St. Mary's Wholesale Fruit & Vegetable Market Co. v. City of New Orleans

47 La. Ann. 205

• Court: Supreme Court of Louisiana
• Decided: July 1, 1895
• Docket: No. 11,618
• Status: Published

Opinion

The opinion of the court was delivered by

Nicholls, O. J.

During the progress of the trial defendant offered testimony to prove the allegations of the answer that not a single specification, not a single condition under which the contract was granted to the Market Company, was ever t arried out. by the plaintiff; and further, in order to show that the conditions under which the franchise was granted had never been carried out, that it had never attempted, and never did carry out any of the terms, conditions and specifications contained in the contract between the city and plaintiff in so far as the constructing and the buildiDg of the market, or the extension of the market, in order to show that the conditions under which the franchise was granted had never been carried out.

Plaintiff objected to this testimony on the ground that the sole question before the court was one of power of the city to pass an ordinance declaring a contract entered into with another party forfeited.

The court sustained the objection, ruling that the testimony was irrelevant, stating that if the city had the power to deal absolutely with the market, then it was the sole judge of the reasons why it should exercise that power here, and that if it had not the power then the question would be irrelevant under the general rule of 'law invoked by plaintiff’s counsel — that a party to a contract has no right absolutely to terminate it, but would only have the right to-sue for its forfeiture. To this ruling of the court defendant excepted.

In his reasons for judgment the District Judge declared that,, plaintiff having discontinued the demand for damages, there was no other relief sought than that the city should be forever enjoined from interfering with the plaintiff’s business in St. Mary’s Market— the interference alleged being that the city had declared the contract forfeited, and under this declaration was threatening with arrest and prosecution persons who resort to said market to trade with the plaintiff. That the ordinance declaring the lease forfeited and at end, whether wrongful or not, was an accomplished iact, and it could not be the subject of an injunction proceeding. That the ordinance has been passed, and that, if acting under it, the city’ should proceed to arrest, prosecute and sentence persons, the illegality of the ordinance could be pleaded, and on appeal direct to the Supreme Court, from the judgment of the municipal court, the question could be tested. That the ordinance of repeal declares that the plaintiff, as a contractor to erect the building or market extension within a fixed term (as extended), had done nothing in that direction. It recited that it has failed after the extension of the period in which the extension of the building should be completed, and therefore it repealed all the ordinances relative to the construction of the market house, and all the rights and privileges granted thereunder. That the city had the right to contract for the erection of market houses like any other proprietor, and it had the right even after contracting for the erection of a building to end the contract and not have the building erected. That Art. 2765 of the Civil Code provides that “ the proprietor has the right to cancel at pleasure the bargain he has made, even in case the work has already been commenced, by paying the undertaker for the expense and labor already incurred and'such damages as the nature of the case may require.”

That the fact that in the contract there was stipulated a lease, and that a price was paid, did not cause it to lose its character as a distinctive agreement for the construction of a market building. “ It was to be built within a short time. It was to 'be completed at a cost of not less than twenty thousand dollars. The plans and specifications under which it was to be constructed were elaborate, going into all details. To be completed within a short period, it was thereafter to be kept in repairs until delivered to the city.” The judge-declared that these were the obligations of the plaintiff, and they were those of builders and undertakers of works in all essentials. That, although the payment of one thousand dollars and the right to-use the market for twenty-five years were stipulated, it was manifest that the necessity of the public for a market extension was the-inducement on the part of the city. A twenty thousand dollar market extension was to be promptly secured and maintained for twenty-five years; when, therefore, plaintiff failed in the work, as the ordinance recites, Art. 2765, Oivil Oode, justified the revocation of the contract. That the city could not compel plaintiff to specifically perform and compel it to build the market house, if it refused to build it. The District Judge, considering that the contract is, for the great part, one for building a public market; that the one thousand dollars paid was more in the nature of earnest money, and if not this, it was at least inconsiderable in proportion; that the twenty-five years’ oecupanc3r was a franchise to collect the revenues, rather than a contract of lease (Weymouth vs. The City of New Orleans and J. T. Aycock, 40 An. 348), held, that the city had the right,, in the public interest, to declare the contract at an end under Art. 2765, C. C., leaving plaintiff to recover the amount paid and damages; thatithadno right to aperpetual injunction, and that in discontinuing the claim for damages and claiming relief by injunction it has mistaken its remed3'.

Plaintiff contends that the court has misapplied the provisions of Art. 2765 of the Oivil Oode. He maintains that that article applies to eases where the cost and expense of the structure is to fall upon the proprietor, and does not extend' to those where the entire cost and expense is thrown upon the builder. He further insists in this, as he did in the District Oourt, that the only issue before us is that of the power of the city to pass an ordinance declaring a contract with another person forfeited, and in support of his position he calls to our attention Art. 2046 of the Oivil Oode, which declares that “a resolutory condition is implied in all commutative contracts to take effect in case either of the parties do not comply with his engagements ; in this ease the contract is not dissolved of right. The party-complaining of a breach of the contract may either sue for its dissolution with damages, or, if the circumstances of the case permit, demand a specific performance.” He says that in the face of this express declaration that non-compliance by a party with his contract obligations does not, ipsofaoto, dissolve the contract, bnt that the dissolution has to be judicially asked for, the City of New Orleans has undertaken to do what the law declares shall not be done: declare' its contract at an end.

We have carefully considered the argument of counsel as sought to be applied to this case under its pleading and evidence, but we have reached the conclusion that the judgment of the District Court was correct.

In the first place, we find no evidence in the record in support of the allegation that the city had threatened parties who might resort to the market for trading purposes with prosecution and punishment. The only action taken by the city in respect to the subject matter of the market, so far as the record shows, is the repealing of the ordinance under which plaintiff’s rights are claimed. The mere act of passing that ordinance furnishes no ground for an injunction. In the next place, there is nothing presented to us in a shape which would call upon us to pass presently upon the effect of the ordinances.

Had the plaintiff adhered to its claim for damages, we should have had that question squarely before us. As matters stand the only thing we are called upon to adjudicate would be an abstract question as to the right of the Council to pass the ordinance it did. If it did not have that right, the ordinance perse could work no injury and damage.

It by no means follows, however, that because an ordinance of the character complained of, which declares in express terms the breaking up of a contract as the direct and immediate effect of that declaration, might not bring about the result so announced, that therefore the ordinance was, for all purposes, totally unauthorized, illegal, absolutely null, void, and of no effect.

In the contract with Raymond, he undertook to do certain work within a certain fixed time, and consented that he should be held as in default by the fact itself or failure to comply with his obligations without notice of default.

If, in point of fact, at the time the repealing ordinance was passed, Raymond was in default, the ordinance in question, if it had no other effect, would have that of placing beyond a doubt the fact of that default, and the fact that the city stood rigidly upon its contract rights. There could be no question of waiver or acquiescence after the passage of that ordinance, and the Council had the undoubted right to pass it for that purpose, and to claim the benefit of the legal consequences, be they what they might, legally flowing from the ordinance, if greater and broader consequences were claimed in the ordinance as to follow than would really follow, the maxim utile per inutile non vitiatur would apply. The ordinance would stand for what it was really worth.

Now if we examine into the dealings between these parties and the city the correctness of the conclusion reached by the District Judge that Raymond occupied under the ordinances and contract a dual position, that of contractor and that of lessee (if such he may • be styled), is apparent. Not only this. It appears that the object upon which the agreement of the city and Raymond was to operate under the so-called contract of lease was not “the one-half of the St. Mary’s Market nearest the Mississippi river,” but the u market as altered and extended,” and that at the time of the contract this precise thing was not yet in existence, but was stipulated by Raymond to be by him brought into existence as an entirety within a fixed time, and when so brought his rights should attach to it as a whole for twenty-five years from the date of the contract. If this was the contract between the parties, and Raymond failed to comply with his obligation to make the alteration and extension at the time fixed, and the city by ordinance (notified to him) announced that it held the contract at an end by reason of that fact, the legal effect of its so doing would be to withdraw from under the contract the power of subsequently building the house. Therefore “ the market and its extension,” which was to be the object of the lease or franchise, was from that time forward to be considered as not susceptible of existence, for if he wasjtjin default at the time of the passage and notification of the ordinance an offer to subsequently comply with his engagement would come too late. Morrison vs. Wimberly, 14 An. 713. It is manifest, as stated by the District Judge, that the main object and purpose of the city was not to obtain a building deliverable to itself without cost at the end of twenty-five years for the purposes of a market, but to extend within nine months to the people of the neighborhood increased market facilities. It would be contrary to the plain purposes of the ordinances and the contract that the erection of the building should be postponed to a period to suit the convenience of Raymond, and that during that period the market facilities should be limited to those afforded by the original building.

If Raymond, by his course, has cut off the possibility of his building the extension in the future, he certainly could not expect to be allowed to continue the collection of dues during twenty -five years from the market in its present condition. That was not the contract of the city. Now whether we deal with the situation from the standpoint taken by the District Judge, that the contract between the parties was brought at once and directly to an end by the city, through the ordinance by the city, under the exercise of a reserved right of canceling the bargain granted by Art. 2765, or from that of considering that the contract by reason of the laches and default of one of the contracting parties has become impossible of execution in view of the non-existence of the object on which it was intended to operate, in either event the plaintiff is not entitled to the relief by injunction which he asks. The petition nowhere negatives the recitals of the repealing ordinance; nowhere claims that the contract has been complied with, and nowhere assigns the existence of any legal valid reason for non-compliance.

Virtually conceding that it is in default, its whole claim seems to be that, notwithstanding that fact, it should be entitled to collect the revenues from the market as it is, during a litigation which it seeks to force and doubtless to prolong. Under' the condition of the case as it reaches us, with its pleadings and the evidence actually introduced, we do not think the testimony offered by the defendant and excluded important. We think, however, it should have been properly admitted, leaving its effect to be determined.

Judgment affirmed.