City of New Orleans v. Liquidators of Louisiana Nat. Bank

Citations

• 123 La. 654
• 49 So. 274
• 1909 La. LEXIS 762

Syllabus

<p>Depositaries (§ 10*) — Interest on Public Monet — Tacit Reconduction.</p> <p>The city of New Orleans in 1900 entered into a conu-act with certain banks, in which, among other matters, the banks, as fiscal agents of the city, bound themselves in solido to pay it 6% per cent, interest per annum upon the average amount of daily balances to the credit of the city treasurer. The contract so entered into was for four years, and under its terms it then expired. Nothing was said by either party at its termination as to a continuance thereof; but as a fact the banks continued to receive on deposit, and pay out as before, the moneys of the city until the ,10th of March, 1905, when a new fiscal agent, having been elected by the city council, qualified and entered upon its duties as such.</p> <p>In the present suit the city sues the banks on the contract for interest at the rate agreed upon therein on the moneys received by them in the interval between the date fixed for the expiration of the contract and the date of the entering upon its duties by the succeeding fiscal agent. The plaintiff declared upon a contract, not a quantum meruit, and relied upon “tacit reeonduetion.”</p> <p>The district court dismissed the suit as brought, under reservation of the right to sue upon a “quantum meruit.”</p> <p>That judgment was correct, and is affirmed.</p> <p>There was, for reasons assigned, no tacit re-conduction of the contract. The parties to it were banking corporations on one side, and a municipal corporation on the other. Both, in creating the contract, were acting under special authority as to what should be done. From the fact that the parties had authority and capacity to enter into the contract as made, there was no implied authority in them to extend it.</p> <p>Tacit reconduction resting upon presumed consent of all parties to the extension, such consent will not be presumed where conditions existing at the commencement of the contract had materially changed at the expirati