C. C. Slaughter Cattle Co. v. Potter County

I respectfully dissent from the majority in the disposition made of this appeal. If the contention was between individuals with relation to property owned in fee by one and purchased by the other, then I think the majority opinion is an able presentation of the law governing the rights of the parties, but, according to my view, we have no such case before us. The subject-matter of the suit is certain real estate expressly set apart to Potter county, "for the benefit of the public schools therein." Section 6, art. 7, of the Constitution of this state declares in unequivocal terms that said land is "of right the property of said" county, and in which "the title thereto is vested." This article further commands that "said lands and the proceeds thereof, when sold, shall be held by said counties as a trust for the benefit of public schools," provided that "each county may sell or dispose of its lands, in whole or in part, in manner to be provided by the commissioners' court of the county." It seems clear that the effect of this pronouncement of the Constitution is to vest the title to the land in the county as a mere trustee, and that the beneficial interest is in the public schools. Indeed, this is expressly, so held by our Supreme Court in Webb County v. School Trustees, 95 Tex. 137, 65 S.W. 878. It follows that the county is the trustee, and the commissioners' court is merely the agent of the trustee, with the limited authority to provide only the "manner" in which the trust property is to be sold or disposed of by such trustee.

We have, then, a case where an attempt has been made to sell and dispose of a trust estate, not by the cestui que trustent, and not by the trustee, except in so far as such trustee has been represented by its agent, the commissioners' court. The school children of the county, the ultimate beneficiaries, could not, in the nature of things, be parties to any contract affecting the trust property. If the trustee and the beneficiaries are to be held bound by the terms of a contract, executed by an agent not of their own selection, but one imposed upon them it should be so held only after the contract has been subjected to the closest scrutiny and after a most searching investigation is made of the facts, and after the strictest application of only the rules of law and equity existing for the protection and guardianship of the sacred rights of those who are the real owners of trust property, and who are at the same time absolutely excluded from having any voice in its disposition. Many rules applicable to suits between individuals where there is no element of agency, trust, or public interest involved are foreign to this case. We know that the personnel of a commissioners' court generally, and as in this case, is a changing one; that new members are usually unfamiliar with the official acts of their predecessors; that they feel bound and generally do act in accordance with what has previously been done; and that, too, without, in many instances, a full investigation. The fact that it is sought to bind the imposed trustee and the powerless impersonal beneficiary by the proceedings of such protean body demands a jealous consideration of the issues presented and in accordance with rules of law peculiarly applicable only to such cases. In the Webb County Case, supra, and also in the case of Dallas County v. Club Land Cattle Co., 95 Tex. 200, 66 S.W. 294, the Supreme Court draws a clear distinction between the county in its ordinary corporate capacity and as trustee of its public school Lands, saying in the last-named case that this distinction "must be kept in mind." I think the majority opinion loses sight of this important distinction. In the Delta County Case, 100 Tex. 51, 93 S.W. 419, the Supreme Court further said that public schools are institutions of the state, established as part of its general governmental policy, intrusted to the management of the commissioners' courts, as instrumentalities in executing that policy, and that suits brought to protect the trust property "are practically suits in behalf of the state." It has been frequently held that commissioners' courts do not have general authority over the business of the county, but are vested with merely such special powers as are specifically conferred by the Constitution and laws of the state; therefore those dealing with them do so with full notice and at their peril. Because this is practically a suit by the state, involving the enforcement of a contract made for those who could not, under the law and in the nature of things, have a voice in the matter, and has been made by an agent with special and limited authority, dealing with trust property in which the public is interested, I cannot agree that all the rules which apply to ordinary contracts entered into by individuals primarily interested should control in the disposition of the case. The danger in so doing is illustrated in part by the application made in the majority opinion of the rule of practical construction of contracts by parties. The effect of that rule is to make it generally controlling, and the courts will ordinarily interpret and enforce an agreement in accordance with the practical construction of the parties to it, but the rule of practical construction, like many other rules, which seem to have governed the majority in the disposition of the case, should have no effect in a controversy of this character. As said in 13 C.J. 459:

"It is obvious that in every act of a party indicative of an understanding of a contract in accordance with the claim of the other party will be given the effect of a practical interpretation, and the effect of any particular acts must be determined from the circumstances surrounding the particular case. One who goes beyond the requirements of his contract, under circumstances of doubt, should not from that fact alone have his act given the effect of a concession."

In the first place, the public, or, in other words, the school children, the ultimate beneficiaries, have done nothing except through their imposed trustee and agents, which brings this case within that rule. The real parties in interest have not and could not act. It is difficult to conceive of a case where acts by a trustee, and ordinarily tantamount to a practical construction, could be held to bind the beneficiary, because the trustee is not the real party to the contract. The rule, so far as I have been able to ascertain, has never been applied except where the conduct which would make it applicable is that of the real parties to the contract. It is said in 13 C.J. 550:

"Where public interests are affected by a contract, the construction placed on it by the parties is not controlling."

The text is supported by reference to the case of Chesapeake, etc., Ry. Co. v. Peed, 155 Ky. 696, 160 S.W. 472; Ann.Cas. 1915C, 460. In that case it is shown that a contract was entered into between two railroads, which prohibited one of them from doing any local passenger or freight business between certain points. The court said:

"It may be conceded that the parties to this contract have given it the construction claimed by counsel, and in a controversy between the parties as to the proper interpretation of the contract this contemporaneous construction of the parties would undoubtedly be entitled to great weight. Nor do we doubt that the parties to this contract are at liberty, as between themselves, to interpret it as they please, so long as their interpretation does not affect the rights of the public. But here we are dealing with a member of the public whose interests are affected by this contract, and the construction given it by the parties is not controlling on him. The public is concerned in the construction of this contract as well as the parties to it, and no construction should unnecessarily be given to it that will interfere with the duties that these carriers and each of them owe to the public."

I heartily concur in that opinion.

The general rule is that a trustee with power to sell has no authority to grant an option. Mansfield v. Wardlow, 91 S.W. 859; In re Armory Board, 29 Misc.Rep. 174, 60 N.Y.S. 882; Hickok v. Still, 168 Pa. 155,31 A. 1100, 47 Am. St. Rep. 880. In Midland County v. Slaughter,61 Tex. Civ. App. 328, 130 S.W. 612, it is held that a lease of 20 years, coupled with an option to purchase the leased premises, was unreasonable and void. A writ of error was refused. Justice Gaines, in Dallas County v. Club Land Cattle Company, 95 Tex. 200, 66 S.W. 296, said:

"In Pulliam v. Runnells Co., * * * it is, in effect, held that the commissioners' court was not authorized to dispose of the lands otherwise than by sale or lease."

The option contract in question recites a sufficient consideration, and, if given effect, would prevent Potter county from selling or otherwise legally disposing of its lands for a term of 5 years to any one save the optionee and for a greater price or upon different terms than 75 cents per acre, payable in 20 years. This would be an unwarranted restriction upon, and a complete surrender and destructive of, the constitutional right of the county during the term of the option to sell to any one for a better price, and is therefore illegal.

"Agreements in violation of positive law are those which are expressly or impliedly prohibited, either by some rule of the common law or by some express statutory provision. * * * As a general rule, all contracts or agreements which involve or have for their object a violation of the law are illegal. It is immaterial, as far as the effect of the illegality is concerned, whether the object of the agreement is forbidden by the common law or by statute, or, generally speaking, whether the thing forbidden is malum in se or malum prohibitum," etc. 13 C.J. 411, § 341.

"Agreements the object or tendency of which is to constitute a fraud or breach of trust or breach of duty on the part of one who stands in a fiduciary or confidential relation are illegal and void, as constituting or tending to constitute a fraud on third persons. While it is often said that such agreements are against public policy, because it is the policy of the law to secure fidelity in the discharge of their duties by all persons holding such positions of trust and confidence, yet it is more accurate to say that such agreements tending to cause unfaithful conduct by fiduciaries are illegal because they are in effect agreements to wrong or to defraud persons whose interests the fiduciaries have in charge."

Bearing in mind the distinction between the county in its ordinary corporate capacity and as trustee for the benefit of the public schools, and the fact that it was its bounden duty as trustee, with power to sell, to obtain the very best price and hold itself free at all times to accept any offer to that end, it seems to me that the option by which the commissioners' court tied the hands of the trustee for five years, thus paralyzing it during that period in the exercise of its constitutional right and duty, should be held void upon the ground of public policy as well. In determining the question of public policy, courts look to the tendency of the contract to harm the public rather than to the actual results.

"If an agreement binds the parties or either of them to do, or if the consideration is to do, something opposed to the public policy of the state or nation, it is illegal and absolutely void, however solemnly made. It is not easy to give a precise definition of public policy; it is perhaps correct to say that public policy is that principle of law which holds that no person can lawfully do that which has a tendency to be injurious to the public or against public good, which may be designated, as it sometimes has been, the policy of the law or public policy in relation to the administration of the law. Where a contract belongs to this class, it will be declared void, although in the particular instance no injury to the public may have resulted; in other words, its validity is determined by the general tendency at the time it is made, and, if this is opposed to the interests of the public, it will be invalid, even though the intent of the parties was good, and no injury to the public would result in the particular case. The test is the evil tendency of the contract, and not its actual injury to the public in a particular instance." 13 C.J. 424, § 360.

It is said that the source of the public policy of a state is its Constitutions, laws, and judicial decisions. Id. § 362. Quoting the text further, we find:

"If by well-settled judicial precedent the law has determined that contracts of a certain class tend to the injury of the public or are inconsistent with sound morality, the court should follow the law thus declared without regard to its own notions of the tendency of the contract, and, even in the absence of precedent, the court may declare a contract void when contrary to the established principles of the law. Many agreements, therefore, which have already been discussed as void, because contrary to the terms of the statute, are also void as being contrary to the policy of the law as expressed in those statutes. But there are many things which the law does not expressly prohibit or penalize, which are so mischievous in their nature and tendency that on grounds of public policy they are not permitted to be the subject of an enforceable agreement."

"Agreements not to compete with another in making bids, to withdraw a bid for a public quasi public contract, to share in the result of profits, or other agreements having a direct tendency to prevent bidding or competition are against public policy." Id. 436, § 371.

I think the contract in the instant case is within this rule, and its vice is more apparent when it is shown that the land was conveyed by deed for 75 cents per acre at a time when its actual market value was $2 per acre. I cannot, therefore, avoid the conclusion that the trustee, the county, through its agent, the commissioners' court, has exceeded its powers as limited and defined by the Constitution, resulting in a contract against public policy. The option feature of this case distinguishes it from the cases of Tabor v. State, 38 Tex. Civ. App. 235, 85 S.W. 835, and Taber v. Dallas County, 101 Tex. 241, 106 S.W. 332, relied upon in part by the majority in sustaining their holding. The contract "under and by virtue of which" appellant acquired the land is evidenced by the several orders of the various commissioners' courts, the option contract of November 8, 1897, the bond for title, the deed and obligation of Ferrel and his assignees, the appellants, and by reference and cross-reference in most of these instruments the option feature is incorporated, and in my opinion is unquestionably made the impelling consideration and inducement from time to time, leading up to the final consummation of the transaction. Every step taken after the commissioners' court granted the option, and after the execution of the formal written option contract in obedience to such orders, harks back to the option, and the attempt of the majority to divorce the bond for title and the final conveyance from its contaminating influence ignores the fact apparent upon the face of the record that the parties regarded the option as the very basis of all their subsequent negotiations and the ground of their respective rights and obligations as well as the inducement for further and final action. I think that the divorcement by the majority of the option from the subsequent proceedings also does violence to the universal rule that all the writings relating to the subject-matter of a contract enter into and are parts of the whole, and together must be looked to and construed as constituting the entire agreement between the parties. I cannot agree that this is a severable contract, because there is only one common intent and purpose in view, viz. the ultimate sale of the land. To this end there is only one covenant on either side. The county covenants to sell the entire tract of land upon payment according to the requirements of the contract at the election of the purchaser if exercised within five years. If this covenant is valid, the purchaser by tendering performance within the time, might have demanded a conveyance. On the other side, the purchaser's covenant is to pay according to the agreed terms. In 4 Page on the Law of Contracts, § 2083, the author, in discussing entire and severable contracts, says:

"If a contract contains two or more covenants on either side, the question arises as to whether it is entire or severable. An entire contract is one the covenants of which have not been separated by the parties, and which accordingly cannot be separated by the court. It is also said to be a contract in which the parties intend that each covenant shall be connected with and relate to every other covenant. It is also said that an entire contract is one in which there is an entire consideration on each side. * * * Such a contract is sometimes called an indivisible contract. If a contract which contains two or more covenants on one side is regarded by the parties as really consisting of two or more separate contracts, the contract is said to be severable. It is said that, if the consideration is single the contract is indivisible and entire. This last statement, however, is rather a test for ascertaining the true intention of the parties than a test for determining the legal effect of the contract when the intention is ascertained."

The subsequent execution of the contract of sale and the final conveyance on the one side, and the agreement to pay and the final payment on the other, are but the consummation of the original void covenant. The promise to convey, upon the one part, and the promise to pay, upon the other, are the considerations moving from the respective parties for their mutual promises. Neither consideration is divisible. The contract to convey and the deed are not new contracts, but were executed to carry out the original illegal intents as expressed in the option. But, if it should be admitted that they are different contracts, the rule is that —

"Where a contract grows immediately out of and is connected with a prior illegal contract the illegality of such prior contract will enter into the new contract and render it illegal. And the rule has been particularly laid down that if the connection between the original illegal contract and the new contract can be traced, and that if the latter is connected with and grows out of the former, no matter how many times and in how many different forms it may be renewed, it cannot form the basis of a recovery. So every new agreement in furtherance of or for the purpose of carrying into effect any of the unexecuted provisions of the previous illegal agreement is likewise illegal and void, as is a contract the performance of which depends on performance of a prior invalid contract." 13 C.J. 509, § 460.

To the same effect is 6 R.C.L. 820, § 260:

"If a contract grows immediately out of or is connected with an illegal or immoral act or contract, a court cannot lend its aid to enforce it, though it is in effect a new contract. If the connection between an original illegal transaction and a new promise can be traced, if the latter is connected with and grows out of the former, no matter how many times and in how many different forms it may be renewed, it cannot form a basis of a recovery. Repeating a void promise cannot give it validity. * * * These are absolutely void because they have no legal sanction and establish no legitimate bond or relation between the parties."

Appellant paid the same price they had agreed to pay in the option contract. But suppose that the option is one consideration for appellant's agreement to pay and that the contract of sale is another, a new consideration; still the consideration moving from appellants cannot be divided or apportioned, and, if this cannot be done, the contract is, entire, and not severable. In the case of Edwards County v. Jennings,89 Tex. 618, 35 S.W. 1053, the county entered into a contract with appellee whereby he was to construct certain waterworks, agreeing as the consideration to pay him $3,500 and grant him an exclusive right of way to lay pipes through the town of Rock Springs. In the course of the opinion the court said:

"We are of the opinion that the agreement of the county to grant Jennings `an exclusive right of way to lay pipe for supplying the town of Rock Springs, Edwards county, * * * with water,' tends to create a monopoly, is violative of the Constitution, illegal, and void. As stated above, the consideration for the obligations imposed upon Jennings by said contract consisted of the obligation of the county (1) to pay $3,500 and (2) to perform this unlawful agreement. We cannot say which of these considerations most affected the mind of Jennings, and induced his promise; nor are there any means of ascertaining how much of his obligation was based upon the illegal consideration. The rule is well settled, upon principle and authority, that a promise made upon several considerations, one of which is unlawful, no matter whether the illegality be at common law or by statute, is void."

See McNeese v. Carver, 40 Tex. Civ. App. 129, 89 S.W. 430; Sabine Tram Co. v. Bancroft, 16 Tex. Civ. App. 170, 40 S.W. 837.

If any part of a single consideration for one or more promises is illegal, or if there are several considerations for one promise, some of which are legal and others illegal, the promise is wholly void, as it is impossible to say which part or which one of the considerations induced the promise. If A. sells property to B. with an option of purchase, it is an entire contract, whether the agreement is evidence by one or several instruments. Miller v. Yturria, 69 Tex. 549, 7 S.W. 206; Hall v. Jennings, 104 S.W. 489; Boatright v. Peck, 33 Tex. 68. We must therefore consider together the order of November 8, 1897, entered in the minute book of the commissioners' court, volume 2, p. 153, granting Ferrel, for a term of five years, an exclusive option to purchase the land for 75 cents per acre, "provided that said Ferrel fully complies with the terms and conditions of his said lease * * * during the grant of option of sale." On the same day Judge Marrs, in compliance with that order, and expressly referring to it in the instrument, executed and delivered the written option contract reciting in part that the grantors —

"do by these presents sell this option to the said R.S. Ferrel, the same being upon the following terms and conditions, to wit: For and in consideration of the sum of one dollar cash in hand, the receipt of which is hereby acknowledged, and the further consideration of the sum of seventy-five cents per acre," etc.

This instrument provides that the option shall be void upon the failure of Ferrel to exercise it within the time limit. Thereafter, on July 1, 1898, the court ordered Judge Marrs to deliver a bond for title to Ferrel, the order reciting:

"Under and by virtue of an option of purchase said Ferrel has with Potter county, Texas, under order of this court, said order being on record on page 153, Book 2."

On July 25, 1898, Judge Marrs executed and delivered to Ferrel a bond for title or contract of sale set out in full in the majority opinion, and this instrument incorporates the order made by the commissioners' court and entered on the minutes thereof in volume 2, p. 153, which granted the option. I am not convinced that the Supreme Court's action in refusing a writ of error in the first Tabor Case, supra, and their decision in the second case, may be taken as a holding that the contract therein discussed was not an option by admitting that such is the holding in those cases; nevertheless, since it is recited in the contract here being considered that it is executed "under and by virtue of" the option agreement, the conclusion is inevitable that it is void if the option is void. "By virtue of" means by or through authority of. "Under" has the same signification and is also defined "in subordination to" and "in conformity with." Bassett v. Mills, 89 Tex. 162, 34 S.W. 93. The bond for title was executed because the optionee had exercised an illegal and void power of election claimed by him under the option. In its absence he could not have demanded that the land be sold to him at 75 cents per acre on 20 years' time. Suppose he had sued the county to enforce specific performance of the option contract; I think the county could have successfully defended upon the grounds that the commissioners' court had exceeded its powers under the Constitution, and had made a contract void as against public policy. If this be true, under the authorities above quoted, the transaction cannot be purged of its illegality nor vitalized by doing voluntarily, under and by virtue of the void option, a thing which as a matter of law it could not be forced to do. Entering into the contract of sale is not a ratification, even if this contract would be ratified, and I insist that it cannot. As said in 6 R.C.L. 820, § 216, in discussing the enforceability of promises growing out of illegal contracts:

"These are absolutely void because they have no legal sanction and establish no legitimate bond or relation between the parties. When the contract is in substance or in essential form illegal, neither party can ratify it, because the wrong done is against the state. The state only can forgive it. To permit the subsequent ratification of such contract or to consider it the sufficient and legal basis of a subsequent promise would be a manifest inconsistency. It would be to annul the rule and enable the parties by an easy expedient to evade laws based upon considerations of public policy."

As insisted by appellee, if the ground of the option is void, then the right of election is void, and the exercise of the right of election, together with the execution of the bond in compliance therewith, can neither create a new contract nor give rise to legal rights under it. Suppose the optionee had waited until the last day of his five-year term and when the land had enhanced materially in value before electing to purchase; could it be contended that compliance then was not against public policy? If a void option for five years can be validated by an election just before the expiration of the period, then one for twenty years would be equally valid. If it is unlawful to make an executory contract, it is unlawful to carry it out.

Notwithstanding the persuasive opinion of the majority, which seems to be supported at least in part by authority, which this writer respects, I am strongly inclined to the opinion that as to Ferrel the bond for title or contract of sale, as it is variously called in the briefs, imposes no actionable obligation upon him in the event he should refuse to comply with its terms. That instrument contains this provision:

"And it is specially provided that, should the party of the second part or his legal heirs or assigns fail or refuse for sixty (60) days after any one semiannual interest payment becomes due to pay the same, then this obligation becomes null and void and of no binding force and effect on either party hereto."

This paragraph of the instrument further provides for the forfeiture of all improvements to the county, binds Ferrel to quit and surrender the premises, and authorizes the county to re-enter and take possession thereof, "and to hold as in her former estate, and thereupon this contract of sale and everything herein contained shall cease and be null and void, and all claims for damages by reason of such entry being hereby expressly waived, and the party of the first part shall have no rights hereunder for a specific performance hereof." I cannot avoid the conclusion that this stipulation is self-executing. By merely refusing to pay any semiannual installment of interest, then ipso facto the obligation becomes null and void and of no binding force or effect on either party. Unless this term is abrogated the contract must be an option. For the courts to ignore it is in effect making a contract for the parties other than the one executed and delivered by them. James on Option Contracts, § 105, says:

"An agreement of sale is a contract by which the seller agrees to sell and the buyer agrees to purchase the property in a thing for a price in money. The distinction, therefore, between a sale or an agreement of sale, on the one hand, and an option contract, on the other, is very apparent. An option does not bind the optionee to purchase the property; an agreement of sale does. The thing directly contracted for in an agreement of sale is the property. In an option contract it is the right of election to purchase the property. It may be laid down as an established rule of law that, unless the contract contains language which may reasonably be construed as an agreement on the part of the vendee to purchase the property, or to assume some obligation thereunder, it will be held to be an option contract, and not an agreement of sale and purchase. It is impossible to conceive of an agreement of sale and purchase without obligations on the part of the vendee; on the other hand, the absence of such obligation is the distinctive characteristic of an option contract. A contract of sale creates mutual obligations on the part of the seller to sell and on the part of the purchaser to buy, while an option gives the right to purchase within a limited time without imposing any obligation to purchase."

In appellee's brief I have found an illuminating discussion of a number of cases which in my opinion announce the rule applicable to this particular feature of the controversy, but which, for the sake of brevity, I will not undertake to reproduce here, because in my opinion the contract of sale clearly does not bind Ferrel to even pay the interest semiannually. It does specifically provide however, that his failure or refusal to do so puts an end to every conceivable obligation in it, and by way of further emphasis of its finality, with great detail, adjusts the rights of the parties after the contract is at an end.

It is my opinion further that the rules of acquiescence, estoppel, and ratification should not be applied as against the beneficiaries for the same reason that the rule of practical construction is inapplicable. It will be remembered that, after the administration of the county's affairs passed into the hands of Judge Merrill and a different commissioners' court, it was so apparent to them that the proposed sale of the land was such a sacrifice of the interest of the beneficiaries that the matter of repudiating the whole transaction was referred to two different firms of attorneys. The doctrines of acquiescence, ratincation, and estoppel do not and should not apply in a case of this kind. Where a person with actual knowledge of all the facts has induced another to believe that he acquiesced in or ratifies a transaction, or that he will offer no opposition thereto, and the other, in reliance upon such belief, alters his position, such person is estopped from repudiating the transaction to the other's prejudice, and may be held to have acquiesced in or to have ratified the act of his agent in making such contract. Acquiescence and ratification must be founded upon knowledge and assent. How could the beneficiaries in this case be held to assent to acts which they were powerless to prevent? This is trust property. No affirmative conduct on the part of the beneficiaries is or could be charged, and the rule is declared "that mere silence and noninterference by the cestui que trust before his interest has come into possession do not bind him as acquiescing in a breach of the trust." It is said in 13 C.J. 506, § 452, "A contract malum in se or against public policy cannot be made valid by ratification," and (Id. § 453) the same rule obtains as to estoppel, and further (Id. § 448):

"Where a person seeking relief from an illegal contract was not sui juris, and therefore did not have legal capacity to enter into the contract, the illegality of the contract will not prevent the courts from granting relief to him to recover property parted with by him in execution of the contract."

Quoting from Ann.Cas. 1914C, 742, note to Walker v. Milliken, this is declared to be the law:

"In order to bind a cestui que trust by acquiescence in a breach of trust by the trustee, it must appear that the cestui que trust knew all the facts and was apprised of his legal rights and was under no disability to assert them. Such proof must be full and satisfactory. The cestui que trust must be shown in such case to have acted freely, liberally, and advisedly, with the intention of confirming a transaction which he knew or might or ought with reasonable and proper diligence to have known to be impeachable. His acquiescence amounts to nothing if his right to impeach is concealed from him or if a free disclosure is not made to him of every circumstance which it is material for him to know. He cannot be held to have recognized the validity of a particular investment unless the question as to such validity appears to have come before him. The trustee setting up the acquiescence of the cestui que trust must prove such acquiescence. The trustee must also see to it that all cestuis que trust concur in order to protect him from a breach of the trust. If any of the beneficiaries are not sui juris, they will not be bound by acts charged against them as acts of acquiescence."

The utter impossibility of ratifying an illegal and void contract or of either party thereto being estopped is so convincingly set out in 2 Page on the Law of Contracts, §§ 1038 and 1039, and the text is sustained by such wealth of decisions, that I deem it sufficient to refer to it and the following Texas cases in support of my position: Commonwealth Bonding Casualty Insurance Co. v. Curry, 183 S.W. 1; State National Bank v. Fink, 24 S.W. 939; Rue v. Railway Company, 74 Tex. 474, 8 S.W. 533,15 Am. St. Rep. 852.

If I am correct in my opinion that the option contract was not only ultra vires, but was also violative of the law and Constitution, and against public policy, then neither the execution of the contract of sale "under and by virtue" thereof nor the receipt of the interest and purchase money, nor the execution of the deed by the trustee, can be held to be a ratification or work an estoppel against the beneficiary. All of these acts are merely factors, calling into action the equitable powers of the courts, and to be considered in adjusting the equities of the parties relative to reinvesting title in the county, refunding payments less reasonable rents, etc., because, as declared in 13 C.J. 497, § 440:

"The ordinary rules governing individuals that when a contract against public policy is executed the law will leave the parties where it finds them does not apply where the public is one of the parties."

The principle of part delicto does not preclude the granting of relief to the complaining party in cases where it is sought to have it applied against trustees and other fiduciaries and where the public welfare is involved. 2 Elliott, §§ 1103 and 1104. Gallup v. Liberty County,57 Tex. Civ. App. 175, 122 S.W. 291, is not, in my opinion, authority upon any issue in this case. There the com missioners' court merely exceeded its pow ers in the manner adopted by it in selling, through the county judge as agent, and agree ing to pay him a commission. This is characteristic of several of the cases cited in the majority opinion. As agent, the county judge made a contract, unobjectionable by reason of the option feature, or otherwise, with the purchasers, which in itself could not be challenged upon the ground of public policy on the violation of a legal inhibition. The trouble in that case was in its contract with the county judge, and in delegating their authority to him the commissioners' court acted, as stated by the Court of Civil Appeals, ultra vires. An ultra vires contract is not wholly void. Railway v. Gentry, 69 Tex. 6258 S.W. 102. In the instant case the contract with the purchaser himself is not only ultra vires, but in my opinion is wholly void upon the ground above stated. The distinction between that case and this is clearly defined in the language of Judge Neil as follows:

"If there is legal authority for the contract, though it be illegal because of some irregularity or informality in the manner or time of its execution, and therefore incapable of enforcement, it may be ratified by an acceptance of the benefits of the contract by the corporation; but, if there be no legal authority for the contract, that authority cannot be created through the application of any doctrine or principle of estoppel, acquiescence, or ratification." 57 Tex. Civ. App. 175, 122 S.W. 296, column 2.

King County v. Martin, 173 S.W. 960, cited with others by the majority, was a suit to set aside the sale of the county school lands because of the alleged fraud of the purchaser. It appears that the county received full value for the property, and the court said, because the commissioners had the power to make the sale at that price, and because fraud did not ipso facto invalidate it, the county could ratify it. In the instant case the granting of the option is ipso facto void, or, as stated by Neil, there is no legal authority for such a contract, and the commissioners' court had no authority to make it or to consummate a sale growing out of it, because the tendency of an option is to result in a sale for less than the value of the land at the time of the election by the optionee. It would needlessly prolong this opinion to review all the cases cited to sustain the view of the majority upon the issues of ratification and estoppel, but a careful review of them convinces me that in those cases where the doctrines are applied the ratification has been of contracts voidable as contradistinguished from void and of acts informal and ultra vires rather than contrary to statutory provision, Constitution of the state and public policy. I have no quarrel with the holding in City of Corpus Christi v. Central Wharf Co.,8 Tex. Civ. App. 94, 27 S.W. 803, or in Bond v. Terrell Cotton Woolen, etc., Co.,82 Tex. 309, 18 S.W. 691, and that line of cases, to the effect that parties who have enjoyed the benefits of ultra vires contracts with municipalities are estopped to set up the illegality of such contracts in suits to recover the amounts due under them. But, in my judgment, the rule does not work conversely to this, as above shown. All of these cases are conclusive authority in controversies between individuals. But, this being a case involving trust property, in which the public, as beneficiary, is primarily interested, I cannot assent to the application of the rules to the issues presented.

I therefore dissent.