Johnson v. Young , 53 Idaho 271 ( 1932 )

I concur in the conclusion reached in the majority opinion. I am of the opinion that the contract is void for the reason, among others, that it constitutes an unauthorized delegation of power in that it authorizes the party of the second part (Humphrey) "to do and perform any and all acts and thingswhich he might deem advisable or necessary . . . . the same as tho said business was his own," and other language of similar and broader import set out in numerous provisions of the contract. The rule, applicable alike to counties as well as cities, would seem to be as stated in Smith v. Morse, 2 Cal. 524,538:

"Again, the common council must exercise the functions imposed upon them by their charter; and have no power to delegate them to others. The power to sell, granted to them, does not include the power to make a deed of trust, or place the property committed to their custody, in charge of others, for the term of three years, with power to sell, asthey may deem advisable."

Also, as held in Mullarky v. Town of Cedar Falls,19 Iowa, 21, with respect to an incorporated town:

"But such corporation has no power to execute a deed of trust conveying a bridge erected by the corporation to trustees, authorizing the charging of tolls thereon, and pledging the bridge and the tolls collected thereon for the payment of the debt created for its construction."

To similar effect see: Scollay v. County of Butte, 67 Cal. 249,7 P. 661; State v. Carrel, 103 Ohio St. 50,132 N.E. 161; Egan v. San Francisco, 165 Cal. 576, 133 P. 294, Ann. Cas. 1915A, 754; Heydenfeldt v. Hitchcock, 15 Cal. 514; Housev. Los Angeles County, 104 Cal. 73, 37 P. 796; McQuillin on Municipal Corporations, 2d ed., vol. 1, sec. 393; 7 Cal. Jur. 512. By the contract before us the board of county commissioners has attempted to delegate to Humphrey the collection of the judgments in favor of the county. Such duty is imposed upon the commissioners themselves and involves the exercise of judgment and discretion and cannot be delegated to others and any contract attempting so to do is ultra vires and void. There is no valid reason shown why the board of county commissioners itself could not carry out this duty, particularly in view of the fact that it had the aid of the prosecuting attorney and special counsel employed for that purpose, nor does any valid reason appear necessitating the appointment of an agent clothed with unlimited powers to perform this duty.

Calling particular attention to the following provision of the contract in question, wherein it is provided:

"That this trusteeship shall continue, and the said party of the second part shall have such time as shall be necessary or advisable, to sell and dispose of any and all properties to which he may have acquired title, as such Trustee, without sacrificing the same; provided that said parties of the first part shall have the right to order a sale of said properties, or any thereof, at such time and price, as all of the parties entitled to prorate in said trust fund shall agree upon."

this is also an unauthorized delegation of power. Under the terms of the foregoing provision the trusteeship cannot be terminated and no sale of the property can be made unless all of the parties entitled to prorate in said trust fund shall agree upon such sale. It is sought to bind incoming boards of county commissioners to retain the trustee without any definite limitation except the happening of an uncertain and perhaps impossible event. In other words, unless all of the parties, the county, the municipalities, Fidelity Deposit Company of Maryland and Federal Reserve Bank of San Francisco reach a mutual understanding or agreement to sell or wind up the trust, the board of county commissioners is helpless. When it is further considered that the trusteeship, as shown by the contract, had its inception in December, 1924, and three boards of county commissioners have been elected since the execution of the contract and that the trusteeship has functioned for over eight years and may continue to so function ad infinitum, it would seem to me that in such circumstances, the contract is void as against public policy.

The contract further provides: "this contract is, and shall be construed to be in all respects, a contract with an interest in said party of the second part."

In other words, the board of county commissioners undertook to appoint Humphrey trustee with an interest in the property held by him in trust, in which the county had an interest. Clearly no authority can be found authorizing the board of county commissioners to convey an interest in county property, except in the manner as provided by law for the sale of county property.

If I understand respondents correctly, they take the position that the validity of this contract was upheld in Evans v.Humphrey, 38 Fed. (2d) 984. I do not so construe the opinion to so hold. The court refused to pass upon the question, saying:

"The only question raised by the judgment debtor in the trial court and in this court is as to the authority of A. Humphrey to act as trustee for the municipal corporations for which he claims to be trustee. We do not see how the appellant is concerned with this question. . . . . We need not decide the contention raised by the appellant, to the effect that the contracts with the municipal corporations under which Mr. Humphrey purported to be acting were ultra vires, for in any event it is immaterial to the judgment debtor whether Mr. Humphrey was acting individually or as trustee."

In my opinion the constitutional provisions and authorities cited construing the same, referred to in the majority opinion and relating to the loaning or pledging of the credit of a county, have no application to the facts of this case.

Since the opinion of the majority on rehearing reverses the former opinion and becomes the law of the case, it follows, without the necessity of direct reference thereto, that the former opinion is no longer the law of the case.

While I have only discussed a limited number of the objections to which this contract is subject, I have carefully examined the entire contract and find myself unable, by reason of its numerous objectionable and void features, to find any ground upon which it can be upheld.

Petition for rehearing denied.