Opinion
Argued October 25, 1888
Decided November 27, 1888
Wallace Macfarlane for appellant.
D.J. Dean for respondent.
The doctrine established in Matter of Anderson ( 109 N.Y. 554) does not control the present case. The controversy there was between the city, seeking to enforce an assessment, and the land-owner resisting. The latter succeeded upon the mixed ground of corporate negligence and fraud in the letting of the contract. It appeared that no effort of any kind had been made on behalf of the city to ascertain the extent of the work; and, beyond the computation of areas, the amounts of earth and rock to be severally excavated were fixed by a mere guess, without effort of any kind to obey the statutory requirement that the quantities should be ascertained as nearly as possible. Coupled with this total neglect on the part of the city was an unbalanced bid, and the two facts together, considered in the light of the result, justified an inference of fraud and collusion between contractor and surveyor which made a case of substantial error.
But here the question is between the city and its own contractor, and without any allegation or proof of a fraudulent collusion between the latter and the corporate agents or officials. On the contrary, the error in the estimates is explicitly alleged to have arisen from "the inadvertence, ignorance, carelessness or error of the surveyor," and is not charged to have been a fraudulent act on his part, or the result of collusion with the contractor. The surveyor testifies that he made his estimate from the surface indications, and as correctly as he could; that what he supposed to be rock turned out to be boulders; and that the formation in the locality of the work is so irregular as to make any estimate in advance unreliable. It does not appear that the contractor influenced that estimate, or knew anything about it when it was made; and the only allegation as to him is that he knew the estimate to be erroneous, and, relying on his own judgment, made an unbalanced bid which gave him the contract as the lowest bidder, while the result of the work showed that he was not such. That state of facts fails to establish a fraud; for, the innocence of the surveyor being conceded, and the absence of any collusion between him and the contractor — which in the Anderson case was a possible and reasonable inference — the charge of fraud rests only on the fact that the contractor had a more accurate knowledge of quantities than the surveyor, and "in bad faith" made his bid. Calling names does not alter facts. The contractor had a right to the benefit of his own knowledge honestly acquired, so long as he did nothing to mislead or deceive the city, and there was no bad faith either in the acquisition of his knowledge, or the use of it in guiding his bid. On the contrary, the terms of the contract warned him that the estimates might not be correct, and left him to judge in that respect and at his own peril in making his bid.
Dismissing, therefore, any defense founded on fraud, or dependent upon the total absence of an effort to ascertain quantities as near as possible, the contention remaining is that the plaintiff was not, in fact, the lowest bidder as demonstrated by the results. The doctrine involved in that theory is that the city, having through its surveyor made an estimate founded upon a surface examination of the locality, and being contented with it, may invite bids upon that basis for the actual work to be done, award the contract to one who is the lowest bidder tested by the proposals, hold him to the contract and require of him its performance, and when it has been completed, annul it because the actual so varys from the estimated result as to make his bid, in fact, higher than others which had seemed to be above his own. We cannot approve that doctrine. Its injustice is very great. Under the law the bids are to be made and the contracts awarded upon estimates of the work to be done, and he who is the lowest bidder upon those estimates is the lowest bidder under the law, and does not lose his right because the estimates are erroneous. He may lose it through fraud, but if guilty of none, the city cannot urge against him its own ignorance or error. The landowner resisting an assessment might justly complain of the city's neglect or carelessness, but the latter cannot plead its own fault when it has complied with the laws requiring estimates to be made, or declare the contract illegal which it made with full knowledge of the facts.
I think the rule is stated fully in accordance with this view in the Anderson case. It is there said, in substance, that where the quantities advertised are mere random guesses, without any basis whatever to rest upon, the statute requirement is in no sense obeyed; but "the case would be different if a bona fide effort had been made to comply with the ordinance, and there had been a mistake or error as to the quantities of different kinds of materials to be excavated." The rule thus stated does not make the validity of the contract depend upon the result of the work. It does require an effort in good faith to ascertain the quantities. That effort in this case was made. Not its good faith but only its accuracy is assailed. The statute and the ordinance are silent as to the precise mode of arriving at the estimate. Neither require borings to be made or other expensive tests, although in many cases they might be wise precautions. It is enough if the proper officer charged with performance of the duty executes it honestly, makes such examination as in the specified locality he, in good faith, deems sufficient for the purpose, and frames the proposals accordingly. The validity of the contract does not depend upon his accuracy, but upon an honest effort to be accurate.
For these reasons the judgment should be reversed, and a new trial granted, costs to abide the event.
All concur, RUGER, Ch. J., and GRAY, J., in result.
Judgment reversed.