Boyle v. Grant , 36 N.Y. St. Rep. 207 ( 1890 )

Bartlett, J.

This action was instituted by the plaintiffs as tax-payers to prevent what they alleged to be an illegal official act on the part of the defend-: ants in executing a contract witli the United States Illuminating Company for the lighting of certain streets in the city of Hew York. The reasons which were given by the learned judge at chambers for denying the application for an injunction are so fully stated and so satisfactory in all respects but one that it is only necessary to discuss the single point in which we differ from his view of the law applicable to the case, and this'difference does not affect the correctness of the result which he reached. Section 64 of the Hew York city consolidation act of 1882 provides that contracts for supplies for the municipal corporation, in cases involving the expenditure of more than $1,000, shall be made under such regulations as shall be established by ordinance of the common council. A corporation ordinance prescribes that all estimates for contracts for doing work or furnishing supplies for the city of Hew York shall state, among other things, whether the party, person,- or corporation making said estimate is the only person interested therein; and that if any other person or corporation have any interest in said estimate, or the contract proposed to be taken thereby, the same shall be so stated. In the estimate or bid of the United States Illuminating Company it was stated that such bidder was the only person or corporation interested therein, and that no other person or corporation had any interest in the estimate or in the contract proposed to be taken. The estimate, therefore, literally complied with the requirement of the ordinance. But the plaintiffs allege that the statement was untrue, and showed upon the hearing that an agreement existed between the United States Illuminating Company and the Safety Electric Light & Power Company, whereby the latter corporation had agreed to pay the interest on the bonded indebtedness of the former and a certain percentage of dividend on its stock, in return for which the United States Hluminating Company was to pay over to the Safety Electric Light & Power Company all its earnings over and above the expenses of the business, the interest on its bonds, and the amount of its guarantied dividends. The court below held that this arrangement did not make the Safety Electric Light & Power Company interested in the bid of the United States Illuminating Company in the contract sought thereunder, “any more than the stockholders of the corporation would have such an interest if the net profits of the business were to be paid to them.” Weare not prepared to accept this view. On the contrary, we are strongly inclined to the opinion that the ordinance under consideration was designed to compel the disclosure on the part of the bidders of just such relations with other parties as those which were shown to exist in this case between the United States Illuminating Company and the Safety Electric Light & Power Company. But there is nothing to show that the statement in the bid to the effect that no one else was interested in the estimate or contract was made with any intent to deceive or mislead the city authorities. They became fully aware of the exact interest, if it was an interest, of the Safety Electric Light & Power Company in the contract before the bid was accepted. There is not the slightest basis shown in the papers which were before the court for any supposition that the proposed contract was not in all respects beneficial to the. city, or that the defendants, in accepting the bid, had not acted in the best interests of the taxpayers ; and hence the mere fact that a statement in thebid might be regarded as untrue upon a particular construction of a city ordinance—while under another interpretation it was entirely true—furnished no sufficient ground for any judicial interference with the action of the defendants in entering into the proposed contract. The order below was right, and should be affirmed, with costs and disbursements. Allconcur.