SMITH
J.
The
facts in this case, as disclosed by the affidavit of the
plaintiffs and the answer of the defendants, are
substantially as follows: On February 5, 1908, the board of
state prison commissioners caused to be published a call for
bids for the care,
custody, and maintenance of all prisoners confined in the
state prison at Deer Lodge for the period of two years,
commencing the 18th day of June, 1908, in answer to said call
two bids were received, one from Conley & McTague, the
contractors in charge of the prison at the time, and one from
the above named plaintiffs. The bid of the latter was less in
amount per capita than that of Conley & McTague. It is
alleged in the answer, and shown by the records of the board,
that after considering said bids the following proceedings
took place: "The board *** found that, in the event of
awarding the contract to the said Henderson & Wyman, it would
be necessary for the state to take over certain property in
said prison belonging to Conley & McTague, who then had the
contract for the care and custody of said prison and the
prisoners therein. That the taking over of said property of
Conley & McTague was required by law, also by the provisions
of a contract signed by said board and said Conley & McTague,
dated May 28, 1906, which contract is now and ever since said
date has been in full force and effect between the said
Conley & McTague and said board; paragraph 4 of said contract
being in words and figures as follows, to wit: 'Fourth.
It is agreed that the said board of state prison
commissioners shall have the right to enter and assume
control of the state prison and prison grounds and all other
property belonging to the state in charge of the parties of
the first part [Conley & McTague], and take charge of all
prisoners, whenever they shall deem it necessary and to the
best interests of the state by reason of breach of this
contract, violation of the law, or otherwise; and the parties
of the first part agree, at the termination of this contract,
or at any other time the board shall deem it necessary to
take charge and control of the prison and the prisoners
confined therein, to quietly yield up possession of the said
state prison without resistance, and turn over to said board
all property belonging to the state as well as all property
that may be in their possession in the prison, or upon or
about the prison grounds, for the use of the prison or the
prisoners therein; provided, however, that for all such
property necessary to the proper care of the prisoners and
the maintenance of the prison belonging to the parties of the
first part, delivered to and retained by said board, the
parties of the first part shall receive compensation in
accordance with their fair market value at such time. In the
event of cancellation of this contract for any reason, the
first parties shall be paid in full to the date thereof at
the rate herein prescribed.' *** That no appropriation
had been made by the Legislature for the purpose of taking
over and paying for any of said property owned by said Conley & McTague. That, in the absence of said appropriation by the
Legislature, the said board had no funds with which to take
over said property of Conley & McTague, and was not in
position to acquire said property and to turn it over to the
said Henderson & Wyman in the event of accepting their bid
and awarding said contract to them. That said property of
Conley & McTague, or a large portion thereof, aggregating
many thousand dollars in value, was necessary for the proper
care, custody, and maintenance of said prison and the
prisoners therein. That said board had no inventory of the
property in said prison that belonged to the state of
Montana, or of the property in said prison that belonged to
Conley & McTague, and had no knowledge of the value of the
property of Conley & McTague that the board would be required
under the law and the contracts with Conley & McTague to take
over in order to award the contract to some other person or
persons. Whereupon Thomas McTague and the said F. A.
Henderson and John S. Wyman were called before the said board
and examined under oath as to the property in said prison
belonging to Conley & McTague, and as to the financial
responsibility of said Henderson & Wyman, and their knowledge
of the business and affairs of the said prison and their
proposed method of conducting same; and thereupon, and at
said examination, the said Henderson & Wyman were fully
advised and informed by said board as to the condition of the
state's funds, and of the absence of any appropriation by
the Legislature for the purpose of taking over property in
the state prison belonging to the said Conley & McTague, and
also of the fact that the said Conley & McTague owned a large
amount of property in said prison that would have to be
purchased from them in the event that the contract was
awarded to some other bidder. *** That at said examination of
Henderson & Wyman they stated to the board that they would be
in a position to pay a sum not to exceed $25,000 for the
purpose of taking over the property in said prison belonging
to Conley & McTague, if the board awarded the contract to
them, and in its judgment decided that the said sum of
$25,000 was a reasonable amount to pay for such property of
Conley & McTague as the board would consider necessary and
desirable for the proper care, custody, and maintenance of
said prison and prisoners therein." That thereupon the
board rejected both bids, and ordered that a new call be
published, the bids to be opened May 6, 1908. The new call
for bids was accordingly made, and was in substance the same
as the first call, with the exception of this paragraph,
which was inserted therein: "Any and all information
respecting ownership of property at the state prison and
necessarily used in connection with the proper conduct of the
said institution *** may be obtained by calling on the
clerk of this board at the office of this board."
Pursuant to said second call, three
bids were received-one from the plaintiffs, wherein they
offered to care for the inmates of the prison at 39 cents per
capita per day; one from Conley & McTague of 45 cents per
capita per day; and one from Joslyn & Potter, of 44 cents per
day. In the proposal submitted by the plaintiffs the
following paragraphs are found: "We further agree under
such rules and regulations as may be prescribed by the board
to guarantee the state against any liability which it must
legally or necessarily assume in the event of the awarding of
the said contract to us the transfer of the control and
custody of said prisoners to us. We further agree under the
rules and regulations of the state board of prison
commissioners to furnish all necessary and desirable
equipment or property necessary for the proper conduct of the
said institution." Neither of said paragraphs, nor
anything in substance like the same, is found in the first
bid of the plaintiffs. Upon receiving said bids, the board
caused to be entered in its minutes a finding that all of the
bids were regular and in accordance with the law and the
call, and, after examination and consideration thereof, the
board on May 7, 1908, took the following action. "After
full and careful consideration and examination of each and
all of said bids, it was by the board duly and regularly
found and determined that the said bid of Messrs. Wyman & Henderson was and is the lowest and best bid, provided that
certain terms and conditions hereinafter stated shall be
complied with by said bidders; and therefore the contract was
by the board duly and regularly awarded unto said bidders
upon the express terms, conditions, and regulations here
prescribed, to wit:
"First.
Said bidders shall on or before the 2d day of June, 1908,
pay into the state treasury of the state of Montana in cash
the sum of twenty thousand ($20,000) dollars, with the
express understanding and agreement that the board of
prison commissioners shall be entitled and authorized to
expend the same, or any part or portion thereof in the
purchase of such property and personal effects belonging to
Messrs. Conley & McTague, the present prison contractors,
as the said board shall determine necessary and desirable
to be kept and held for the proper conduct and management
of the business and affairs of said institution and the
proper care of the prisoners therein confined, the board to
determine what property shall be purchased and the price to
be paid therefor.
"Second.
Said bidders must furnish on or before the 2d day of June,
1908, a good and sufficient bond, to be approved by the
board, in the sum of thirty thousand ($30,000) dollars, in
addition to the bond required by law and the call for bids
for the faithful performance of the contract, which
additional bond shall be in form such as prescribed by the
Attorney General's office, and conditioned that such
bidders will, without cost or expense to the state,
receive, accept, and pay for such of the property of the
present contractors, Messrs. Conley & McTague, as the board
may deem necessary or desirable to be used in connection
with the conduct of the business and affairs of the said
state prison after the said $20,000 cash shall have been
exhausted by the
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