City of Northport v. Northport Townsite Co.

Citations

• 27 Wash. 543
• 68 P. 204
• 1902 Wash. LEXIS 423

Syllabus

<p>CONTRACTS-AGAINST PUBLIC POLICY-INTEREST OF OFFICER IN CITY CONTRACT.</p> <p>The interest of a councilman in a contract entered into by the city for the improvement of a street is established when it appears that such councilman was at the time a large stockholder and business manager of a lumber company, and that as such business manager he sold to the contractor the material to construct the improvement under an agreement to receive the improvement warrants in payment therefor.</p> <p>SAME-ENFORCEMENT OF ASSESSMENT FOR STREET IMPROVEMENT-3STOPPEL-VALIDITY OF CONTRACT.</p> <p>The fact that a property owner stood by and allowed the city to improve a street upon which his property abutted, without raising any objection to the letting of the contract or the levy of the assessment would not estop him in an action to enforce the assessment from setting up the illegality of the contract by reason of the interest of a member of the city council therein, since, under Bal. Code, § 968, which forbids city officers from being interested in city contracts, and provides that “any claim for compensation for work done, or supplies or materials furnished, in which any such officer is interested, shall be void, and, if audited and allowed, shall not be paid by the treasurer,” such contract is shorn of all equitable features, and the duty imposed on the court of declaring the contract void, whenever its illegality appears from the evidence.</p> <p>SAME-RULE APPLICABLE TO STOCKHOLDER.</p> <p>The interest of a stockholder of a corporation in corporate contracts brings such stockholder within the reason of the rule prohibiting a city officer from being interested as an individual in the city’s business.</p>