Wellman v. Reilly

• Decision Date: 05 November 1924
• Citation: 127 A. 875
• Parties: WELLMAN et al. v. REILLY et al.
• Court: New Hampshire Supreme Court

127 A. 875

WELLMAN et al.

v. REILLY et al.

Supreme Court of New Hampshire. Hillsborough.

Nov. 5, 1924.

Transferred from Superior Court, Hillsborough County; Sawyer, Judge.

Suit by James A. Wellman and others against Leo Bayles Reilly and others. Question transferred to Supreme Court. Case discharged.

Bill in equity for the rescission of a written contract between the city of Manchester and the defendant Reilly, and for an order enjoining its further performance. The contract was made and executed on the part of the city by the director of the department of public works with the written approval of the mayor. By the terms of the contract, Reilly, a consulting engineer, undertook to prepare preliminary studies, specifications, contract drawings, forms of proposals, and contracts and estimates of cost, for the construction of the Amoskeag and McElwain bridges and their approaches; also to supervise the work and issue certificates of payment; his compensation to be 6 per cent. of the estimated cost, payable in partial payments, 25 per cent. upon completion of the preliminary studies, 60 per cent. upon completion of specifications and general working drawings, and the balance in monthly instalments based upon the percentage of work done, final payment to be made upon completion of the work. The contract further provided for the reimbursement of the defendant for the cost of transportation and living incurred by him and his assistants while traveling in discharge of duties connected with the project. The contract was made January 13, 1921. On January 22, Reilly submitted to the mayor estimates under which the Amoskeag bridge was to cost $468,880, and the McElwain bridge, $1,031,856. At the same time he presented a claim for $22 511.04 as his commission then due. By a bill introduced in the Legislature January 12, approved January 27 (Laws 1921, c. 202), the department of public works was abolished, and a department of highways for the city of Manchester created and invested with the powers, so far as here material, which under Laws 1917, c. 350, had been possessed by the department of public works. The plaintiffs, having been appointed commissioners of the department of highways, notified Reilly on February 2 to discontinue work, and on February 8 formaUy repudiated the contract.

The question whether Reilly is barred from recovery on the contract upon the reported facts is transferred by Sawyer, J., as of legal importance in advance of further action. These facts present questions (1) as to the validity of the contract, which is denied because of the failure of Reilly to furnish surety as required by Laws 1917, c. 350, § 4, and because of alleged fraud in securing the approval of the mayor; (2) as to the authority of the city to make the contract, which is contested because of inadequate appropriations, and because the contract contemplated expenditures in excess of its debt limit.

The defendant Reilly alone answered to the bill, and for convenience will be referred to in the opinion as the defendant.

Tuttle, Wyman & Starr, Thomas J. Bois, Timothy F. O'Connor, and L. E. Wyman, all of Manchester, for plaintiffs.

Lucier & Lucier, of Nashua, for defendant Verette.

Kerwin & Reilly, of Lowell, Mass., and Robert W. Upton, of Concord, for defendant Reilly.

SNOW, J. The sole authority of the director to bind the city by contract is contained in Laws 1917, c. 350, § 4, which provides:

"The director shall have full charge, supervision, management and control of the building, constructing, repairing and maintaining of all highways; * * * he shall have the expenditure of all appropriations which the board of mayor and aldermen shall from year to year vote for such purposes, with the approval of the mayor, and all bills and pay-rolls for expenditures from the appropriations voted from year to year by said board of mayor and aldermen for such purposes shall be certified to by the director and approved by the mayor before the same are paid by the city treasurer. * * * The director is hereby authorized to provide for the furnishing and delivering of supplies and the performance of any work contemplated in this act by contract, and in so doing to call for proposals for furnishing and delivering such supplies or doing such work and to make a contract therefor in the name and behalf of said city: Provided such contract shall first be approved by the mayor, and the party to whom the contract is awarded shall furnish proper surety for the faithful performance of said contract; provided however, that in the employment of labor, citizens of Manchester shall be given preference, and in the making of contracts such preference shall be stipulated for when practicable. * * * The director shall have full charge and control of the engineers' department, and shall have in charge the performance of all duties heretofore pertaining to the office of engineer; he shall appoint one competent person to act as superintendent of highways, one competent person to act as superintendent of sewers and one competent person to act as superintendent of street cleaning; he shall establish a schedule of grades or relative positions to include all superintendents, subordinate officers, agents, clerks and all other persons who are employed or may be employed in carrying on the work contemplated under this act, and he shall for the carrying out of the purposes of this act have all the powers now by law vested in the hoard of public works and the various city departments and officials of said city now having control of the matters covered by this act and he shall have the authority to employ, appoint or hire, to dismiss or discharge such superintendents, subordinate officers, agents, clerks and other persons as he may deem expedient."

The plaintiffs concede that the authority here conferred upon the director includes authority to contract for the construction of bridges, but contend that the supposed contract with the defendant Reilly is void for the want of a surety. The defendant, on the other hand, contends (1) that the provision requiring the approval of the mayor and surety for the performance of the contract is limited to contracts for furnishing and delivering supplies, or doing work of sufficient importance to warrant a call for proposals, and that the authority conferred upon the director to call for...