Greene County v. Center Township , 305 Pa. 79 ( 1931 )

There is no statute in Pennsylvania which imposes any obligation upon the defendant township to pay any part of the cost of the road which the plaintiff county built for a distance of 5,950 feet in this township. Any obligation of the township to pay any part of the construction cost of this road must in the present state of the law have been self-imposed, as by no outside agency could it be imposed legally. If the obligation was self-imposed, it must have been imposed by contract. The Act of May 24, 1917, P. L. 291, supplementing the Act of May 11, 1911, P. L. 244, empowers the authorities of any borough or township or incorporated town to enter into a contract or contracts with the commissioners of any county for the construction of highways, and provides that payment for the construction shall be borne jointly by the borough, township, or incorporated town, and the county, in such ratio or proportions as may be agreed on in the contract or contracts. Where is the contract between plaintiff and defendant in which defendant assumed the burden of paying one-half of the construction cost plaintiff is seeking to collect? I search the record in vain for a contract in which the Township of Center assumed any such obligation.

There is nothing in the law of contracts more completely fundamental than that a contract is based upon an offer and acceptance and that "an acceptance must be absolute and identical with the terms of the offer. . . . . . . If A offers to X to do a definite thing and X accepts conditionally, or introduces a new term into the acceptance, his answer is either a mere expression of willingness to treat, or it is in effect a counterproposal": Anson on Contracts, 2d Am. edition, 22, 23. Another fundamental rule of the law of contracts is that if the terms of an alleged contract are so vague and indefinite as to be incapable of creating legal relations between the parties, it is unenforceable. "In order that an offer may be made binding by acceptance, it must be made in contemplation of legal consequences; a mere statement of intention made in the course of conversation will not constitute a binding promise, though it be acted upon by the party to whom it was made": Anson on Contracts, 2d Am. edition, 21, 22. "Both parties [to an agreement] must assent to the same thing in the same sense, and their minds must meet as to all the terms": 13 Corpus Juris, section 48, page 264, citing Powers v. Curtis, 147 Pa. 340.

Page on the Law of Contracts, volume 1, page 45, lays down this principle: "The offer must not merely be complete in terms, but the terms must be sufficiently definite to enable the court to determine ultimately whether the contract has been performed or not."

In the case before us, the county never accepted the offer made by Center Township, even if the resolution of the township, dated February 5, 1919, can be construed as an "offer." This resolution declared that the commissioners of Greene County "contemplated" taking over and reconstructing under the Act of May 11, 1911, P. L. 244, and its amendments, the Oak Forest Road, a public roadway between certain points in Greene County, a section of 12,140 feet of the roadway so to be reconstructed being in the defendant township, and the supervisors resolved on behalf of the township and agreed for themselves and their successors in office to provide for the payment of, and to pay to the County of Greene from the township funds, one-half of the total expense of the improvements, when due, and to levy a cash road tax to pay all costs of maintaining the road after construction. On May 12, 1919, the commissioners of Greene County duly resolved to reconstruct and improve Oak Forest Road, extending through, inter alia, Center Township, and they authorized the county engineer to prepare surveys and plans of this highway, together with an estimate of the cost, and the county solicitor to prepare a petition to be presented to the court of quarter sessions and to obtain an order directing that notice be given that the petition, plans, surveys and estimated cost of the permanent construction of the road would be laid before the grand jury at the June Sessions, 1919. The matter was duly presented to the court of quarter sessions and pursuant to court order it was laid before the grand jury and its approval returned and certified to the court. No exceptions were filed, and on May 12, 1924, the final order and decree was entered authorizing Greene County to enter upon, take over and improve this highway and let a contract or contracts for the construction thereof under specifications prepared by the proper county authorities. Plaintiff county proceeded with the construction, not of 12,140 feet of Oak Forest Road in Center Township, but of only 5,950 feet.

Nothing can be clearer than that these respective resolutions of the supervisors and commissioners do not constitute a contract between the parties. The resolution of the county commissioners made not the slightest reference to the resolution of the supervisors of Center Township passed three months earlier. The county commissioners simply declared that they deemed it expedient to improve the Oak Forest Road in Center Township and authorized the county engineer to prepare surveys, plans and an estimate of the cost. The county commissioners' resolution ignored the supervisors' resolution entirely, and they proceeded to construct only 5,950 feet of the 12,140 feet the township wanted. They did not even indicate that any financial help from the township was wanted or would be accepted. The township supervisors were not consulted as to the character, length, width or cost of the road to be built. The court below, in the opinion of President Judge SAYERS, pertinently says that "the resolution passed by the county commissioners did not refer to the resolution, request or proposal of the township supervisors, but simply sets forth a description of the road and the purpose of the county to improve the same, a direction to the county engineer to prepare plans and an estimate of the cost and expense of the improvement, and a direction to its solicitor to present the matter for approval by a grand jury and the court. The county resolution does not recite that it is accepting any resolution or proposal of Center Township to join in the expense of building a road, nor does the statement set forth that any plans, specifications or estimates of cost were submitted to the supervisors of Center Township or that they joined in the proceeding before the grand jury or approved the plans, specifications or costs of the building of the road at any time. The resolution of the supervisors of Center Township did not contain a complete proposal because there was no specification showing the width, character or cost of the highway proposed to be improved. The terms of the two resolutions do not indicate a meeting of the minds of the parties: Northwestern, etc., Co. v. Campbell, 78 Pa. Super. 97. It is nowhere alleged that the township ratified the kind, character or cost of the road proposed to be constructed. 'Contracts are derived from consent and cannot as a rule be binding where there is no real consent established': Rismiller v. Evangelical Lutheran Congregation, 268 Pa. 41."

In the opinion of the majority appears the following statement: "The chief difficulties arose from the attitude in which the proceedings were regarded by the court below. They were treated as though the matter in suit was a contract between individuals, whereas the municipalities were following a statutory method by which the State's political subdivisions of government might improve the State's property — its highways, entrusted to their keeping."

I find in the law of Pennsylvania no such statutory method as that invoked here to make a township pay a part of the cost of a road built by a county in that township. All the township did was to manifest a willingness to enter into a contract for the construction of 12,140 feet of road. Its manifestation was never acknowledged and no contract was ever entered into by the township to pay one-half of the cost of building any part of the Oak Forest Road. As a matter of fact, only 5,950 feet of the road were built.

The statutory method of imposing an obligation upon a township for any part of the cost of a county road built in the township is the method provided by the Act of May 24, 1917, which empowers the proper authorities of the township to enter into a contract with the commissioners of the county. Under the law of Pennsylvania a contract means exactly the same thing when used in a statute as when used elsewhere. Our law of contracts will be in a state of chaos if we hold otherwise. The majority opinion is based on the theory that the word "contract" when used in the Act of 1917 means something entirely different from what it hitherto has always meant. The majority opinion says, "It is evident, therefore, that what the legislature intended, when it used the word 'contract' in the Act of 1917, was that the township should indicate a willingness or agreement to be bound under the Act of 1917, and when it had done so, the county commissioners should proceed under the Act of 1911 to construct the improved highway as contemplated in the township resolution." My opinion is that the township can be "bound" under the Act of 1917 to pay only what it agrees to pay in a contract definite in all its terms. Surely the township ought to know what a proposed road will cost before it can be obligated to pay half of that cost.

The majority opinion also says, "When the township resolution was adopted and delivered to the commissioners, the county could not contract with the township or with any other party for the construction of the improved highway; for such highway could be contracted for and constructed only under the enabling authority of the Act of 1911; and a strict compliance with its terms required that authority to contract be secured from the court." In my view nothing could have been simpler or easier than for the county commissioners to have entered into a contract definite in all its terms as to cost, size, quality, etc., of the proposed road, with the supervisors of Center Township, expressly subject to the approval of the proposed road by the grand jury and the court of quarter sessions as provided in section 3 of the Act of 1911.

The Act of 1911, after providing in section 3 for a petition by the county commissioners to the court of quarter sessions showing the survey, plans and estimated cost of a proposed county road and providing for the approval or disapproval by the grand jury and the court of quarter sessions of the proposed road as planned, provides later, in section 18, thatboroughs can by ordinance agree with the county commissioners to pay 33 1/3 per cent of the cost of construction of that part of a continuous county highway that lies within the borough. Apparently this agreement can be entered into after the county highway has been constructed to the borough limits, and, as section 18 says, "where the failure of said borough to improve said highway within its limits would leave a break or unimproved section in such a continuous highway." Then according to this section 18 "proper officials of the borough [can] enter into an agreement with the county commissioners" to build a road "which will connect the two ends of such highway or highways."

If county commissioners and borough officials can make a formal agreement based on an ordinance, sharing the cost of construction of a highway through a borough as provided by section 18 of the Act of 1911, surely county commissioners and township officials can enter into a contract sharing the cost of construction of an improved highway through a township as provided by section 1 of the Act of 1917, P. L. 291. These contracts with either borough or township authorities can be made before or after the grand jury and court of quarter sessions have approved the proposed road. It is not at all unusual for agents to enter into contracts subject to the approval of their principals or of coördinate authority, just as, for example, the president of the United States enters into treaties (contracts) with foreign governments subject to the approval of a coördinate branch of the government, to wit, the United States Senate. The majority opinion asks, "How could the county formally bind itself to do an act, when the indispensable prerequisite to the doing of this act was the obtaining of the approval of the grand jury and the court of quarter sessions?" The answer to that query is that the county did not have to formally bind itself by contract with the township to build a road before the necessary approval of the grand jury and the court of quarter sessions was obtained but it could enter into a contract, definite in all its terms, with the township whereby both the county and the township would be bound to share the cost of the road in the event that the grand jury and the court of quarter sessions later approved the proposed road; or the county commissioners could wait until such approval had been obtained and then enter into a contract with the supervisors providing for the township's bearing a share of the cost of the highway. If the township refused to enter into such a contract after the approval of the court and grand jury had been obtained for the proposed road, and the commissioners then felt that they had been misled by the expressed willingness of the township supervisors to enter into negotiations leading to a contract to pay a proportion of the cost of the road through the township, it would be a simple matter for the county commissioners to petition the court and ask that the previous order made at the commissioners' request for the construction of the proposed road be vacated. The better practice undoubtedly would be for the commissioners and township supervisors first to enter into a formal and definite contract to share the cost of the construction of the road through the township, and in that contract to provide that it would not be given legal effect until the approval of the proposed road by the court and the grand jury had been obtained.

The view herein expressed that the law and canons of construction relating to contracts apply to all contracts, whether they are provided for in statute or otherwise, and to those between public corporations as well as to contracts between individuals, is, I think, sustained by the authorities.

McQuillan on Municipal Corporations, 2d edition, page 796, section 1265, lists among "the rules applicable to all contracts, whether a municipal corporation is a party thereto or not," the following: "Mutuality is essential to a contract; there must be an offer and acceptance."

In Donnelly, Law of Public Contracts, the author says at section 172: "Public contracts are no different from private contracts. The obligation of each endures under the law, and the former are governed by the same canons of interpretation as apply to contracts between natural persons." See also Dillon on Municipal Corporations, pages 1235, 1236.

In the case before us there was no mutuality between the plaintiff and defendant and there was no offer and acceptance, and the authorities hold that mutuality and offer and acceptance are just as essential in municipal contracts as in those of individuals.

To hold the defendant township liable in this case means that whenever a township's supervisors express a willingness to enter into a contract to pay one-half of the cost and expense of constructing a highway the county is given carte blanche to go ahead and build the road or a part of it with any material and at any cost, without consulting the township, and then make the township pay one-half of the cost of this construction. This would be analagous to A's telling B that he, A, would be willing to enter into a contract with B to pay one-half of the cost of building a house, whereupon B proceeds, without consulting A, to build a house of any kind and size that suits him, B, and at any cost which he alone decides on, and then attempts to make A pay one-half of that cost. This impresses me as a novel doctrine and I find no precedent for it anywhere. If this is now to be the law, it will in my judgment be a wide departure from the law heretofore controlling the creation of reciprocal rights and obligations.

In 13 Corpus Juris 290, section 100, appears the following: "There is no meeting of the minds of the parties while they are merely negotiating as to the terms of an agreement to be entered into. To be final, the agreement must extend to all the terms which the parties intend to introduce, and material terms cannot be left for future settlement."

I think the language of this court in the case of Hepburn v. City of Phila., 149 Pa. 335, 340, applies here: "The papers referred to . . . . . . set forth the terms upon which the city was willing to enter into a contract with him, but neither singly nor altogether do they constitute a valid contract, nor in fact any contract. They are merely negotiations preparatory thereto."

The cases of Rhodes v. Terheyden, 272 Pa. 397, and Winters v. P. R. R. Co., 304 Pa. 243, are emphasized in the majority opinion. The first case lays down this principle at page 401: "The question to be decided under section 20 of the [Practice] Act, which provides only 'a substitute . . . . . . for the common law demurrer' (Hutchinson Baking Co. v. Marvel, 270 Pa. 378,381), is not whether the statement is so clear, in both form and specification, as to entitle plaintiff, without amendment, to proceed to trial, but whether, upon the facts averred, it shows, as 'a question of law,' that plaintiff is not entitled to recover." It is obvious to me in the case now before us that as a matter of law plaintiff under the facts averred was not entitled to recover. The court below was right, I think, in so ruling. The second case holds that even if a statement of claim in trespass is insufficient yet if it is evident that a better statement of facts could show an enforceable claim, the court should grant plaintiff leave to file a further statement of claim within a limited time. However in the second case this court agreed with the court below that recovery could not be had even under the facts set forth in plaintiff's petition to file an amended statement. The plaintiff in the case now before us makes no claim that any material fact was omitted from its pleadings, and it is not evident that any better statement of facts was possible. On the contrary it is evident that plaintiff's action was brought on a contract that never existed. If the case had proceeded to trial on a nonexistent contract, it would have been the duty of the trial judge to give binding instructions for the defendant.

It appears by supplemental record filed in this case that since the beginning of the present action, part of the road in Center Township taken over by the County of Greene by its proceedings, No. 4, June Sessions, 1919, as a county road and not improved, being 6,190 lineal feet of the 12,140 feet taken over, has been returned to the Township of Center by proper proceedings in the Court of Quarter Sessions of Greene County. This furnishes further proof of the fact that if the resolution passed by the township supervisors on February 5, 1919, can be construed as an offer to pay one-half the cost of improving the 12,140 feet of Oak Forest Road which in the resolution the supervisors declared the county commissioners contemplated taking over for the purpose of improving and reconstructing the same, this "offer" was never accepted by the commissioners in terms identical with it. As we have already said, the resolution of the county commissioners of May 12, 1919, made no reference whatsoever to the supervisors' resolution, but if by any reasoning it can be considered a response to the supervisors' resolution, it is at most a mere willingness to treat, or in effect a counter-proposal.

I cannot interpret the Act of 1917, supra, as using the word "contract" in any other sense than it has been used in the law for centuries. "The current of authority at the present day is in favor of reading statutes according to the natural and most obvious import of the language without resorting to subtle and forced constructions for the purpose of either limiting or extending their operation": 25 Ruling Case Law, section 217, page 962. I think it is the duty of the court to interpret the word "contract" in that act according to its "natural and most obvious import." That is the only import it has hitherto had.

I would affirm the judgment of the court below.