Opinion
September, 1915.
Lee Dowling, for plaintiff.
August Merrill, for defendants.
The plaintiff, a citizen, a resident, and a taxpayer in the city of Utica, seeks to restrain the defendants as commissioners of common schools in said city from entering into any contract for installing in what is known as the Academy building or in Kernan school a unit or Monarch system of ventilation, or from entering into any contract whatever regarding the heating or ventilating of said building, or from awarding any contract under the notices set forth in the complaint.
A taxpayer's action to restrain waste or injury to the property or funds of a municipality, or to prevent any illegal official act on the part of the officers of such municipality, will, in a proper case, lie under the provisions of section 1925 of the Code of Civil Procedure, or section 51 of the General Municipal Law. The provisions of section 51 of the General Municipal Law are, as it seems to me, somewhat broader in their scope, and provide somewhat more specifically for an action to prevent illegal official acts, and, in a proper case, restitution; but the principles governing an action brought under either of the aforesaid provisions are substantially the same, and the complaint in this case is broad and specific enough to be framed under either provision.
The right of a taxpayer to maintain an action to prevent waste of or injury to the estate, funds or other property of a county, town, city or village, or to prevent an illegal official act, was passed upon by the Court of Appeals in 1891 in the case of Talcott v. City of Buffalo, 125 N.Y. 280. This, in brief, was an action by a taxpayer of that city to restrain the governing authorities from substituting electric lights for gas in one of its streets. It was alleged in substance that the street was already suitably lighted; that an actual majority of the taxpayers thereon did not desire a change; that the common council had entered into a contract with an electric light company to make the substitution; that the price charged by said company was exorbitant; and that the expense of lighting the street would be greatly increased. A demurrer overruled the order and judgment of the general and special terms and sustained the demurrer. Mr. Judge O'Brien, in writing the opinion for the court, on page 286, uses the following language: "The terms `waste' and `injury' used in this statute (referring to chapter 161, Laws of 1872, afterwards incorporated in section 1925 of the Code of Civil Procedure) comprehend only illegal, wrongful or dishonest official acts, and were not intended to subject the official action of boards, officers or municipal bodies acting within the limits of their jurisdiction and discretion, but which some taxpayer might conceive to be unwise, improvident or based on errors of judgment, to the supervision of the judicial tribunals. It is believed that no action was ever maintained under this statute with the sanction of this court, without some proof or allegation that the official act or proceeding complained of was without power or was tainted by corruption or fraud."
The learned judge says further, on page 288: "Full force and effect can be given to the statute by confining it to a case where the acts complained of are without power, or where corruption, fraud or bad faith, amounting to fraud, is charged. Any other construction would subject the discretionary action of all local officers and municipal bodies to review by the courts at the suit of the taxpayers, a result which would burden the courts with litigation, without increasing the efficiency of local administration."
While the words "without power" apply to illegal contracts, such as an agreement to pay public money to a monopoly, I do not understand that the courts have extended the scope of this action in an attempt to review the discretionary power of an official board or body or officer. As stated by the late Justice George W. Kennedy in an unreported case ( Smith v. City of Syracuse), in which a taxpayer brought an action to restrain the purchase of a lot upon which to erect a school-house, and it was claimed by the plaintiff that the price proposed to be paid was exorbitant, in deciding the application for an injunction: "It is only when the undisputed evidence shows that the common council or other officers of a city threaten to squander its money or means, that the court is justified in interfering with their official action. While I may think it unwise for the city to make this purchase and pay the price proposed, others equally well qualified may entertain an opposite view. The law has vested the right to determine the wisdom of the measure in the board of education and the common council, and so long as they act fairly and in good faith, it would be an act of judicial assumption for a court to interfere and attempt to correct an error in judgment by either. The motion to continue the temporary injunction is denied and the same is vacated with $10 costs to the defendants."
In the case of Ziegler v. Chapin, 126 N.Y. 342, on page 348, Mr. Judge Finch, speaking for the court, says: "We have quite recently declined (referring to the Talcott case) to become arbitrators between taxpayers and their municipal officers in every instance of disagreeing opinions or conflicting judgments, and have decided that, jurisdiction in officials existing, the courts can interfere in actions like that before us only where some fraud or collusion or bad faith is alleged and proved."
In Dunning v. County of Orange, 139 A.D. 249, the opinion of the court on page 251 contains the following: "There is neither allegation nor proof of any fraud or corruption in connection with the making of said contract or the official proceedings prior thereto It is, therefore, incumbent upon the plaintiff, if he would succeed, to establish that it is the result of illegal official acts. Unless he establishes this, it matters not how unwise or extravagant the contract appears, the court may not interfere."
Although the statutes in question have been under consideration in all the courts of this state, I understand that the authority of the Talcott case remains unimpaired, and, as there are no allegations of corruption or affirmative fraud, the plaintiff, to succeed, must show either that there is no statutory authority for the commissioners to make the contracts in question, or that, if such authority exists, that the proposed contracts are illegal, and that the commissioners have acted in bad faith amounting to fraud. These claims will now be considered.
Have the defendants the authority to make the contracts in question? It is claimed by the plaintiff that such authority must be found in the acts creating the charter of the cities of the second class (Laws of 1898, chapter 182, as amended) and also in the provisions of chapter 560, Laws of 1902, being an act relative to public instruction in cities of the second class. Without going into a detailed statement of the provisions of the acts last referred to, I simply state that if these acts are applicable there can be no doubt that the power to let the contracts in question rests with the board of contract and supply and not with the defendants.
The several acts creating a charter for cities of the second class contain the usual provision that all statutes inconsistent with the provisions of these acts are repealed. I may state in passing the well known principle that repeal of a law by implication is not favored. Section 120 of the Second Class Cities Law (Laws of 1909, chap. 55), which creates a board of contract and supply and defines the duties of the members thereof, contains the following provision: "Except as otherwise provided by law." It seems to me that there is nothing inconsistent in the provision of chapter 137, Laws of 1842 (hereafter specifically referred to), entitled an act in relation to the common schools in the city of Utica, and which provides for the election of six commissioners of common schools and defines their duties, with the provisions creating a charter of second class cities.
It is to be noted in this connection, while not controlling, that chapter 182, Laws of 1898, entitled an act for the government of cities of the second class, was amended by chapter 560, Laws of 1902, and that said amendment relative to the department of public instruction in cities of the second class was not re-enacted in the charters passed in 1908 and in 1909, although expressly referred to therein that nothing should affect the validity of the provisions of said chapter 560; or, to state it in another way, the revisers of the charter of cities of the second class deemed it wise to separate the provisions relative to public instruction from the body of the charter itself.
Chapter 137, Laws of 1842, to which reference has been made, provides in detail the various powers and duties of the commissioners of common schools in the city of Utica. By the provisions of section 13 of said act, it is provided:
"2. To purchase or hire school houses, and rooms and lots or sites for school houses, and to fence and improve them as they deem proper.
"3. Upon such lots or sites, and upon any sites now owned by said city, to build, enlarge, alter, improve and repair school houses, out houses and appurtenances as they may deem advisable."
Other provisions relate to their powers relative to their employing and paying teachers, custody of school-houses, and so on. This act has been, from time to time, amended, but the general trend of said amendments has been to enlarge rather than to restrict the powers of said board. The last amendment to said act was in 1909, chapter 85, providing in substance that said board should prepare an annual estimate of the money to pay the salaries of teachers, etc., and present the same to the board of estimate and apportionment, which said board shall include the same in its annual estimate of revenues and expenses.
Returning for a moment to a consideration of the provisions of chapter 560, Laws of 1902, relative to a department of public instruction in cities of the second class, it is provided by the terms of said act that there shall be a board of education composed of three members appointed by the mayor, and prescribes the duties of such board of education. Upon the argument in this case, the learned counsel for the plaintiff admitted that the defendants, commissioners of common schools of the city of Utica, had the general power of the management of the schools of said city, that is, the power to hire and discharge teachers and provide the course of instruction, and so on, but contended that the power given them by the act of 1842 to build and repair school-houses no longer existed. I do not agree with the position of the learned counsel in this regard. It would seem that the direction of the general plan of instruction and education of the young of a city is as important as the occasional construction of a school-house, and it seems to me there is no stronger reason for retaining the board of common school commissioners for one purpose than for another. If the act of 1842 is repealed by implication, such repeal eliminates the board itself and is not confined to any of the specific provisions which define its duties.
This matter has, however, as I understand it, been passed on by a special term in this judicial district, in the case of People ex rel. Irish v. Cantwell, an application for a peremptory writ of mandamus to compel the defendant to make and transmit to the county clerk of the county of Oneida a notice that four commissioners of the common schools of the city of Utica are to be voted for at the coming election, it being alleged that in the notice he had served he had failed to certify and give notice that there were commissioners to be elected. The then corporation counsel, William Townsend, presented in opposition thereto his affidavit in which he stated that chapter 560, Laws of 1902, was still in full force, and provides a complete system for the department of instruction in cities of the second class, and that after the 1st day of January, 1908, deponent verily believes the public schools of the city will be administered under and pursuant to chapter 560 of the Laws of 1902. Thereupon Justice William S. Andrews granted the prayer for a peremptory writ of mandamus, and the four commissioners referred to in the moving papers were subsequently elected, and, as appears by the moving papers herein, said board of commissioners of common schools, and their successors, have continued to perform the duties prescribed by law, so that in the absence of a reversal of said decision, or an explanation of its being inadvertently made, it would seem to be, in the absence of strong reasons to the contrary, controlling.
But, before leaving the subject, I call attention to the fact that thereafter and by chapter 244, Laws of 1908, the common council of the city of Utica was authorized to issue bonds upon the credit of the city to be denominated school buildings repair funds, and provided that said money should be used by the commissioners of common schools in equipping, remodeling and repairing school buildings of the city so as to safe guard the pupils, and to facilitate their escape in case of fire. I also refer to chapter 85, Laws of 1909, to which reference has heretofore been made, for the purpose of showing that the existence and the authority and power of the defendants as commissioners of the common schools of the city of Utica have continued to be recognized. In other words, a "practical construction" of the application of chapter 137, Laws of 1842, and the acts amendatory thereto. Meriam v. Harsen, 2 Barb. Ch. 232, 269, 270.
The plaintiff claims that the unit or Monarch system of ventilation is not the best plan of ventilation, and he submits the result of experiments tending to show that under such system now in existence in other schools in the city of Utica the amount of fresh air supplied to each pupil is from thirty-two per cent to forty-four per cent less than that which is required by the Education Law of the state of New York, and that in other respects relative to fire risks the system is not the best. It also is charged by the plaintiff that the cost of installing said unit or Monarch system, as compared with the Standard system of ventilation, will be in excess thereof to an amount of about $20,000, and then he proceeds to state the advantages of the Standard system of ventilation, in which he is presumably interested.
On the other hand, the defendants claim that distinguished experts have tested the heating and ventilating of the Monarch system now in operation in Utica, and that the result of such tests was uniformly approved by the department of education. Such conflicting claims are not unusual between rival concerns seeking to place their wares on the market, and so far as these rival claims of merit or demerit are concerned, for the reasons heretofore stated, this court is not going to substitute its judgment for that of the board of school commissioners. These issues being controverted, they should be submitted to the test of actual trial, and not determined upon affidavits. Maloney v. Katzenstein, 135 A.D. 224; Western N.Y.W. Co. v. Laughlin, 82 Misc. 496, to the effect that: "Injunctions pendente lite, which in effect determine a litigation, and give the same relief sought to be obtained by the judgment, should be granted with great caution and only where necessity requires."
The plaintiff claims that the defendants will require each bidder for the ventilation of said buildings to use only material obtained from the Monarch Ventilator Company or a like concern, thereby preventing open and competitive bidding and creating a monopoly, which restriction is illegal, and that no one except the Monarch Ventilator Company could enter bids under the notices referred to in the complaint, because it is impossible to tell what kind of material or what will be required for the purposes of such installation, and it will be impossible to procure such material in the open market, thereby destroying competition and creating a monopoly.
The specifications for the material and workmanship required to install a Monarch system of heating and ventilating in the academy building define the system of heating that is to be installed, and contain some twenty-five separate provisions as to what is to be furnished. The first specification to which this reference is made, simply by way of illustration, provides that the owner shall furnish the necessary heating boilers. The only specifications which in terms refer to the Monarch Ventilator Company relate to "boiler breaching" and "pressure regulators," and possibly to "automatic control." A reference to the last specification is enlightening. It provides in terms as follows: "This contractor shall install the diaphragm temperature control valves which will be furnished by another contractor." To be more precise, there is no inhibition, except as above stated, to the contractor from purchasing the materials in open market from anybody, and there is nothing, so far as I can understand, in the specifications indicating that the materials are patented or of unusual make or difficult to procure. Here is the distinction between this situation and the case of the contract of the city of Syracuse for the installation of the Gamewell fire and telegraph system. Grace v. Forbes, 64 Misc. 130. As pointed out in the very able opinion of Justice William S. Andrews, in that case, the specifications provided that the sealed proposals should be received by the board of contract and supply for manufacture, delivery and installation of relay boards, switchboards, recording and transmitting and other apparatus comprising a complete fire alarm telegraph central office equipment necessary for the operation of the fire alarm telegraph system of the city of Syracuse. Then followed a statement of what the equipment, material and work should consist of, and it seemed to have been taken, as stated by the learned justice, from specifications of patents taken upon their apparatus by the Gamewell company, and still valid and in force.
It was found by the learned justice that it was practically impossible for any one else to furnish the material called for by the specifications. But suppose that some of these articles purchased from the Monarch Ventilator Company were illegally purchased, I see no objection, notwithstanding that fact, in the defendants making a legal contract to the lowest bidder to install such materials. Suppose that in the Grace case, the city of Syracuse had purchased from the Gamewell people the material necessary for the construction of the fire alarm system, or that portion of it which would necessarily have to be furnished by that company, while such purchase might be illegal and would be subject to a restraining order or an action against the officials, I take it that there would be no legal objection in letting a contract to the lowest bidder for its installation.
The situation in regard to the Kernan school is somewhat unusual, and can best be indicated by a brief extract from the pleadings. The complaint contains the following: "That as plaintiff is informed and believes under the specifications and plans for the heating and ventilating of the Kernan School the requirement is made that the ventilation shall be based upon the unit system, which is in other terms the Monarch system of ventilation; that each bidder must supply his own specifications and plans for the said system."
The answer contains the following: "That the plans and specifications for heating and ventilating the Kernan School were prepared by the architect retained by the defendants, and were general plans and specifications, which provided that each bidder should submit in detail a lay-out of his proposed system of heating and ventilating, which, however, was required to be of the unit type."
The specifications of the Kernan school consist of some nine pages of typewritten matter, and, so far as I can understand, the only reference to a ventilating system is the following: "The system of heating is to be that known as the multiple unit system. A unit or units is to be placed in each room to be heated and ventilated, consisting of a motor fan or fans, a radiator and means for moistening the air expelled from the unit, radiators to be provided with strong and proper steam and air valves of approved make, and proper provision to be made for controlling the heat and air.
"Direct radiators are also to be placed in the rooms for reinforcing the rooms supplied with the units and in other rooms where units are not called for. Direct radiators for all class rooms to be of the kind known as the wall type."
In other words, I assume the correctness of the statement in the answer to which reference has been made, "that each bidder should submit in detail a lay-out of his proposed system of heating and ventilating." These specifications are subject to the criticism made by Mr. Justice William S. Andrews in the case of Grace v. Forbes, 64 Misc. 138: "Involved in the whole scheme provided by the statute is the rule that the proposals called for are proposals for furnishing certain specific materials and doing certain specific labor in accordance with the specifications which have been prepared. In other words, the board of contract and supply must decide what work it wishes done and how it wishes it done before it calls for bids.
"If this is to be anything more than a farce, if competition is what is desired, if a comparison of bids is to be made, all the bids must be for the same thing. If `A' offers to lay a floor with pine, `B' with oak and `C' with chestnut, there is no basis laid for a proper decision as to the lowest bid. In other words, the spirit of the statute requires that the plan of the work to be done be adopted before proposals are invited to the end that all bids may be for the same thing, and that nothing may remain to be determined by the board but the question as to which figures are the lowest. The statute implies a common standard by which bidders are to be measured. It implies plans previously adopted, which are to be open to all. It implies a chance to bid for a contract which is to be adopted; not that a contract may be adopted, after bids are in and in view of them."
While the above decision was addressed particularly to a case arising under section 120 of the Second Class Cities Law, which provides that: "Specifications for the performance of any work and for the supply of any materials shall be prepared and set forth with sufficient detail to inform all persons proposing to bid therefor of the nature of the work to be done and of the materials to be supplied, and written or printed copies thereof shall be delivered to all applicants therefor," the principle is applicable to the facts in this case; unless there is a common standard by which bidders are measured, there is no competition.
The City of Utica is a proper but not a necessary party. Wenk v. City of New York, 171 N.Y. 607, 615; Steele v. Village of Glen Park, 193 id. 341, 349; Hicks v. Cooks, 167 A.D. 862. The cases cited by the learned counsel for the defendants are distinguishable.
The injunction, so far as it relates to the academy building, is dissolved, and so far as it affects the Kernan school it is modified so as to prevent the letting of a contract for ventilating under the present notice and specifications, but not to prevent a readvertising for bids under plans and specifications which correct the errors hereinbefore set forth.
Ordered accordingly.