Opinion ID: 75752
Heading Depth: 3
Heading Rank: 1

Heading: Commissioner McCall's Authority

Text: 10 Both parties acknowledged that some contract existed; the issue is the nature — and therefore the extent — of the obligation. 2 According to ISN, Commissioner McCall verbally accepted ISN's offer to manage and coordinate Y2K remediation. The City argues that McCall's acceptance, whether verbal or written, is legally irrelevant since McCall did not have the authority to contractually bind the City. 11 Under Georgia law, one who deals with a public officer must determine whether the officer has the authority necessary to bind the public entity. City of Atlanta v. Black, 265 Ga. 425, 426, 457 S.E.2d 551, 552 (1995). Such due diligence may require a party to take affirmative steps; parties are presumed to know the law. O.C.G.A. § 1-3-6. Furthermore, a party is charged with notice of state law as well as municipal codes. City Council of St. Mary's v. Crump, 251 Ga. 594, 595, 308 S.E.2d 180, 182 (1983). 12 Upon review of the documents governing Atlanta, it is clear that Commissioner McCall lacked the authority to contract on the City's behalf. Only two people are so authorized: section 3-104(10) of the City Charter grants the power to the mayor, and section 2-1137(a) of the City Code grants the power to the City's purchasing agent. Other than these two officers, no city officer or employee shall order the procurement of supplies, services, construction, professional or consultant services and real estate or make any contract other than through the bureau of purchasing and real estate. Atlanta City Code, § 2-1138(c). 13 We note that the purchasing agent, who has the authority to contract for the City, reports to Commissioner McCall. ISN's belief that Commissioner McCall could contract for the City thus seems fairly reasonable. An apparent authority theory, however, cannot succeed under these circumstances. Under Georgia law, the [p]owers of all public officers are defined by law and all persons must take notice thereof. The public may not be estopped by the acts of any officer done in the exercise of an unconferred power. O.C.G.A. § 45-6-5. 14 This statute was applied in 1997 when the City of Atlanta faced almost identical litigation. Two public officers, without the authority to do so, signed a contract committing Atlanta to payment for consulting services. When the consultants sued the City for breach of contract, the court reasoned that [s]ince this case does not involve an irregular or unauthorized method of exercising a granted power, but rather action taken by City officials who had no authority to do so, the unauthorized nature of the contract precludes [the plaintiffs] from asserting estoppel against the City. Walston & Assocs., Inc. v. City of Atlanta, 224 Ga.App. 482, 483, 480 S.E.2d 917, 918 (1997). Furthermore, [t]here can be no estoppel by conduct where both parties have equal knowledge or equal means of knowing the truth. Tybrisa Co. v. Tybeeland, Inc., 220 Ga. 442, 446, 139 S.E.2d 302, 306 (1964). Here, ISN had both the means to know the truth and the duty to discover it. Any acceptance made by Commissioner McCall bound the City to nothing.