Ludlow v. The City of Emporia
| Decision Date | 10 January 1920 |
| Docket Number | 22,411 |
| Citation | 106 Kan. 107,186 P. 981 |
| Parties | W. E. MIDDLETON and A. D. LUDLOW, Partners, etc., Appellants, v. THE CITY OF EMPORIA, Appellee |
| Court | Kansas Supreme Court |
Decided January, 1920.
Appeal from Lyon district court; WILLIAM C. HARRIS, judge.
Judgment affirmed.
SYLLABUS BY THE COURT.
1. MUNICIPAL CORPORATIONS--Method of Letting Contracts for Public Improvements. In the absence of a statutory provision as to the method of letting contracts, a city of the second class may contract for the work through a public letting after an advertisement of the same. The authority to the city to have the work done carries with it the discretion to contract for the work in any practicable method that will safeguard the public interests.
2. SAME--Public Improvements--Advertisement for Bids--Bid Accepted by City Constitutes a Contract. Where the city advertised for proposals from bidders for the work according to full and definite plans and specifications furnished to bidders, and a proposal made by a bidder was formally accepted by the mayor and commissioners of the city, the acceptance of the bid concludes a binding contract notwithstanding the fact that it was stipulated that the contract so made should subsequently be reduced to writing.
3. SAME--Defaulting Bidder--Cannot Recover His Deposit Accompanying His Bid. A deposit which accompanied the bid as a guaranty of the good faith of the bidder and that he would enter into a formal contract and give a specified bond for the faithful performance of the work contracted for, cannot be recovered back by a bidder who fails to comply with the requirements of the agreement resulting from the accepted proposal.
4. SAME--Forfeiture of Deposit Money--Damages. After the bidder had notified the city that he was unable to give the bond provided for and carry out the contract, it was competent for the city authorities to declare the deposit forfeited to the city and apply the same to the actual damages sustained by the city through the failure of the bidder to perform his agreement.
5. SAME--Defaulting Bidder Liable to City for Actual Damages. The forfeiture and application of the deposit did not relieve the bidder from liability to the city for the actual damages suffered by reason of the breach of the agreement to give the bond and complete the work.
6. SAME--Defaulting Bidder--Measure of Damages Sustained by City. After the default of the bidder, the city accepted the next lowest bid without readvertising or a reletting of the contract, which under the circumstances appeared to be the lowest bid the city could hope to obtain. Held, that the difference between that bid and the accepted bid made by plaintiff, is a proper measure of the damages sustained by the city.
7. SAME--Contract for Improvements--Estimates by Non-resident Engineers. Following Abilene v. Lambing, 78 Kan. 484, 96 P. 838, it is held that the fact that the city employed nonresident expert engineers to make estimates, plans and specifications for the work, instead of having them made by the city engineer, who performs the ordinary duties of the position, did not impair the validity of the contract for the work made by the city.
W. W. Parker, of Emporia, Henry E. Dean, and Thomas A. Pollock, both of Kansas City, for the appellants.
S. S. Spencer, and Gilbert H. Frith, both of Emporia, for the appellee.
OPINION
The plaintiffs sued to recover from the city of Emporia the amount of a deposit which accompanied a bid they made for the extension and improvement of the waterworks system of the city. In its answer, the defendant asked judgment for $ 3,242.29, the difference between the amount of the deposit and the damages sustained by the city through the failure of the plaintiffs to carry out the contract resulting from the acceptance by the city of plaintiffs' proposal. The court found against the plaintiffs and awarded judgment in favor of defendant on its cross petition in the sum of $ 3,242.29. From this judgment, plaintiffs appeal.
It appears that bonds of the city to the amount of $ 150,000 were voted by the electors for the improvement of its waterworks system, and the firm of Black & Veatch, engineers of Kansas City, Mo., were authorized and employed by the city to make surveys, prepare plans and specifications for the work, and to supervise the construction of the plant. Plans and specifications were prepared by the engineers, including instructions to bidders, and proposals were invited. In response to the invitation, there were six bids received, ranging from $ 65,792.49 to $ 77,992.70. The plaintiffs' bid was the lowest, and the next lowest bid was made by McCoy & Taylor, for the sum of $ 70,534.78. The proposal of plaintiffs, which was accompanied by a deposit of $ 1,500, was accepted by the city on March 24, 1916. Each bidder was required to inclose with his bid a certified or cashier's check to be left with the clerk as a guaranty of good faith, to be forfeited if he failed to enter into a formal contract and give the required bond for the faithful performance of the work. In relation to the deposit, it was stated:
"In default of the performance of any of the conditions on our part to be performed, the amount of a check which we have this day deposited with the city clerk, shall, at the option of the commissioners, be absolutely forfeited to the city of Emporia, but otherwise the check shall be returned to Middleton & Ludlow," etc.
It was further stipulated that the bidder would enter into a contract within ten days from the acceptance of the bid and give a bond equal to sixty-five per cent of the amount of the bid, to secure the performance of the contract in accordance with the plans and specifications. On April 3, 1916, the plaintiffs notified the city commissioners that they were unable to give the required bond, but they expressed a willingness to do a small part of the work. After receiving this notice and on April 6, 1916, the mayor and commissioners declared a forfeiture of the deposit and directed that it be placed in the city treasury. On the same day, they proceeded to complete the letting. There was testimony to the effect that upon a consultation with the engineers, it was determined that as prices of material had advanced, there was no prospect that a lower bid than that of McCoy & Taylor, the next lowest bid which had been made, would be received by a readvertising and reletting. It was the opinion of all that a postponement for another notice and letting, with the constantly increasing prices, would cause the city to pay more for the improvement than the amount of the next lowest bid, and thereupon the bid of McCoy & Taylor was accepted. It appears that there was a marked advance in the prices of steel, cement, and lumber, after March 24, 1916, and these were the principal materials to be used in the work.
Although questioned, there can be no doubt of the power of the mayor and commissioners of the city to contract for such an improvement through a public letting, and this plan has been generally followed by municipalities of the state, time out of mind. In some instances it is specifically required by statute, but no method is prescribed in contracts of the kind in question. It is not necessary that the statute should expressly provide for a public letting, or prescribe the manner for contracting for an improvement. The authority to the city to have the work done carries with it the discretion to have it done in any way in which it is practicable and convenient, and in acting under such authorization the city is entitled to contract and bind itself and to all the rights and remedies of private parties. (2 Dillon on Municipal Corporations, 5th ed., § 815.) In such a case the protection of the public is the first consideration, and probably no method employed better safeguards the public interest than a public...
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