This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
Since the power of a public corporation to bind itself by contract depends upon the nature and extent of the powers conferred upon it by statute, no general absolute rules can be laid down as to the contractual powers which are necessarily possessed by every public corporation.1 A slight difference in the
9 State v. St. Louis, 169 Mo. 31; 68 S. W. 900.
10 Savidge v. Spring Lake, 112 Mich. 91; 70 N. W. 425.
11 Keen v. Waycross, 101 Ga. 588; 29 S. E. 42.
13 Norfolk v. Pollard, 94 Va. 279; 26 S. E. 832.
14 Turner v. Fulton County, 109 Ga. 633; 34 S. E. 1024.
15 Ft. Edward v. Fish, 156 N. Y. 363; 50 X. E. 973; affirming 86 Hun (N. Y.) 548.
16 Putney Bros. Co. v. Milwaukee Co., 108 Wis. 554; 84 X. W. 822.
17 Frankfort v. Brawner, 100 Ky. 166, 172; 37 S. W. 950; rehearing denied, 38 S. W. 497.
1 "Upon the general subject of the liability of a municipal corporation, the authorities are a tangled web of contradictions and it is difficult to assert any proposition with respect to the same for which adjudications on both sides may not be cited." Argenti v. San Fran-
•wording of two statutes may lead to material differences in the power of making contracts possessed by the corporations acting respectively under such statutes. All that can be done is to give typical illustrations of the contractual powers usually possessed by public corporations. A public corporation usually has power to construct and maintain streets, and hence may contract for the construction and repair2 and lighting3 of its streets; for sidewalks4 and shade trees.5 It may contract for a water supply,6 and an underground railway.7
Under a power to provide a system of sewers a public corporation may buy a right of way for a sewer;8 may contract for disposing of sewage outside of the city limits;9 and has power to contract with a rendering establishment situated outside the city.10 cisco, 16 Cal. 255, 283; quoted in Cincinnati v. Cameron, 33 O. S. 336, 374.
2 French v. Paving Co., 181 U. S. 324; affirming Barber, etc., Co. v. French, 158 Mo. 534; 54 L. R. A. 492; 58 S. W. 934; Reuting v. Titusville, 175 Pa. St. 512; 34 Atl. 916. The contract for construction may provide that the contractor shall repair the street as far as necessary by reason of poor work or defective material in consideration of the original assessment. City of Kansas City v. Hanson, 60 Kan. 833; 58 Pac. 474; citing Cole v. People, 161 111. 16; 43 N. E. 607; Allen v. Davenport, 107 Ia. 90; 77 N. W. 532; Barber Asphalt Paving Co. v. Ullman, 137 Mo. 543; 38 S. W. 458; Robertson v. Omaha, 55 Neb. 718; 44 L. R. A. 534; 76 N. W. 442; Wilson v. Trenton, 60 N. J. L. 394; 38 Atl. 635.
3 Seitzinger v. Tamaqua, 187 Pa. St. 539; 41 Atl. 454.
4 Jones v. City of Camden, 44 S. C. 319; 51 Am. St. Rep. 819; 23 S. E. 141.
5 Heller v. Garden City, 58 Kan. 263; 48 Pac. 841.
6 Cincinnati ex rel. v. Cincinnati, 11 Ohio C. C. 309; 1 Ohio C. D. 372. A county may contract for a water supply for an unincorporated town. Agua Pura Co. v. Las Vegas, 10 N. M. 6; 60 Pac. 208.
7 Sun, etc., Association v. The Mayor, etc., of New York, 152 N. Y. 257; 37 L. R. A. 788; 46 N. E. 499 (by special statute).
8 Coit v. Grand Rapids, 115 Mich. 493; 73 N. W. 811. (Even if the price to be paid is said to be an exemption of the land through which the right of way runs from the sewer assessment; for though a contract to exempt from assessment was void, the real purpose of the contract was to pay a sum equal to the assessment for the right of way, which was lawful.) Citing Turner v. Cruzen, 70 Ia. 202; 30 N. W. 483.
9 McBean v. Fresno, 112 Cal. 159; 53 Am. St. Rep. 191; 31 L. R. A. 794; 44 Pac. 358.
10 Tiede v. Schneidt, 105 Wis. 470; 81 N. W. 826.
A city may acquire a building for public purposes and dispose by lease of any part thereof not immediately necessary for public use.13 So a city may erect a lighting plant, and furnish private light as well as public, if it is a suitable method of operating.14 A city and county owning a building in common as city hall and court house may make a joint contract for lighting it.15
A municipal corporation has power to compromise claims in dispute between it and other parties, such as it could have originally incurred.16 A city having power to place the cost of improvements on the general duplicate, or to make special assessments, may compromise with abutting property owners if the special fund proves insufficient.17
As a power specifically given carries with it power to make contracts necessary to carry such given power into effect, power to construct a lighting plant includes power to buy an engine therefor,18 and to contract for labor and material.19 Power to erect poles and lights includes power to contract therefor.20 A vote for free turnpikes is a vote to incur expenses necessary thereto,21 and power to build a court house is power to furnish it.22 Power to provide for "health and welfare" includes power to contract with a waterworks company for a supply of water to extinguish fires,23 but not to operate a dispensary.24
11 Witter v. Board, etc., 112 Ia. 380; 83 N. W. 1041; Richmond, etc., Co. v. West Point, 94 Va. 668; 27 S. E. 460; (citing (The Mayor, etc., of) Nashville v. Ray, 19 Wall.
(U. S.) 468; Ketchum v. Buffalo, 14 N. Y. 356).
12 Attorney General v. Nashua, 67 N. H. 478; 32 Atl. 852.
13 Curtis v. Portsmouth, 67 N. H. 506; 39 Atl. 439 (citing Spaulding v. Lowell, 23 Pick. (Mass.) 71; French v. Quincy, 3 All. (Mass.) 9); Jones v. Camden, 44 S. C. 319; 51 Am. St. Rep. 819; 23 S. E. 141.
14 Jacksonville, etc., Co. v. Jacksonville, 36 Fla. 229; 51 Am. St. Rep. 24; 30 L. R. A. 540; 18 So. 677; Mitchell v. Negaunee, 113
Mich. 359; 67 Am. St. Rep. 468; 38 L. R. A. 157; 71 N. W. 646; compare Biddle v. Riverton, 58 N. J. L. 289; 33 Atl. 279.
15 State v. McCardy, 62 Minn. 509; 64 N. W. 1133.
16 Oakland v. Water-Front Co., 118 Cal. 160; 50 Pac. 277; People v. Board, etc., of San Francisco, etc., 27 Cal. 655; Agnew v. Brail, 124 111. 312; 16 N. E. 230; Grimes v. Hamilton Co., 37 Ia. 290; Mills Co. v. R. R. Co., 47 Ia. 66; State v. Martin, 27 Neb. 441; 43 N. W. 244; City of San Antonio v. Ry. Co., 22 Tex. Civ. App. 148; 54 S. W. 281; Sheafe v. Seattle, 18 Wash. 298; 51 Pac. 385.
17 Sheafe v. Seattle, 18 Wash. 298; 51 Pac. 385.
A county may make a contract to investigate the books of the county auditor and treasurer,25 and may give a bond for money borrowed to support the families of soldiers during the Rebellion.26 Under power to "construct and maintain waterworks" it cannot sell without legislative enactment.27 A public corporation cannot bind itself by contract not to exercise its governmental functions. It cannot contract to exempt from taxation.28