Case Name: Clark et al. v. Miller, State Revenue Agent
Court: Mississippi Supreme Court
Jurisdiction: Mississippi
Decision Date: 1925-03-16
Citations: 142 Miss. 123
Docket Number: No. 24507
Parties: Clark et al. v. Miller, State Revenue Agent.
Judges: 
Reporter: Mississippi Reports
Volume: 142
Pages: 123–145

Head Matter:
Clark et al. v. Miller, State Revenue Agent.
(In Banc.
March 16, 1925.
Suggestion of Error Overruled May 4, 1925.)
[105 So. 502.
No. 24507.]
Engle & Laub, for appellants E. T. Clark and E. P. Harris.
W. M. Hall and Pollard S Hamner, for appellant, United States Fidelity & Guaranty Company.
B. L. McLaurin, for appellant C. H. Dulaney.
Noel c0 Neilson and Shands, Elmore é Causey, for the appellee.
Lucy B. Somerville, also, for appellee.
Argued orally by W. M. Mall, for appellants, and A. W. Shands and E. F. Noel, for appellee.
Headnotes 1. Levees and Flood Control, 36 C. X, Section 16; 2. Pleading, 31 Cyc., p. 564; 3. States, 36 Cyc., p. 880; 4. Levees and Flood Control, 36 C. X, Section 44; 5. Levees and Flood Control, 36 C. X, Section 17 (Anno); 6. Equity, 21 C. X, Sections 309, 431.

Opinion:
Smith, C. J.,
delivered the opinion of the court.
This is a suit brought by the state revenue agent by which he seeks to collect money alleged to be due the Yazoo Mississippi Delta levee board, and the case comes to this court on an appeal to settle the principles of the case from a decree overruling several demurrers to the bill. The bill alleges in substance that in November, 1916, R. T. Clark, R. L. Cheshire, R. P. Harris, L. C. Dulaney, and C. H. Dulaney, doing business under the firm name of R. T. Clark & Co., entered into a contract with the Yazoo Mississippi Delta levee board by which they agreed to construct, according to certain specifications, a designated portion of a levee along the Mississippi river at and for the sum of twenty-eight and one-half cents per cubic yard, the performance of which contract was guaranteed by a bond on which the United States Fidelity & Guaranty Company -is surety. One of the allegations of the bill is that—
"On the 30th day of April, 1918, at a time when the said firm of E. T. Clark & Co. had completed seven per cent, of the work called for, by the said contract, the said E. T. Clark & Co. declined to proceed further with their said contract and notified the then commissioners of said district that they were unable to proceed further, and wholly abandoned the said contract. Complainant here charges that the said E. T. Clark, E. P. Harris, E. L. Cheshire, C. H. Dulaney, and L. C. Dulaney thereupon became liable to pay to the board of levee commissioners for the' Yazoo Mississippi Delta levee district the difference between the price at which the commissioners could secure the work done in accordance with the terms of the contract, and the said United States Fidelity & Guaranty Company as surety on the bond of said contractors likewise became liable in the amount of the penalty of their bond, to-wit, the sum of one hundred sixty thousand dollars. Complainant further shows that the average price per cubic yard of the original contract was twenty-eight and one-half cents, and the total amount to be paid under said contract was the sum of eight hundred five thousand one hundred seventy-five dollars. Complainant would further show that the said bond executed by the United States Fidelity & Guaranty Company contains many provisions with reference to notice being given to them, and as to time within which suit might be brought, all of which provisions were either complied with by the then commissioners or were waived by the said bond company.
"Complainant would further show that upon the breach of the contract by the said E. T. Clark & Co., they diligently began to find other contractors to complete the work, and after doing everything humanly possible to get the work completed at the lowest possible price, and after inviting bids from contractors which.were then and there rejected because too high, E. T. Clark, E. P. Harris, and E. L. 'Cheshire, doing business under the firm name and style of E. T. Clark & Co., being a different partnership from the original contractors, but all of the members of the second firm being members of the first, became and were the lowest and best bidders, and contract was accordingly entered into between the commissioners and the new firm of E. T. Clark & Co. to do the same work, which said contract, complainant charged upon information and belief, was in the same words and figures as the contract made Exhibit J hereto, except as to the dates, names of members of the partnership, and schedule of prices;.-but complainant would show that the time for the completion of the work was, and said time was extended from November 1, 1919, as provided in the original contract to January 1, 1920, and the price for the doing of the work was increased so as to make the average price per cubic yard forty-five cents, and the total amount to be paid for the completion of ninety-three per cent, of the original was the sum of one million one hundred eighty-two thousand two hundred eighty-two dollars and fifty cents. Complainant attaches hereto, as Exhibit L to this bill of complaint, copy of a schedule of prices on this second contract. Complainant here charges upon information and belief that the commissioners in reletting this contract took every possible precaution to look after the interest of the said district, and that they obtained the lowest price that could be obtained at said time, and that the difference between the original contract price and the new contract price, to-wit, the sum of four hundred thirty-three thousand four hundred sixteen dollars and twenty-five cents, is the true measure of the liability of the members of the original partnership of E. T. Clark & Co., and of the United States Fidelity &. Guaranty Company to the extent of one hundred sixty thousand dollars.
"Complainant would further show that to guarantee this second contract the said new firm of E. T. Clark & Co. executed their bond in the sum of eighty thousand dollars, with sureties appearing thereon, a copy of which said bond is hereto attached marked 'Exhibit M,' and asked to be taken and considered as a part of this bill of complaint as fully as if copied at length herein."
A bond executed to the levee board by R. T. Clark & Co. for the execution of the second contract recites that—
"The condition of the' foregoing bond is such, that whereas R. T. Clark & Co. entered into a contract with the board of levee commissioners of the Yazoo Mississippi Delta aforesaid, of date November 1, 1916, to do certain work therein set forth, all of which contract is made a part hereof as if fully copied herein as the same now appears on file in the said office of said levee commissioners; and,
"Whereas, certain parts of the contract have been changed in this, to-wit, that the price in said contract has been raised for the benefit of the principals hereof, and certain other changes made therein, all of which are made a part hereof as the same appears either from said bond or from the minutes of said board of levee commissioners ; and,
"Whereas, it was further agreed by said principals hereto that an additional security of eighty thousand dollars should be given in addition to and concurrently with the security already given under said contract as shown by the files of the said commissioners:
"Now, therefore, if the said R. T. Clark & Co., principals hereto, shall well and truly perform their said contract according to its terms as set forth in the said contract, and by the minutes of the said board of levee commissioners, then this obligation to be null and of no effect, otherwise to be and remain in full force and effect until discharged."
When the second contract was made, C. H. Dulaney had ceased to be a member of R. T. Clark & Co., and the firm was then composed of Clark, Cheshire, and Harris,
R. T. Clark & Co. entered upon the execution of the second contract with the levee board, and some time there after advised the board that they could not do the work at forty-five cents per cubic yard and asked for an increased price therefor, which increase the board granted. About this time the firm of E. T. Clark & Co. seems to have been dissolved. At all events, the building of the levee was thereafter proceeded with by Clark alone and all payments therefor were thereafter made to him alone.
The defendants to the bill are members of the original firm of E. T. Clark & Co., the United States Fidelity & Guaranty Company, surety on the original bond, the levee commissioners who voted for and allowed the increased compensation for carrying out the second contract, and the sureties on their official bonds. The sureties on the second bond executed by E. T. Clark & Co. were also made parties defendant, but the bill was afterwards dismissed by the complainant as to them.
The recovery sought is:
(1) From the original members of the firm of E. T. Clark & Co. and the United States Fidelity & Guaranty Company for the breach of the original contract, the measure of damages therefor alleged being the difference between the price agreed to be paid for the building of the levee under the original contract and that agreed to be paid therefor under the second contract.
(2) From E. T. Clark and the levee commissioners who voted therefor and the sureties on their bonds of the compensation paid to E. T. Clark by the levee board in excess of .the forty-five cents per cubic yard for which the levee was to be constructed under the second contract.
The demurrers to the bill are by E. T. Clark, E. P. Harris, L. C. Dulaney, 0. H. Dulaney, and the United States Fidelity & Guaranty Company.
The appellants' contentions are: (1) That the bill states no cause of action against any of them, and (2) that the bill is also multifarious.
It is manifest from the allegations of the bill and the exhibits thereto that L. C. Dulaney was not a party to either of the contracts sued on and as to him the bill should have been dismissed.
The bill sets forth two separate and distinct causes of .action: (1) A breach by R. T. Clark & Co. of the original contract for the construction of the levee; and (2) the payment to R. T. Clark for completing the levee under the second contract of compensation in excess of that provided by the 'contract. These causes of action can best be dealt with here separately.
1. The ground on which it. is claimed that no recovery can be had on the appellee's claim for damages because of the- breach by R. T. Clark & Go. of the original contract for the construction of the levee is that the breach of that contract was waived by the levee board when it entered into a new contract with R. T. Clark & Go. for the completion of the levee.
Counsel for the appellee deny that the breach by R. T. Clark & Co., of the first contract was waived by the levee board: First, for the reason that it does not appear from the allegations of the bill that the board intended so to do; and, second, that even had it intended so to do, the levee board was without power to waive the breach of the contract or to release R. T. Clark & Co. or their bondsmen from liability therefor.
The bill alleges a total breach and abandonment by R. T. Clark & Co. of the first contract for the construction of the levee, and a general invitation by the levee board for bids for a new contract for the completion of the levee; that the lowest bid received therefor was by R. T. Clark & Co., for which reason the new contract was awarded to them. This allegation of the bill necessarily negatives any intention on the part of the levee board to waive the breach by R. T. Clark & Co. of this contract,' and clearly sets forth that the entering into by it of the second contract with R. T. Clark & Co. was brought about solely because their bid for the completion of the levee was lower than that of any of the other bidders therefor.
But it is said by counsel for the appellant that the recitals of the bond executed by R. T. Clark & Co. for the performance of the second contract a copy of which is filed as an exhibit to the bill, contradict the allegation of the bill that the second contract was entered into -because of the breach*by R. T. Clark & Co. of the first contract, and indicate that the second contract was simply an agreement to pay an increased price for building the levee, and they invoke the rule that where the allegations of a pleading contradict the recitals of an exhibit thereto, the exhibit and not the pleading controls. This rule has no application here for the reason that the bond executed for the performance of the second contract has no sort of bearing on the rights of the parties hereto growing out of the first contract and was made an exhibit to the bill, not as a basis of the liability claimed for the breach of the first contract, but as a basis for the claim asserted against the sureties on that bond for the recovery of the money paid R. T. Clark under the second contract in excess of the amount provided for therein. This claim, as hereinbefore set forth, has been abandoned, and.the bill has been dismissed as to the sureties on the second bond. Profert of this bond was not necessary in so far as liability is sought to be predicated, and on the breach of the original contract it was pertinent only to the case originally sought to be made against the sureties thereon.
Since the bill negatives any intention on the part of the levee board to waive the breach by R. T. Clark & Co. of the first contract, we are not called on to determine whether it had the power to waive it.
The Yazoo Mississippi Delta levee board was originally created by chapter 168, Laws of 1884, and was recognized and continued by section 227 et seq. of the state constitution. The right here claimed for the levee board to pay Clark compensation for building the levee in excess of that provided in his contract therefor is based on the grant to the board by section 27 of the statute by which it was created of ' ' full power and authority . . . to contract with any person . . . for the construction, maintenance or repair of the whole or any part of its line of levees," etc., and on the grant to it by section 232 of the constitution of the "supervision of the erection, repair, and maintenance of the- levees in their respective districts."' It is unnecessary for us to here decide the extent of the power conferred by the statute and constitution upon the levee board, for it is manifest by section 96 of the constitution that the broad language in which the power here granted is couched must be restricted so as not to authorize the board to grant extra compensation to any public contractor after the contract is made. The section is as follows:
' The legislature shall never grant extra compensation, fee, or allowance, to any public officer, agent, servant, or contractor, after service rendered or contract made, nor authorize payment, or part payment, of any claim under any contract not authorized by law," etc.
It is true that the legislature only is mentioned in this section of the constitution, but nevertheless it binds not only the legislature but all subordinate state agencies created or controlled by it; for what the legislature cannot do directly it cannot do indirectly by delegating the power so to do to a subordinate agency. The Yazoo Mississippi levee board, vxeypt as may be otherwise provided by the constitution, is subject to the supervision and control of the legislature and can exercise, unless the constitution otherwise provides, only such powers as may be delegated to it by the legislature. Bobo v. Levee Commissioners, 92 Miss. 792, 46 So. 819.
R. T. Clark was, of course, a public contractor, for the levee which he contracted to build was for the public, and the compensation paid him therefor in excess of that for which he contracted to build the levee was paid .to him after his contract was made; the payment of this extra compensation therefore comes within the express prohibition of the constitution, and consequently R. T. Clark has no right thereto and must account therefor to the levee board or to the revenue agent who represents it here.
The bill of complaint is multifarious, and the demurrer should have been sustained on that ground. The two causes of action sued on flow from different and disconnected sources, and the parties defendant thereto are different. If E. T. Clark had been sued alone, it may be that the two causes of action could have been joined under section 598, Code of 1906; Hemingway's Code, section 358, as to which we express no opinion; but this section does not authorize the joinder of separate causes of action against disconnected defendants.
Because of this defect in the bill, the judgment of the court below must be reversed and the cause remanded.
Reversed and remanded.