National Surety Co. v. Miller

The board of levee commissioners for the Yazoo-Mississippi Delta was incorporated under chapter 168, Laws 1884, and sections 228-232 of the Constitution recognized and continued the said board in existence, with the jurisdiction conferred upon it now to be mentioned. By section 4 of the said chapter of said laws it was enacted that the said board "shall have power, and it is hereby made their duty to build, rebuild, strengthen, elevate and maintain the levees upon and along the Mississippi river front, in and through the counties" of their district, and after further elaborations and grants in said section of this power, among which expressions is, "and may make all contracts for the work and all needful regulations and do all acts necessary to protect their said district from overflow by the waters of the Mississippi river," the act returns to the particular subject in section 27 and confers the widest discretion in these matters. Construing these sections our court said in Ham v. Board of Levee Commissioners, 83 Miss. at pages 552, 553, 35 So. 943, 946: "In view of the generality and broadness of the terms employed in granting powers to the appellee board, it is plain that it was the intention to vest the boards of levee commissioners with plenary authority to deal with the `erection, maintenance and repair' of the levee system at their discretion, for the purpose of protecting the property of their respective districts from loss and destruction."

On November 1, 1916, the board let a contract to R.T. Clark Co. to rebuild, strengthen, and elevate approximately sixteen miles of the levees. Owing to conditions which are fully set out in the statement of facts made a part of our opinion in Clark Co. v. Miller, 122 So. 475, the board on April 30, 1918, entered an order increasing the contract price, and the work thereupon proceeded, but *Page 121 under still greater difficulties, until the end of the year 1919, when the time for the completion of the contract expired under its terms, but when in fact only forty-eight per cent. of the work had been completed. The contractor was in a broken financial condition, their equipment was worn-out and in urgent need of replacement, labor was difficult to obtain and then only at large wages, all necessary supplies had advanced in cost beyond all prices theretofore known, and the contractor had informed the board and its engineers that he could go forward but a little while longer until complete bankruptcy would take him from the work. The board made efforts everywhere and in every available manner to get other contractors or to secure some other means to progress with the work, but without the slightest success. The chief engineer after a complete survey reported that no contractor or other living person could do the work at the then contract prices, nor for less than an increase of approximately seventy per cent., and the engineers were warning and threatening the board with the imminence of the danger of an annual major flood before the work would be finished unless the same were pressed forward with renewed energy. The levees on the Arkansas side were being built, and it was no less than a certainty that, unless those on the Mississippi side were also brought to standard, disaster to lives and millions of property would be the result. The Governor of the state was urging action, the attorneys of the levee board and the attorney-general of the state gave it as their mature legal opinion that the board had the legal power and authority to make a further increase in the contract price in order to secure the going forward with the work, without which increase it had become evident to all the work would not and could not be done.

The board made the increase, and the work was finally finished and in time to meet the flood of 1922, these being *Page 122 the only levees which fully withstood that flood, and likewise the greater flood of 1927, thereby exonerating the wisdom and foresight of the board in matter of fact, whatever may be the opinion as to its decision in point of law. The increase in the contract prices amounts in the aggregate with interest to more than a half-million dollars. The state revenue agent sued the contractor and the members of the levee board, who voted for said increase, to recover the said amounts of the said increase with interest, and he obtained a decree therefor in the trial court against the contractor and the said members of the said board.

The suit is based upon section 96 of the Constitution, which reads as follows: "The legislature shall never grant extra compensation, fee, or allowance, to any public officer, agent, servant, or contractor, after service rendered or contract made, nor authorize payment, or part payment, of any claim under any contract not authorized by law; but appropriations may be made for expenditures in repelling invasion, preventing or suppressing insurrections."

Under this section the appellant contractor is liable as was settled in Clark v. Miller, 142 Miss. 123, 105 So. 502, and the decree is correct in that respect. But there remains the question whether the appellant members of the said board are individually liable and on their bonds.

Although the situation which confronted the levee commissioners was grave and urgent, in fact to the utmost distressing, and although they had the opinion of their own attorneys and of the attorney-general of the state that they had the power to make the said increase in compensation to the contractor, and although they have in their favor the well-supported finding of fact by the chancellor that they acted in entire good faith and without intention of any wrong, yet when we look at the plain terms of section 96 of the Constitution, and contemplate *Page 123 the spectacle of trusted public officers invested with power over large public funds turning over these funds in what now appears to us to have been a violation of a salutary constitutional provision so clear that it is not easy to see why it was not clear to them at the time, we may confess some difficulty in passing over such a violation to a conclusion that these commissioners are not personally liable. But in this case, as in all others, when we find the course for our guidance well marked in the "uniform and solemn language of the common law," there being no express statute providing otherwise, it is our duty to follow.

It is the uniform and solemn language of the great weight of the decisions that a public board and the members thereof, so long as they act in good faith and from honest motives, and there is no express statute making them liable, are to be protected from the consequences of an erroneous decision when the matter upon which the action was taken was one belonging to the general class of cases within the cognizance of said board, or as otherwise termed was within the subject-matter of the general jurisdiction of the board, or, again, was within the scope of the subject-matter over which the board has general jurisdiction. The principle that protects the judge of a court of general jurisdiction against liability for erroneous action in relation to a matter within his jurisdiction and about which he is called on to decide under the law and the facts, in which he is to pass judgment, in other words, is to adjudge the issue one way or another, is applied to all boards which exercise semi-judicial or quasi-judicial powers, for the principle stands upon the same basis of reason as does the rule with respect to judicial officers; the only qualification being that as to quasi-judicial officers their acts must be bona fides and free from fraud and corruption. 22 R.C.L., pp. 485, *Page 124 486; 46 C.J., pp. 1043, 1044; 23 Am. Eng. Ency. Law, pp. 375-377.

"`The doctrine which holds a judge exempt from a civil suit or indictment, for any act done, or omitted to be done by him, sitting as judge," said Chief Justice KENT in Yates v. Lansing, 5 Johns. (N.Y.) 282, "has a deep root in the common law. It is to be found in the earliest judicial records, and it has been steadily maintained by an undisturbed current of decisions in the English courts, amidst every change of policy, and through every revolution of their government." And after reviewing the long line of English cases, he quotes with approval the first great case on the subject that received review in this country, Phelps v. Sill, 1 Day (Conn.) 315, wherein it was said that: "It was a settled principle, that a judge is not to be questioned in a civil suit for doing, or for neglecting or refusing to do a particular official act, in the exercise of judicial power. That a regard to this maxim was essential to the administration of justice. . . . The rules and principles, which govern the exercise of judicial power, are not, in all cases, obvious; they are often complex, and appear under different aspects to different persons. No man would accept the office of judge, if his estate were to answer for every error in judgment, or if his time and property were to be wasted in litigations with every man whom his decisions might offend." And in concluding his opinion, the Chief Justice, JAMES KENT, perhaps the most eminent name in all the literature of the law, observed: "Judicial exercise of power is imposed upon the courts. They must decide and act according to their judgment, and therefore the law will protect them. . . . No man can foresee the disastrous consequences of a precedent in favour of such a suit. Whenever we subject the established courts of the land to the degradation of private *Page 125 prosecution, we subdue their independence and destroy their authority."

Equally is it to be said that when we create boards and commissions and invest them with high duties and powers towards the accomplishment of great public objects, if we are to subject them to actionable liability for errors of decision and judgment and cast their estates in ruin, although they acted within their jurisdiction and in good faith, we will have only insolvents in office, or else those who will be so fearful of disaster to their private fortunes and the safety of their families that the rule of their conduct will be that of nonaction or of action so feeble and halting and cautious, their performances so paralytic of the vigor of decision, that they would become little more than objects of commiseration and at last of contempt.

The whole matter has been summed up by the supreme court of the United States in an opinion by Justice FIELD, in Bradley v. Fisher, 13 Wall. 335, 20 L. Ed. 651, with language so apt and comprehensive that the case has become the leading expression on the point, and the quotation now made from that opinion has been accepted in practically every jurisdiction as the settled law on the subject: "A distinction must be here observed between excess of jurisdiction and the clear absence of all jurisdiction over the subject-matter. Where there is clearly no jurisdiction over the subject-matter any authority exercised is a usurped authority, and for the exercise of such authority, when the want of jurisdiction is known to the judge, no excuse is permissible. But where jurisdiction over the subject-matter is invested by law in the judge, or in the court which he holds, the manner and extent in which the jurisdiction shall be exercised are generally as much questions for his determination as any other questions involved in the case, although upon the correctness of his determination in these particulars *Page 126 the validity of his judgments may depend. Thus, if a probate court, invested only with authority over wills and the settlement of estates of deceased persons, should proceed to try parties for public offenses, jurisdiction over the subject of offenses being entirely wanting in the court, and this being necessarily known to its judge, his commission would afford no protection to him in the exercise of the usurped authority. But if on the other hand a judge of a criminal court, invested with general criminal jurisdiction over offenses committed within a certain district, should hold a particular act to be a public offense, which is not by the law made an offense, and proceed to the arrest and trial of a party charged with such act, or should sentence a party convicted to a greater punishment than that authorized by the law upon its proper construction, no personal liability to civil action for such acts would attach to the judge, although those acts would be in excess of his jurisdiction, or of the jurisdiction of the court held by him, for these are particulars for his judicial consideration, whenever his general jurisdiction over the subject-matter is invoked. Indeed some of the most difficult and embarrassing questions which a judicial officer is called upon to consider and determine relate to his jurisdiction, or that of the court held by him, or the manner in which the jurisdiction shall be exercised. And the same principle of exemption from liability which obtains for errors committed in the ordinary prosecution of a suit where there is jurisdiction of both subject and person, applies in cases of this kind, and for the same reasons."

So in the case at bar. The levee board had jurisdiction over the subject-matter. It was within the general scope of their jurisdiction to build the levees, or to repair or to reconstruct them and to do all things needful to the accomplishment of that object. To contract with a contractor and to pay said contractor to build or rebuild *Page 127 or repair the levees was a function within the general scope of their jurisdiction; it was a subject-matter over which they had jurisdiction. In their decision in respect to making the contract here involved they mistook and exceeded their legal powers, but it was nevertheless of a matter within the subject-matter over which they had general jurisdiction.

It is, as we think, just at this point that the divergence of opinion arises. We submit that it arises out of a confusion of legal power with jurisdiction, as if synonymous; whereas, in respect to the question here in hand power is distinguished from jurisdiction. That distinction is well illustrated by Justice FIELD in the above quotation when he refers to the action of a court, which although it has general jurisdiction over the subject of criminal offenses, yet sentences a convict to a greater punishment than that allowed by law. As to the excess punishment there was an absence of legal power, but there was present the jurisdiction over the subject-matter. If, on this question of immunity, we shall consider jurisdiction as no greater than legal power, then immunity disappears, and all that the law throughout generations has said on that subject is laid aside. For so long as officers act within their legal powers there is no occasion for immunity. The very term presupposes error — action without or beyond legal power. And it can make no essential difference in legal effect that the power which is absent, is absent because it has never been granted, or, on the other hand, is absent because it is prohibited. In either case it is absent, does not exist. We cannot grasp the conception that nonexistence can be less than nonexistence, or that there can be different kinds of nonexistence, or that that which is absent can be more absent. When a power is expressly prohibited, it may for that reason be the more difficult to convince the trier of the facts that the officer has acted in good *Page 128 faith, and that his conduct has been the result of an honest error; nevertheless when, as is the case here, the good faith and the honesty of the error, is established in the evidence, and admitted in the argument, every distinction, for all the practical purposes of decision, in a case such as this, disappears as between want of power because not granted and want of power because prohibited.

Pertinent to the thought just expressed it may be observed that the record discloses that all the discussions which arose among the members of the levee board respecting their legal power and authority to take the action upon which this suit is based, and all the argument and progress of opinion on the part of their attorneys and of the attorney-general of the state in advising the commissioners that they had the legal power to take their said action, following which they did act, turned upon the question whether section 100 of the Constitution stood in the way. Section 96 was never mentioned. It did not at the time occur to the attorney-general or to the attorneys of the levee board, or to any one else, so far as the record discloses, that section 96 was, or would be, in any way an operative factor. Apparently, it was supposed that the prohibition of that section is one directed solely against legislative enactment; the fact being that the legislature only is mentioned in section 96, and the fact being further that it had never been held to apply to any other state agencies until the case of Clark v. Miller, 142 Miss. 123,105 So. 502, was decided by this court in 1925. Clear as it may seem to us now, it cannot justly be maintained, as we think, that the mistake of the board and of their attorneys and of the attorney-general in supposing, as they must have supposed, that section 96 applied only to the legislature, is a mistake so utterly indefensible as to divest them, as a matter of law, of the defense of good faith and honest error; and unless the *Page 129 latter can be done there can be no liability, since they were acting within the scope of their general jurisdiction.

The ancient and established principles to which we have in the main addressed ourselves in the foregoing paragraphs have long been well recognized in this state. In Bell v. McKinney, 63 Miss. 187, a mayor fined and imprisoned a person for an offense committed outside the limits of his municipality. He had no legal power so to do, and in it he clearly exceeded his powers — in fact, he had no power whatever to do what he did. But in a suit against him because of it, the court in recognition of the aforementioned established principles said: "The extent of his authority was to have required appellee to give bond or recognizance to appear at the circuit court. But as he had jurisdiction as a conservator of the peace of the offense charged and acted in good faith, he is not liable under these circumstances for errors of judgment or mistakes of law committed in the execution of his office." In Paxton v. Baum, 59 Miss. 531, a suit against a member of the board of supervisors for appropriations of money on public contracts not let in the manner provided by law, in other words upon void contracts, the court expressly declared that it is "the well-settled rule of the common law that for errors or mistakes a public officer acting judicially or quasi-judicially is not liable," and in holding the board not liable, because the appropriations were made to "objects authorized by law," using that term, as it appears from the entire opinion, as being synonymous with the term "jurisdiction of the subject-matter," the court concludes its opinion in these words: "Manifestly it is impossible, after we pass the point of corruption to draw any line other than that named by us, namely, liability where the subject-matter of the appropriation is beyond the jurisdiction of the board; non-liability where the object is within the jurisdiction, *Page 130 but there has been a mistaken exercise of legal power." To the same effect is Paxton v. Arthur, 60 Miss. 832, in which the court said if the appropriations were honestly made, though in mistake of law or fact and "were to an object which, under some circumstances, might lawfully be made," the members of the board are not liable for appropriations to such objects.

But the case most squarely in point with the case at bar is State to Use of Lincoln County v. Green, 111 Miss. 32, 71 So. 171, 172. There Green was the county superintendent of education, and among the several items upon which he was sued was the issuance of illegal pay warrants in the aggregate of four thousand seven hundred dollars paid out to teachers in excess ofthe amounts called for by their contracts — a thing as much and as clearly within the prohibition of section 96 as is the case now at the bar. The court, however, adhering to the same ancient and established principles that "a public officer is not liable to an action if he falls into error in a case where the act . . . is one in relation to which it is his duty to exercise judgment and discretion," denied liability, and concluded its opinion in these words: "In view of the fact, therefore, that the work paidfor by the superintendent. . . . were within the jurisdictionof his office and no corruption is charged, the bill fails to state a cause of action." The work paid for was within the jurisdiction of his office, says the court, and so it is in the case in hand; the sums paid were paid for work in building these levees, and building the levees was within the express jurisdiction of the levee board. The court in the Green case did no more than to make, in other terms, an application of the language used by the court in Paxton v. Baum wherein the court there said: "It is for money appropriated to something for which the law does not permit it to be appropriated at all, in any way or under any circumstances, that members are personally *Page 131 liable. . . . It is what the money is appropriated to, and not how it is applied, that furnishes the test of personal liability for it. `Object' signifies the thing aimed at, the end sought to be accomplished." Applying this language here, the object or thing aimed at, the end sought to be accomplished, was the building of the levees, the thing that the law placed within the jurisdiction of the levee board, and charged them with the duty to do.

Much reliance is placed by appellee on Miller v. Tucker,142 Miss. 147, 105 So. 774, but in that case it will be observed there was no purpose to overrule the case of Paxton v. Baum, or similar cases, or to disturb the principles of those cases; the same principles being in fact reaffirmed by Miller v. Tucker, as the opening pages of the opinion reveal. Such being the case, appellants have also cited it as an authority in their favor. It was rather the purpose of the Miller v. Tucker case, to apply as to some of the items therein an express statutory personal liability in respect to members of the board of supervisors; but there is no such personal liability statute in cases of levee boards, and we must proceed in the case now before us under the common law. Unless the Miller v. Tucker case, is construed as we have just stated, then it is in conflict with State to Use of Lincoln County v. Green, which is not even referred to in Miller v. Tucker. It may be that as to one or two others of the several items dealt with in the Miller v. Tucker case the exact facts touching those items did not bring them without the rule of nonliability that in its main or major aspects was being sought to be applied by the court. Of a somewhat similar situation it was said by the court in Leavenworth v. Reeves, 106 Miss. at page 731, 64 So. 660, 663: "The case . . . relied on by appellee is not in conflict with the view here expressed, and the rule applied in that case is the same as the rule applied here. It may be that the facts of that case did not bring it within the *Page 132 rule, and to that extent the court was then in error, and conceding, for the purpose of the argument, that this is true, that fact is of no importance here, for the rule itself was leftby the court undisturbed." Principles control decision; when the principle is clear and well established, the court applies the facts of each successive particular case as best it can to that principle, and though this may be inaptly or even erroneously done in some detail in one case, that alone and of itself does not overthrow the principle, which lives on as before.

Cases in other jurisdictions, such for instance as the case of Chippewa Bridge Co. v. Durand, 122 Wis. 85, 99 N.W. 603, 106 Am. St. Rep. 931, have been strongly relied on by appellee. These cases in general were where the officers, not by mistake or erroneous interpretation or decision, but purposely and knowingly wholly disregarded the fundamental requirements of the procedure, which were a part of the essentials of the exercise of their jurisdiction, and awarded contracts privately instead of proceeding by public advertisement. We are not called on to expressly differentiate these cases for several reasons, one of which is that as to the case in hand there was no requirement in the law how the levee board should let its contracts. It is admitted in the argument that the levee board could let all its contracts privately under the law; or so far as concerns any specific or particular directions in the law the levee board could have done the work itself with its own implements and with day and salaried labor; and again, when we find the principles which control a case well established in our own decisions, there is no requisite occasion to deal with cases in other states beyond a reference to those outstanding and leading opinions from the great masters of the law who have laid down and illustrated the principles which our own court has long recognized and followed. *Page 133

Finally, it is contended that when the board had let its contract its authority in that respect was exhausted, and that in its subsequent action in making its amended contract, or its contract for the increased compensation, it did so without authority, that is to say, in want of authority, its authority having been exhausted; and the argument is that, such being the case, its latter action was beyond its jurisdiction. If the board had no legal power, it would be an indifferent matter, so far as concerns the question before us, whether there was an absence of grant of the legal power, or it was absent because prohibited or was absent because already exhausted. In either of these events the power was absent; nevertheless the action taken was within a subject-matter, which subject-matter in turn was within the general jurisdiction of the board. The contention is no more than the other contentions that when there is an absence of legal power there is an absence of jurisdiction; it is the same contention merely in another form. The issue for the board to decide was whether it had the legal power and that question involved a determination as a legal issue, along with all the other legal issues, whether its power had been exhausted, and for honest legal error in arriving at their conclusion in that respect the members are as much within the reason of the rule, and therefore within the rule itself, as in any other respect touching the questions of law and fact which, within the general scope of the subject-matter of their jurisdiction, they were called on to decide.

The case at bar, summarized, is that the action of these members of the levee board complained of was in respect to a decision of the board within the scope of the subject-matter over which the board had general jurisdiction; the object for which the money was appropriated and paid by it was to secure the building of the levees, the building of which was not only within the jurisdictional *Page 134 province of the board, but was its duty. The thing aimed at, the end sought to be accomplished, the work for which these payments were made, was to an object or end the consummation of which was the chief purpose in the creation of the board and the vesting in it of its jurisdiction; — that was its general jurisdiction. In their action the error was free from fraud and corruption, was in good faith. This must be the end of the matter unless the court is to hold that in the absence of legal power there is liability, which is to say, if there is error with respect to the legal power and the legal power is exceeded, then there is liability; and as already pointed out, this would be to deny the doctrine of immunity and cast it out of the books. This would permit liability, for instance, in a case where a board has acted upon an apparently valid statute clearly giving a power, but the statute is subsequently declared unconstitutional, so that it had never had any real existence. Thereupon suit is begun against the members of the board for acting without legal power, and being without power they would have no defense. Illustrations of the unjust and mischievous consequences of such a doctrine could be extended almost beyond number. To uphold liability whenever, without more, there has been an error of law in the actions of boards or commissioners would be to require of men, who as a rule are not learned in the intricacies of legal science, such a perfect knowledge of the law, such a superiority over all its uncertainties and obscurities, such an infallible foresight of what will be adjudged in the last resort in the future, as none however eminent on the bench or at the bar can for a moment be supposed to possess. Such a rule cannot, as we think, be supported in just reason, and, as we have attempted to show, is not in accord with maturely established principle. *Page 135

The decree will be affirmed as to the appellants R.T. Clark Co.; but as to the remaining appellants the decree will be reversed, and the bill dismissed.

Affirmed in part, and in part reversed.