| N.Y. App. Div. | Nov 23, 1906
Lead Opinion
The Kelly Asphalt Company in July, 1905, made a contract with the city of New York, through the president of the borough of Brooklyn, to repave Broadway, in Brooklyn, from Havemeyer street to Lafayette avenue with asphalt blocks for .the sum of $87,475.13. During the progress of the work and under the provisions of the contract the company received partial payments on account thereof, known as seventy per cent payments, to the amount of $60,942.66, leaving a balance of $26,532.47 unpaid on said contract price. The block pavement laid turning out to be of poor quality and rapidly disintegrating, the chief engineer declined to give the final certificate which would entitle the company to receive its final payments. •
The company thereafter brought an action against the city to recover the said amount, but before the trial an agreement in writing and under seal was entered into by and between the company and the borough president. This agreement is entitled “ Supplemental agreement made this 19tli day of July, 1906,” and it provides that: “ Whereas, a certain contract was entered into between the said parties on August 21, 1905, providing for regulating and repaving with asphalt block pavement on a concrete foundation, the roadway of Broadway from Havemeyer Street to Lafayette Avenue in the Borough of Brooklyn, together with all work incidental thereto, under which contract the parties of the second part have performed some portion of such work in a satisfactory manner but have failed to meet the requirements of the contract and of the Chief Engineer of the Bureau of Highways representing the City of New York as to the quality and durability of the asphalt block provided for in said contract, and Whereas, the said Chief Engineer has properly refused to accept as satisfactory the asphalt blocks furnished and laid on this work, and the parties of the second part have instituted an action against the City of New York to recover the sum of $26,118.29 alleged by.them to be an amount due in settlement of the work required by the city under the said original contract of August 21, 1905, and Whereas, in settlement of said action pending against the City, the said parties of the second part by counsel and. directly, have proposed to the President of the Borough of Brooklyn to remove the defective work and to substi
It appears that this agreement was made as the result of a conference between the representatives of the company, tiro borough president, certain engineers of the city, and the commissioner of public works, and was submitted to the comptroller of the city for his approval, and it was approved by him.' Thereafter the company proceeded with the work of taking up the asphalt block pavement it had laid down, and of laying an asphalt sheet pavement, when this taxpayer’s suit was instituted for the purpose of obtaining a judgment, declaring said agreement void, and of restraining payment of any sums of money by the city thereon, and an injunction pendente lite was granted. ■ From the order continuing ' the same this appeal is taken.
The appellants claim that the agreement was properly entered into and is lawful by virtue, of tiro provisions of section 149 of the . ^Greater New "York charter (Laws of 1901, chap. 466, as amd. by Laws of 1904,' chap. 247), which, in providing for the duties of the comptroller, says inter,alia: “He shall settle and adjust'all claims in favor of or against the corporation, and all accounts hi which tiro corporation is concerned as debtor or creditor; but in adjusting and settling such claims he shall, as far as practicable, be governed by the rules of law and principles of equity which prevail in courts of justice.” ’ _ .
The comptroller-is vested by law with great ¡rowers, but in the main they are powers of audit and settlement. He is. not a contracting officer. • The charter provides for the-manner in which contracts with the city shall be made with the heads of the different, departments upon approval as to form by the corporation counsel.
The settled law for the city is that contracts for new work or supplies, or for the completing or perfecting of any work when the amount involved is more than $1,000 shall be made by the borough president or heads of departments upon public letting after due advertisement upon preliminary statements and estimates by sealed bids, and, except in exceptional cases provided for by laAv, to the lowest bidder.
This agreement purports to have been made by the borough president of Brooklyn in behalf of the city. The amount involved is upwards of $26,000. .It was either a contract for new work or a contract to perfect or complete work in a' particular job. It would seem as if it came directly within the express language of the stat
The appellants claim that this is not a new contract or a different contract, but that it is part of the original contract, which amounted to some $86,000. But that contract was to pave this particular street with a particular kind of pavement, to wit, asphalt block, and it must have been let after due advertisement and public competition upon sealed bids, and under it the city was entitled to receive a street paved with asphalt blocks. Under' this agreement it is proposed to give a street paved with sheet asphalt, an entirely different substance laid in a different manner.
If the city had intended to pave this street with asphalt sheet pavement, it is quite possible that some other bidder than the Kelly Company would have obtained the contract at a much lower price than that bid for the asphalt blocks. It is ho answer to the specific requirements of the statute that the city may be getting a better pavement than that provided for in the original contract. The statutes were intended to prevent the possibility of private substitution between city officials and the contractors of one material rather than another, or of one kind of construction rather than another.
If the city had contracted to build a public library of a certain kind of marble and during the progress of the work it should turn out that the marble was of poor quality, and thereupon without public advertisement or competition the city officials and the contractor should agree to substitute brick for marble at the same price for which they had contracted to furnish marble, could it be said tha,t such a substitution was not in violation of the law ? There is no difference here. The city contracted to get one thing for a particular price after public competition and gets another by private agreement between the officials and the contractor, as it seems to me, in direct violation of the salutary provisions of the law.
The contention that this course of procedure can be sustained as upon the settlement of a claim does not appear to me to be sound. What was the claim that was settled ? The agreement under seal disposes of that.' It is therein recited that the company has failed
Further, the comptroller had no power to make a settlement of this kind. As said in Hearst v. McClellan (102 A.D. 336" court="N.Y. App. Div." date_filed="1905-07-01" href="https://app.midpage.ai/document/hearst-v-mcclellan-5196109?utm_source=webapp" opinion_id="5196109">102 App. Div. 336), the comptroller is an auditing and not a contracting officer, and the powers given to him to settle a claim against the city did not confer upon him any power to authorize one of the contracting officers of the city to make a contract in obvious violation of the .provisions of law.
We have no doubt that, in this particular case the motives of all the parties to the proceeding were commendable. But the charter provisions in regard to the doing of public work are of such importance to the city that no evasion of them should be permitted when called to the attention of the court, however innocent the acts of those violating them may appear to be.
The order appealed from should be affirmed, with ten dollars costs and disbursements to the respondent.
McLaughlin and Scott, JJ., concurred; Houghton, J., dissented.
Concurrence Opinion
I concur in the affirmance of this order on the ground that the court below was justified in enjoining the comptroller from paying this claim until the question as to the validity of the supplemental contract or settlement was determined upon the trial. I do not think we should determine upon this appeal the validity of this supplemental contract or settlement, and, therefore, do not concur in what is said in relation thereto.
Dissenting Opinion
Notwithstanding the recitals of the new contract, I think it is fair to say that all that, was in fact done, and all that was. attempted to .be done, was to permit, and to compel the contractor to complete bis former valid contract in a proper manner satisfactory to the city. • . • ' ' '
There is no suggestion of collusion or fraud. The pavement which had been laid was defective. The new contract did not provide for the payment of any greater sum of money than was due under the old contract when it should have been fully performed. The amount stipulated by the new contract was the- exact amount ' remaining due on the old one. All that was done was simply to bring about an adjustment of a claim under the former concededly valid contract. " This adjustment might have been made by accepting the defective pavement at a reduced price, or by compelling the pavement to bernade good according to the contract, or as good as that provided by the contract and then paying the stipulated sum.
. It seems to me that such an adjustment is within the powers of the comptroller, and that, in the absence of fraud" or bad faith, his acts in such respect should be upheld.
The injunction should not have been granted and the order should he reversed.
Order affirmed-, with ten dollars costs and disbursements. Order filed.