« ΠροηγούμενηΣυνέχεια »
into a conspiracy with the manager of a water company to foist its plant on the town at an excessive price, the burden was on complainants, in order to sustain such charge, to prove either a corrupt combination to do an unlawful act or to accomplish a lawful act by unlawful means. [Ed. Note. For cases in point, see vol. 10, Cent. Dig. Conspiracy, §§ 1-5, 26.]
3. SAME-CONSPIRACY TO DEFRAUD.
Where the selectmen of a town, in considering a proposition to purchase a water plant, failed to publish or state their vote to buy the plant in the warrant for a town meeting to consider the same, before the inhabitants were called on to pass on the proposition, and later it appeared that a majority of the voters did not favor the plan, such error of judgment on the part of the selectmen was not, of itself, evidence of corruption, without proof of fraudulent conduct or an unlawful purpose.
[Ed. Note. For cases in point, see vol. 10, Cent. Dig. Conspiracy, §§ 1-5, 12.]
4. WATERS AND WATER COURSES-PURCHASE BY TOWN-CONTRACT-VALIDITY-FRAUD BY
Under Pub. St. c. 27, § 27, and Rev. Laws, c. 25, § 31, providing that a town cannot buy the plant of a waterworks company without the consent of a majority of its selectmen, the assent so required is the affirmative action of the selectmen acting as a board.
5. SAME EVIDENCE OF ASSENT.
Such assent was not to be implied from recitals in a clause in the contract authorizing the selectmen to execute a contract in behalf of the town; the board in existence at the time it was voted to make the purchase having declined to assent.
6. SPECIFIC PERFORMANCE CONTRACTS - IN
Where the vote of a town to purchase a waterworks was void for failure of a majority of the selectmen to assent to the contract as required by Pub. St. c. 27, § 27, and Rev. Laws, c. 25, § 31, such vote was ineffective as a foundation for a bill by the water company against the inhabitants of the town to compel specific performance.
7. WATERS AND WATER COURSES-PURCHASE BY TOWN-ACT OF INHABITANTS-STATUTES.
Under Rev. Laws, c. 25, § 31, providing that a town, by the action of its selectmen, ratified by a majority of its voters, may purchase of any municipal or other corporation the right to take water from its sources of supply or its pipes, or may purchase the water plant, etc., a majority of the voters of the town are required at some period of time to either ratify or reject a proposed contract for the sale of a water company's plant to the town, which contract is unenforcible until so ratified. 8. SAME-ELECTION-NOTICE-WARRANT.
Where the voters of a town were called on to vote on a proposition to purchase the plant of a water company, the warrant for the town meeting was the only authorized source to which the voters could look to ascertain what subjects were presented for their decision, and no valid action could be taken by them in the absence of a specified article in the warrant covering such proposed purchase.
9. SAME ACTION OF SELECTMEN - RATIFICATION.
Rev. Laws, c. 25, § 31, provides that a town, by the action of its selectmen, "ratified by a majority of its voters present and voting thereon at a town meeting," may purchase the works of a water company. Held, that such section contemplated that the question of initiative public policy of purchasing the waterworks should have been passed on by the selectmen prior to the calling of the, town meeting, and that the selectmen had previously taken the
appropriate action for the purchase of the waterworks.
10. SAME-INVALID VOTE CONVEYANCE-PURCHASE PRICE OBLIGATION TO PAY.
Where the vote of the electors of a town, at a town meeting, to purchase the plant of a water company, was void, neither the subsequent notice and acceptance of such vote by the company, the delivery of a deed, nor its acceptance and recordation by the selectmen of a town, followed with a semblance of taking possession of the works, passed title to the town or imposed on it any obligation to pay the stipulated price.
11. SAME ESTOPPEL.
Where a vote taken by a town purporting to ratify a proposal to purchase certain waterworks was void, and the town thereafter not only refused to ratify the action of its selectmen in favor of such purchase, but specifically rejected the same, the town was not estopped by its acceptance of a deed by the selectmen, followed by a semblance of taking possession of the works, to deny that title passed by the deed and that it was bound to pay the price. 12. QUIETING TITLE-CLOUD ON TITLE.
Where a deed of a water company's plant to a town, which was ineffective to transfer title for invalidity of the proceedings, was recorded and might constitute a cloud on any title that the town might subsequently obtain, as provided by St. 1905, p. 492, c. 477, § 12, the town was entitled to a decree of cancellation.
[Ed. Note. For cases in point, see vol. 41, Cent. Dig. Quieting Title, §§ 15, 16.]
Whether the public interest would be served by conferring authority on towns to supply its inhabitants with water is a matter for the exclusive determination of the Legislature.
[Ed. Note.-For cases in point, see vol. 10, Cent. Dig. Constitutional Law, §§ 129, 131.] 14. SAME-VESTED RIGHT-CORPORATE PRIVILEGES-IMPAIRMENT.
Where a water company was incorporated as provided by St. 1882, p. 101, c. 142, it enjoyed no vested rights which gave it immunity from competition by the construction of a municipal plant as authorized by St. 1905, p. 488, c. 477, though its property would probably be diminished in value and its business might be destroyed by reason of the competition. 15. SAME DUE PROCESS OF LAW.
St. 1905, p. 488, c. 477, providing for the establishment of municipal waterworks in towns supplied by private corporations, is not unconstitutional as an appropriation of private property for public use, without due process of law, because the establishment of such municipal plant would necessarily operate to depreciate or destroy the property of such corporation. [Ed. Note. For cases in point, see vol. 10, Cent. Dig. Constitutional Law, § 890.] 16. WATERS AND WATER COURSES SUPPLY-ESTABLISHMENT - STATUTES-VA
St. 1905, p. 488, c. 477, authorizes the erection and maintenance of an independent water supply system in towns supplied by private corporations, and sections 12, 13 (pages 492, 494), provide that in case of the organization of an independent system, the supplying corporation shall be left unrestricted in its choice to continue in business or to sell to the town which is required to purchase under certain conditions which can only come into potential existence on the initiative of the water company. Held, that such provision was constitutional.
TIME. After the passage of St. 1905, p. 488, c. 477, authorizing towns to establish independent municipal waterworks, the act was accepted by a town on July 19, 1905. Immediately thereafter the existing water company notified the selectmen of its desire to sell to the town, but its proposition was rejected at a town meeting, September 25, 1905, after which a second meeting was held November 23, 1905, at which the town voted to buy. Held, that the last vote constituted an acceptance of the water company's proposition within a reasonable time.
St. 1905, p. 488, c. 477, providing that after acceptance by a town of a water company's proposition to sell its plant to the town, the company shall complete the transaction by conveying its property to the town within 30 days, only provided a minimum limit of time, and did not prevent the conveyance being executed and delivered after such time limit had expired.
21. SPECIFIC PERFORMANCE-CONTRACTS-WATERWORKS-CONVEYANCE TO TOWN.
Where a water company's proposition to sell its plant to a town had been accepted under St. 1905, p. 488, c. 477, requiring a town to purchase and the company to convey within 30 days, equity could decree specific performance of a contract in writing embodying the terms of the sale executed by the parties on a bill brought by either.
[Ed. Note.-For cases in point, see vol. 44, Cent. Dig. Specific Performance, §§ 195-197.] 22. SAME-ADEQUATE REMEDY AT LAW.
Specific performance of such contract will not be denied on the ground that there is an adequate remedy at law by an award of damages for breach of the contract.
[Ed. Note.-For cases in point, see vol. 44, Cent. Dig. Specific Performance, § 6.] 23. WATERS AND WATER COURSES-MUNICIPAL SUPPLY ACQUISITION OF PRIVATE
Where a water company elected to sell its plant to a town as authorized by St. 1905, p. 488, c. 477, and the town voted to buy, the elements of compensation to be considered in determining the price to be paid should not be determined, nor the amount estimated, until title passes.
Case Reserved from Supreme Judicial Court, Suffolk County.
Cross-actions by the Revere Water Company against the inhabitants of the town of Winthrop to compel specific performance of a contract for the conveyance of complainant's plant, and by the town against the water company for the cancellation of a deed of such plant, given by the water company and others and accepted by the selectmen of the town. In the Supreme Judicial Court
the case of the inhabitants of the town was dismissed as to the individual defendants, and was reserved for the full court on other questions of law. Bill by the water company dismissed, and decree for a cancellation of the deed granted, and affirmed as to the individual defendants.
L. L. Scaife, Chas. F. Choate, Jr., and Jas. D. Colt, for town of Winthrop. A. E. Pillsbury and G. M. Palmer, for Revere Water Co. Dunbar, Rackemann & Brewster, for Magee, Pope, Ridgway, Neal, and Clark.
BRALEY, J. The town having considered it advisable to join several of its citizens as defendants, who either when acting as members of a municipal committee, or of its board of selectmen participated in the negotiations, legislative proceedings, and an alleged contract of sale, all of which related to the acquisition by purchase of the company's water plant, their liability should be first determined. They severally as public officers are charged with an abuse of their trust by entering into a conspiracy with the manager of the company to foist this plant upon the town at a price greatly in excess of its intrinsic value. If thereby pecuniary loss resulted, such conduct, if proved, would render them liable in damages, or to the costs of any litigation in which the town became involved by their corrupt action, as they were bound to act in good faith for the interest of their principal, and to buy at the lowest price for which the property could be purchased. Boston v. Simmons, 150 Mass. 461, 23 N. E. 210, 6 L. R. A. 629, 15 Am. St. Rep. 230; Alvord v. Cook, 174 Mass. 120, 127, 54 N. E. 499; Emmons v. Alvord, 177 Mass. 466, 59 N. E. 126; Byrne v. Norcott, 13 Beav. 336, 346. Notwithstanding the redundant verbal setting found in the bill, to sustain this charge the evidence must show either a corrupt combination to do an unlawful act, or to accomplish a lawful act by unlawful means. O'Callaghan v. v. Cronan, 121 Mass. 114, 115. Upon a full examination of the testimony while it reveals the existence of great diversity of opinion among the citizens who finally became divided into two factions, one favoring the purchase at the price fixed by an hydraulic expert, who had been employed by the committee, and the other opposing such purchase, with the consequent engendering of much dissension and partisan bitterness, it also fails to establish a conspiracy, or even dishonest individual conduct. Beyond possible errors of judgment accompanied by a strong bias leading them to support the advisability of their own action in making the preliminary agreement with the company's manager, the defendants appear to have acted in this part of the transaction, as well as throughout the subsequent proceedings with fidelity, and for what they considered the welfare of the town. When malfeasance by a public officer is charged. motive may become an important element,
and while pecuniary gain need not be shown, it is significant that the evidence does not disclose any advantage by way of office, or of public or private emolument, that either of these defendants might have hoped to receive in taking the course they are shown to have pursued. But even if their final action, when those in office sat as a board of selectmen, in not publishing to the community, or stating in the warrant, their vote to buy the plant before the qualified inhabitants were called upon by them in town meeting to pass upon this proposition in the form submitted, may be open to criticism, yet if at a later date in the opinion of a majority of the voters, the purchase was ill advised, such an error of judgment of itself is not dishonesty, nor evidence of corruption, without proof of connecting fraudulent conduct, or of an unlawful purpose, neither of which is found. In an inquiry involving personal motives and integrity, and where nearly the whole of the oral testimony is given by the implicated officials, as in the present case, much depends upon the appearance of witnesses, the manner in which they give their evidence, and their apparent credibility; and these characteristics the printed record, however full, cannot reproduce. From our examination of the evidence, which has been fully reported, we find no substantial reason leading us to doubt the correctness of the result reached by the decree of the county court, which fully exonerated these defendants from all incriminating allegations. Skehill v. Abbott, 184 Mass. 145, 68 N. E. 37. In whatever form they may be stated by the averments of the parties in their several pleadings, when freed from this entanglement of fraud and conspiracy, there remain two important questions upon the decision of which the rights of the company and the town depend. They are, either for the company to be granted specific performance of an alleged contract of sale of the plant, or for the town to acquire it by purchase under the provisions of St. 1905, p. 488, c. 477. Before taking them up, the validity of an earlier contract of which the town asks specific performance must be decided, for if this is enforceable these questions become immaterial. This contract with the company was executed July 22, 1884, and gave the option of buying the waterworks with all connected privileges at a price which was to be fixed by appraisers who were either to be selected by the parties, or appointed by this court, and nearly 20 years after on July 14, 1904, it was voted to make the purchase. But at the date of the contract Pub. St. c. 27, § 27, and at the date of the vote, Rev. Laws, c. 25, § 31, provided that a town could not buy without the consent of a majority of its selectmen. To constitute such assent affirmative action by them as a board of public officers is required, and is not to be implied from the recitals found in the last clause of this contract, that they were authorized to execute it in
behalf of the town, and the evidence is conclusive that the board in existence when the vote was passed declined to assent. Atty. Gen. v. Eastern Railroad Co., 137 Mass. 45, 49: See Murdough v. Revere, 165 Mass. 109, 42 N. E. 502. This precedent condition not having been complied with, even if the contract in other particulars was one which the town could make, the vote was a nullity, and not only was the title of the company left unclouded, but no foundation had been laid upon which a bill in equity can now be maintained to compel specific performance. Smith v. Dedham, 144 Mass. 177, 10 N. E. 782. It, therefore, becomes unimportant to consider other serious objections which would have to be removed before such relief could be granted, and the result is that the town and the company were left unhampered from entering into subsequent negotiations. Assuming without further discussion, that the appointment of a committee for this purpose on February 25, 1904, and their conduct in the ensuing negotiations was within the scope of their authority, and that the vote to buy passed by the selectmen on March 13, 1905, was such official action by them as to be a full compliance with the requirements of Rev. Laws, c. 25, § 31, we come directly to the point on which this part of the controversy turns.
At some period of time the statute requires that a majority of the voters of the town which is to purchase, shall act upon the subject, either by ratifying or rejecting a proposed contract of sale. The question now presented is to be distinguished from cases where under acts incorporating water supply companies a condition often is inserted that the town which is to be supplied may buy upon certain terms, or where subsequent legislative permission is given to the municipality to erect and maintain a competing water system, unless the water company already established elects to sell, as in Braintree Water Supply Co. v. Braintree, 146 Mass. 482, 16 N. E. 420; Rockport Water Co. v. Rockport, 161 Mass. 279, 37 N. E. 168; Inhabitants of West Springfield v. West Springfield Aqueduct Co., 167 Mass. 128, 44 N E. 1063; Newburyport Water Co. v. Newburyport, 168 Mass. 541, 47 N. E. 533, and Gloucester Water Supply Co. v. Gloucester, 179 Mass. 365, 60 N. E. 977. The general law, however, is framed for the purpose of enabling towns to buy in the market if a bargain can be made, and instead of commissioners being appointed to estimate values and fix a price which is the usual method provided by special legislative acts, the selectmen are given authority to act in behalf of the town, and to attend to any preliminary details, and when they have reached a conclusion to report to the town, which then decides whether a contract shall be perfected by its sanction. Ordinarily a board of selectmen would not enter upon such inquiries or make an inchoate agreement to
buy unless directed by the municipality, but this precaution of administration does not limit their statutory power, although its exercise well may be made by them to depend upon the will, previously expressed of a majority of the voters. The language of the original act, which is St. 1870-71, p. 68, c. 93, required the "consent" of a majority of the selectmen "sanctioned and ratified by a majority of the voters of the town," but this phraseology does not differ in meaning from the language of the last revision. Reynolds v. New Salem, 6 Metc. 340, 343. Under either, the provisions of the proposed contract may be first determined by the selectmen upon conference with the company, which, must be presumed however, to act with full knowledge of the statutory limitation. Dill v. Wareham, 7 Metc. 438; Wormstead v. Lynn, 184 Mass. 425, 428, 68 N. E. 841. But after this has been accomplished a contract of sale does not become binding or enforceable until ratified by a majority of the voters, and when this is done thereafter the contracting parties become respectively the water company and the town. In the prolonged consideration of the whole subject that ensued at numerous town meetings, and elsewhere, after the committee had been appointed, it is plain from the evidence that the voters generally had become fully acquainted with all of the important phases of the proceedings, yet as they were not charged with constructive notice from the record kept by the selectmen, apparently they had not been informed prior to March 16, 1905, that the board finally had decided to take the works at a price agreed upon between them and the company. Com. v. McGarry, 135 Mass. 553, 554. But whatever outside information they may have possessed, and from whomsoever derived, the warrant for the town meeting was the only authorized source to which the voters could look to ascertain what subjects were presented for their decision, and no valid action could be taken unless there was a specific article covering the subject-matter. Grover v. Pembroke, 11 Allen, 88; Sherman v. Torrey, 99 Mass. 472; Whitney v. Stow, 111 Mass. 368; Reed v. Acton, 117 Mass. 384; Woodlawn Cemetery v. Everett, 118 Mass. 363, 365; Locke v. Lexington, 122 Mass. 290; Bloomfield v. Charter Oak Bank, 121 U. S. 121, 129, 7 Sup. Ct. 865, 30 L. Ed. 923. While the warrant is not to be construed with technical strictness, and intelligible notice is all that is required, yet an article which presents only the general proposition whether a purchase shall be made, but action upon which does not commit the town to buy, is legally distinct from a proposition of ratification which if carried does bind the town. The one presents for consideration a question of initiative public policy, while the other upon being duly voted by the town and accepted by the company creates a contract which cannot be revoked without the assent of both.
Braintree Water Supply Co. v. Braintree, ubi supra. The word "ratified" as used in the statute plainly means that when the selectmen issue the warrant they are supposed to have taken appropriate precedent action, otherwise there is no proposal of purchase in existence which can be made the subject of ratification, and which by the ratifying act thereupon becomes an existing contract. Locke v. Lexington, ubi supra. See New England Dredging Co. v. Rockport Granite Co., 149 Mass. 381, 382, 21 N. E. 947. 381, 382, 21 N. E. 947. The cases of Harrington v. Harrington, 1 Metc. 404, 407, and Geer v. Fleming, 110 Mass. 39, on which the company relies to sustain its contention that it was neither necessary for the selectmen to act before the warrant issued, or for the warrant to state that they had acted, relate to the laying out of town ways. In the performance of this function under Rev. Laws, c. 48, § 71, the selectmen act as public officers, and not as agents of the town, and as the way must be laid out, and the report filed seven days before the town meeting at which it is to be accepted, this action need not necessarily be taken before the warrant issues, but if not done within the statutory time, the warrant is rendered nugatory. But even then an article must be inserted sufficiently definite to notify the inhabitants that they may be called upon to act upon the subject. Jones v. Andover, 9 Pick. 146. Both of these irremediable defects are found, for when on March 7, 1905, the warrant for the meeting of March 16, 1905, was issued, the selectmen neither had acted, nor did the warrant contain an article which under the most liberal interpretation conveyed any notice to the voter that by his vote he was irrevocably committing the town to take over the property under a proposed contract of purchase which previously had been negotiated and accepted by the board of selectmen. Because of this failure of the selectmen to act before they issued the warrant, as well as its insufficiency, original authority was wanting, as the town could not act except as authorized by statute. Rev. Laws, c. 11, § 328. Parsons v. Goshen, 11 Pick. 396; Smith v. Stoughton, 185 Mass. 329, 70 N. E. 195. Consequently the notice by the company of the acceptance of the vote passed at this meeting, the delivery of the deed, its acceptance and recording by the selectmen, even if followed by them with a semblance of taking possession of the works, neither conveyed title to the town, or imposed upon it any obligation to pay the stipulated consideration. Meigs v. Dexter, 172 Mass. 217, 218, 52 N. E. 75. If upon the entire evidence there is any question of law upon either of ratification, or of estoppel by conduct, which we do not intimate, it is effectually disposed of by the vote passed June 8, 1905, whereby the town not only refused to ratify the action of the selectmen taken March 16, 1905, but also specifically rejected the attempted purchase.
While the company, therefore, must fail in its effort to have this deed declared to be a valid conveyance, and the town decreed to make payment of the amount for which it claims the property was sold, yet as the recording of this instrument may have the effect of clouding any title which the town lawfully can obtain under St. 1905, p. 492, c. 477, 12, it is entitled to a decree of cancellation. Rogers v. Nichols, 186 Mass. 440, 71 N. E. 950; Sawyer v. Cook, 188 Mass. 163, 74 N. E. 356.
If no title vested, the questions raised by the supplemental amendments to the company's bill become immaterial, and the validity of St. 1905, p. 488, c. 477, must be next considered. The company contends that the act is unconstitutional, while the town asks that in compliance with its provisions, the company should be decreed to convey the property treated as an equipped system of supply. This act was passed to enable the town to supply its inhabitants with water, and whether the public interests would be served by conferring such authority was for the Legislature to determine. Agawam v. Hampden, 130 Mass. 528, 530. It is manifest that if an independent system might be thus established, the defendant's property probably would be diminished in value, and its business perhaps destroyed by reason of the competition, but the company under St. 1882, p. 101, c. 142, by which it was incorporated, enjoyed no vested rights which gave it immunity from this contingency, or rendered such legislative action unconstitutional. Pub. St. c. 105, § 3; Commissioners of Inland Fisheries v. Holyoke Water Power Co., 104 Mass. 446, 451, 6 Am. Rep. 247; Newburyport Water Co. v. Newburyport, 168 Mass. 541, 47 N. E. 533; Gloucester Water Supply Co. v. City of Gloucester, 179 Mass. 365, 60 N. E. 977. Nor is legislation of this nature an appropriation of private property for a public use without due process of law under the fourteenth amendment to the federal Constitution. Newburyport Water Co. v. Newburyport, 193 U. S. 561, 24 Sup. Ct. 553, 48 L. Ed. 795; Gloucester Water Supply Co. v. Gloucester, 193 U. S. 580, 24 Sup. Ct. 557, 48 L. Ed. 801. If sections 12 and 13 are eliminated, the act simply authorizes the erection and maintenance of an independent water system, and these sections are nou made mandatory. By section 12 the company was left unrestricted in choice, for it either could continue in business, and take any risk of pecuniary loss, or could sell to the town which was required to purchase under certain conditions, which only could come into potential existence upon the initiative of the company. Braintree Water Supply Co. v. Braintree, 146 Mass. 482, 487, 16 N. E. 420. Of course, it can be said, that in whatever guise the question may be put as to this freedom of choice, there was nothing else the company eventually could do but to sell as the territory and patronage were too limited to afford
a reasonable probability that two independent water systems could be supported, or that the town in reality never intended to build, but only to acquire the company's plant. But the very terms of these sections contemplate that the company may choose to sell, and if it does, then the town must purchase at a valuation which if not fixed by agreement must be determined by commissioners. St. 1905, pp. 492, 494, c. 477, §§ 12, 13. Newburyport Water Co. v. Newburyport, ubi supra.
If the privilege of taking water under the Metropolitan Water System within the territory of which the town of Winthrop is situated could not be exercised unless the town first acquired the works of any water company within its limits, this furnishes no argument against the validity of the statute, which makes express provision for the accomplishment of this purpose by the acquisition of the company's works if it decides to sell. See St. 1895, p. 566, c. 448, § 3, St. 1898, p. 333, c. 392, and St. 1899, p. 306, c. 349. The statute being found constitutional, the town contends that a valid contract having been made according to its provisions, which the company has failed to perform, specific performance should be decreed. It, therefore, becomes essential to determine whether such a contract exists. After the act was accepted by the town on July 19, 1905, the company under section 12, without waiving its claim either as to the validity of the prior sale, or its contention that the statute was unconstitutional, notified the selectmen of its desire to sell. By this action it took the position that if the questions within the protest were decided adversely, then the offer was an unqualified proposal of sale which it must make unless it elected to continue in business. and which the town by force of the statute was equally bound to accept. While acceptance under the statute is neither limited in time, or to any number of town meetings, yet it undoubtedly was obliged to act within a reasonable time after the offer had been made, and as the rejection at the town meeting held September 25, 1905, did not exhaust the right of the town again to vote upon the proposition of purchase, so the second town meeting held November 23, 1905, at which the town voted to buy was within a reasonable period. Under the statute the company was required within 30 days to complete the transaction by conveying its property unincumbered by a good and sufficient deed. The action of the company in electing to sell upon the statutory terms must be treated as voluntary, for it could have gone on leaving the town to establish its own system, but the offer having been duly accepted the town is prohibited by section 12, from taking such action. At this point the next necessary step is the passing of title by the company, which has not been done, but there are no provisions found in the statute which prevent a conveyance being executed and delivered after the thirty days.