151 Ind. 229 | Ind. | 1898
The appellant sued the appellees Hess and Myers as principals, and Gilmore and Cor-bin as sureties, on a bond executed by them to appellant on May 26, 1892, conditioned that Hess and Myers should, as contractors, construct a school building in the town of Winamac for $16,896.60, in all respects according to and in compliance with the terms, stipulations, and specifications of a contract executed by them on the same day to appellant. The defendants Hess and Myers, filed a cross-copaplaint, seeking to recover a judgment against the plaintiff. A trial of the issues resulted in a special finding of
The substance of the facts found is that in March, 1892, the only schoolhouse in Winamac was destroyed by fire, and it became necessary to construct a new one to provide common schools for the 400 children of school age residing in said town. The town owned a suitable tract of ground within said town for such a building, and the school trustees procured plans and specifications for a school building of suitable size at a probable cost of $19,000.00. The school town then asked the town to issue and sell bonds to the amount of $15,000.00, and turn the proceeds over to the school town, to be used in the proposed building. The proper steps were taken, and the order made for the issue 'of such bonds in April, 1892; and on May 26, 1892, appellant and appellees Hess and Myers, entered into a written contract, by which said appellees bound themselves to furnish the material and construct the building on said piece of ground according to the plans and specifications, for which appellant was to pay them $16,896.60. This written contract is set out in full in the special findings.., On the same day the contractors as principals, and appellees, Gilmore and Corbin as sureties, executed to appellant a bond in the penalty of $10,000.00, conditioned for the faithful performance of the building contract. This bond, also, is set out in full in the findings. Among other things, it was stipulated in the building contract that the contractors should begin work at once, gnd should complete said building on or before November 1, 1892, and if they failed to
It had a contract with Joseph E. Mills by which it was to pay him for preparing plans and overseeing the work the sum of $700.00, to be paid, $200.00 when the contract was let, $200.00 when the brick walls were up, $200.00 when the building was plastered, and $100.00 when the buildingwas complete. And neitherthe town of Winamac nor the school town was otherwise indebted. On the day of the execution of the contract and bond aforesaid, the school town of Winamac had on hands, cash belonging to its special school fund, for use in the construction of a public school building, the ¡sum of $4,800.00. And after the decision of this court aforesaid, the school trustees of the appellant presented to the board of trustees of the civil town of Winamae a petition, in writing, asking said civil town trustees to- issue and i sell bonds to the amount of $5,000.00 to raise funds with which to complete said school building, and, pursuant to said petition, •on July 6, 1892, they entered an order to sell bonds amounting to said sum of $5,000.00. Afterwards, on August 22, 1892, said bonds were duly issued and sold, and the proceeds thereof, $5,000.00, in cash, were paid over to the school trustees of appellant, to be used in defraying the expense of the erection of said school building. After the execution of said building contract the .appellant received from the tax levied
That from time to time during the year 1893, beginning with March 8, 1893, and ending December 12, 1893, the school trustees issued orders against the special school fund of the. school town of Winamac, payable to various persons therein named, and sold said orders for their face value in cash, aggregating $9,700.00. And in January, 1893, the town of Winamac had a surplus in its treasury of $1,000.00, which, upon request of the school trustees, was loaned to appellant for use in said building. All of said funds were placed in the special school fund of said school town of Winamac, said fund being made up of the following,items, to wit:
Gash in special school May 26, 1892_______$ 4,800.00
Total from tax levy, as above............ 3,392.00
Total from sale of bonds, as above....... 5,000.00
Total from sale of orders, as above........; 9,700.00
Received from surplus funds of town..... 1,000.00
Total ....................;...........$23,892.00
And out of said special school fund said school trustees of appellant paid for material, and employed and paid workmen, and completed said school building according to the original plans and specifications. Said building was finally completed and ready for use November 1, 1893. After paying the aforementioned estimates to the contractors, Myers and Hess,, the appellant, in completing said building according* to the contract, was compelled to pay. the sum of
That at the time said Myers and Hess abandoned said work, upon said building, the plaintiff had paid in full all estimates which had been made, and said plaintiff had yet remaining in its treasury, belonging to its special school fund, $3,873.97, which might be used in the construction of said building, and which was afterwards used by said school town to complete said building; that when Myers and Hess abandoned the said work they demanded the right to remove all material then on the ground and not in the building, and the plaintiff refused to permit them to do so. And said Myers and Hess thereupon demanded of the plaintiff payment to them of $3,000.00, which' they claimed was. due them for work and material furnished to the plaintiff, and plaintiff refused to pay them anything; and at the same time Myers and Hess demanded that a correct estimate be made of all work and material furnished by them, and that they be paid according to such correct estimate, and plaintiff refused to make any different estimate or pay anything to said Myers and Hess.
By said failure of said Myers and Hess to complete said building according to contract, the plaintiff was
The trial court stated the following conclusions of law: (1) That the contract and bond of May 26, 1892, are illegal and void, and the plaintiff cannot recover thereon in this action. (2) That defendants Myers and Hess are not entitled to recover upon their cross-complaint for work and material placed in the building while proceeding under the contract. (3) The defendants, Myers and Hess, are entitled to recover upon their cross-complaint for the value of the material placed on plaintiff’s grounds by them, which the plaintiff took possession of and used in the. completion of the construction of said building, and interest thereon.
The assignment of errors calls in question only the first and third conclusions of law. That part of the first conclusion which holds that the bond sued on is illegal and void is clearly error. The facts found show nothing to make that bond void for illegality. It was a penal bond, with sureties, that the contractors, Myers and Hess, would keep and perform their building contract. It rests for its consideration entirely upon the building contract. If the building contract was void for any reason, then the bond sued on would be invalid. The appellees’ contention is that
Appellant, however, contends that the building contract did not create a debt to the full extent- of the contract price of the construction of the school building, because they contend that unless the contractors did some work and furnished some material under the contract, no debt or liability of any sort whatever would ever arise against the school town of Winamac on the contract, within the principle laid down in the City of Valparaiso v. Gardner, 97 Ind. 1. And, accordingly, appellant contends that the work was to be paid for on estimates made every three weeks as the work progressed, and until an estimate was made, no debt or liability was created or existed under the contract, and then only for the amount of the estimate; and, as shown, those estimates at no time ever made the indebtedness of the town exceed the two per cent, of the taxable property. While this argument seems plausible, we need not and do not decide that it is either correct or incorrect, because it is conceded by appellees that even though we treat the whole contract price for the construction of the school building as creating a debt against the town, and applying the $4,800.00 special school fund found to be in the school town treasury, to the payment of such debt, pro tanto, the remaining portion of such debt would exceed the two per centum limit prescribed by the constitutional inhibition by less than one-half of the contract price. About, or in the neighborhood of, $8,000.00 of this indebtedness did not exceed the constitutional limit. The question then
“In the state of Iowa, which has a constitutional provision almost identical with that now under consideration, the officers of a school district made a contract to build a schoolhouse, for which the contractors were to receive $15,000.00 in bonds of the district, when the amount of indebtedness which the district could lawfully contract was only $2,057.50. The supreme court of that state say: ‘We have seen that for the excess over the prescribed limit no right of action exists against the district. The question now arises, is the district liable for the amount of the
According to these authorities, and we think they correctly express the law, the appellees, Hess and Myers, as contractors, had the valid obligation of the appellant to pay them in and about $8,000.00 for the construction of the school building. It is true that was only about half the contract price. But the contractors were chargeable with notice of the limits on the power of the school board, and also with the knowledge that the full contract price exceeded two per centum-of the assessed valuation of the taxable property within the corporate limits of the town, when added to existing indebtedness of the town.
The third conclusion of law is wrong, because the facts found show that after the material left on the
No question is raised as to tbe second conclusion, but it is right anyway, because, when taking all tbe money paid to tbe contractors on tbe work from time to time, and adding that amount to tbe cost and expense appellant was to in completing tbe building, it amounts to $3,102.85 in excess of tbe contract price, and tbis sum tbe contract binds tbe contractors to pay to appellant. And the contract, as that finding likewise shows, binds them to pay appellant $10.00 a day for every day tbe completion of tbe building was delayed beyond tbe contract time for completion, and tbe finding shows that to have been 360 days. Tbe judgment is reversed, and tbe cause remanded, with instructions to restate tbe conclusions of law in accordance with tbis opinion, and to render judgment thereon in favor of tbe plaintiff.