Kreusler v. McKees Rocks School District ( 1917 )

Opinion by

Me. Justice Mestrezat,

These are cross appeals from the same judgment, and will be considered together. We have examined the numerous authorities cited by counsel in both appeals and are not convinced that the conclusion of the learned judge of the court below is not correct. His opinion so clearly vindicates the judgment he entered that the discussion here will be only an amplification of the reasons he has so well stated. We are aware of the conflict of authority in the different jurisdictions on the right of a contractor to recover money expended or property delivered under a void contract, as appears by the cases cited, but we think the conclusion of the learned court below that under the facts and circumstances of this case there can be no recovery for work and materials furnished under such contract in an action of assumpsit on an implied contract is sustainable on principle and is supported by well considered decisions in many jurisdictions.

The action is assumpsit on an implied contract f or the value of work done and materials furnished towards the construction of a superstructure of a school building for the defendant school district, and for repairs made on the foundation of the building which had been built by another party. Thé parties entered into a written contract for the erection of the superstructure of the building, but on a taxpayers’ bill the court held that the contract created an indebtedness in excess of the constitutional limit and was, therefore, void and of no,effect, and an injunction was awarded restraining its performanee: McKinnon v. Mertz, 225 Pa. 85. After the contract was made in June, 1908, the plaintiff began work and continued operations until he was enjoined, in the early part of the following November, by the final decree of the Common Pleas. In the meantime, however, he was notified by an association of taxpayers that the contract was within the constitutional inhibition and not to proceed with the work, and later, on July 21st, the bill was filed by taxpayers to enjoin the carrying out of the contract for the construction of the school building. The plaintiff, therefore, had not only constructive notice of the invalidity of the contract, but also express notice by the taxpayers of the district that it was illegal and not to proceed with the work. He also disregarded the notice contained in the bill filed to enjoin him from doing the work under the contract. The building was never completed, nor has the defendant used the material put in place by the plaintiff. In this action, he claims to recover as upon a quantum meruit the value of the work and materials furnished during the time he was engaged in the operation on the ground that the defendant received the benefit of the work and materials and the amount claimed is within the constitutional limit authorizing the school district to incur an indebtedness.

We do not agree with plaintiff’s counsel that he can recover his claim in an action on an implied contract. The contract of 1908 was ultra vires the school board and. against the policy of the State. The only authentic admissible evidence of public policy of a state on any given subject is its constitution, laws, and judicial decisions, and the public policy of a state of which courts take notice and to which they give effect must be decided from those sources. Where the state has spoken through its legislature, there is no room for speculation as to what the policy of the state is: 9 Cyc. 482. The work and materials were furnished under the provisions of the written contract, as the plaintiff himself testified- The time when the work was begun — whether immediately as the plaintiff claims or a month after the contract was let — is immaterial, and does not affect the learned trial judge’s conclusion. The material and controlling fact is that all of the work was done on the superstructure under and in pursuance of the illegal contract. It may be conceded, as claimed by the plaintiff, that members of the school board were occasionally present while the work on the superstructure was in progress, and that the board’s architect instructed the plaintiff to proceed with the work, but the evidence clearly discloses that these matters all occurred after the contract was let to the plaintiff, and were done solely under and in performance of the illegal contract. They furnish no ground whatever from which a contract on the part of the defendant can be implied to' pay the plaintiff for the work and materials furnished for the building, and hence they are without merit as evidence in this action.

The plaintiff concedes that he cannot maintain an action on the written contract, and resorts to this action on a quantum meruit to recover the value of the work and materials furnished under the contract. His claim, as laid in the statement, is that “although said written contract between plaintiff and said school district was void for the reason given, yet said materials and work so furnished and done by plaintiff in good faith at the request of defendant being of very great value and being retained and still in the possession, use and control of said school district, and said school directors having authority to purchase and contract for the same and having ordered said materials and work on behalf of said school district and having accepted the same on its behalf, and said school district having received the benefit of said work and materials, said school district was and is liable to plaintiff for the fair market value of said work and materials.” As already pointed but, all the work and materials were furnished under an express, and not an implied contract. The evidence fails to show, as appears above, any facts or circumstances from which a contract to pay for the work can be implied. The plaintiff’s proofs, therefore, did not sustain the allegations of the statement which were the grounds of his cause of action.- If the plaintiff can recover on a quantum meruit under the facts and circumstances of this case, the constitutional inhibition laid on the power of a school district to create excessive indebtedness will afford very little protection to the taxpayers of a district. It would, in effect, be vitalizing a contract condemned by the Constitution and policy of the State. The basis of the claim here has no better or stronger support than the supplemental contract by which these parties attempted to evade the constitutional prohibition by limiting the manner of payment to legally available funds of the current revenues as they might arise from a special tax or otherwise. This device for legalizing an ultra vires contract did not avail the parties: McMinnon v. Mertz, 225 Pa. 85.

In addition to the claim for work done on the superstructure, the plaintiff claims for work done and materials furnished in reinforcing the foundation which had previously been constructed. This work was done under a valid agreement made after the contract for the erection of the superstructure. There was no dispute as to the amount due the plaintiff for the work, but the defendant district claimed the right to set off $10,200 which it had paid the plaintiff on account of work done on the superstructure- under the contract which was subsequently declared illegal. The learned court below refused to allow the set-off on the ground that, as it was paid on an illegal contract, the law leaves “the parties just in the condition in which it finds them.” This is the general rule to which the present case is not an exception. The contract.for the construction of the superstructure was ultra vires the school board, and, therefore, incapable of enforcement. Hence, the plaintiff is not permitted to invoke its aid in collecting the amount due him for work done on the superstructure. For a like reason, the contract will not support an action by the defendant school district to recover back the money which it paid illegally to the plaintiff for work done under the contract. The set-off, therefore, cannot be allowed as, in effect, it would be sustaining an action by the defendant for the money paid the plaintiff: Everson v. Fry, 72 Pa. 326. The plaintiff having notice of the wrongful act is in pari delicto with the school board. Neither is the victim of the other. The plaintiff knew, or is presumed to have known, that the contract was violative of the Constitution of the State, 2 Dill, on Mun. Corp., 5th Ed., Sec. 777, and hence void and not capable of enforcement. He cannot allege ignorance of the indebtedness of the school district: O’Malley v. Olyphant Borough, 198 Pa. 525. In this case it was said (p.533): “To their (plaintiffs’) allegation that they have no way of ascertaining the indebtedness of the borough, the answer is that it was their duty to ascertain it in some way, or to refuse to enter into the contract until the borough officials had satisfied them that the proposed additional indebtedness would be within the constitutional limit. Without taking this, precaution, they acted at their peril.” The law, under such circumstances, will not give relief directly or indirectly to either party.

The judgment is affirmed.