Ness v. Board of Commissioners

Myers, J. On January 23, 1909, the Board of Commissioners of the County of Marshall presented to the county council of said county a petition and estimate for the repair and remodeling of the courthouse of said county. In this petition it was stated, among other things, that the board proposed to prepare a room in the basement of the courthouse for the county surveyor. Acting on this petition, the county council made an appropriation as follows: “That there be appropriated out of the county funds of said county the following sums. * * Por repair of courthouse, including heating apparatus therefor and other necessary repairs, $15,000. * * * Said appropriation of $15,000 is to be used or expended on the courthouse as follows: Repairing or reroofing, remodeling tower with illuminating dial, painting outside and painting and decorating inside, repairing old floors or putting in new ones. ’' On February 10, 1909, the county council made an order specifically authorizing the construction of three'toilet rooms on the second floor, and for rewiring for electric lighting, under the ap [224] propriation of $15,000. On June 5, said council made a further order, specifically authorizing the repair of the windows, under the appropriation of $15,000, provided the whole cost did not exceed the whole amount of the appropriation. Acting on these various appropriations, the board of commissioners on March 1,1909, employed architects, and caused plans and specifications to be prepared for the repairs and changes that were to be made, except for decorating the court room, which plans and specifications were duly filed in the auditor’s office, as required by law. On March 2, 1909, the board of commissioners of said county made an order fixing the date when the plans should be placed on file, and as a part of the order provided that “the advertisement shall state that in case the old boiler after test shall show that it is in good condition, no new boiler will be purchased, but, if after test is made and the boiler is shown not to be in good condition, then bids on new boiler will be considered.” At a subsequent meeting of the board of commissioners, June 7 was fixed as the date on which bids would be received, and the order provided “that the board advertise for bids on the repair of the courthouse, as per the plans and specifications now on file, except the old boiler is to be used, and may be transferred to some other part of the basement. ’ ’ The published notice of the letting also stated: “Old boiler to be used.” The specifications divided the work into two parts, which included under one, or the general contract, every thing shown on the plans and in the specifications, except the heating, plumbing and the electric wiring, which were to be bid on separately, but let as another contract. The general specifications embraced construction of a surveyor’s room in the basement, as a part of the general contract. It was also provided that bidders in bidding on the general contract should “bid separately” on the specifications for constructing a surveyor’s room, remodeling windows and decorating the court room; also bids in the alternative for wood and tile floor and wood and metal roofing. The bids [225] for -heating, plumbing and electric wiring were separate. These instructions were set out in the published notice to bidders, which also stipulated that each bid should be accompanied by a noncollusion affidavit, as required by §5897 Burns 1908, Acts 1907 p. 580. The auditor prepared separate blank forms, to be furnished possible bidders in four sets: One for the general work under the specifications and one each for the steam heating, for the electric wiring and for the plumbing. There were several bidders on each item of the general contract, except the eighth, which was for decorating the court room. Appellee O’Keefe used the form furnished by the auditor, except as to the eighth item he added ‘ ‘ on design to be submitted $300. ’ ’ After the general bid he added the words: “This bid and bond is filed conditional that I am awarded all of the work under the general specifications.” He also bid on the wiring, plumbing and heating. At the close of each of his bids on wiring and plumbing, he added the words: “This bid conditional upon being awarded all of the work,” and in his bid as to the heating he added the words: “Using old boiler and new valves.” O’Keefe also filed a noncollusion affidavit, following §5897, supra; the other bidders filed affidavits conforming to §5959 Burns 1908, Acts 1899 p. 343, §42. The bids of O’Keefe were accepted, and one contract entered into with him June 8, 1909, for all the work, and this action was brought June 18 by appellant, as a taxpayer, to enjoin the performance of the work under that contract, and from paying for it. 1. It is clear that none of the other bidders could have any standing, because of the failure to file affidavits under §5897, supra, as notified, instead of §5959, supra, as they did. Being a statutory requirement it could not be waived. [226] 2. [225] All persons dealing with public officers or those exercising [226] statutory powers, are bound to ascertain for themselves'that the law is complied with. State, ex rel., v. Board, etc. (1905), 165 Ind. 262, 74 N. E. 1091, 6 Ann. Cas. 468; Board, etc., v. Gillies (1894), 138 Ind. 667, 38 N. E. 40; Rissing v. City of Fort Wayne (1894), 137 Ind. 427, 37 N. E. 328; Lund v. Board, etc. (1911), 47 Ind. App. 175, 93 N. E. 179; Zorn v. Warren-Scharf, etc., Pav. Co. (1908), 42 Ind. App. 213, 224, 84 N. E. 509; Board, etc., v. Pashong (1908), 41 Ind. App. 69, 83 N. E. 383; Silver, Burdett & Co. v. Indiana State Board, etc. (1905), 35 Ind. App. 438, 72 N. E. 829; Wrought Iron Bridge Co. v. Board, etc. (1898), 19 Ind. App. 672, 48 N. E. 1050; Throop, Public Officers §§551, 556. 3. It is urged that O’Keefe’s bid is defective, for the reason that it is claimed that it should also have contained the statement that he had no agent present at the bidding. We think that position untenable. It will be seen that there is a difference between §5897 and §5959, supra, and while the proceeding is statutory, and one who seeks to avail himself of its provisions must bring himself within its terms, yet if he complies with the statute he has done all that he is called on to do. Section 5959, supra, applies generally to matters within the jurisdiction of county councils and boards of commissioners, but §5897, supra, a later act, applies specifically to repair of courthouses, and while a strict construction should be required in the interest of the public, and the securing of honest competition, and the prevention of collusion or fraud, §5897, supra, only requires affidavits by the “bidder and each of his agents or representatives present at the time of filing such bids.” The affidavit covers the case where there are no representatives or agents present at the time, and the bidder is present, by requiring the affidavit to show that the forbidden thing has not been done directly or indirectly. A bidder might be present himself and have agents or representatives present, none of whom had done the prohibited thing, but if an absent [227] agent or representative has done the prohibited thing, the affidavit required would make each of the parties making it guilty of perjury, by virtue of the act of the absent one, in the prohibition of the thing by such indirection, as well as by direction. 4. There was no appropriation for a surveyor’s office, yet in the general specifications, and in the specifications for heating, the work on a surveyor’s office was provided for, and bid on under the general contract. There were no specifications for decorating the court room. No argument or citation of authority is necessary to show that neither could be undertaken, as being clearly in excess of the powers of the board. 5. It is next insisted that the words added by O’Keefe to his bid under the general specifications, and after his separate bid on wiring and plumbing, and, in his bid on heating in which he added, “using old boiler and new valves”, rendered the bids and contract'invalid, as being contrary to the specifications, and as being an entire contract with no separate bids, for the alleged reason that the conditions added by him make each of his bids conditional on his being awarded the entire work bid on. It is manifest that the plain purpose of the statute is to place all bidders on an equality, and secure competition in fact. The general specifications provided that the “general contract will include all the work shown on the plans and in specifications, with the exception of the steam heating, plumbing and electric wiring. The steam heating, plumbing and electric wiring will be let under one contract and under separate specifications.” Other provisions are that “separate bids” will be received on heating, wiring and plumbing, and on different items of the general contract; The board of commissioners before advertising for bids determined to use the old boiler. The notice to bidders referred them to the plans and specifications, and gave notice that “bids will be received for the general contract, heating [228] (old boiler to be used), plumbing and electric wiring.” Separate bids were made by items, and in the alternative as to floors and roof. Separate bids were made for heating, plumbing and wiring, without any itemization of parts. The condition in the bid of O’Keefe under the general contract added nothing to it, and made it no different from that of any other bid, because it embraced but one subject, viz., the items of the general contract, as one subject of the bid, made by items, all of which were the same in each bid, but separated in bidding, and meant no more than that he should receive all the work under that contract, which was made up of a number of items, and that construction of it is both reasonable and consistent, if otherwise legal. As to the plumbing, wiring and heating, they were to be the subject of one contract, and they also were separated in the bidding, so that adding to the bids for plumbing and wiring the words, “conditional upon being awarded all the work”, evidently meant the work under the one cpntract for plumbing, wiring and heating. It is readily seen how this may have arisen. Instead of preparing the forms so that one bid would embrace these three subjects, by separate items, the forms were framed for them separately, and in view of the provisions of the specifications, that they would be let under one contract, but “bid on separately”, it was not an unwise precaution, in view of the possible construction, emphasized by the construction' here insisted on, that the bid should be so framed that plumbing, heating and wiring should be the subject of one contract, and therefore adding the words which were added in nowise changed the bid, or the relation of the bidders to subjects bid on under that proposed contract, or put the bidders on a different basis of bidding. We are unable to perceive that there is any connection between the bids under the two proposed contracts. They are wholly independent. Under the specifications the successful bidder under the general con [229] tract was entitled to be awarded all the wgrk required under the specifications to perform that contract. As to the plumbing, wiring and heating, the bids could not have been made the subject of separate contracts, but all these matters were the subjects of one contract. Neither O’Keefe nor any other bidder could have been required to enter into a contract to do any one of the three things independently of the other two subjects required to be performed under one contract; hence the added words in O’Keefe’s bids are simply in recognition of that fact. 4. The action of the board of commissioners, however, cannot be upheld on other grounds. There was no-appropriation for the surveyor’s office, and there were no specifications for decorating' the court room. There could, therefore, be ho legal bidding for either of these matters. State, ex rel., v. Board, etc., supra; Lund v. Board, etc., supra; Board, etc., v. Pashong, supra. And these facts put the matter in such condition, as to bidding, as to render it possible to nullify the very object of the statute, and the possibility that this may be accomplished, aside from all question as to whether it is done, is sufficient to condemn it. 6. The board and the bidders were bound to know that there could be no letting or contract for either of those matters, and presumptively did know it. 7. The practical result possible, then, is this: Knowing that no such contract could be made, nor such items contracted in the one general contract, the bidding is done on it as one contract, embracing at least two prohibited items, and O’Keefe’s bid embraced both of them, and, in addition, is made conditional on his receiving the whole of the work, including those items. One.of two things would necessarily be true: either he could refuse to accept or refuse to execute the contract with those two items in it, both because of the condition, and of its entirety or, bidders knowing that certain items bid on cannot be legally awarded, may frame bids accordingly, and may insert in bids, as to the [230] prohibited items, a proposition to do the work at a figure for less than its value, and put up the price bid on the authorized items, and when the unauthorized items are eliminated receive much more than the work is worth, or than they would otherwise bid; or, they may put a higher bid as to the unauthorized items, and a higher bid than they otherwise would on the authorized items and by eliminating the unauthorized items receive more than they should. In either event the municipality suffers. If the bidders all bid on the same idea, it might put them on an equality as between themselves, but the county has not received the benefit of competition as to subjects which are the just subjects of bidding and competition. It will hardly be contended that if O’Keefe had refused, after the contract was made, to execute it, that he could have been compelled to do so, or to perform the unprohibited parts, by reason of the indivisibility of the contract. Our conclusion is that the bidding and contract-are indivisible ones in and of themselves, so far as the general contract goes, and that the public interest demands that they be so regarded to insure that equality and common ground in bidding which is the object of the statute. The case does not present the question of an innocent party, or where there may be a separation of the valid and invalid portions. It is said in 2 Beach, Contracts §1426, in discussing the subject of divisibility of contracts: “A contract is wholly void if covenants in restraint of trade, which are illegal as against public policy, enter into and form a part of the entire consideration, and both parties are at fault as to those covenants. ’ ’ [231] 8. [230] As we have pointed out, it is impossible to discover what part of or how far, the bids on the surveyor’s office and for decorating the court room form a part of the entire consideration. See, also, 2 Beach, Contracts §§1422, 1425 and notes. 0 ’Keefe was not bound to abide by his bid unless he received the work on the surveyor’s office and for decorating the court room, independently of the condition in his bid, and he could not be forced to do so, nor could the county be [231] required to let the contract to him on account of the unauthorized items. It was therefore not mutual, neither was it divisible on the election of either party, and in the interest of the public ought not to be divisible by the election of both parties, and it is hardly necessary to- suggest that in order to be valid the bid must be such that either party may enforce its performance. It was therefore void for lack of mutuality. State, ex rel., v. Cadwallader (1909), 172 Ind. 619, 628, 87 N. E. 644, 89 N. E. 319; Fowler Utilities Co. v. Gray (1907), 168 Ind. 1, 79 N. E. 897, 7 L. R. A. (N. S.) 726, 120 Am. St. 344 and notes; Waterman, Spec. Performance §196. It was also void as an indivisible bid'and contract. The reasoning applied to eases between individuals, applies with greater force to public officers and public contracts. Cleveland, etc., R. Co. v. Closser (1890), 126 Ind. 348, 26 N. E. 159, 22 Am. St. 593, 9 L. R. A. 754 and notes; Hausman v. Nye (1878), 62 Ind. 485, 30 Am. Rep. 199; Smith v. Lewis (1872), 40 Ind. 98; Chicago, etc., R. Co. v. Southern Ind. R. Co. (1906), 38 Ind. App. 234, 70 N. E. 843. The principle is well stated in the first above cited case. ‘ ‘ The purpose to break down competition poisons the whole contract, and there is no antidote which will rescue it from legal death. ’ ’ That is precisely what would be permissible, if we were to uphold the contract. The bid for plumbing, wiring and heating is not subject to the vice of the general contract, in so far as the bidding is concerned, but instead of following the declared intention and purpose to let two separate contracts, all the subjects of bids were embraced in one contract when finally reduced to writing, and while they may be severable from -the general contract under ordinary circumstances, with the general contract stricken down, the contract for wiring, heating and plumbing could not be executed or complied with, and is so dependent on the execution of the general contract that the whole must fall together. [232] 9. 10. It is urged that appellant is estopped because of the delay in bringing the suit. On the day the contract was let, counsel for appellant was present and notified the board that if the law was as he believed it to be, he would resort to the courts. Very little was done under the contract prior to the suit being brought, which was within ten days, and was not unreasonable delay; besides, there can be no estoppel against the pnblic from the violation of a statute, even though in the particular case no injury to the public has resulted, and appellees are in no situation to raise the question, where it is contrary to the expressed public policy, as in case of contracts in restraint of trade, or as monopolies, it is not necessary that they shall have so resulted; it is sufficient that they may do so. State, ex rel., v. Portland, etc., Oil Co. (1899), 153 Ind. 483, 53 N. E. 1089, 74 Am. St. 314, 53 L. R. A. 413; Knight & Jillson Co. v. Miller (1909), 172 Ind. 27, 36, 87 N. E. 823, 18 Ann. Cas. 1146, and cases cited; Fireman’s Charitable Assn. v. Berghaus (1858), 13 La. Ann. 209; Greenhood, Public Policy 115-126. Cross-errors are assigned, the only one of which not waived is that of the sufficiency of the complaint. Prom what has been said, the sufficiency of the complaint abundantly appears. The judgment of the court below is reversed, with instruction to grant a new trial, and for further proceedings not inconsistent with this opinion.