City of Ft. Scott v. W. G. Eads Brokerage Co.

Citations

• 117 F. 51
• 54 C.C.A. 437
• 1902 U.S. App. LEXIS 4404

Syllabus

<p>1. Municipal Corporations—Powers Limited by Statutory Grant.</p> <p>The powers of municipal corporations are limited to those expressly granted and those fairly implied therefrom or incidental thereto, and a reasonable doubt of the existence of a power is fatal to its being.</p> <p>2. Same—Power—Prescription of Manner of Exercise Negatives Right</p> <p>to Use Otherwise.</p> <p>The prescription, by the statutes, under which, a municipality is organized or acting, of the manner in which it shall exercise one of its powers, limits the right to exercise it to that method, and its use in any other way is ultra vires of the corporation, and void.</p> <p>8. Same—Statutory Method of Investing Sinking Funds Exclusive.</p> <p>When a municipal corporation of Kansas has a sinking fund In excess of $2,000 for investment in the purchase of its bonds, the statutes of that state require it to advertise for bids and to invest the fund in the bonds of those parties who offer them at the lowest price. Gen. St. Kan., 1899, §§ 6284, 6294. A city in such a situation made a contract with a brokerage company to repay it the amount it should expend in the purchase of the city’s bonds, not exceeding their par value and 10 per cent, premium, and to pay the company for its services in addition more than 16 per cent, of the par value of the bonds it bought Held, the statute prescribing the method of investing the sinking fund was exclusive, the contract with the brokerage company was ultra vires of the city and void, and a contract to pay the reasonable value of such services was void for the same reason.</p> <p>4. Same—Estoppel from Denial of Lawful Exercise of its Powers.</p> <p>A municipal corporation, which has retained the benefits of a contract Invalid not because it was beyond the scope of its powers but because’ in the making or performance of the agreement the power of the municipality was illegally exercised, may be estopped from denying the validity of the contract as against an i