51 How. Pr. 235 | N.Y. Sup. Ct. | 1876
— This action was commenced in March, 1873, by Francis C. Barlow, then attorney-general of the state. Its object is to recover the damage which the plaintiffs have sustained by reason of a contract made between the state and the defendant Stephens, dated the 31st day of
From the statement just made it will be seen that the fulfillment of the contract according to its terms is conceded, and that no claim is made for damages founded upon an unfaithful, dishonest or improper compliance with the conditions of the agreement. On the contrary, a further inspection of the complaint shows that the alleged wrongful acts of the defendants for which redress is sought were anterior to the execution of the instrument, under which the work was performed. It is alleged that, on the 28th day of December, 1866, “ the contracting board,” which “ was a board of public officers created by law, and consisting of the three canal commissioners of the state of Few York, the state engineer and surveyor, and the auditor of the canal department,” were, according to their advertisement, on that day to receive proposals to do the work, which was let as before stated to the defendant Stephens, and performed, as also before stated, by the defendants Gale, Belden and Denison. That in order to compel the plaintiffs to let the work at higher rates than it was reasonably worth, and above those which could have been obtained upon a fair competition, “ the defendants combined, conspired and confederated together to deceive and defraud the plaintiffs,” and to that end, before the bids were
The present trial, with a struck jury, was commenced April 3, 1876, and, at the close of the plaintiffs’ evidence, and after some documentary testimony had been given by the defendants to enable them to present the questions involved therein, a motion is made in behalf of the defendants for a nonsuit, upon substantially two grounds: First. That the plaintiffs are barred from maintaining this action by reason of a former judgment of this court rendered in one brought by these plaintiffs against two of these defendants, Stephens and Gale, on the 2d day of June, 1870. Second. That whatever conspiracy existed, the state, having (as is claimed the evidence fully establishes), with full knowledge thereof, insisted upon the performance of the contract, and having voluntarily, with complete information of every fact now relied upon as a ground of recovery, paid its money, is in no situation to recover damages for acts which itself directed, and which, by such direction, it determined should be incurred. These propositions were discussed with very great learning and ability by the counsel representing the various parties, and present questions of gravity and Importance- as well as
The prior suit, the judgment in which is pleaded as a bar to any recovery in this, was commenced in ¡November, 1868. It was an action brought by the plaintiffs in this, the people of the state of ¡Mew York, against two of the present defendants, William C. Stephens, the original contractor, and Thomas Gale, the assignee, and one of the executors of such contract. The object of the action was to set aside the same agreement which is the subject of controversy in this, on account of the identical alleged unlawful and illegal acts which are urged as the grounds of recovery in the present; and also to recover the damages which the state had sustained up to the time of bringing such action, by reason of such contract and the execution thereof. There is no substantial fact alleged in the complaint in the present cause which was not also averred in the other, and many parts of each are clothed in the same language. To justify a recovery in either case, according to the theory of the plaintiffs, the same facts would be proved and the same arguments urged. The only difference upon the trial of the two actions would be, that when this suit was commenced the contract had been fully performed; and the conduct of the state thereupon, since the commencement of the previous action, places the defendants in a position to urge other and additional acts in could have been urged against the maintenance of the other, support of the second ground of nonsuit to those which
To the complaint in the former action a demurrer was interposed by the defendants, assigning three grounds, viz.: “ First. That there is a defect of parties defendant, viz.: That the persons alleged to have combined and confederated with said defendants should have been named, and should have been made parties defendant. Second. That several causes of action have been improperly united. Third. That
After the decision in .favor of the defendants upon such demurrer and the filing of the original order just given, and its entry upon the minutes of the court, no further proceedings were had in said action until the year 1872, when Mr. Barlow, who had succeeded Mr. Champlain as attorney-general of the state, appealed from such order to the general term of the supreme court. That appeal was, on affidavits duly served by defendants, and on motion made in their behalf, on the 7th day of May, 1872, dismissed by the general term. On appeal from such order of dismissal to the court of appeals, the action of the general term was sustained, upon the ground that the parties to the action had agreed to be bound by the decision of the special term, and the plaintiffs had effectually waived all right to appeal. (See opinion of the court of appeals in 52 W. El, 310, and also that of the present judge, delivered upon a motion made during the progress of this trial to set aside the judgment entered in the action.) After the decision of the court of appeals, and in March, 1876, a formal roll, containing all the proceedings, pleadings and papers in the action, and ordering judgment in favor of the defendants upon the demurrer, without costs (the right to 'costs having been waived upon the stipulation of the plaintiffs not to appeal from the order of the special term), was duly filed; and such judgment roll and original
The judgment of a court of competent jurisdiction upon a question directly at issue between parties, unless reversed, forever concludes and estops all parties to the action and those in privity with them, from questioning its accuracy or justice in another action. This rule, so essential to peace and ¡repose, and so preventive of endless, .and vexatious litigation, is also so firmly rooted and grounded in every enlightened system of jurisprudence that it is at once conceded, and has not now been .questioned. That this principle is fully applicable to a judgment rendered upon a demurrer, the plaintiffs likewise concede, and the authorities are abundant to justify such concession (Bouchaud, agt. Dias, 3 Denio, 238; Hunt agt. Terrell, 7 J. J. Marsh., 67; Wilson agt. Ray, 24 Indiana, 156; Ferguson agt. Couster, 8 Georgia, 524; Gray agt. Gray, 34 Georgia, 499; Perkins agt. Moses, 16 Ala., 17; Robinson agt. Howderd, 5 Cal., 428; City Bank agt. Waldon, 1 La. Ann., 4). While the counsel for. the plaintiffs do not deny the general propositions we have stated, they nevertheless urge that as the demurrer, specified three grounds, judgment might have'been given upon one or both of the first two, which did not reach the merits of the action, and not upon the third, which did, .and therefore it does not appear that a court of competent jurisdiction has ever decided in an action against these defendants or any of them, that the alleged acts set out in the complaint afforded to the plaintiffs no ground of action upon the contract, norre dress and compensation for the damages which they have sustained in its performance or by its fulfillment! • Is this proposition sound, and do not the order and judgment, presumptively at least, show that the merits of the case were in fact determined ? There was but a single demurrer, though it was -based upon three grounds. It was, according to the order and judgment, “ the demurrer” which came" on for argument at the special
In Estep agt. Larsh (21 Indiana, 190) the record did not show the grounds of demurrer; and as it did not appear that either went to the merits the estoppel was not sustained.
In Birch agt Funk (2 Metcalfe [Ky.], 444) the petition, to which the demurrer had been sustained, omitted many facts essential to the relief demanded, and this was held to be no bar to a second which contained them.
In Griffin agt. Seymour (15 Iowa, 30) there were two grounds of demurrer stated: “1. For the reason that there was a misjoinder of parties. 2. That the petition did not show such a state of facts as would entitle the plaintiff to recover.” The demurrer was sustained, but upon what ground does not appear. The plaintiff appealed from the ruling of the district court, and upon the hearing in this court the judgment was affirmed. By referring to the opinion (see 10 Iowa, 223) it will be observed that this court held that there-was a misjoinder of parties, and that in this respect the demurrer was well taken. The question presented by the second cause of demurrer does not appear to have been raised, or at least passed upon.” To this statement of facts, copied from the reported case, the remarks of Baldwin, C. J., in his
In the most, if not all, of the other cases cited by the plaintiffs’ counsel it did not presumptively appear that the point involved in the action sought to be maintained had been decided in the former. The most that could be said in favor of the estoppel was, that the record was not inconsistent with the decision of the question — it might or might not have been determined. Lawrence agt. Hunt (10 Wendell, 80) is one of that character. It was an action for the non-delivery of wheat, and a former judgment was pleaded in bar. In the first action the defendant in the second had prosecuted the plaintiff in the latter for wheat, rye and corn sold and delivered. The claim for the wheat had been resisted, in part at least, upon the ground that the contract was with Lawrence alone. “Hunt had a verdict, for what amount does not appear from the case.” The plea was overruled because it did not appear that the verdict covered the wheat, non constat, but the jury predicated the whole thereof upon the rye and corn, and hence there could be no estoppel. This differs very widely from a case in which the judgment professes to cover every point, as we have endeavored previously to show. It was the demurrer, the whole of it, which the order professed to sustain.
■ The limits of an opinion forbid a critical examination of every case cited by the learned counsel for the plaintiffs upon the argument. They will be found, however, easily explainable upon the principle we have stated, i. e., that it did not presumptively appear that the question involved in the second suit was decided in the first. A very large number of cases sustaining the doctrine which we have stated can also be found. A few, and only a few, of them are White agt. Simonds (33 Vermont, 178); Foote agt. Gibbs (1 Gray, 412);
Ho language or argument which we may employ can render the decision just referred to more apparently applicable to the question now being considered — is the judgment upon the demurrer to he regarded as rendered upon the merits of the action •—• than the simple perusal of the case itself. It is useless, with this very high authority controlling us, to argue from the apparent frivolousness of the other grounds of demurrer, that the order sustaining it must have been based upon the third, which went to the merits of the action. Heither is it necessary to prove that the affidavits, upon which the order of the general term of this court dismissing the appeal from the order sustaining the demurrer was made, showing as they do that the order was decisive of the merits, and forming part of the judgment roll in evidence, are evidence upon this trial to declare the point on which the decision turned. The order as it stands must be so construed, and we have therefore a former judgment of this court forever and irreversibly (all remedy by appeal being lost) establishing that, as against the defendants Hale and Stephens at least, the state has, upon the identical facts found, no cause of complaint whatsoever. Hor is the effect of the former judgment upon this action in any wise weakened by the consideration that additional and subsequently accruing damages are now also sought to be recovered. The right to them is urged upon the same grounds — the same alleged frauds, the same alleged conspiracy — and these are
Attention has already been drawn to the allegations of the complaint in this action, declaring that “ the defendant Stephens assigned said contract to the defendant Gale (who represented as well himself as the defendants Belden and Denison) * * * and that said Gale and said Belden and Denison have performed said contract.” The defendants Belden and Denison being in privity with the defendant Gale that the estoppel in their favor is just as effectual as in favor of Gale, will not be denied. The rule as to an estoppel created by a judgment is scarcely ever stated without including privies as well as parties. If the state, by reason of the former adjudication, ■ is concluded from maintaining the' suit against Gale, the right to sustain it against Belden and Denison will not be argued. It is claimed, however, that the former judgment affords no protection to the other defendants, because a party may fail to recover against one joint wrong-doer and yet succeed as against others. This is undoubtedly true when a case turns-upon evidence given. The proof may be sufficient to justify a recovery against one, but insufficient as to another. Has it, however, ever been held that upon the same proof against two the same court would be justified in holding the one guilty of actionable conduct whilst the other was not ? The tribunal which would administer justice upon any such principle would deserve to be stripped of its judicial functions, and be 'condemned to eternal infamy.
Though we have reached the conclusion that this action cannot be maintained, for the reason that it is barred by the judgment in the former, the gravity and importance of the case, and the public interest therein, require us to examine the second ground for a nonsuit, which, upon the undisputed facts, as defendants claim, presents this question: When a contract for work and labor has been let, after an advertisement for proposals, and a party has obtained it who has illegally conspired with others to suppress- bids, thus seeming-a larger price than he could otherwise have procured, can the person who has the work done, with full knowledge of the conspiracy, require the other to proceed in its performance ; and when the contractor has done just what he was required and compelled by the other to do, and received just and only that which the ¡other, with- full' knowledge, voluntarily, and without .-even a protest, paid, recover alleged damages sustained by its execution which he has thus himself compelled, and thus voluntarily incurred % And this question, perhaps, involves still another, which is this: Does the state, in the application of the rule which. the former qirestion involves, occupy a different or better position than any other party ? These questions will be separately considered.
The counsel for the people contend that when a contract for work, labor and services has been procured by an illegal and unlawful combination to put up the price, the party for whom the work is done can, with full knowledge of such combination, require and demand its performance, voluntarily and with full knowledge pay the stipulated 'price, and then in an action recover his damages; which, of course', is
A party who is not deceived into an agreement to pay a large price for work, by means of a conspiracy to obtain it, has no redress. Heither has one any redress, whatsoever, who makes it in ignorance of the fraud, but who compels its performance with full knowledge. The party guilty of the illegal act must proceed ánd perform according to his promise, and can interpose no objection — he is powerless. Under these circumstances, the other compels him to proceed, knowing every fact. The damages are not only avoidable, but they are compelled to be inflicted ; and to permit a recovery would be very much like allowing a man to recover for a battery upon his person which he not only directed to be committed, but which he actually compelled. The cases are, in my judgment, exactly parallel.
In addition, then, to the distinction heretofore pointed out between an action founded upon an executory contract of sale, or that of Whitney agt. Allaire, where there is a positive affirmation of fact, and one like the present, based upon the consideration that the former rests upon an independent promise, and the latter upon an allegation that the plaintiff was deceived in entering into the contract, by the supposition that the price was a fair one, because fixed by honest competition, which must fail when the party is shown to know that
Thus far we have discussed the question upon the theory that the dealings were directly between the parties to the contract. If the one for whom the work is done acts through an agent, does any different principle apply ? If an agent be authorized to receive proposals and contract for work, does not this power necessarily carry with it the right to decide every question pertinent to the making thereof? It surely does, for the authority conferred upon an agent to do an act is “always construed to include all the necessary and usual means of executing it with effect ” (Story on Agency, sec. 58). The party intrusted with such a power is chosen, not because he is a machine, but a man with eyes to see and judgment to exercise. When the question comes as to the propriety of making the agreement, his principal expects that he will consider every point bearing upon the expediency of the act which he is to do. This right to consider and determine, necessarily involves the power to bind the principal by the decision when made. Knowledge of the agent is knowledge of the principal, and the acts of the former, when in good faith, bind the latter (Joslin agt. Cowle, 52 N. Y., 90; S. C., 56 id., 626). To illustrate: Suppose A. is sent by B. to a book auction to buy a book. The article is struck off to him at the price of five dollars. Before paying the sum bid, C. informs him that he had been
In the further discussion of the point under consideration, we are next to see whether the principles enunciated are applicable to the plaintiffs, the people of this state. It is well to premise that discussion with the statement, that there is no allegation of any fraud or collusion between the defendants and any officer of the state. That is neither averred in any pleading, supported by any evidence, nor claimed in any way. The cause is to be decided upon the theory that all official action has been honest, every act in good faith, and every thing done by the state’s agents for the best interest of their principal so far as they could see. How, what have théy in good faith done ?
The contracting board of the state had knowledge, before they executed the contract, that other parties were willing to do the work at a price less than the Stephens bid called for. The informal bids, rejected because they were informal, but not required to be refused for that reason, so informed them. They also knew that the proposal was too high, for it was first rejected for that very reason; but, subsequently, it was accepted, and the contract signed.
In about a month after the contract was signed the legislature of the state had knowledge sufficient to put them upon inquiry, and as early as January 30, 1867, the resolution organizing a committee of inquiry was introduced, and had passed both houses on February 7th, 1867.
April 19, 1867, a joint resolution was adopted by the two legislative branches requiring the contractors to proceed in the execution of the contract, and directing that the “ canal
As early as March 11, 1867, certainly, and perhaps before that, the canal board bad accurate information of' the alleged conspiracy, and the officers of the state ordered-the work to proceed, and compelled its performance for the whole five years. .
On January 1, 1868, the joint.committeé of the legislature made its report, and such report, fully established every fact relied upon in this action. During' the same session a law was passed (Laws of 1868, chap. 869) authorising the attorney-general to commence suit to annul, the contract, among others, which is involved in this action: -
By chapter 55 of the Laws of 1870, the contracting board was abolished, but it declared that fits "abolition should- not “invalidate the contracts heretofore:made, or discharge any of the contractors from the duties and obligations imposed by such contracts, or the said -laws.”' By the- same act the canal board was authorized, “ whenever they shall deem it for the interests of the state to cancel and annul any contract or contracts for repairs of the canals heretofore made, by a resolution to be entered in ;the minutes of ;the said board.” - ■ : •
With entire knowledge the work'was executed. Tear by year a report from the canal commissioner in ch'arge declared the sum due the contractors. Appropriations to pay were regularly made by the legislature,- and payments made by the officers who were charged with .that duty. The proof conclusively establishes that when the contract w-as executed the contracting board was not deceived by the supposition that the accepted bid was the lowest price to. be obtained after a fair competition • that the officers of the state ■ in charge of the work, and its legislature,- when its performance was required were fully informed of the' alleged fraud; that the law-making power of the state, with accurate and complete knowledge, affirmed the contract by express law, and year
It is true that no act which an officer of the state illegally performs can bind it. All have powers defined by law, and no one can be deceived as to the extent thereof, but within those actually conferred, their action is as obligatory upon the parties whom they represent, as that of the agent of the private citizen. Will it be argued that the contracting board was a mere machine, and had no judgment to exercise, and no duty involving reflection to discharge? Were they absolutely bound to accept the lowest bid proffered under their advertisements, though they knew by it the state would lose untold millions? Are all its officers to direct the execution of every agreement, though they may know it to be rotten with fraud and seething with iniquity ? Where" the entire law-making power of the state, the legislature and the governor, has declared and affirmed a contract as valid, are the-courts to give no efficacy to the law so declaring it ? When appropriations are made year by year, and the. money placed in official hands for disbursement, is there no intelligent duty to be discharged, no discretion to refuse payment where the claimant is not justly and honestly entitled to it? If these questions are answered in the negative, we have, it is true, the machinery of government, but no intelligent hand to guide its movements, and no heart to distribute by its pulsations,
In reaching the conclusion that the plaintiffs must be non-suited, I have not lost sight of the suggestion that unless my views are clearly against the .plaintiffs, the cause should be sent to the jury upon the questions of fact. They are clear, and impressions reasonably free from doubt made upon the
The motion for a non-suit is granted.