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.
One group of statutes intended to prevent municipalities from incurring indebtedness, seeks to restrict expenditure to income. Different statutes of this group seek to attain this result in different ways. Some of these statutes forbid a contract unless an appropriation has been made by the proper authorities available for payment on such contract.1 A contract entered into when no such appropriation has been made is unenforceable,2 and no recovery can be had for property or services fur-nished thereunder.3 Thus a contract to complete a building made when an appropriation for part of its cost only has been made is invalid, although the city had agreed to make a subsequent appropriation to complete such building.4 So no recovery can be had in excess of the appropriation made.5 A general appropriation for the expense of building a bridge is sufficient to make valid a contract with an adjoining land owner whereby the city agrees to pay damages, and allow him to use a vault built by the city under the street, in consideration of his allowing the city to swing its bridge over his land.6 A general appropriation for constructing a street intended to cover future repairs is sufficient to make valid a contract therefor.7 If an appropriation lapses at the end of a fiscal year it cannot validate subsequent contracts unless re-appropriated.8 Such a statute is superseded by a subsequent grant of power to incur indebtedness for specified purposes, from which grant restrictions are omitted.9
1 Hilliard v. Bunker, 68 Ark. 340; 58 S. W. 362; Wiegel v. Pulaski County, 61 Ark. 74; 32 S. W. 116; Indianapolis v. Wann, 144 Ind. 175; 31 L. R. A. 743; 42 N. E. 901; Kel-ley v. Broadwell (Neb.), 92 N. W. 643; Clark v. Portsmouth, 68 N. H. 263; 44 Atl. 388; Engstad v. Din-nie, 8 N. D. 1; 76 N. W. 292.
2 Hurley v. Trenton. 67 N. J. L. 350; 51 Atl. 1109; affirming 66 N. J. L. 53S; 49 Atl. 518; Roberts v. Fargo, 10 X. D. 230; 86 N. W. 726.
3 Board of Water Commissioners v. Commissioners, 126 Mich. 459; 85 N. W. 1132; Roberts v. Fargo, 10 N. D. 230; 86 N. W. 726.
4 Johnston v. Philadelphia, 113 Fed. 40.
5 Hurley v. Trenton. 67 N. J. L. 350; 51 Atl. 1109; affirming 66 N. J. L. 538; 49 Atl. 518.
6 Chicago v. Milling Co., 196 111.