Holroyd v. Town of Indian Lake

This is an action at law, brought to recover unliquidated damages from the defendant, a town in Hamil

The question presented by the appeal is raised by a demurrer interposed to the complaint upon the ground that it does not state facts sufficient to constitute a cause of action. That question depends upon the construction of said statute, which is a general act, entitled “ An Act authorizing the establishment of water districts in _ towns.” The object of the act is to enable a majority in number and value of the resident owners of real estate in the proposed district to compel the construction of a water plant in order to store and distribute water among the inhabitants thereof. It authorizes the town board of any town, upon a petition duly signed and acknowledged by a majority in number of the resident owners representing a majority in value of the real estate owned by residents of the proposed district, to create a water district wholly within the town and appoint water commissioners, who have power to advertise for proposals and enter into contract for the construction of the plant. (§§ 1-5.)

Immediately after letting the contract the commissioners are required to give written notice to the town board “specifying the amount of such contract or contracts and the amount of money needed for the construction of such water system.” . Thereupon, as the statute further provides, “it shall be the duty of the town board to raise the money necessary by the issue and sale of bonds as provided in .this act.” (§ 6.) The bonds, signed by the supervisor and attested by the- town clerk, must bear interest at a rate not exceeding five per cent and must mature at convenient intervals within twenty years after they are issued. They are to be sold “ on sealed proposals or at public auction,” after due advertisement, for not less than par. They are made “a charge upon the town” but are to “be collected from.the property within the water district.” ’(§ 7.)

The water commissioners are required each year to appor

By appropriate allegations the complaint sets forth the creation of a water district at Blue Mountain lake in said town and the appointment of commissioners, who, “ on behalf of the water district,” entered into contract with the plaintiffs for the construction of a water plant for the sum of $13,000, which is less than the maximum amount proposed by the petition to be expended in the construction of the water system. Payments were to be made upon the certificate of the engineer appointed by the commissioners. The plaintiffs allege due performance of the contract on their part and the breach thereof by the defendant in that it refused to pay the amount called for by the agreement or any part thereof. Without stating in detail the allegations of the complaint, and disregarding the claim that the contract was broader than the statute authorized, it is sufficient to admit for the purpose of discussion that a cause of action is set forth against the defendant, provided the town is liable upon the contract of the water commissioners in an action at law brought to recover the stipulated price for the construction of the water plant. The Special Term overruled the demurrer, btit the Appellate Division sustained it and dismissed the complaint.

The contract in question was not made by the town or by its officers or for its benefit. It was made by the water commissioners of a water district, who are not town officers proper, such as are named in the Town Law. Their powers are limited to the construction and management of a water plant for the exclusive benefit of the water district They do not act for the town, and no action on their part can make the town liable. The statute, however, lends the credit of the town to the water district in order to raise money to pay for the water plant, but the bonds issued by the town for that purpose, although its obligations, are not paid by it, but by taxes levied upon the property of the district through the board of supervisors. The statute requires the water commissioners, after they have made a contract for the construction of the plant, to notify the town board of the amount

While the statute does not say in terms that the money thus raised is to be paid over to the water commissioners, we think that is the intention of the act as gathered from the duties of the water commissioners when contrasted with the duties of the officers of the town. They are charged with the duty of constructing the plant. They have the power of condemnation to acquire the necessary lands and may adopt ordinances to enforce the collection of water rents and regulate the use of water. The water system is not only to be built by them, but it is to be managed by them after it is built. It does not belong to the town, but to the district. Being authorized to make the contracts, the commissioners are impliedly authorized to pay the contractors out of moneys, raised by the town board for the purpose. The town has no power to build the plant, which is wholly beyond its jurisdiction and control. It has no right to use it or regulate it or collect the rents. It does nothing but lend its credit to the district and in effect it is given a lien upon the taxable property of the district as security, with power to enforce it by taxation in the usual way. The town is not responsible for the acts of the water district which it creates, any more than the state is liable for the action of the town which it creates. The cases relied upon by the appellants, which relate to public improvements made, owned and controlled by ordinary municipal corporations, do not apply. The water district is not created for the town, but for a district in the town. The town officers have nothing to do with the construction of the plant. They neither con

Bo action at law will lie against the town, because the contract is not made by the town and is not for its benefit. The duty of the town board and the town officers is simply to raise the money in the manner specified and pay it over to the commissioners upon whom is placed the duty of constructing the plant and managing it after its construction. The duties of both are ministerial and performance may be required by mandamus. If, after the contract has been made by the water commissioners, they fail to notify the town board of the amount required to discharge the obligation, they can be compelled by mandamus to do so. If, upon the receipt of the notice, the town board fails to issue the bonds and raise the money, mandamus will lie to compel it' to act in accordance with the requirements of the statute. So, when the time is ripe" for any action on-the part of any officer of the town or district and he refuses to act, he can be compelled to act by a writ of mandamus. A right of review by writ of certiorari is provided in case he acts, but does not act in accordance with law. The remedy of the plaintiffs is not by an action at law against the town, but by one or more special proceedings as the case may require to compel the action required by the statute. A town, as we have seen, cannot be sued except for

We have not considered the question whether the statute violates the Constitution, because it is unnecessary, and the rule of courts is not to decide such questions unless the case requires it. (Const, art. 8, § 10.) We have simply pointed out the theory of the act as we understand it, and if we have construed it correctly, it is obvious that the action of the Appellate Division in sustaining the demurrer and dismissing the complaint was proper and should be affirmed.

Cullen, Ch. J., Gray, O’Brien, Bartlett, Haight and Werner, JJ., concur.

Judgment affirmed, with costs.