Destructor Co. v. City of Atlanta

232 F. 746, 1916 U.S. Dist. LEXIS 1690
CourtDistrict Court, N.D. Georgia
DecidedApril 20, 1916
DocketNo. 53
StatusPublished
Cited by1 cases

This text of 232 F. 746 (Destructor Co. v. City of Atlanta) is published on Counsel Stack Legal Research, covering District Court, N.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Destructor Co. v. City of Atlanta, 232 F. 746, 1916 U.S. Dist. LEXIS 1690 (N.D. Ga. 1916).

Opinion

NEWMAN, District Judge.

On August 19, 1914, the Destructor Company filed its bill in equity against the city of Atlanta. The allegations of the bill are shown substantially in the opinion filed by tins court on October 15, 1914, which appears in 219 Fed. 996. The. substance of the bill was: That, on July 9, 1913, the Destructor Company made a contract with the city of Atlanta for the erection by the company of a plant for the destruction of the city’s refuse. That about a year before this contract was made the company had made a previous contract with the city providing for the erection by the company of substantially the same plant and an electric generating plant for the utilization of the steam produced. That this contract had been made with a previous city administration, and had been based upon a practice which had been current in the city of Atlanta for many years, under which one city administration, in making contracts for important public works, pledged the moral obligation of the city to fulfill them in part during the succeeding administrations. That a suit was instituted against the city and the Destructor Company, in the superior court of Pulton county, to have this contract declared illegal and invalid. That the superior court held the contract to be legal, and the case was taken to the Supreme Court of the state, which reversed the decision of the lower court, and declared the contract illegal, as being beyond the power of the city government. When this decision was announced, the Destructor Company had done a large part of the work of erecting the plant under the first contract, and on the city’s land, relying in good faith on the advice of counsel of both the city and the company that the contract was legal and that the city would fulfill the moral obligation to perform it, and had expended large sums in such performance, but had received no> payments from the city. That in this situation the present contract was made." It differed from the previous contract mainly in cutting out the electric generating plant, and thus making no provision for the utilization of the surplus steam produced in the operation of the plant, reducing the contract price, which was $274,759, plus about $8,000 for extras allowed for excavation and foundation, by over $22,000, to the sum of $260,000, and providing that this reduced price be paid, $125,000 cash upon the execution of the new contract, and the balance of $135,000 when the plant was completed and proved by tests as prescribed in the specifications to meet all requirements. That the $125,000 was paid by the city to the company under the present contract. That upon signing the contract the company entered upon the work of completing the plant, and in accordance with the terms of the contract it was completed and ready for useful operation by August 15, 1913, and the company notified the city that the plant was ready. That the city, a few days later, began regular delivery of refuse at the plant, and the company has been [754]*754operating the plant ever since, and has kept it in continuous operation, and destroyed all of the city’s refuse that has been brought to the plant, with a few unimportant exceptions.

It is alleged that the contract contains certain guaranties of performance in the matter of capacity, steam production, etc., and provides that the fulfillment of these guaranties shall be determined by tests of 24 hours’ duration, with a refuse mixture of certain specified proportions. The contract provides.that the first test shall be made at a time fixed by the company, and' the second at a time to' be agreed upon between the city and the company, within six months after the plant was ready for useful operation. Reference is then made to certain clauses of the contract, which relate to the right of the company to make changes in the incinerator if by doing so it may be made to satisfactorily fulfill the requirements of the guaranty, and with reference to the character of the work that it must be done to the satisfaction of the city, and it is then alleged that the company, on finding the actual conditions were different from those represented by the city and specified in the contract, and to meet which the plant had been designed, did not lie back and claim that it was only required to burn refuse in the proportions specified, but that it, in substance, did try to meet actual conditions.

It is alleged that at the time the bill was filed it had fulfilled its contract, .and that on August 8, 1914, the plant had fulfilled all guaranties and requirements of the contract, but the city still refused to pay the balance due. Certain applications for tests made by the company to the city are then referred to, and after certain failures to have a test it is alleged: That on March 14, 1914, a test was run. That on this test the crematory satisfactorily destroyed all the refuse, but fell 10 per cent, short in the amount destroyed in 24 hours; that is, the contract provided for; the destruction of 250 tons in 24 hours, and the plant destroyed 225 tons. That the company then, as allowed by the contract, made certain changes to meet the full requirements' of the contract, although it had great difficulty in making such changes and keeping the plant in operation. Reference is then made to a test attempted to be made on August 8, 1914, as to which, while the refuse furnished was not what it should have been, tire report of Gabriel R. Solomon, an unbiased engineer who ran the test, showed compliance with all guaranties and requirements of the contract.

In an amendment to this bill it is alleged that on the date the bill was filed the company had fulfilled its contract with the city of Atlanta and that on the test of the crematory plant held on August 8, 1914, the plant complied with the guaranties and requirements of the contract. The substance of the allegation is that, while on March 14, 1914, the plant lacked 10 per cent, of destroying the amount of refuse required by the contract, the changes thereafter made brought the plant up to the required capacity. It is then alleged that, the plant having been completed in accordance with the contract, the company asks for a test.

The prayers of the bill are for an injunction restraining the city from talcing possession of the plant until they have paid the amount due under the contract; for a receiver to take charge of the plant, and op[755]*755erate it; that the receiver be instructed to afford the company every reasonable opportunity to install at its own expense such improvements as it may deem necessary to increase the efficiency of the plant; that the plaintiff’s interest in or lien upon the plant be declared, protected, and enforced by foreclosure of the lien or otherwise;, that the court may determine the amount due the plaintiff for building the plant, and decide by running a test whether plaintiff has complied with its contract, and, if not, give it reasonable opportunity to make such improvements and run such further tests as shall show that the plant complies with all the guaranties of the contract and that the contract be specifically enforced in this respect; that the provisions of the contract for the settlement of all disputes by arbitration be enforced by the running of a fair test by arbitrators under the court’s supervision; that an accounting be had as to the amount due the company from the city for the building and operation of the plant and the extra expenditures caused the company, for which the city is responsible; that the final amount due from the city having been determined, and the amount realized by the foreclosure of the company’s lien having been applied thereon, a judgment for the deficiency be given against the city.

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Cite This Page — Counsel Stack

Bluebook (online)
232 F. 746, 1916 U.S. Dist. LEXIS 1690, Counsel Stack Legal Research, https://law.counselstack.com/opinion/destructor-co-v-city-of-atlanta-gand-1916.