Marshall & Bruce Co. v. City of Nashville , 109 Tenn. 495 ( 1902 )

Mr. Justice Wilkes

delivered the following dissenting opinion:

I do not concur in the conclusion reached by the court. I am of opinion the ordinance in question is void for the reasons stated in the opinion of the majority, but I think the legal and logical consequence is that the letting of the contract under it was illegal, and complainants are not entitled to recover upon such illegal contract of letting. City of Memphis v. Memphis Gayoso Gas Co., 9 Heisk., 532.

The provision of the charter relating to the letting of contracts is mandatory and controlling, and the bidding, not having, in my opinion, been open to free and unrestricted competition, was illegal, and gave no rights and imposed no liability, éven though fully performed by either party. City and County of San Francisco v. Broderick, 125 Cal., 188 (57 Pac., 887) ; McBrian v. City of Grand Rapids, 56 Mich., 95 (22 N. W., 206); McDonald v. City of New York, 28 Am. Rep., 144; Zottman v. City and County of San Francisco, 81 Am. Dec., 96.

In McDonald v. City of New York, 23 Am. Rep.) 144, the court held (Judge Folger delivering the opinion) that, when the charter of a city prohibited it from incurring liability except in a specified manner, the city was not liable where the method prescribed in the charter was not followed. This is the rule laid down by the supreme court of the United States in Bank v. Dandridge, 12 Wheat., 70 (6 L. Ed., 552).

In Zottman v. City and County of San Francisco, 81 Am. Dec., 96, it was held (Chief Justice Field delivering the opinion of the court) that the charter of a municipality is the source of its power, and, when the mode in which its power on any given subject can be exercised is prescribed by its charter, the mode must be followed, or the municipality will not be bound. It would seem to follow, as an inevitable conclusion, that a contract made in violation of a charter provision can not be ground for any liability against the corporation, and such contract can not be ratified by any subsequent act of the municipal authorities. See, also, City of Memphis v. Memphis Gayoso Gas Co., 9 Heisk., 532. Chief Justice Marshall, in Head v. Insurance Co., 2 Cranch, 127 (2 L. Ed., 229), said: “Thp act of incorporation is to them an enabling act. It gives them all the power they possess. It enables them to contract, and, when it prescribes to them a mode of contracting, they must observe the mode, as the .instrument no more creates a contract than if the body had never been incorporated.” See, also, McCracken v. City of San Francisco, 16 Cal., 591; Iowa Railroad Land Co. v. Sac Co., 39 Iowa, 149; Carron v. Martin, 69 Am. Dec., 584, note; Ferguson v. Halsell, 47 Tex., 423.

The requirement inserted in the advertisement for sealed bids, containing the provision that the work should bear the union label, was calculated to deter free and competitive bidding. Even though we assume that all bidders knew the provision to be illegal and void (a violent presumption), still it is apparent that for such a small bill no bidder would care to incur the trouble and expense of litigation likely to follow a defiance of the provision.

It is safe to presume that complainant would not have done so, except tó test the question involved, and the record indicates that such was the purpose (and not an illegal one) of the complainant in becoming a bidder and making the contract.

The doctrine is tersely stated in 20 Am. & Eng. Enc. Law (2d Ed.) p., 1166, as follows: “A fair competition among the bidders is the prime object of such provisions, and anything which tends to impair this is illegal. So is a requirement that each bidder shall agree not to employ any one not belonging to organizations approved by certain building trade councils.” Elliott v. City of Pittsburg, 6 Pa. Dist. R., 455; Van Reipen v. Jersey City, 58 N. J. Law, 262 (33 Atl., 740) ; McCloud v. City of Columbus, 54 Ohio St., 439 (44 N. E., 95), cited in 20 Am. & Eng. Enc. Law (2d Ed.), p. 1166.

I concur, therefore, with the majority in holding the ordifiance invalid, but I am of opinion the letting was illegal, and no right exists in either party to enforce it. Justice McAlister joins me in this dissent.