Case Name: THE PEOPLE OF THE STATE OF NEW YORK ex rel. ORRIN W. SAGE, Respondent, v. GEORGE W. SCHUYLER, Auditor of the Canal Department, Appellant
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1879-01
Citations: 24 N.Y. Sup. Ct. 106
Docket Number: 
Parties: THE PEOPLE OF THE STATE OF NEW YORK ex rel. ORRIN W. SAGE, Respondent, v. GEORGE W. SCHUYLER, Auditor of the Canal Department, Appellant.
Judges: TappaN, J., concurred.
Reporter: Supreme Court Reports (Hun)
Volume: 24
Pages: 106–111

Head Matter:
THE PEOPLE OF THE STATE OF NEW YORK ex rel. ORRIN W. SAGE, Respondent, v. GEORGE W. SCHUYLER, Auditor of the Canal Department, Appellant.
Illegal contract by the canal commissioners — what not a ratification thereof, by the Legislatm-e.
December 18, 1872, the canal commissioners, without authority, let a contract for the erection of a dam. Subsequently one of the canal commissioners drew two drafts upon the auditor for payments due on the work, both of which were protested. Thereafter an arrangement was made, whereby the relator advanced money to the contractor, and received the certificates issued to him; the final certificate being issued in July, 1874. The commissioners in charge reported to the Legislature of 1873 that the contract had been made, and in the report to the Legislature of 1875 the amount of the certificates was reported as an item of public expenditure. In,1875 an act was passed appropriating $107,004.03 for the payment.of certificates issued for work on the canals, and $12,973.08 for interest thereon. A clerk in the auditor’s office testified that he prepared the budget for this appropriation, and that the aggregate of the certificates issued as aforesaid to the said contractor, and the interest thereon, were included in it.
Held, that these facts did not show that the Legislature had knowledge of the illegality of the contract under which the work was done, and that the act of 1875 did not amount to a ratification of it,1 or authorize payment of the certificates. (Boardman, J., dissenting.)
Appeal from a judgment, entered upon the report of a referee, in favor of the relator, granting a peremptory mandamus against the defendant, as auditor of the canal department, requiring him to audit and allow á claim of the relator against the State.
In 1855 the State made a permanent appropriation of the waters of Cazenovia lake and of its outlet Chittenango creek to the purpose of feeding the Erie canal. At that time there were two clams on the creek, one near the outlet of the lake which belonged to the State, and the other below which belonged to private parties. The State also owned the Erieville reservoir, another feeder, the waters from which emptied into the Chittenango creole between the two dams. In 1864 the State placed in the lower dam a gate and kept a man in charge of it. In 1865 this dam was carried away by a flood and was rebuilt by the owners, the State replacing the gate. In 1872 it was again carried away. This time the owners refused to rebuild. Thereupon the canal board, deeming it necessary and proper for the interest of the State that this dam should be rebuilt, by resolution passed May 8, 1872, adopted plans and estimates for its construction, and authorized the canal commissioners to advertise the work for ten days and let the same, provided the parties whose water rights were affected should make a release satisfactory to the attorney-general. The canal commissioners accordingly advertised for proposals and announced that they would receive bids until May 21, 1872. On May 22, 1872, the canal board passed a resolution reconsidering the resolution of May eighth, and as reconsidered laying the same on the table. Nothing further was done until December 18, 1872, when the canal commissioners, assuming to act under chapter 343 of the Laws of 1872, let the work to Henry J. Mowry, accepting a bid put in by him when the work was first advertised. On this letting the commissioners did not advertise at all. A release had been executed by the mill owners in May, but it had not been approved by the attorney-general. A contract was made and the construction of the dam was begun, according to a plan which had not been submitted to the canal board, and differing in some respects from the one they had adopted. In March, 1873, Mowry obtained from one of the canal commissioners a draft upon the auditor of the canal department for $714, and in April, 1873, one for $1,292, being the amounts of the first and second estimates of the engineer. These drafts were protested for non-payment. Afterwards they were surrendered and certificates issued in their jflace. The contractor having refused to go further with the work until provision was made for payment therefor, the canal commissioner in charge applied to the relator to advance the necessary money, until provision could bo made for the payment thereof by the Legislature. Thereupon the relator and Parsons, the mill owner, obligated themselves to do so upon the assignment to them of the certificates issued or to be issued to the contractor. Work was resumed and the dam finished, and in July, 1874, a final certificate for $7,734.61 was issued to the contractor. All three certificates were duly assigned to the relator and Parsons, and Parsons afterwards assigned his interest to the relator. The commissioner in charge in his annual report for 1872, to the Legislature of 1873, stated the carrying away of the dam, that its maintenance was necessary for the State, and that the canal commissioners had contracted to have it built. In the annual report for 1874, to the Legislature of 1875, the aggregate amount of the three certificates issued was reported as an item of public expenditure. In 1875 the Legislature passed an act (chap. 263, Laws of 1875) appropriating moneys for the canal department, and among other things appropriating for the payment of certificates issued for work done on the Erie canal, etc., between January 1, 1874 and March 15, 1875, the sum of $107,004.03, and for interest on these and on other items named, the sum of $12,973.08. The witness Savage, a clerk in the auditor’s office, testifies that he made up the budget for the appropriations included in this act, and that the aggregate of the three certificates issued to the contractor, together with the proper interest thereon, was included in the above amounts. In 1876 the Legislature passed an act (chap. 425, Laws of 1876), which it is claimed repealed the act of 1875.
A. SchoonmaJcer (Attorney General) and Isaac D. Garfield, for the appellant..
J2. P. More and P. Countryman, for the respondent.

Opinion:
Learned, P. J.:
While 1 agree with much of the opinion of my brother Board-man, there is one important respect as to which I must disagree, and that is on the question of ratification by the act of 1875. The very ground of any ratification (by the Legislature or by any other party) must be Icnowledge.
the action in the auditor's office does not sbow knowledge in the Legislature. And especially it is not proved that the Legislature had knowledge of the illegality of these contracts. (People ex rel. Wasson v. Schuyler, 69 N. Y., 242.) If the language of the act expressly included the certificates the case would be quite different. But it does not. And therefore, when the act is claimed to be a ratification only, it should appear plainly that the Legislature, with knowledge of the circumstances respecting these certificates, must have intended by this appropriation in general language to ratify them. I do not think that such knowledge is shown, and I am of the opinion, therefore, that the judgment on the referee's report should be reversed, with costs.
TappaN, J., concurred.