these $60,000 of bonds and installing these public improvements was an issue. The two members of the old board and mayor who were candidates for re-election were defeated, and a new board and mayor elected.

On April 20, 1917, after the defeat of the old board in the election, and before the final acceptance of the bonds by Slayton & Co. the old board made award on certain bids for materials, all subject, however, in the language of the resolution adopted at that time, that:

"All bids accepted for light, water and sewerage material shall be accepted conditionally upon the sale of lights, water and sewerage bonds."

On April 25, 1917, R. W. Lucas, a citizen and taxpayer, instituted an action against the old board, the members of which had not been re-elected in the recent election, and whose terms of office would expire Monday May 7, 1917, and filed his complaint on April 27th, asking an order to restrain the old board from proceeding further in making and completing contracts for these public improvements, alleging bad faith, and that they were seeking on the eve of their retirement from office to fasten obligations on the town to carry out their personal will and to deprive their successors in office of any discretion in the premises. Upon this complaint, used as an affidavit, a restraining order was issued by Daniels, J., which on April 27th, was served upon said mayor and aldermen prohibiting their proceeding further in making or completing contracts with respect to electric lights, waterworks, and sewerage for the town of Belhaven. They were ordered to show cause on Monday May 7, 1917, why the order should not be continued to the hearing, but did not do so. Immediately on the service of said restraining order an attorney for said board by its authority had a conference with the McCrary Company in Atlanta, Ga., in consequence of which the aldermen on April 30, 1917, sent an attorney to make a delivery of said $60,000 to Slayton & Co., who had not till then accepted the said bonds. Said attorney proceeded to Toledo, Ohio, and on the 3d or 4th of May, 1917, pending said injunction, delivered said bonds to Slayton & Co., accepting in payment therefor $3,000, less than par and interest, and on May 5th said board made contracts with McCrary & Co. for sundry materials. The expenses of counsel to Atlanta and to Toledo, Ohio, were ordered paid by the old board before going out of office.

On Saturday May 5, 1917, just before retiring from office, the old board adopted certain resolutions in which is the following language:

"The said W. L. Slayton & Co. declined compliance with its offer of purchase of said bonds, unless allowed by the...