Missouri Service Co. v. City of Stanberry

• Decision Date: 30 July 1937
• Parties: Missouri Service Company, a Corporation, et al., Appellants, v. The City of Stanberry, a Municipal Corporation, et al
• Court: Missouri Supreme Court

108 S.W.2d 25

341 Mo. 500

Missouri Service Company, a Corporation, et al., Appellants, v. The City of Stanberry, a Municipal Corporation, et al

Supreme Court of Missouri

July 30, 1937

Appeal from Daviess Circuit Court; Hon. Ira D. Beals Judge.

Affirmed.

Clarence A. Davis, Gillihan & Gillihan and DuBois, Miller & Beavers for appellant.

(1) This is an equity case, and this court will review all the evidence in the case and make its own finding of fact on the record. Farmers Bank v. Handly, 9 S.W.2d 891; Allen v. Allen, 14 S.W.2d 686; Haltgreve v Sobolewski, 31 S.W.2d 996; Noell v. Remmert, 30 S.W.2d 1009. (a) A city makes a valid contract only when the consideration which the city is to receive is expressly stated therein in writing. The facts and circumstances and evidence in the instant case are that the consideration which the respondent, city of Stanberry, was to receive was not expressed in the written contract in evidence and in controversy. Sec. 2962, R. S. 1929; Woolfork v. Randolf County, 83 Mo. 506; Crutchfield v. Warrensburg, 30 Mo.App. 462. (b) A contract of a city should be enjoined if it provides for the expenditures of the proceeds of a bond issue for a purpose not authorized or contemplated by the voters. The facts and circumstances in evidence in this case are that the voters of Stanberry did not authorize the city to issue bonds and use the proceeds to purchase the labor and materials which are the subject matter of the contract in controversy. Art. 10, Sec. 20, Mo. Const.; 44 C. J. 1209; Harding v. Board of Supervisors of Osceola County, 237 N.W. 625; Hayes v. Seattle, 120 Wash. 373, 207 P. 607; Heathman v. Singletary, 12 S.W.2d 150; Turkey v. Omaha, 54 Neb. 370, 74 N.W. 613; Kansas Elec. Power Co. v. Eureka, 45 P.2d 877; Beers v. Watertown, 177 N.W. 502; Sager v. City of Stanberry, 78 S.W.2d 431; Palmer v. City of Liberal, 64 S.W.2d 265. (c) The powers of a city are to be strictly construed, and in acquiring an electric light plant, it must contract with the person who will agree to do the work on the lowest and best terms. The facts and circumstances in evidence in the instant case are that the contract in controversy was not the result of competitive bidding, and that the contract was not awarded to the lowest and best bidder. Secs. 7669, 7673, R. S. 1929; State ex inf Chaney v. West Mo. Power Co., 281 S.W. 709; Boonville ex rel. Cosgrave v. Stephens, 238 Mo. 339; Youmans v. Everett, 173 Mo.App. 671; City of Maryville v. Lippman, 132 S.W. 47; Thrasher v. Kirksville, 204 S.W. 804. (d) Where the scheme or purpose for which money derived from an authorized bond issue proves impossible of performance or illegal, the money so borrowed by a city should not be used to accomplish portions of the impossible or illegal project which might yet be possible or legal, but should be used to repay the indebtedness created; if the whole cannot be performed, the whole must fail. The facts and circumstances in evidence in the instant case are that it is impossible to carry out the purpose for which the funds here about to be expended were authorized because a material and substantial part of such scheme has been declared illegal. Sager v. City of Stanberry, 78 S.W.2d 431; Kansas Elec. Power Co. v. Eureka, 45 P.2d 877; Art. X, Sec. 20, Mo. Const. (e) Unilateral contracts are void. If the obligations of one of the parties is not obligatory, the other party is likewise excused performance, and the whole is void. The contract in evidence and in controversy in this case does not require the contractor to perform a large portion of the necessary labor, and is unilateral. Hudson v. Browning, 264 Mo. 58; Gillen v. Bayfield, 46 S.W.2d 571; Huttig v. Brennan, 41 S.W.2d 1054; Hagler v. Salem, 62 S.W.2d 751. (f) The aldermen of a city cannot delegate their legislative powers or vest others with authority vested in them by law. The facts in evidence in this case are that the contract in controversy is the result of such unlawful delegation of authority. Hays v. City of Poplar Bluff, 173 S.W. 676; Haag v. Ward, 186 Mo. 325. (g) Expenditures must be within the anticipated revenues of a city or authorized by two-thirds of the voters voting for that purpose, to be valid. The facts in evidence in the instant case are that the city of Stanberry had no funds available with which to supplement the bond proceeds for the purchase of materials necessary to effect the purpose for which said bonds were authorized. Art. X, Sec. 12, Mo. Const.; Sager v. City of Stanberry, 78 S.W.2d 431. (2) The court erred in excluding legal relevant and competent evidence offered by appellants showing the matters, issues and position of respondents in the prior suit to enjoin the expenditure of the funds herein, entitled Sager v. City of Stanberry, 78 S.W.2d 431; Thompson v. Lindsay, 242 Mo. 53.

Fielding P. Stapleton and Robert B. Fizzell for respondents; Poppenhusen, Johnston, Thompson & Raymond and Bowersock, Fizzell & Rhodes of counsel.

(1) The city of Stanberry has the right to spend the proceeds of its $ 40,000 electric light bonds in the manner contemplated. Such expenditure will not constitute a diversion of the bond money to a purpose different from that for which the bonds were voted. General understandings, comments and even specific promises or representations made by city officials prior to the bond election would have no legal effect on the validity of the bonds or on the right of the officers of the city to use the proceeds of the bonds for the purpose of accomplishing the object contained in the bond proposition submitted to the voters. Palmer v. City of Liberal, 334 Mo. 266, 64 S.W.2d 265; State ex rel. Kellett v. Johnson, 330 Mo. 452, 50 S.W.2d 121. Even misrepresentation or fraud in the bond election would not affect the validity of the bonds or the right of the city to use the proceeds for the purpose specified in the bond proposition submitted to the voters. State ex rel. City of Clarence v. Drain, 335 Mo. 741, 73 S.W.2d 804; State ex rel. Jackson County v. Waltner, 100 S.W.2d 27; Humphrey v. City of Pratt, 93 Kan. 413, 144 P. 197; City of Oswego v. Davis, 97 Kan. 371; Epping v. Columbus, 117 Ga. 263, 43 S.E. 803; Johnson v. Town of Remsen, 215 Iowa 1033, 247 N.W. 552; Reid v. Muskogee, 137 Okla. 44, 278 P. 339; Balducci v. Strough, 239 N.Y.S. 611, 135 Misc. 346. Extrinsic aids to the construction of a written instrument may be resorted to only when the instrument itself is ambiguous. State ex rel. Russell v. State Highway Comm., 328 Mo. 942, 42 S.W.2d 196. (2) The contract in issue in this case was executed by proper authority, in proper manner, in proper form, and in conformity with the controlling statutory law and ordinances. (a) The contract in question complies with Section 2962, Revised Statutes 1929. The contract is in writing, states the consideration, was dated when made, and was subscribed by the parties thereto. (b) The contract in issue is not indefinite as lacking in mutuality, nor is the contract unilateral in character. The acts of the parties and other extrinsic evidence were competent to interpret the contract and to explain the meaning of the terms therein contained. St. Louis Gaslight Co. v. St. Louis, 46 Mo. 121; Laclede Const. Co. v. Moss Tie Co., 185 Mo. 25, 84 S.W. 76; State ex rel. Morrison Inv. Co. v. Trimble, 301 Mo. 146, 256 S.W. 171. The appellants' petition in this case does not attack the contract on the ground that it fails to comply with Section 2962, Revised Statutes 1929, or on the ground that it is indefinite, lacking in mutuality, and unilateral in character. These issues are entirely outside of the pleadings in this case and the foregoing attacks constitute afterthoughts which should be disregarded in this court. (c) The letting of the contract by the city of Stanberry was regular and legal. The governing body of a city has wide discretion in connection with awarding contracts for public work. Gast v. Langston, 15 S.W.2d 353. (d) The authorization of the contract in controversy was legal. Irregularities and formal defects in a contract for public work between a city and a contractor cannot be urged by third parties to invalidate the contract. 5 McQuillin on Municipal Corporations (2 Ed.), sec. 2054, p. 334; City of Philadelphia v. Gorgas, 180 Pa. St. 296, 36 A. 868; State ex rel. v. District Court of Ramsey County, 32 Minn. 181, 19 N.W. 732. Irregularities in the procedure followed by a city or even the failure of a city to follow directory statutes enacted by the Legislature would not affect the validity of municipal action. State ex rel. Lincoln v. Bird, 295 Mo. 344, 244 S.W. 938; Hudgins v. Mooresville Consolidated School Dist., 312 Mo. 1, 278 S.W. 769; City of Tarkio v. Cook, 120 Mo. 1, 25 S.W. 202; City of Kirksville v. Harrington, 225 Mo.App. 309, 35 S.W.2d 614; Webb City v. Aylor, 163 Mo.App. 155, 147 S.W. 214; City of Rockville v. Merchant, 60 Mo.App. 365; Meyers v. Wood, 173 Mo.App. 564, 158 S.W. 909. (e) The officers of the city of Stanberry did not delegate any legislative power to the consulting engineer of the city. The consulting city engineer of the city of Stanberry acted purely in an advisory capacity, all final decisions being made by the Board of Public Works and the Board of Aldermen of the city. Even if the city of Stanberry had by ordinance delegated certain administrative details to the city engineer (which the city did not do), such action would not invalidate the contract. Whitworth v. Webb City, 204 Mo. 579, 103 S.W. 86; St. Joseph to use of Gibson v. Owen, 110 Mo. 445, 19 S.W. 713; State ex rel. Cavender v. St. Louis, 56 Mo. 277.

Hays, J. All concur, except Douglas, J., not voting because not a member of the court when cause was submitted.

OPINION

HAYS

This suit was brought by the ...