Fire Extinguisher Manufacturing Co. v. City of Perry

Opinion of the court by Burford, C. J.: The plaintiff in error, the Fire-Extinguisher Manufacturing company, a corporation, brought an action in the district court of Noble county against the city of Perry to recover judgment for certain fire apparatus sold and delivered to said city. The petition embraces four separate causes of action. The first is based upon- a city warrant for the sum of $225, the second on a city warrant for the sum of $375, the third on a city warrant for the sum of $500,and the fourth upon a contract for the purchase of the same property for which the warrants were issued, the contract price agreed upon being $1,100. In this cause of action it is alleged that the property had been delivered and accepted *431 according to the terms oí the contract, and that the city-refused to pay for the same. The city, by amended answer, sets up three defenses. The first defense alleges that the warrants mentioned in the first, second, and third causes of action were issued by the city of Perry in payment for the fire extinguishers,, hooks, ladders, wagons, and other fire apparatus mentioned in the contract in the fourth cause of action; that the property embraced in the contract and for which the warrrants were issued, was-all purchased at one time and by one agreement, and that the contract price for same was $1,100; that said purchase had never been authorized by any vote of the- electors resident of said city; that said property was personal property, and that the value' thereof, as agreed upon by the purchase and sale, was in excess^ of $500; that the mayor and city council had no authority to make said purchase or to issue said warrants; and that said con-, tract was ultra vires. The third defense alleged that the-contract for purchase of said fire apparatus was fraudulent and void, for the reason that the same was made for double the value of the property. The plaintiff in error demurred to these two defenses, and: -the demurrer was overruled, and, declining to plead further, judgment was given for the city. The only error complained of is the ruling on the demurrer to the first and third defenses. It is conceded that if the proviso in section 538, Statutes 1893, is a limitation on the power of the city to contract for fire apparatus, then this contract, and the warrants issued thereon, are void; but it is contended that section 583-specifically confers unlimited powers in the purchase of fire supplies, and that this particular provision is to be- *432 considered in the nature of an exception to the general limitations embraced in section 538. The provision of ■section 538, relating to the matter under discussion, is .as follows: “Provided, however, that no real estate shall be bought or sold, nor shall any personal property, where the value of the personal property, contracted for at one purchase exceeds five hundred dollars, until the purchase or sale be authorized by a majority vote of the electors, resident of the city, or village.” The provision of section .583, which it is claimed creates the exception to the limitation in section 538, is as follows: “The , council may, also, procure fire engines, hooks, ladders, buckets, and other apparatus, and organize ■fire-engine, hook and ladder and bucket companies, and prescribe rules of duty and [for] the government thereof, with such penalties as they deem proper, not exceeding one hundred dollars, and make all necessary appropriations therefor.” The contention of plaintiff in error is that the phrase “and- make all necessary appropriations therefor,” confers upon the council unlimited power to* contract for the necessary supplies and apparatus for extinguishing fires. We cannot approve this contention. The provisions of ■section 538 relate to the power to contract, and are an express and mandatory limitation on such power. The provision® of section 583 relate to the authority to make payment for supplies, and have no reference to the power to contract. The power to contract is one separate ■and distinct from the power to appropriate money, and the latter clause in section 583 relates only to the power to appropriate money. It is contendted that the power to' appropriate money is one that exists without statutory permission: but that is *433 no sufficient answer. The power to contract for fire apparatus or other necessary and incidental supplies also •exists without statutory authority, but both of these powers are subject to legislative control, and may be limited in such manner as the legislature may deem prudent. Section 538 is intended to limit the power of the city council in the purchase of personal property at •one time, to sums of $500 and less, unless such purchase shall be authorized by a majority .vote of the electors resident of the city. If the •council deem it advisable to make a purchase of personal property the value of which is in •excess of $500, it becomes their duty to submit the question as to whether such purchase-shall be made to a vote of the resident voters of the city, and the power to make such purchase can only be exercised when a majority vote of the electors voting on such proposition has authorized the council to make it. There is no conflict between this section and section 583. The latter section authorizes the council to procure fire engines, hooks, ladders, buckets, and other apparatus, and to organize fire companies', etc., and, further, gives the council authority to make all necessary appropriations therefor. The power to contract for articles enumerated in this section is controlled by the limitation in section 538, and the authority to make all necessary appropriations for payment of these articles is limited to all necessary appropriations for which the council is authorized to contract, which may be any sum less than $500 without 'any vote, and may be any sum ever $500 when authorized by a majority vote of the qualified electors. Both sections are part of the same act, and were adopted at the same time, and must be construed together so as *434 to avoid'-any conflict, and make both provisions effective. The interpretation we have given these two sections, has this effect. Counsel for plaintiff in errorr have cited a number of cases defining the rule for interpretation of statutes in certain oases. We find no fault with the rule-contended for, but, according to our view, the cases cited have no application to the question under consideration. There was no error committed in overruling the demurrer t-o the first defense. The facts averred constitute-a complete bar to the action, both on the warrants and on the contract. If the city council purchased $1,100-worth of fire apparatus at one purchase, such contract was void, and they could not render such act valid by dividing the contract price into three parts, each less than $500, and executing warrants therefor. The third defense attempted to set up fraud in the-purchase of the fire apparatus. The only material fact alleged is that the property was not worth the amount-agreed to be paid. A mere allegation of fraud is a conclusion and is not sufficient. The specific facts constituting the fraud must be -averred. It is not -alleged that any representations of value were made to the city, or that the city was ignorant -of the value of such articles at the time the purchase was made, or that the city relied upon, or was deceived in any manner by, the acts or representation's of the plaintiff in error. Fraud, as a defense-to an action on a contract, cannot be pleaded in general terms. The demurrer to this defense should have been sustained, but, as the first defense pleaded was- a complete bar to all the causes of action embraced in the petition, the error oomitted by t'he court in overruling the demurrer to the third defense is not available. There was no prejudicial error committed by the -trial court. The *435 judgment of the district court is affirmed', at the costs of' plaintiff in error. Hainer, J., haying presided in the court below, not sitting; all of the other Justices concurring.