Beloit Water Co. v. City of Beloit

Citations

• 91 Kan. 665
• 139 P. 388
• 1914 Kan. LEXIS 98

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>Sale — Watenvorks to City — Contract—Interest on Bonds Properly Applied, on Hydrant Rentals. A contract of sale of waterworks to a city was made by a written proposition of the water company, and an acceptance with modification by resolution and ordinance of the city. By a previous contract the city had agreed to pay certain hydrant rentals at the state fiscal agency, which by subsequent agreement were to be applied to the payment of interest on the bonds of the water company, also payable at the same agency. The city held some of these bonds, and instead of remitting the hydrant rental the interest coupons were delivered to the water company in payment of the hydrant rental. After a time the city ceased paying the rental, and interest payments on the bonds ceased at the same time. The contract of sale was then made, in which the city agreed to pay the hydrant rental from the date of default to the date of transfer and to cancel and surrender the bonds it held and all unpaid coupons, and to furnish evidence that all accrued interest had been paid. In correspondence between the date of the contract and the transfer, relating mainly to the assembling of securities and the release of the mortgage, the water company insisted that the hydrant rental should be paid in full to the date of delivery of its deed, and the city indicated its understanding that interest accruing upon the bonds it held should be applied on the hydrant rental. No reference was made to this claim of the city by the company, although it continued the correspondence for some time. In one letter the city stated the sum which would be due on hydrant rental at the date of the contemplated transfer, which was much less than the full amount, thus indicating a purpose to claim a credit. But the company made no inquiry or objection. Finally the company directed the city attorney to compute the amount of the rental and have a remittance made therefor. The computation was made