Kansas City v. O'Connor

82 Mo. App. 655, 1900 Mo. App. LEXIS 295
CourtMissouri Court of Appeals
DecidedFebruary 5, 1900
StatusPublished
Cited by12 cases

This text of 82 Mo. App. 655 (Kansas City v. O'Connor) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kansas City v. O'Connor, 82 Mo. App. 655, 1900 Mo. App. LEXIS 295 (Mo. Ct. App. 1900).

Opinions

ELLISON, J".

The defendant O’Connor is a contractor who paved a street in Kansas City under an ordinance thereof. This action is on the bond given by O’Connor as principal and the other defendants as sureties for the faithful performance of the contract, wherein it was alleged to have been a part of the contract that O’Connor was to keep the street in rep'air [660]*660for á certain period which he failed to do. The action is for a breach of the contract. A demurrer to the petition was sustained in the trial court on the ground that it did not state a cause of action. The city appealed.

The contract embodied an agreement not only to pave and keep in repair, but also to sprinkle the street in question. The ordinance, the bids, the letting of the contract and the contract itself, all contemplated and provided for the paving, repairing and sprinkling as one work for one entire sum. There was no separation.

That portion of the contract providing for sprinkling the street was ultra vires. It was not within the power of the city to lay a special tax against the abutting property of the citizen for the purpose of paying for sprinkling. A special tax against abutting property is based and sustained on the idea that- the work for which the tax is laid is an improvement of the property, and sprinkling to keep down the dust, while good for the comfort of the inhabitants, is too intangible to be denominated an improvement of the property. Chicago v. Blair, 149 Ill. 310; Ins. Co. v. Prest, 71 Fed. Rep. 817; Pettit v. Duke, 10 Utah, 311.

We therefore have a contract and a bond which provide for doing a work, as an entirety — inseparable—a part of which is illegal and void. Under such condition the whole contract is void. Virden v. City of St. Louis, 131 Mo. 26; Sumner v. Summers, 54 Mo. 340.

But it is argued for the plaintiff that since O’Connor, the contractor, has been paid for the work as provided by the contract, it has become performed by the city and that he (or his sureties standing in his shoes) can not set up ultra vires against the city. The authorities on this phase of the doctrine of ultra vires are not in accord. But in our view the reason of the matter is, that if a contract is void it can not be validated by being partly performed. The limit to the right of a corporation to contract is made by the policy of the law [661]*661and a violation of the law ought not to be made to work out the validity of the contract. Thomas v. Railway, 101 U. S. 85. In that case it was said that a right of action on a contract ultra vires could not be founded on the withdrawal of a party to it. To hold that it could “is, in our opinion, to hold that any act performed in executing a void contract makes all its partis valid, and that the more that is done under a contract-forbidden by law, the stronger is the claim to its enforcement by the courts.” The same conclusion is announced in Railway v. Railway, 130 U. S. 22, 38; Railway v. St. Louis R’y Co., 118 U. S. 316-318; Transportation Co. v. Car Co., 139 U.S. 54; Compress v. Planters’ Press., 70 Miss. 669; Marble Co. v. Harvey, 92 Tenn. 115; Trust Co. v. Miller, 33 N. J. Eq. 155; Black v. Delaware, 24 N. J. Eq. 455. In Trust Co. v. Miller, 33 N. J. Eq. 162, it is said that: “The supreme court of the United States has recently declared, following a judgment of the house of lords, in which the present Lord Chancellor (Sebome) and the late Lord Chancellor (Cairns), and Lords Chelmsford, Hatherly and O’Hagan concurred, that the broad doctrine is now established that a contract, not within the scope of the powers conferred on a corporation, can not be made valid by (the consent of every one of the shareholders, nor can it, by any partial performance, become the foundation of a right of action. Thomas v. Railroad, 101 U. S. 71. While it must be -admitted that this doctrine has not received the sanction of every eminent judge who has been called upon to enforce it, yet I think it is now vouched for by such august authority, and is so manifestly supported by sound reason and the highest considerations of policy, that it must hereafter be accepted, universally, as expressing the true rule of judgment in such cases.” The view expressed in the foregoing cases is adopted as á correct statement of the law in Reese on Ultra Vires, sec. 72.

Contracts ultra vires can not be likened to contracts within the statute of frauds where part performance ousts the [662]*662application of the statute. Eor the former are prohibited from being made and the corporation can not make them. A thing void can not be made valid by relation. While the latter are not prohibited from being made but 'are only prohibited from being enforced and they are not void, they are simply unenforcible. McGowen v. West, 7 Mo. 569; Alexander v. Merry, 9 Mo. 514; Farrar v. Patton, 20 Mo. 81; Ivory v. Murphy, 36 Mo. 534; Browning v. Walbrun, 45 Mo. 477; Aultman v. Booth, 95 Mo. 383; Minns, v. Morse, 15 Ohio, 568; Child v. Pearl, 43 Vt. 230. The language of the statute of frauds is that “no action shall be brought to charge,” etc.. While the language of the law is, that no contract beyond the chartered power can be made.

This is a different case from that where a contract ultra vires had been performed by both sides, the status of the parties become fixed and the whole matter at an end. In such instances courts rarely disturb the condition in which the parties have placed themselves. Neither party could make out his case without showing his own violation of the law. This case is founded on the fact that a part of the contract, to wit, repair, had not been performed and it is for that alleged dereliction that damages are sought. And in order to sustain its case the city proposes to rely upon a contract which was forbidden by law.

But if, as claimed, the city has paid O’Connor for the, work, it must not be understood that it is without remedy. It is without remedy on the contract for that, as we have seen, is void. But it may sue'O’Oonnor on the case it has outside the contract. That is, O’Connor can not keep the consideration and yet refuse to perform the work for which he received the consideration.

“A contract ultra vires being unlawful and void, not because it is in itself immoral, but because the corporation, by the law of its creation, is incapable of making it, the courts, while refusing to maintain any action upon the unlaw[663]*663ful contract, have always striven to do justice between the parties, so far as could be done consistently with adherence to law, by permitting property or money, parted with on the faith of the unlawful contract, to be recovered back, or compensation to be made for it.”

“In such case, however, the action is not maintained upon the unlawful contract, nor according to its terms; but on an implied contract of the defendant to return, or, failing to do that, to make compensation for property or money which it has no right to retain. . To maintain such an action is not to affirm, but to disaffirm, the unlawful contract.” Transp. Co. v. Car Co., 139 U. S. 60.

The plaintiff may recover outside the contract “to the extent of the benefit received by the defendant from the execution of the agreement by the plaintiff.” Compress v. Planters’ Press, 70 Miss. 669; Gas Light Co. v. United Gas Co., 85 Maine, 541; Reese on Ultra Vires, see. 74, and authorities cited.

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Bluebook (online)
82 Mo. App. 655, 1900 Mo. App. LEXIS 295, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kansas-city-v-oconnor-moctapp-1900.