Illinois Trust & Savings Bank v. City of Burlington
Illinois Trust & Savings Bank v. City of Burlington
Opinion of the Court
The opinion of the court was delivered by
This is an action brought by the ■Illinois Trust & Savings Bank, as trustee for certain holders of bonds issued by the Burlington Water Works Company, for rentals due to the company from the city on hydrants used for fire protection to the city. In March, 1897, under an. ordinance duly passed, a contract was entered into by the city of Burlington, the Burlington Water Works Company, and the Illinois Trust & Savings Bank, which granted the right and privilege to the company of furnishing water to the city
In the ordinance was a provision that the company should extend its mains to any part of the city when requested to do so by a majority of all the votes cast at any election at which the proposition was submitted to the people, and it was further provided that for every 430 feet of the mains so extended the city should rent one or more hydrants at an annual rental of $35. On April 7, 1903, an election was held and a proposition to extend the mains was submitted to the voters, at which election 191 votes were cast, the vote on the waterworks extension being 82 votes in favor of, and 80 against, the extension. The mayor, in August, 190.3, assuming that the proposition was carried, served formal notice on the company that the, proposition to extend the mains had been adopted. An ordinance was passed on April 15, 1904, which provided for the payment of the stipulated rental of $35 per hydrant for every 430 feet of extended mains.
About July 26, 1904, the company gave notice to the city and its patrons that because the entire receipts of the business were insufficient to pay operating expenses, taxes and interest it would be obliged to shut down the plant. In accordance with this notice, and on September 24, 1904, the company discontinued furnishing water to its patrons because of inability to pay op
It appears that the city was indebted for the amount claimed as hydrant rentals unless the failure of the company to fulfil its obligations to the city excused payment. On the side of the city it is claimed that it was the duty of the company to extend its mains in accordance with the result of the election and the subsequent direction of the mayor and council. It seems that the election did not result in favor of the extension of the mains. While there were more votes cast for the proposition than against it, a majority of the votes cast at the election were not in favor of the proposition. The ordinance which controls provided that the company should extend the mains “when requested to do so by a majority of all votes cast at any general or special election at which the proposition of. such extension shall
If all of the 191 votes cast were legal 96 affirmative votes were necessary to carry the proposition. Much is said as to whether women were qualified to vote on the question, but the findings disclose that even if women should not be regarded as some of “the people” to whom the question was to be submitted, and if the women voters are entirely eliminated from consideration, the proposition failed. It was found that of the 191 names of persons appearing on the poll-books at least 15 were women. In one ward 5 women voted for the proposition, but how the other women voted does not appear. Assuming that the women were disqualified, and deducting 15 (the number of women who voted) from the total number of votes cast, we have 176, and a majority of these would be 89, which is 7 more than were cast for the extension. In any view that may be taken of the right of women to vote on the question there was not the majority which the ordinance required. The election therefore imposed no obligation upon the company to extend the mains, nor can its failure to observe a request of the mayor based on that election be regarded as a default or a ground of forfeiture.
Another defense of the city is that the company did pot raise any objection to the regularity of the election and that the company made no other objection than that the city had not passed an ordinance providing for the payment of the rentals on the proposed extension.
. There is a further contention, by the city that if the rentals were earned they were forfeited by the shutting down of the plant on September 24, 1904, and the failure of the company itself to supply water from that date to June 25, 1905, when the plant was sold under a decree of the federal court. In section. 12 of the ordinance it was provided that the company should not shut off the supply of water from the city or its inhabitants except for repairs and extensions, and then not to- exceed ten hours at any one time, and that “if from any cause the said water-works company be temporarily unable to supply water to the city or individual consumers, all rents for use of water shall cease during such periods, and if such disability be the fault of said, water-works company, its successors or assigns, the rebate for water rent shall be for double the time the-works are thus disabled.” In section 16 of the ordinance it was provided that if the company, its successors or assigns should “fail to perform any of the-duties or to keep any of the covenants herein made and entered into in which penalty is not otherwise provided for, said water-works company shall forfeit all hydrant rentals from notice until such failure is removed.” Under the provision of section 12 of the ordinance the company could not, of course, claim rentals from the city or from private consumers from September 24, 1904, until November 1 of the same year, for
Whether the city may recoup for the thirty-eight • days when no water was supplied depends upon whether the failure to supply water was the fault of the •company. Notice was given by the company and the claim made that it was unable to furnish water because the receipts from the business were insufficient to pay the necessary expenses of operation. In behalf of the plaintiff it isurged that if the city had paid the rentals when they became due the company would not have been obliged to shut down the plant. The claim is that 'the lack of funds and the consequent shutting down of the plant were due to the fault of the city rather than ' the fault of the company. It is possible that the company might not have been compelled to shut down until a later time if the city had paid the rentals that were
As there are important findings, however, that are not sustained by the evidence, we can not direct the judgment to be entered, and hence the judgment rendered is reversed and the cause remanded for a new trial.
Reference
- Full Case Name
- The Illinois Trust & Savings Bank, as Trustee, etc. v. The City of Burlington
- Cited By
- 7 cases
- Status
- Published
- Syllabus
- SYLLABUS BY THE COURT. 1. Elections—Extension of Water-mains—Vote Required. A provision in, a city ordinance that a water-works „ company shall extend the water-mains “when requested to do so by a majority of all votes cast at any general or special election at which the proposition of such extension shall have been submitted to the people” means that the company is not required to make an extension unless a.majority of all those voting on any proposition at such election vote in favor of the extension. '2. Contracts—Modification—Authority of Agent of a Corporation. The power to make agreements modifying the franchise and contract made between the water-works company and the city is not incidental to the office of secretary of the company or of superintendent of the water-plant, and an agreement of that kind, if made by such officer, is not binding on the company in the absence of evidence of authority to make it or of ratification by the company. :3. --• Forfeiture—Estoppel—Contract Executed by a Receiver for One Party. The water-works company shut down the plant on the alleged ground that the earnings were insufficient to meet operating expenses, and a receiver for the company was appointed, with the consent of the city, who proceeded to operate the plant and to supply water to the city. Held, that the receiver was in a sense a trustee for the city and the company, and the city was not in a position to insist on a forfeiture for the non-supply of water while it was receiving water from the receiver, nor to claim damages from the company as if no water had been furnished. 4. Damages—Liquidated. Where damages provided for in a contract are uncertain' in their nature and can not well be ascertained by any pecuniary standard, and where the parties themselves, understanding the peculiar circumstances surrounding the transaction, are better able to estimate the loss that may be sustained by delay or failure of performance, they are permitted to fix the amount of damages to be recovered. 5. -Same., A provision in the contract stipulating that if the water-works company shall be temporarily unable to supply water no rentals shall be paid during such period, and that if the disability be the fault of the company the rebate for water rent shall be for double the time the works are thus disabled, should be regarded as liquidated damages recoverable by the city.