People ex rel. Grannis v. Roberts

• Decision Date: 01 May 1900
• Citation: 57 N.E. 98,163 N.Y. 70
• Parties: PEOPLE et rel. GRANNIS et al. v. ROBERTS, Comptroller.
• Court: New York Court of Appeals Court of Appeals

163 N.Y. 70

57 N.E. 98

PEOPLE et rel. GRANNIS et al.

v.ROBERTS, Comptroller.

Court of Appeals of New York.

May 1, 1900.

Appeal from supreme court, appellate division, Third department.

Application by Charles W. Grannis and William T. O'Connor for mandamus against James A. Roberts, as comptroller of the state of New York. From a judgment of the appellate division (61 N. Y. Supp. 148) affirming an order granting the writ, defendant appeals. Reversed.

Vann, J., dissenting.

T. E. Hancock, for appellant.

Frank Hiscock, for respondents.

PARKER, C. J.

The fact having been brought to the attention of the comptroller that the relators, Grannis and O'Connor, had made what is known as an ‘unbalanced bid’ for the doing of certain work between locks Nos. 61 and 62 on the western division of the Erie Canal, he declined to pay the full amount of the drafts drawn upon him in behalf of Grannis and O'Connor, refusing to accept and pay such part of the drafts as represented about the sum of $30,000. Thereupon relators instituted this proceeding for the purpose of obtaining a mandatory order of the court requiring the comptroller to accept the drafts and pay the same in full. The comptroller, in his return to the writ, set up, among other things, that the state engineer omitted to comply with the command of the statute, in that he did not estimate or ascertain with any accuracy whatever the quantity of rock excavation necessary to be done upon that portion of the canal affected by the Grannis and O'Connor contract, putting in the specifications 100 yards as the quantity of rock excavation, whereas the rock excavation was, in fact, more than 30,000 yards; and this led to a bid on the part of the contractors to excavate rock for $3 a yard, which, on the basis of the contract, would amount to $300, whereas, in truth and in fact, down to the time when the comptroller refused to pay any more on the drafts, the so-called ‘rock excavation’ already amounted to $90,000. The return further charged that the relators well knew at the time they signed the contract that there were a great many thousand yards of rock excavation to be done, and, further, that ‘there was no lawful competition among the bidders for said work, and the purpose of the law was thwarted, and the contract was not let to the lowest responsible bidder, as the law requires, but was let to the persons alone who, by deceit, concealment, and fraud, had an opportunity to secure a pretended contract; that because of such fraudulent conduct the treasury of the state has been and will be depleted, and the funds of the state wasted;’ and the return concluded with a prayer that the court declare such contract illegal and void. An alternative writ of mandamus was granted, and the issues were brought on for trial before a referee, the attorney general in person representing the comptroller with marked ability. It was shown that the rock excavation was not worth to exceed $1 per yard, and that under the contract, if permitted to stand, the relators were entitled to $3 per yard, so that for the 30,000 yards of rock excavation that had been done, worth $30,000, relators would receive $90,000, or $60,000 more than the work was fairly worth,-a result which was fittingly characterized by the comptroller in his return as a waste of the funds of the state. Now, no one pretended on the trial that the taking of this $60,000 could be justified on any other principlethan because ‘it is so nominated in the bond,’ and so the real controversy before the referee was whether the contract was tainted with fraud, and therefore void. The attorney general contended that it was, and he found evidence tending in that direction in the fact that the state engineer had failed to comply with the statute requiring him to state in the specifications and in the contract the amount of rock excavation required, coupled with the fact that one of the firm of the relators had been over the work, and knew, at least, that there were a great many thousand yards of rock excavation, if he did not know exactly how many there were, prior to the execution of the contract. While it was admitted that the state engineer did not put the correct number of yards in the contract and specifications, it was testified to that he did cause the survey to be made, and did ascertain the quantity of rock excavation necessary, in advance of advertising for bids, and the excuse offered for putting in 100 yards instead of 40,000 yards (for it seems there is still about 10,000 yards of rock excavation to be made) was that the estimates were in the division engineer's office at Rochester,-an excuse which would have had more value when the canal was first built than now, when the space between the two cities can be covered at the rate of nearly 60 miles an hour. While the contract was executed by the superintendent of public works, he had a right to rely upon the estimates made by the state engineer, and there is no hint in the record that he either suspected, or had reason to suspect, that the estimates contained in the specifications and contract had not been placed therein by the state engineer in strict conformity with the demand of the statute. The result of the trial was a finding by the referee that there was no collusion between the contractors and the state engineer by which this contract was brought about, and no fraud attending the execution of a contract that has proved so helpful to the pockets of the contractors and correspondingly depleting to the treasury of the state; and, that finding having been, in effect, affirmed by the appellate division, we are without authority, under the constitution, to consider the question of fraud at all, and come now to an investigation of the contention of the attorney general that, the comptroller having the authority to audit the claims against the state, including the canal claims, and having audited these claims, he cannot be compelled by mandamus to decide in any particular way, or to audit the account in the amount claimed by the relators. In other words, that, having audited the first draft of $43,794 at $27,846, and the second draft of $38,727 at $23,703, the court cannot now say that he should have audited at the full amount, and by mandamus compel him to do it; for that writ never issues to require the performance in a specified way of a discharge of a duty involving the exercise of judgment or discretion. This, of course, cannot be gainsaid, if the comptroller possessed the authority to audit, and whether he did must be the subject of our next inquiry.

In the first place, it should be noted that the constitution contemplates that the moneys of the state should not be paid out without an audit, and the legislature is deprived of the power to audit. Const. art. 3, §§ 19, 21; art. 7, § 6. Two facts must exist before any of the funds of the state can be paid out: First, an appropriation by the legislature; and, second, an audit by such authority as the legislature may create for the purpose. The legislature in this case appropriated the moneys, which were the proceeds of certain bonds of the state, for the payment of canal claims, and it was its further duty to provide for an audit of such...