Findley v. City of Vidalia , 78 Ga. App. 581 ( 1949 )

1. The motion to dismiss the writ of error is denied.

2. It appears from the allegations of the petition that the plaintiffs had a remedy in law or equity. No facts or circumstances are alleged that show the necessity for the application of the Declaratory Judgments Act, and the court did not err in sustaining the general demurrer to the petition.

3. The contract between the city and the contractor, for the construction of extensions and improvements to the city's waterworks system, made pursuant to the former action of the city in undertaking such improvements under the Revenue Certificate Law of 1937, which contract was authorized by a motion duly made and unanimously passed by the city council in a regular meeting, was not void for lack of appropriate approval by proper corporate action.

(a) Said contract was not contrary to public policy and void for that reason.

DECIDED JANUARY 8, 1949. REHEARING DENIED FEBRUARY 11, 1949. C. W. Findley and others, citizens and taxpayers of the City of Vidalia, filed a petition in Toombs Superior Court in behalf of themselves and other citizens and taxpayers of said city, against the City of Vidalia and J. B. McCrary Company Inc., for a declaratory judgment and other relief.

The material allegations of the petition of the plaintiffs were: that on March 3, 1948 the defendant municipality and the defendant corporation entered into a contract for the construction of certain extensions and improvements to the waterworks system in the municipality; that the municipality failed to comply with certain charter provisions in taking corporate action with respect to said contract, which provisions were set forth in the petition; that the contract was executed by the mayor and clerk of the municipality pursuant to the action of the city authorities in a regular meeting held on March 3, 1948, at which all members of the city council were present, said action being the unanimous adoption of a motion that the city enter into a contract with McCrary Company authorizing it to proceed with the contemplated improvements to the waterworks system of the city: that the "ordinance or resolution" was not published as required by the charter, and the city had not asked for or sought competitive bids on the work to be done before the execution of the contract; that the contract was null, void and ultra vires because (a) the ordinance or resolution authorizing the execution of the contract was not sufficient to constitute corporate action by the mayor and council in that the terms of the contract were not set out in the resolution, (b) the ordinance or resolution was not published before its introduction and passage, (d) said contract was contrary to public policy in that the municipality had surrendered to the McCrary Corporation its authority and duty to make contracts in its behalf in the purchase of materials and machinery used in the construction work, and (e) was contrary to public policy in that it was entered into without competitive bidding. It was alleged that the work had not been done under the contract, that if the city was permitted to carry out said contract it would involve the incurring of illegal debts and spending of sums illegally to the detriment of the plaintiffs as citizens and taxpayers, and that the plaintiffs had no adequate remedy at law and this was a proper case in which the courts should declare the rights and liabilities of the municipality with respect to the contract to the end that the plaintiffs be afforded relief from uncertainty and insecurity respecting their rights as citizens and taxpayers. The prayers were (a) that the court declare the contract to be null, void and ultra vires, (b) that both defendants be enjoined from carrying out any of the provisions of the contract until a final adjudication as to its validity or invalidity, (c) that the municipality be enjoined from paying any money to the McCrary Company or doing any other thing in performance of the contract, and for process and such other and further relief as may seem meet to the court. The plaintiffs amended by alleging that the contract was null and void because McCrary Company had a dual interest therein under its fee for supervision and payment for the use of certain machinery to be furnished by it, and the payment of salaries to supervisory personnel, and because there was no fixed and certain maximum liability on the city.

The City of Vidalia demurred generally to the petition and McCrary Company demurred generally and specially. Upon the hearing it was admitted by counsel for the plaintiffs in open court that the city had in its treasury $200,000 derived from the sale of revenue-anticipation certificates issued pursuant to law for the purpose of constructing the extensions and improvements to the city's waterworks system. The court sustained the general demurrers of the defendants and dismissed the petition and the plaintiffs have excepted to that judgment. 1. The motion to dismiss the writ of error on the ground that the case is moot because the contract has now been fully performed is denied.

2. The court did not err in sustaining the general demurrers and in dismissing the petition. "Where there exists a remedy, either in law or in equity, a petition for declaratory judgment will lie only when there be some fact or circumstance which necessitates a determination of disputes, not merely for the purpose of enforcing accrued rights, but in order to guide and protect the petitioner from uncertainty and insecurity with respect to the propriety of some future act or conduct which is properly incident to his alleged rights, and which future action without such direction might reasonably jeopardize his interest."Mayor c. of Athens v. Gerdine, 202 Ga. 197 (42 S.E.2d 567). See also Shippen v. Folsom, 200 Ga. 58 (35 S.E.2d 915), Clem v. Kaplan, 201 Ga. 396 (40 S.E.2d 133), andGeorgia Marble Co. v. Tucker, 202 Ga. 390 (43 S.E.2d 245). Although our Declaratory Judgments Act says it is to be liberally construed and administered, "it manifestly was never intended to be applicable to every occasion or question arising from any justiciable controversy, since the statute does not take the place of existing remedies." Mayor c. of Athens v. Gerdine, supra. If the contract here under attack was illegal or invalid as contended by the plaintiffs, they had a remedy either in law or equity, and no facts or circumstances are alleged showing the necessity for the application of the declaratory judgments statute.

3. The contention is made that the contract was void because it was not properly authorized by the mayor and council, and was authorized by a void resolution which was not passed with the same formality as an ordinance, resolution or motion, authorizing the payment of the obligation. The contract was made in pursuance of a former action of the city properly taken under the Revenue Certificate Law of 1937 (Code, Ann. Supp., Ch. 87-8), for the construction of the extensions and improvements to its waterworks system, and the former action of the city is not now under attack. The validation of the revenue certificates made the former action of the city conclusive upon it and its citizens and taxpayers. "When the Revenue Certificate Law of 1937 and the Constitution of 1945 were adopted, the provisions of each as to revenue certificates became a part of the charter of every municipality of the State." Reed v. Smyrna, 201 Ga. 228 (39 S.E.2d, 668). "The acquisition, construction, reconstruction, improvement, betterment, or extension of any undertaking . . may be authorized under this Chapter by resolution or resolutions of the governing body which may be adopted at a regular or special meeting by a majority of the members of the governing body. Unless otherwise provided therein, such resolution or resolutions shall take effect immediately and need not be laid over or published or posted. . ." Code (Ann. Supp.), § 87-804. Another section of the Revenue Certificate Law provides that: "In addition to the powers which it may now have, any municipality shall have power under this Chapter: . . (e) To make all contracts; execute other instruments; and do all things necessary or convenient in the exercise of the powers herein granted. . ." Code (Ann. Supp.), § 87-803. It has been held that the determination of a municipality to pave its streets was legislative in character, and involved official discretion, and the city council could not delegate this power and this discretion to two of its members or to the county; "but when the city council had decided to pave these streets, then they could delegate the making and the execution of any necessary agreement for this paving to a committee composed of councilmen. The making of the contract for the paving was a ministerial act which a committee of council could be empowered to perform." Mayor c. ofWashington v. Faver, 155 Ga. 680, 686, (117 S.E. 653). See also Fuller v. Atlanta, 66 Ga. 80, and City Council ofAugusta v. Owens, 111 Ga. 464, 477, 478 (36 S.E. 830).

We think that the making of the contract between the city and the construction company, for the doing of the work proposed and contemplated in the extension and improvement of the city's waterworks system, under the Revenue Certificate Law, in pursuance of a motion duly made and unanimously adopted in a regular meeting of the city council, was an approval of the contract by appropriate corporate action. The mayor of the City of Vidalia is authorized to sign all contracts made for or by the city "which shall have been ordered or approved by the mayor and council duly assembled in their corporate capacity," under section 15 of its charter, and no ordinance being necessary the charter provisions respecting the passage of ordinances are not applicable.

The final attack on the contract is that it is void because McCrary Company is both an agent and a contractor thereunder, and that it is contrary to public policy. The contract must be construed in its entirety. When it is so construed we do not think it is against public policy for the reason claimed. McCrary Company was employed by the city to manage the construction, and to purchase material and equipment on bids and quotations submitted to various dealers and manufacturers, to the best interests of the city, and to employ labor, all of which was to be done "in accordance with the plans, specifications and estimates" approved and adopted by the city in detail; and was to direct and supervise the construction "according to the plans, specifications and estimates in a first class workmanship manner." The contract provided that the construction company would furnish certain trucks on a rental basis, also certain machinery for the making of excavations at a stipulated price per cubic yard, and for all dirt backfilled by the machines at a specified price; and would keep records of cost of all work done and make monthly reports to the city showing the costs of the job to date, and guaranteed that the total cost, including their fee, would not exceed the contract price. The contract also provided that all work done thereunder was subject to the inspection and approval of the city's representative. The fact that the contractor received a fee of 15% of the guaranteed estimate of the costs of the construction, with specified sums for the use of necessary machinery furnished by it, does not make the contract void as against public policy. The agency in the contractor with respect to the purchasing of materials and the employment of labor and supervisory personnel was limited by the terms of the contract in such manner as to bind the contractor to the plans, specifications, estimates and costs set forth therein. Even if some provisions of the contract standing alone may seem to subject it to the attack that the contractor was his own employer, we do not think the contract as a whole is properly capable of such construction.

Many authorities are cited by the plaintiffs in line with the holding in Mayor c. of Macon v. Huff, 60 Ga. 221, to the effect that no official or agent, whose duties it is to supervise a contract in behalf of his employers or principal, can himself undertake to do the thing which his office or agency makes it his duty to supervise. Neither of the cases cited for the plaintiffs fits the facts of this case. The general principles invoked and applied in them are not applicable here when the contract is considered as a whole.

"A public officer is presumed to have done his duty, and, in the performance of any judicial act, to have followed the requirements of law." Georgia Power Co. v. Fincher, 46 Ga. App. 524 (168 S.E. 109). This principle is recognized in the case of municipal officials in Southern School Supply Co. v.Abbeville, 34 Ga. App. 93, 99 (128 S.E. 231). "Courts will not assume that public officers will act dishonestly or dishonorably, or use their public trust for private ends, and in the absence of proof to the contrary, officers will be presumed to have acted in the exercise of their powers in the interest of the public and within the authority granted them." McQuillian, Municipal Corporations (2d. ed.), Vol. 2, § 519. "The power of the courts to declare a contract void for being in contravention of a sound public policy is a very delicate and undefined power, and, like the power to declare a statute unconstitutional, should be exercised only in cases free from doubt." Equitable Loan Security Co. v.Waring, 117 Ga. 599 (44 S.E. 320, 62 L.R.A. 93, 97 Am. St. R. 177). "The delicate and undefined power of courts to declare a contract void as contravening public policy should be exercised with great caution, and only in cases free from substantial doubt." Foster v. Allen, 201 Ga. 348 (40 S.E.2d 57). We do not think it can be said that the contract here involved clearly shows a dual interest of the contractor so as to make it contrary to a sound public policy and authorize the courts to set it aside.

Judgment affirmed. Sutton, C. J., concurs. Felton, J.,concurs in the judgment.