Rose Bros., Inc. v. City of Alva

• Decision Date: 09 November 1960
• Docket Number: No. 38812,38812
• Citation: 356 P.2d 1083
• Parties: ROSE BROTHERS, INC., a corporation, Plaintiff in Error. v. CITY OF ALVA, a municipal corporation, Defendant in Error.
• Court: Oklahoma Supreme Court

Page 1083

356 P.2d 1083

1960 OK 231

ROSE BROTHERS, INC., a corporation, Plaintiff in Error. v. CITY OF ALVA, a municipal corporation, Defendant in Error.

No. 38812.

Supreme Court of Oklahoma.

Nov. 9, 1960.

Syllabus by the Court.

1. 'Conversion' consists of an assumption or exercise of dominion or ownership over property of another without the consent of the owner. If the owner expressly or impliedly assents to or ratifies the taking, use, or disposition of his property, he cannot recover as for a conversion thereof.

2. A municipality has no general power to contract for paving or to pay for same except in the manner provided by law, and a contractor is charged with knowledge of the law under which a paving contract is entered into.

3. Under provisions of 11 O.S.1951 § 90, any amount of a paving contract with a city in excess of the engineer's estimate filed in accordance with Section 89 of said title shall be void.

Appeal from the District Court of Woods County; Tom R. Blaine, Judge.

Action by contractor against city to recover value of extra oil and asphalt used in paving district. From judgment sustaining defendant city's demurrer to plaintiff's evidence and dismissing the action, plaintiff appeals. Affirmed.

John B. Doolin, Alva, for plaintiff in error.

Richard R. Downer, Herbert D. Smith, Alva, for defendant in error.

JACKSON, Justice.

In this action, plaintiff, Rose Brothers, Inc. seeks to recover the cost of 144,962.5 gallons of oil used in the construction of a street improvement in the city of Alva by plaintiff and a subcontractor in excess of the amount specified in a written contract with the defendant city. Subsequent to the award of the contract to plaintiff, it assigned and subcontracted the laying of the soil-asphalt base to Harrison-Wilson Company, of Eldorado, Kansas, plaintiff reserving the concrete curb and gutter portion. The action is grounded upon the theory that the defendant city converted the extra oil 'by requiring and ordering plaintiff and subcontractor to complete said paving district,' as alleged in the amended petition, all to plaintiff's damage in the sum of $21,744.37.

At the time plaintiff submitted its proposal to the city, plaintiff excepted to certain provisions of the specifications, and entered its bid subject to the following, to wit:

'That if in the opinion of the City Engineer additional asphalt is needed to insure construction according to intentions of Specifications, the contractor shall be allowed an additional sum of 15cents per gallon as an extra, for asphalt delivered and mixed over and above the limit set forth in the specifications, (not in excess of three (3) gallons per square yard).'

It is conceded by defendant city that the above provision was mutually agreed upon.

At a pre-trial conference between plaintiff and defendant, it was stipulated and agreed by the parties that the asphalt, oil or petroleum derivative for which plaintiff seeks payment had been deposited upon the streets comprising said paving district. Some of the evidence developed at the trial tended to show that city employees using city trucks removed asphalt from the common mixing area and used it to patch streets outside as well as inside the paving district. The amount of asphalt used outside the paving district was not established, and appeared to be negligible. We consider that such evidence was introduced for the sole purpose of bolstering plaintiff's theory of conversion.

At the conclusion of plaintiff's evidence, the trial court sustained defendant's demurrer to plaintiff's evidence and entered judgment for the defendant city, from which plaintiff appeals. Hence the immediate question is whether plaintiff's evidence, construed in the most favorable light to plaintiff, entitled plaintiff to any relief. Colorado Interstate Gas Co. v. Wheeler, Okl., 344 P.2d 1055.

Harold Wilson, president of the subcontractor company, testified that he was actively engaged in the work on the street improvement district and was on the job about eighty per cent of the time; that the oil used was ordered from Anderson-Prichard and shipped to the city of Alva; that the city of Alva directed him to place the oil on the streets; that the mayor and city clerk were present at numerous times when it was being put on the streets.

The city clerk testified, as follows:

'Q. The city has acknowledged there would be some excess oil needed in this particular district from the very inception of the whole contract since this is the very first thing they ever heard from any bidder? A. Yes.'

Everett L. Rose, president of plaintiff corporation, testified that the extra oil in question was used in paving district No. 43; that he had a conversation with the city clerk on October 1, 1957, and with the city engineer before the final estimate was made; that the city knew that the oil had gone into the paving district.

On January 21, 1957, the city engineer submitted its final estimate of the cost of the entire project at $98,736.62 (apparently pursuant to 11 O.S.1951 § 96) and in the last paragraph of its letter added the following:

'In addition to the above, 144,962.5 gallons of oil, in excess of 3 gallons per square yard, were used, to be paid for at an agreed price of $0.15 per gallon.

144,962.5 gals. Oil @ 0.15 $21,744.37

'Total Amount Due Contractor $120,480.99'

Thereafter the governing body of the city approved the cost of the improvement as estimated by the city engineer but took no action on item of excess oil in the sum of $21,744.37. The plaintiff filed its written protest with the board because of the omission of the $21,744.37, which was denied. Later, upon the advice of its attorney plaintiff let the matter go through so that the appraisers could apportion the benefits to the several lots and tracts of land benefited by the improvement, and in order that bonds might be issued in the approximate sum of $98,736.62. Plaintiff was paid the contract price of the improvement, as adjusted.

We agree with plaintiff in error's contention that a city may be liable for conversion under certain circumstances; however, we think the cases cited by plaintiff in error are distinguishable on the facts.

In Selected Investment Co. v. City of Lawton, Okl., 304 P.2d 967, and Wichita Finance & Thrift Co. v. City of Lawton, D.C., 131 F.Supp. 788, plaintiffs had installed water systems in a residential area under an agreement with the city that the systems would be connected to the city water system and plaintiffs would be reimbursed for the cost of same by means of fees collected from the consumers. Later the city repudiated its agreements and refused to pay plaintiffs' claims for the cost of the water system, while wrongfully asserting ownership of or dominion over the systems.

In the instant case we find no evidence of an unauthorized assumption or exercise of right of ownership over the oil in controversy. Under the evidence, all of the asphalt for the district was mixed in one area, and although city employees assisted in mixing and applying asphalt to the streets, such acts of the city were with the...