Fayer v. Mayor of Washington

159 Ga. 568 | Ga. | 1925

Lead Opinion

Hines, J.

(After stating the foregoing facts.) When this case was here before this court held that the petition failed to set forth a cause of action, and that the court erred in overruling the demurrer. Before the remittitur from this court was made the judgment of the court below, the plaintiffs amended their petition by new and additional attacks upon the validity of the assessment against property abutting upon the streets paved to defray the expenses of paving. To the petition as amended the defendants renewed their demurrer, which the court sustained; and to this judgment the plaintiffs excepted.

The plaintiffs attack the validity of the assessment, because the contract between the city and the county for paving these streets was illegal and invalid. The alleged invalidity of this contract is based upon the ground that all contracts entered into by the ordinary or county commissioners, as the case may be, with other persons in behalf of the county, must be in writing and entered on their minutes . (Civil Code of 1910, § 386); and that such contracts, unless so in writing and so entered on the minutes, are incapable of enforcement by those with whom they- are made. Weathers v. Easterling, 153 Ga. 601 (2) (113 S. E. 152). ít is likewise true that a contract between a county and a contractor for the construction or improvement of a State-aid public highway must be in writing and entered upon the minutes of the board of county commissioners, before the same can be enforced by the contractor. Board of Commissioners v. MacDougald Construction Co., 157 Ga. 595 (122 S. E. 317). Eor the purposes of this case we may concede, without deciding, that a contract fully performed by the other party, where the full fruits of. the contract have been received and retained by the county, can not be enforced against the county. So in this case, if the contract between the city and count}" was one in behalf of the county, it must be in writing and spread on the minutes of the county commissioners, before it would be enforceable. In deciding whether the contract was made in behalf of the county, we must keep clearly in mind the nature of the arrangement between the city and county. The State Highway Department and the county were desirous of constructing or improving interconnecting county-seat roads. The City of Washington was desirous of having portions of the streets in question paved. The city was unable to obtain Federal aid for the paving of its streets. -The State Highway Department and the county could and did procure such. In this situation the city appointed the county its agent to contract for the paving of portions of these streets. The creation of this agency was made by a written resolution of the mayor and council of the city,- duly passed and spread upon the minutes of the city council. So the contract creating the agency rvas in writing. But if it had rested only in parol, it was made in behalf of the city and not of the county. So we are of the opinion that the appointment by the city of the county as its agent to contract for the paving of a portion of its streets, under a common arrangement betAveen the State Highway Department, the county, and the city for the construction of interconnecting county-seat highways, of AArhich such streets Avere links, was not a contract in behalf of the county, but one in favor of the city, by which the city reaped the benefits of Federal aid, and thus lessened the burden of taxes its citizens would have to bear to secure the pavement of these streets. This being so, we do not think that the contract was such a one in behalf of the county as was required to be in writing and spread upon the minutes of the county commissioners, as required by this section of the code. It is not amiss to say that the contract between the county and contractor was in writing and spread on the minutes of the board. While this contract was not made by the county expressly in the name of the city, it was executed and performed under the above common arrangement. So the contract between the city and the county was not invalid because not in writing and spread on the minutes of the county commissioners, and the assessment of property abutting on these streets to pay a portion of the cost of paving them was not invalid because based upon an illegal contract.

Where the charter of a municipality authorizes the paving of streets and the collection of assessments against abutting-prnperty owners, and provides that such property owners may file an affidavit of illegality and may contest the whole or any part of the amount so claimed, levy of the assessment is not void on the ground that the owner is not afforded due process of law. Sanders v. Gainesville, 141 Ga. 441 (2) (81 S. E. 215); Horkan v. Moultrie, 154. Ga. 444 (2) (114 S. E. 888).

Another attack upon the validity of the assessment against abutting property is that the contract, by which the city entered into the above arrangement with the State Highway Department and the county, created a debt by the city, in violation of article 7, section 7, paragraph 1, of the constitution of this State, which prohibits municipalities from creating debts without the sanction of a popular vote. When this case was here before, we held that the allegations of the petition did not show the creation of such a debt. By an amendment to their petition, made after the above ruling, plaintiffs alleged that the City of Washington, under its charter, is only authorized to levy and collect a tax for general purposes, not exceeding 25 cents on every $100 of taxable property in said city; that the total property returned for taxation for the year 1919 therein amounted to $2,971,380; that the total sum the city was authorized to levy for town purposes, under said limitation in its charter, on the taxable property within its limits was only $7,-438.45; that out of said sum the city was required to pay and did pay sums amounting to $18,605.23 for general purposes, by reason of which there were no funds in its treasury, and the city could not, during said year, levy any tax for the purpose of paying the cost of said paving; and that in consequence of these facts the arrangement under which these streets were paved amounted to the creation of a debt in violation of said constitutional provision. Under the resolution of the mayor and council of this city, providing for the paving of these streets, the city appropriated $25,000 for this purpose, to be raised by levy of assessments upon the property abutting on such streets, and further provided that any balance of the cost which could not be paid from funds derived from said assessments should be paid out of the general funds of the city. Under these additional allegations, taken in connection with those of the original petition, the plaintiffs failed to show that the city created any debt for these improvements, in violation of the above constitutional provision, it not being alleged that in pursuance of said resolution the city made any contract for the paving of said streets, by which it would be required to pay out of its general funds any portion of the cost of the improvements, and there being no allegation that the assessments were not sufficient to pay that portion of the cost properly chargeable to abutting-property owners, and that the funds derived from the State Highway Department and Federal aid under the above arrangement were not sufficient to pay the city’s proportion of the entire cost of paving these streets. The absence of an allegation, in the petition as amended, that there existed such balance negatives its existence; and we can not assume that the assessments were not sufficient to meet the sum appropriated by the city to pave these streets. So we are of the opinion that the plaintiffs failed to show the creation of any debt by the city in violation of the above constitutional provision. The burden to do this rested upon them; and they failed to carry this burden.

Another attack on the legality of the paving assessments is based on the ground that the assessments against abutting-property owners included the intersection of cross-streets not abutting on the property of the individuals assessed. Under the decision in Kaplan v. City of Macon, 144 Ga. 97 (86 S. E. 219), the assessment was not illegal on this ground. The request to review and overrule that decision is denied.

Paragraph 5 of section 2 of article 5 of the act of August 18, 1919, reorganizing the State Highway Department (Ga. Laws 1919, pp. 242, 249), provided: “That when any portion of the designated State-aid road system is taken under the jurisdiction of the State Highway Department by written notice as prescribed in article 5, section 1, hereof, the county or counties in which said portion is located shall not thereafter be required to levy taxes for the construction or maintenance thereof.” This provision is a limitation upon the power of the county to levy taxes for the construction and maintenance of State-aid highways, but is not a limitation on the power of a city to provide for the pavement of its streets under such an arrangement as was made in this ease. Whether a city would be liable for the maintenance of its streets which are made a part of State-aid roads is not now for decision by this court.

Under section 7 of article 5 of the above act, reorganizing the State Highway Department, provision is made for reimbursing counties for money expended in the construction of State-aid roads. This act does not make provision for the payment of moneys expended by a city for paving its streets, nor for the payment of assessments levied by the city for such purpose when such moneys are expended and such assessments are levied in pursuance of an arrangement by which the city is to secure the pavement of its streets free of all cost, except.such portion thereof as can be assessed against the lands of individuals abutting on said streets, or from funds otherwise lawfully applicable for such purpose, notwithstanding the fact that such streets are links in State-aid roads. Plaintiffs allege that certificates have been issued to the County of Wilkes which are sufficient to pay the entire cost of paving these streets, and that this act provides a complete method for the payment of these costs. There is no allegation in the petition that these costs have been paid in full by the State Highway Department to the county. If these certificates had been paid to the county and the entire cost of paving these streets had thus been liquidated, a different question would be presented for adjudication. Whether the city and the plaintiffs would be entitled to the proceeds of these certificates when they are paid is not now a question for determination by this court. Such provision for the reimbursement of counties for funds expended in the construction of such highway.-, and the mere issuance of certificates by the State Highway Department, which show that the county is entitled to funds sufficient to pay the entire cost of the pavement of these streets, in the absence of an allegation that the certificates themselves have been paid, do not render illegal the assessments levied against lands abutting on these streets to meet the portion of the cost of paving, which the city was authorized in its charter to assess -against abutting property. It may be that if these certificates are paid, the city and the owners of abutting property on these streets would be entitled to such funds; but this question is not now before us for decision.

'Other allegations of the petition attack the constitutionality of the act of the General Assembly creating the Highway Commission, wherein authority was granted to said board to. lend its credit to the political subdivisions of the State for the building of State highways, it being contended that these provisions are in conflict with article 7, section 8, paragraph 1, of the constitution of Georgia (Civil Code (1910), § 6565), providing: “The State shall not assume the debt, nor any part thereof, of any county, municipal corporation, or political division of the State, unless such debt shall be contracted to enable the State to repel invasion, suppress insurrection, or defend itself in time of war.” This contention is without merit.

It follows from the foregoing rulings that the court did not err in sustaining the general demurrer and dismissing, the petition.

Judgment affirmed.

All the Justices concur, except Beck, P. J., disqualified, and Hill and Gilbert, JJ., dissenting.

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Dissenting Opinion

Gilbert, J.

I dissent for the following reasons:

The board of commissioners of roads and revenues takes the place of the ordinary, in so far as this case is concerned, in the discharge of the financial affairs of the County of Wilkes. Weathers v. Easterling, 153 Ga. 601, 603 (supra).

“All contracts entered into by the ordinary [or board of county commissioners, as the case may be] with other persons in behalf of the county must be in writing and entered on the minutes.” Civil Code (1910), § 386.

A person can not enforce -a contract made with a county, by suit or otherwise, unless such contract is entered on the minutes of the proper county authority executing the contract on the part of the county. Milburn v. Glynn County, 109 Ga. 473 (34 S. E. 848); Weathers v. Easterling, supra.

Where a contract is let by a municipality for the construction of a public improvement such as the paving of its streets, and an assessment is levied to pay such contract price, the validity of such contract is essential to the validity of the assessment, since otherwise the assessment would be levied to pay a claim not legally due against the city. Sanders v. Gainesville, 141 Ga. 442 (1 a) (supra).

Since there is no contract enforceable against the city for the construction of street-paving as alleged in the petition, because the purported contract wus not in writing and not recorded on the minutes of the board of county commissioners, the assessment was not enforceable as against plaintiffs, abutting-property owners; and the court erred in sustaining a demurrer to the petition as amended.

Even though the invalid contract between the municipality and the county has been fully executed by the completion of the pavenjent, this does not render the assessment valid. There must be a valid and enforceable contract between the municipality and some other contracting party for the laying of the public improvement, before the assessment can be enforced. To hold otherwise would be a solemn adjudication that public servants might ignore the law governing their official actions, and, after executing the terms of their invalid agreement, that the citizen and taxpayer is rendered helpless as against their demands for the payment of money to carry out illegal and invalid obligations.

No estoppel against the plaintiffs can arise on account of the fact that the pavement was completed before the filing of the petition for injunction. Knowledge on the part of plaintiffs that the work of paving was being done by the County of Wilkes could not operate as notice that the municipality of Washington intended to assess abutting-property owners to pay for the same; and inspection of the minutes of the municipality would merely have disclosed the passage of a resolution authorizing two of the members of council to enter into a contract with the County of Wilkes, without disclosing any of the terms of said contract. Inspecting the minutes of the board of commissioners of Wilkes County, and finding no contract with the City of Washington of record in these minutes, the plaintiffs would have- beep authorized to conclude that no contract between the county and the municipality had been entered into. Observing the employees of the County of Wilkes actually constructing the paving, which was a part of a continuous highway running through the city, was not notice to the plaintiffs that the city was assuming an obligation to pay for the paving and that abutting-property owners would be assessed for the purpose of payment to the city. Sanders v. Gainesville, supra.

When the case was previously here it was held that a contract between a county and a city was not illegal and void on the ground, as then contended, that such contract was “a delegation of legislative authority of the city to the county, the State Highway Department, and the Federal government, no such delegation of legislative and official discretion appearing from said resolution and contract.” Mayor &c. of Washington v. Faver, 155 Ga. 680 (4) (supra). The court did not rule that the contract was valid as against any attack not then made and dealt with in the case.

Under authority of Sanders v. Gainesville, supra, the petitioners were entitled to the remedy by injunction.

The United States and the State, being sovereigns, have inherent power to contract; but that attribute can not strictly be said to exist in the political subdivisions of the State. Counties in Georgia possess no power to contract, other than that conferred by the sovereign State. Decatur County v. Roberts, 159 Ga. 528 (126 S. E. 460). Whoever deals with the officers of a county is bound at his peril to take notice of the limitations upon the power and authority; for they can only bind the public which they represent within the limits of their authority. “Where the law requires a public contract to be in writing the provisions of the law are mandatory, can not be waived, and are in most instances in the nature of conditions precedent to the exercise by public bodies of the power to contract. They [the courts] therefore hold these provisions of law applicable alike to contracts executed as well as executory. Accordingly, since the manner of making public contracts is thus limited, where it is not followed the contract attempted to be made is illegal, and no recovery may be had thereon even though there has been full performance and the public body has received and retained the benefits. Nor will recovery of reasonable value be permitted.” Donnelly on Public Contracts, § 138; Murphy v. Louisville, 9 Bush. (Ky.), 189; Boston Electric Co. v. Cambridge, 163 Mass. 64 (39 N. E. 787); McBrian v. Grand Rapids, 56 Mich. 95 (22 N. W. 206); Schumm v. Seymour, 24 N. J. Eq. 143; McDonald v. Mayor, 68 N. Y. 23 (23 Am. R. 144); Dickinson v. Poughkeepsie, 75 N. Y. 65; Smart v. Philadelphia, 205 Pa. 329 (54 Atl. 1025); McManus v. Philadelphia, 201 Pa. 619 (51 Atl. 322); Watterson v. Nashville, 106 Tenn. 410 (61 S. W. 782); Starkey v. Minneapolis, 19 Minn. 203; Arnott v. Spokane, 6 Wash. 442 (33 Pac. 1063). It should be observed that the Civil Code, § 386, declares that “All contracts entered into by the ordinary with other persons in behalf of the county must be in writing and entered on their minutes.” Since the mandate of the law in this respect applies to “all contracts,” it would seem to be impossible to eliminate some contracts from the operation of the statute. “Public policy requires such restrictive enactments to be rigidly enforced, and the consequences resulting from the void character of the contracts they prohibit must be the same in equity as at law.” Schumm v. Seymour, 24 N. J. Eq. 143 (8).

The majority of the court, in the first headnote, hold that the contract between the municipality and the county “is not such a contract as is required to be in writing and spread upon the minutes of the board of county cqmmissioners of said county.” This conclusion appears to me to be unsound, for several reasons. In the case of Board of Commissioners of Morgan County v. MacDougald Co., 157 Ga. 595 (supra), it was héld that a contract between a county and a paving contractor for the paving of a State-aid road was such a contract as the statute required to be in writing and entered’ on the minutes of the proper county authorities. If there was a contract between the municipality and the county, what was its object? It can not be questioned that the county and the municipality had in contemplation only one thing, and that was the paving of a street which was to connect a State-aid road and make it continuous. The moment we say that the expression in the statute that “all contracts” does not mean all contracts, but that on the contrary some- contracts do not fall within the statute, we enter upon dangerous ground. Such construction destroys almost altogether the protection which the lawmaking power intended to afford the taxpayer. It leaves open, as a matter of construction, each instance where a contract is entered into by the county, to be determined by the facts and circumstances as they can be made to appear at the time. Another objection of perhaps equal importance is that the construction amounts to a ruling that.a county may become an agent for a municipality. This construction appears obviously unsound. No such power is given to county authorities under the constitution and laws of this State. No instance has been pointed out under which such an undertaking has been approved by the courts. ’ So far as appears, this is the first instance in which a Georgia county has undertaken to act as the agent of a municipality in any kind of an undertaking. It is significant that in the first instance the undertaking partakes of a dubious character. The undertaking, when analyzed, partakes more or less of a fraud on the United States Government. The Federal Government appropriates funds to be apportioned to the States and expended by and under the direction of the State Highway Commission in the construction of public highways of a designated character. The State Highway Commission can obtain these funds only by obligating itself to see that they are expended according to the laws of the State and of the Federal Government. Such Federal funds are not intended for the use of a municipality, and can not be obtained directly by municipalities. This fact is conceded in the majority opinion, and is offered as an explanation of the necessity of the county becoming an agency of the municipality. In other words, it is explained that, because of the fact that the municipality can not lawfully obtain Federal funds for the paving of its streets, it became necessary for the municipality to constitute the county as its agency, and as such agent the county was to undertake to procure such funds in its own name but to be expended for the benefit of'the city on the streets of the city. It follows, if the county was merely the agent of the city in obtaining Federal funds, that the funds were not obtained for the benefit of the county.

The writer can not escape the conclusion that the transaction was more than a mere indirect method of doing a lawful thing, but that it partook more of the nature of a legal fraud. Under such circumstances it would seem deplorable for this court to condone and approve the transaction. The majority hold that the appointment of the county by the city as its agent was made by resolution, which was spread upon the minutes of the mayor and council; and therefore the conclusion is reached that “the contract creating the agency is in writing.” This position also seems untenable. A resolution was adopted by the mayor and council, but it went no further than to empower two of the members of council to enter into a contract with the county. This is far different in effect from a resolution creating an agency on the part of the county to act for the municipality, even if the county could act as such agent. The majority also say, “But if it had rested only in parol, it was made in behalf of the city and not of the county.” In point of fact it is clear from the record that the county was seeking to complete an intercounty road through the City of Washington, and the arrangement was made as much in behalf of the county as it was in behalf of the city. The county was to obtain a. completely connected intercounty highway and the city was deriving the benefit therefrom of Federal funds to be used in part payment for paving the city street. The majority also say that “the contract between the county and the contractor was in writing and spread upon the minutes of the board.” This fact, however, can not lend any element of legality to the transaction between the county and the municipality. The law requires that the municipality must be bound by a legal and enforceable contract binding the city itself to pay for the pavement, before it can assess ’ abutting property owners for repayment. The city had no such contract. It had merely by resolution appointed two of its members to contract with the county. According to the record in the case, these members of the council entered into an oral contract with the county to actually pave the street. The county made a contract with the paving company, which was in writing, entered upon its minutes. The latter contract had no binding effect with respect to the municipality, and could not be enforced against the municipality. According to the record one or the other horn of the dilemma must be accepted, either one of which is fatal to the case. Either, under the terms of the transaction between the county and the municipality, the county took over that portion of the municipal street which was paved and made it a part of the intereounty highway and thus assumed all of the expense of paving and maintenance, to the exclusion of the city, or the county was a mere means or agency by which the city indirectly obtained Federal funds, to which it was not entitled under the law. If the first is the proper construction of the transaction, then the city owed nothing for the paving, since the duty to pave rested wholly upon the county. If the status in regard to paving was unchanged by the transaction and the duty still rested upon the municipality, and the county was undertaking to act merely as agent, then the county diverted the Federal funds from the purposes to which they were restricted by law, having obtained the funds under false colors and applied them to the exclusive use of the municipality, which had no right to obtain them.

The decision in Lee County v. Smithville, 154 Ga. 550 (115 S. E. 107), dealt with the right of the State Highway Commission, in conjunction with the county authorities, to lay out and construct a State-aid road through a municipality, so that such highway might be continuous. In the opinion (at p. 560) it was said: “The truth is, that the streets of the towns and cities belong to the State as do the county public roads. The legislature has given to the municipalities temporary control over the streets within their borders, which it can wholly withdraw or modify at will. So we reach the conclusion, that the State Highway Department, cooperating with the county commissioners of Lee County, can build this public road through the town of Smithville without its consent and against its will.” If the effect of the transaction between the county and the City of Washington is to make the portion of the city street in question a part of a State-aid highway, then it must follow that the jurisdiction over the street and responsibility for its upkeep is taken from the municipality and placed upon the State Highway Commission; so that the conclusion is inescapable that the City of Washington was not bound by any enforceable contract for the paving of the street, no matter which view is taken. In either case the transaction, as a matter of law, should not be upheld. For all of these reasons the writer can not concur in the conclusions reached by the majority in the first headnote and first division of the opinion. The conclusion should have been directly to the contrary. The municipality was not bound by any legal and enforceable contract, and for that reason could not enforce assessments against the property owners. This conclusion should control the ease and render unnecessary the consideration of any other issue. The writer is of the opinion that the city created a debt, as contended for by the plaintiffs in error, falling within the provisions of art. 7, section 7, par. 7, of the constitution (Civil Code of 1910, § 6563); but it is unnecessary, in this dissent, to deal with that question, for the reasons stated above.