235 P. 986 | Cal. | 1925
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *745 This is an appeal from a judgment denying a writ of mandate following an order sustaining a demurrer to the petition without leave to amend. The facts are therefore undisputed.
On October 5, 1920, the electors of the city of Stockton authorized a bond issue of $600,000 as the estimated cost of the acquisition, construction, and completion of a new city hall, including the land, equipment, furnishings, appliances, and necessary appurtenances, for the housing of the several departments of the city and for general municipal uses. The bonds were duly issued and sold at par and a premium of $50,556. The sum of $4,146.25 was realized from the sale of buildings on the land purchased for the site and the rental thereof for one month. A total of $654,702.25 was therefore available for the new city hall as proposed. Notwithstanding the exercise of all practicable diligence in procuring a site and making other arrangements for the project *746 it was more than two and a half years before the city council was in position to advertise for bids for the construction work. Pursuant to notice inviting proposals the appellant submitted his bid on the general construction contract. By resolution of the council, No. 6070, adopted on June 22, 1923, and approved in writing by the mayor on the same day, the bid of the appellant in the net sum of $360,897 was accepted, the contract was awarded to him and the mayor was thereby "authorized and directed to execute and enter into a contract on behalf of the city" with the appellant. Within ten days after the adoption of said resolution a contract in due form was prepared, approved by the city attorney, signed by the appellant, filed with the city clerk and presented to and left with the mayor for his signature. The appellant also in due time executed and filed the required faithful performance bond. The mayor retained possession of the contract, assuring the appellant from time to time that he would sign it, until the expiration of his term of office, on July 2, 1923, but did not attach his signature thereto, although due demand was made upon him so to do. In the meantime the appellant incurred an indebtedness of $5,400 as the premium on his faithful performance bond, and, in reliance upon the award of the contract to him, made and entered into contracts with subcontractors and materialmen for work, labor, and materials necessary to carry out the contract and refrained from soliciting other contracts which could have been obtained, all to his detriment in the estimated sum of from thirty-five to forty thousand dollars.
Upon the incoming of the new city administration at 8 o'clock P.M. on July 2, 1923, the new city council, as one of its first acts, adopted a resolution wherein it recited the expenditure from the fund available for new city hall purposes of the sum of $184,347.77 for the site, architects' fees, and other items, the awarding of the general contract to the appellant in the sum of $360,897, the receipt of a bid from Edward L. Gnekow for plumbing, electrical work, heating, and ventilation, in the sum of $60,869, and the receipt of a bid from the Pauley Jail Building Company for jail equipment in the sum of $36,463. The resolution further recited that no arrangement had been made for inviting proposals for furnishing the new city hall; that the reasonable estimate for such equipment was approximately $92,000; *747 that certain architects' fees remained unpaid in the sum of $10,800, all of which would leave for the account of furnishings the sum of $1,200 only; that there were no other moneys in said bond fund, or in any other fund then available for furnishings except the said sum of approximately $1,200; that the estimate for the acquisition, construction and completion of said city hall according to the plans and specifications theretofore adopted would exceed the amount on hand for such purposes by approximately $90,000; that it was believed to have been the intention of the electors who authorized the bond issue that the sum realized therefrom should result in a city hall ready for use and that the bids theretofore received should be rejected. It was accordingly resolved that the bid of the appellant for the general construction work, the bid of Edward L. Gnekow for plumbing, electrical work, heating, and ventilation and the bid of the Pauley Jail Building Company be rejected and that all acts and proceedings taken relative to said bids and subsequent thereto be rescinded. Upon the refusal of the new mayor on demand to sign the contract awarded to the appellant this proceeding was brought in the superior court to compel him to do so.
It is the contention of the appellant that it was the duty of the mayor to sign the contract pursuant to the authorization and direction of the resolution adopted June 22, 1923, and that he had no discretion to do otherwise. Further, that upon the award of the contract to him and compliance with all requirements on his part he obtained a right to whatever benefits might accrue to him under the contract when signed and that he could not be divested of such right by the adoption of the second resolution.
At the time the contract was awarded to the appellant the charter of the city of Stockton provided that the council should be the governing body of the city; that the mayor should be the president of the council and should preside at its meetings (Stats. Ex. Sess. 1911, p. 269, secs. 55, 56). In section 95 of the charter it was provided that all contracts should be drawn under the supervision of the city attorney and that they "must be in writing, executed in the name of the city of Stockton by an officer or officers authorized to sign the same." The contract in question was approved by the city attorney. The mayor was a member of the deliberative *748
body which accepted the bid and awarded the contract. He was also the officer of the city authorized and directed by that body to sign the contract. Under the charter provision and the terms of the resolution it is clear that it was the duty of the mayor to sign the contract as he was authorized and directed to do and that he could not refuse to do so without legal justification. An examination of the charter as then in effect discloses that the signing of contracts was no part of the charter duties of the mayor. It may be deemed no more than a coincidence that the mayor was designated to execute this particular contract. The council could have authorized and directed any other officer of the city to sign the same on behalf of the city, as, for instance, the city clerk, or the street superintendent, or any of the other officers mentioned in section 43 of the charter. But although the duty of the mayor to sign the contract in question did not arise under any specific provision of the charter, when he, as an officer of the city, was authorized and directed by the duly adopted resolution of the council to sign the same, it became his duty to do so as a duty resulting from his office. The mayor's duty to sign the contract was ministerial only, and involved the exercise of no discretionary power (see Earl v. Bowen,
The situation here disclosed is almost identical with that presented in Neal Publishing Co. v. Rolph,
The respondents take the position that because the charter of the city of Stockton provided that all contracts be in writing, and that as this contract was not signed by both parties, therefore the appellant had no rights which may be enforced in this proceeding. They rely on the cases of LosAngeles Gas Co. v. Toberman,
It will readily be seen that those cases do not apply to the situation in the case at bar. There the plaintiffs were asserting rights under alleged contracts which were found to be not binding on the cities because the provisions of their respective charters had not been followed. Here the appellant concedes that the contract to which he claims to be entitled is not in writing. He is not asserting rights as under a contract duly executed but is seeking to compel the signing of a contract so that when it is properly executed he may proceed with the performance of the work with full confidence in its due execution and with assurance that payments thereunder will be made as the work progresses. In those cases rights were asserted by the plaintiffs on the theory that contracts were in existence. In this proceeding the right to the execution of a contract is asserted. When there is no discretion to refuse to do that which will cause the contract to comply with the formalities of the charter the right to its execution would seem to be clear. The charter of the city of Stockton contained no such provisions as section 207 of the Los Angeles charter and section 167 of the Eureka charter. Under the law as it stood at the time of the award the right of the appellant to have the contract signed became fixed and the rule as stated in Donnelly on the Law of Public Contracts would apply. It is said in section 143 thereof that, "When an award has once been made the public body has no discretion but to execute the contract. The rights of the parties then become fixed, and the power to cancel the award or reject the bids does not exist. The obligation of the contract made cannot thus be impaired at the option of one of the contracting parties." The rule is also stated in McQuillin on Municipal Corporations, volume 2, section 1226, as follows: "While it is true that a municipal corporation has a discretion as to the time and manner of making the corporate improvements and the *752 purchase of supplies, still when this discretion has been exercised and a contract made relative thereto, the legislative function has been exhausted, and the duty has become purely ministerial, and a contract so made cannot be impaired at the option of the municipality. Hence, when a bid has been accepted by the proper authorities, such acceptance cannot be revoked."
In their supplemental brief the respondents also rely on and quote from Mr. Donnelly wherein it is said in section 148: "Even if the proceedings are all regular and conducted according to law, and the bidder has in all respects conformed to the provisions and requirements of the advertisement and the charter, he may not have a writ of mandate to compel the execution of a contract to him." But immediately following that statement the author says: "The reason for this rule is that he has a right of action against the public body for damages which he has sustained by reason of the refusal to execute and carry out the contract." The rule under which the writ in such cases is denied is therefore based on the fact that a right of action for damages would lie which, as contemplated by our code section (1086, Code Civ. Proc.) would constitute a plain, speedy, and adequate remedy at law and which it is conceded is not available to the appellant in this case.
On January 29, 1923, the new charter of the city of Stockton was approved by the legislature (Stats. 1923, p. 1321). Section 3 of article XXIII thereof provides that, "All contracts shall be signed on behalf of the city by the mayor and attested by the city clerk." This provision became effective on July 2, 1923, the day on which the resolution of the new council purporting to reject all bids and to rescind all proceedings thereunder was adopted. The respondents therefore contend that at the time of the application for the writ in the superior court there was no resolution of the council in existence directing the mayor to sign the contract on behalf of the city and that the new charter provision vested in the mayor a discretion to refuse to sign the contract. It may be assumed as respondents contend that the adoption of the resolution of June 22, 1923, awarding the contract to the appellant was in the exercise of a legislative function (see Hopping v. Council of City of Richmond,
Respondents further contend that the contract which the appellant is seeking to have signed would be void if executed. The basis of this contention is the fact that if the city became obligated under the contracts awarded to the appellant and to Gnekow and pays other obligations properly chargeable to this particular bond fund, approximately $1,200 only will remain for the purchase of furnishings, which amount is alleged to be insufficient to properly furnish the building, and it is insisted that the rules laid down in Jenkins v. Williams,
In the present case the proceedings were not taken under section 4088 of the Political Code, for that section applies to counties only. They were taken under the city charter and the Municipality Bond Act of 1901 (Stats. 1901, p. 27). Under that statute the council is not bound to specify in the ordinance calling the election the exact amount which will be required to acquire, construct, and complete the public improvement contemplated. On the contrary, the statute requires that theestimated cost shall be set forth. This requirement was strictly complied with. In the ordinance calling the election it was recited that the estimated cost of the acquisition, construction, and completion of the proposed municipal improvements, and of each and every one thereof, would be too great to be paid out of the ordinary annual income and revenue of the city; that it was proposed in Proposition 1 to incur an indebtedness in the sum of $600,000 for the acquisition, construction, and completion of a city hall. In section 4 of the ordinance it was provided: "The estimated cost of the municipal improvement referred to under the designation of Proposition 1 in the preceding section of this ordinance is the sum of $600,000." The amount provided for city hall purposes was therefore merely an estimate. In spite of due diligence on the part of the city officials in furthering the project to the point of letting the contracts, over two years and a half elapsed, and in the meantime the cost of building construction had increased from twenty to twenty-five per cent. It quite often inevitably happens that the ultimate cost of a proposed public improvement exceeds the preliminary estimate. If the city authorities having the power and responsibility of proposing the bond issue have not, by the form employed in submitting the proposition to the electors, confined themselves to an absolutely definite and inflexible plan of construction and expenditure and have proceeded in good faith in accordance with the program based upon estimated costs, no good reason appears why they should not be permitted *757 to continue with the improvement to the extent of the funds available. The good faith of the respondent city is here unquestioned. The contract which appellant seeks to have signed calls for an expenditure within the funds available for the purpose intended. Under the facts alleged in the petition the appellant was entitled to the issuance of the writ and the demurrer should have been overruled.
The judgment is reversed.
Richards, J., Seawell, J., Waste, J., Myers, C.J., Lawlor, J., and Lennon, J., concurred.