In interpreting the contract between Public Market Company of Portland and the City of Portland, certain well-known rules of construction should be kept in mind: 1. The intention of the parties to the contract is to be ascertained and given effect (§ 9-215, Oregon Code 1930). 2. "The circumstances under which it was made, including the situation of the subject of the instrument, and of the parties to it, may also be shown," so that the court may be placed in the position of those whose language it is to interpret (§ 9-216, Oregon Code 1930). 3. The *Page 181 function of the court is "simply to ascertain and declare what is, in terms or in substance, contained therein, not to insert what has been omitted, or to omit what has been inserted" (§ 9-214, Oregon Code 1930).
We should also keep in mind the provisions of § 148 of the charter of the city of Portland, which provides that: "The City of Portland shall not be bound by any contract nor in any way liable thereon, unless the same is authorized by an ordinance and made in writing and signed by some person or persons duly authorized thereunto by the council".
In order to place ourselves in the position of the contracting parties and to discern their intention in entering into said contract, we shall take up in chronological order the events leading up to and culminating in the execution of the contract here involved. On August 5, 1931, the council of the city of Portland enacted ordinance No. 61192, the title of which reads as follows: "An ordinance providing for the issuance and sale of public market utility certificates of the city of Portland, Oregon, in an amount not exceeding two million five hundred thousand dollars ($2,500,000.00), to be hereafter dated as determined by the council by resolution, authorizing the execution of a trust mortgage against real property to secure said certificates, approving the form of said certificates and interest coupons thereon, and providing for the retirement of the certificates."
The first section of this ordinance recites that: "To provide funds for the purpose of purchasing and establishing a public market as a public utility, public market utility certificates shall be issued by the City of Portland" in an amount not exceeding $2,500,000. The ordinance proceeds to set forth the form of the certificates and the form of the interest coupons thereto *Page 182 attached, and then recites that the certificates authorized by the ordinance "shall be secured by a trust mortgage covering the real property and the buildings constructed thereon and all equipment, furnishings and personal property owned by the city and used for the said public market". It is further stated that such certificates shall not be a general obligation of the City of Portland but shall be paid from the net revenue derived from the operation of the public market.
Section 6 of the ordinance is as follows:
"It is the purpose and intention of this ordinance that the city of Portland, Oregon, shall obligate itself to establish a public market in the city of Portland, Oregon, as a public utility and to purchase land and buildings and equipment therefor. At the time of the enactment of this ordinance the council had not selected any real property for use as a public market. Such selection shall hereafter be made by the council by ordinance and when so purchased the same is hereby declared to be a public utility and the city of Portland, Oregon, further obligates itself to establish and put into effect, in so far as its powers will permit, a sufficient schedule of charges for the use of said public market and the privileges and facilities offered in connection therewith to raise a sufficient annual revenue to meet the following expenses, to-wit:
"(1) A sufficient sum for the maintenance of said public market.
"(2) To meet the annual interest on all public market utility certificates authorized hereby.
"(3) To provide a sufficient sum for the annual retirement of the number of certificates specified herein."
Section 7 of the ordinance provides that said certificates shall be advertised and sold "after said public market shall have been established and constructed".
On October 10, 1931, ordinance No. 61566 was passed by the city council of Portland, with title thereof as *Page 183 follows: "An ordinance selecting and designating certain real property for use as a public market and authorizing the purchase of said real property and the building to be constructed thereon and the equipment to be installed in said building upon the terms and conditions required by ordinance No. 61192, passed August 5, 1931, and upon such other terms and conditions as shall hereafter be determined by the council, and authorizing preparation, approval and execution of a contract with the Public Market Company of Portland, and declaring an emergency."
Section 1 of this ordinance is thus worded: "Conforming to the provisions of ordinance No. 61192, entitled . . ., the hereinafter described real property is hereby selected and designated for use as a public market and the purchase of said real property and a building to be constructed thereon and equipment to be installed in said building is hereby authorized from the Public Market Company of Portland, an Oregon corporation, owner thereof, upon the terms and conditions required by said ordinance No. 61192, and subject to the terms of the contract hereinafter referred to." Then follows a description of the real property.
Section 2 of ordinance No. 61566 provides that: "The mayor and auditor are hereby authorized to execute on behalf of the city a contract with the Public Market Company of Portland in conformity with the plans and specifications now on file with the auditor, subject, however, to such changes as may be determined by the city. Provided, however, that the form of said contract shall be prepared by the city attorney and said contract shall be approved as to form and contents by the council by resolution prior to its execution by the mayor and auditor." *Page 184
The only remaining section of the ordinance is the one declaring an emergency.
The foregoing two ordinances are the only ordinances on the subject passed by the city council preceding the execution of the contract between the market company and the city of Portland. Therefore, to hold the city liable on its contract at all, either generally or otherwise, it would be necessary to find authorization for execution of the contract in one or both of these ordinances: § 148, charter of the city of Portland. The first of these ordinances, to wit, No. 61192, declared it the purpose and intention of the city to obligate itself to establish a public market as a public utility and to purchase land, buildings and equipment therefor, and provided the method of raising funds to purchase such public market, that is, by the issuance of public market utility certificates.
In conformity to the provisions of that ordinance the city council did, by ordinance No. 61566, designate the land on which the market was to be located and did authorize the execution of a contract with the market company, plaintiff herein, for the purchase of land and the buildings thereon located, as a public market. It is therefore appropriate at this point, before referring to the terms and conditions of the contract between the market company and the city of Portland, to examine the provisions of ordinance No. 61566 in order to ascertain the terms and conditions under which the city was authorized to enter into such a contract.
The title of that ordinance states as the purpose of the enactment the selection and designation of certain real property for use as a public market and the authorization of the purchase thereof "upon the terms and conditions required by ordinance No. 61192 . . . and upon such other terms and conditions as shall hereafter *Page 185 be determined by the council." It is suggested that by the use, in the title, of the words "and upon such other terms and conditions as shall hereafter be determined by the council" it was contemplated by the council that it had a right, when entering into such contract with the market company, to ignore the provisions of ordinance No. 61192. It is further asserted that the word "other" as used in that part of the title last above quoted means "different" and that the title of the act should be interpreted as authorizing the purchase of the property selected under the terms and conditions required by ordinance No. 61192 or upon such different terms and conditions as the council might determine.
The word "other" as defined by all the dictionaries and lexicographers has numerous meanings, depending upon the context in which it is found. In some instances it may mean "different", while again it may mean "additional". In the title of this ordinance the word "other" is preceded by the conjunction "and", which would indicate that it was used in the sense of "additional", although had it been preceded by the disjunctive "or", it might be construed to mean "different" or "unlike".
Further reason for holding that the word "other" as used in the title of ordinance No. 61566 has the connotation of "additional" is found in the fact that the word is immediately preceded by "such", which means "similar" or "the same as previously mentioned or specified". In this connection we quote fromTraders' Insurance Company v. Dobbins Ewing, 114 Tenn. 227 (86 S.W. 383), the following:
"The first or primary definition of the word `such' given in the authority above referred to is, `of that kind; of like kind or degree; like, similar.' Following *Page 186 this definition is a short essay upon the expression `such as,' which we have quoted above, and the two examples which we have copied, along with numerous other instances of the same kind. There is a secondary meaning of the word `such,' which is given as `the same as previously mentioned or specified'; `not other or different.' We are of opinion, however, that the primary meaning of the word is the correct one to be applied in the present case, especially as the word `such' is followed by the word `as.' This meaning is strengthened by the use of the word `other.' The words being read together as they stand in the clause, `and such other merchandise as is usually kept for sale in a retail hardware store,' means articles in addition to those already mentioned; their kind being only limited by the provision that they shall be of a sort usually kept in retail hardware stores."
See also: In re Tidball, 40 F.2d 560; Ex parte Hull,18 Idaho 475 (110 P. 256, 30 L.R.A. (N.S.) 465).
It is a well-known rule of statutory construction that when an act or ordinance is ambiguous or subject to more than one interpretation, the title thereof may be looked to in aid of construction. It is also a familiar rule that anything contained in the title of the act which is not found in the body thereof, either expressed or implied, is surplusage and must be ignored. Turning now to the body of the ordinance, we find in § 1 thereof that the city council has ordained that, "conforming to the provisions of ordinance No. 61192," certain described real property is selected and designated for use as a public market and that the purchase of said real property with the building constructed thereon and equipment installed therein "is hereby authorized from the Public Market Company of Portland, an Oregon corporation, owner thereof, upon the terms and conditions required by said ordinance No. 61192, and subject to the terms of the contract hereinafter referred *Page 187 to." There is nothing stated to the effect that the market property may be purchased on terms and conditions different from those contained in ordinance No. 61192.
The part just quoted does provide that the purchase shall be subject to the contract "hereinafter referred to", and we find in § 2 of this ordinance that the contract which the mayor and the auditor are authorized to execute on behalf of the city for the purchase of the property is subject to the requirement that the "building to be erected thereon and equipped by said Public Market Company of Portland" shall be "in conformity with the plans and specifications now on file with the auditor, subject, however, to such changes as may be determined upon by the city." There is no indication afforded by a reading of the entire body of the ordinance that the city council is authorizing the execution of a contract for the purchase of a public market on terms and conditions different from those provided in ordinance No. 61192. The last-mentioned ordinance did not attempt to set forth all the terms and conditions for the purchase of such public market, and it is only natural that there must be terms and conditions written into the contract in addition to, but not in conflict with, those contained in that ordinance.
The contract which is the subject of this litigation was entered into October 28, 1931, between the market company and the city of Portland. Section 1 of the contract is in part as follows:
"The company agrees that within fifteen (15) days after the city shall have secured the approving opinion of legal counsel and the authority of the city to issue and sell the public market utility certificates authorized by ordinance No. 61192, it will resume active construction of a public market building upon the real property in the city of Portland hereinafter more particularly *Page 188 described, according to plans and specifications hereto attached".
After stating that the contract was executed by the market company through its duly authorized officer, the instrument recites, "and the said City of Portland has caused these presents to be executed by its mayor, attested by its auditor, pursuant to authority duly given under the terms of ordinance No. 61566 of the city of Portland, enacted on the 10th day of October, 1931, and effective on the 10th day of October, 1931, and resolution No. 20291, adopted October 28, 1931."
The agreement obligates the market company to construct a public market building upon the real property referred to and described in ordinance No. 61566, according to certain plans and specifications, under the supervision of the building inspector or city engineer of the city of Portland, with authority given the city to make alterations and changes in the said plans. It also obligates the market company to acquire and install in the said building, within ten days after the completion thereof, "equipment, materials and supplies" described in an exhibit attached to the contract, at an estimated cost of $46,000. The city agrees to pay the actual cost thereof plus ten per cent, "in addition to the principal sum to be paid the company, as hereinafter fixed".
The contract further provides that upon completion of the building and purchase and installation of equipment, materials and supplies, the market company shall convey to the city by warranty deed a good and marketable title to the real property and convey the movable fixtures and personal property by bill of sale, and the city agrees to "accept said conveyances and said *Page 189 assignments" and to pay to the market company the sum of $1,244,790.66.
There is a further provision in the contract to the effect that "before the city acquires said public market building it shall be so occupied as to be a going public market utility." In order that the said building might be in use as a going concern, the market company was to perform "leasing services for the procuring of tenants" for the building.
Many other details are contained in the contract, among them the requirement for an accounting between the market company and the city covering the compensation to be received by the market company for its services in obtaining tenants, and the amount due to the city for rents received by the market company, also other matters necessitating an accounting.
The contract further provides that the title to be conveyed to the city "shall be subject to the unmatured intercepting sewer and drainage system assessments, which the city assumes and agrees to pay out of the revenues from said public market utility". There is also this provision: "It shall also be permissible for said title to be subject to taxes and assessments due and payable after November 5, 1931. The company agrees that it will pay all legal taxes, assessments and interest which become due and are payable after November 5, 1931, up to the time that it delivers title to the city, and the city agrees that it will reimburse said company from funds derived from the sale of public market utility certificates for all sums which said company shall pay for such taxes, assessments and interest, with interest at 6 per cent from the date of said payment or payments."
The conclusion seems inescapable that the contract between the market company and the city of Portland *Page 190 contemplated that the market company should be paid out of funds realized from the sale of public market utility certificates issued in pursuance of ordinance No. 61192. That ordinance was passed pursuant to §§ 151, 153 and 155 of the charter of the city of Portland, and especially in pursuance of the last-mentioned section, which authorizes the city council to issue and sell public utility certificates for the acquisition by purchase or otherwise of any public utility to be operated within the city. Section 155 specifically provides that the said certificates shall not be a general liability of the city, but that the same shall be paid solely from the revenues derived from the plant or from the sale thereof, and further provides that the power thereby granted to the council shall be exercised only by ordinance.
The contract here involved must be construed in connection with the ordinance or ordinances authorizing the city to enter into such contracts. The authority to bind the city on this contract is found in ordinance No. 61566, which by its terms refers to and incorporates the provisions of ordinance No. 61192. In neither of these ordinances is found any provision which expressly or by implication authorizes the city to enter into any contract for the purchase of a public market utility to be paid for out of the general funds of the city or otherwise than through the issuance of public market utility certificates.
The contract before us states that the same is executed by the mayor and attested by the auditor pursuant to authority duly given under the terms of ordinance No. 61566 and resolution No. 20291. Resolution No. 20291 is to the effect that the contract here under consideration is approved as to form and contents, by the council. This is merely a resolution of the city council *Page 191 which is signed by the auditor alone, and not signed by the mayor and attested by the auditor as required of ordinances by § 51 of the Portland charter. It can not be asserted that this resolution modified or superseded ordinance No. 61566.
There are other and persuasive reasons indicating that the parties to the contract intended that the funds to make payment under the contract were to be derived from the sale of public market utility certificates. By the terms of the contract the plaintiff is not only required to complete the market building but to provide the same with necessary furnishings and equipment, to obtain tenants and in general to do everything necessary in order to turn over the market as a going concern. With the market utility in that condition, the city would be in a position to dispose of the public market utility certificates. It seems somewhat strange, if the city intended to create a general obligation, that it did not purchase the land and let the contract for the construction of the building and the installation of equipment, fixtures and furnishings therein to the lowest responsible bidder.
In support of the contention that it was contemplated by the parties to the contract that the purchase price should be a general obligation of the city, not limited to the funds realized from the sale of utility certificates, plaintiff has directed attention to the provision in the contract which expressly requires that plaintiff shall be reimbursed out of funds derived from the sale of public market utility certificates, for taxes and assessments due and payable after November 5, 1931, and paid by plaintiff. It is argued that since the contract expressly provides that these charges shall be paid out of the funds derived from sale of the certificates and the contract is silent as to the manner of *Page 192 payment of the other obligations under the contract, the parties to the contract must have intended that those other obligations were not to be limited to funds realized from the sale of such certificates but should be a general obligation of the city. Even to ignore for the moment the requirement in the city charter that before the city can be bound by any contract it must have authorized the same by ordinance, there still remains no valid reason to hold that by specifically providing for payment of the taxes and assessments out of funds realized from sale of the certificates the city undertook to pay to the plaintiff out of its general funds the remaining obligations incurred in connection with acquiring the market utility.
A number of reasons might be suggested for specifically providing for the payment of those taxes and assessments out of funds derived from the sale of public market utility certificates. It is apparent that the purchase price agreed to be paid for the real property and the building thereon located, to wit, $1,244,790.66, was not intended to cover taxes and assessments due and payable after November 5, 1931, which was the final date for the payment of taxes due and payable during the year 1931. Therefore, since the purchase price named in the contract did not include taxes due and payable subsequent to November 5, 1931, and since the contract specifically provided that the title conveyed might be subject to such taxes, it was only reasonable, in order that there should be no misunderstanding, to provide that the plaintiff should be reimbursed out of funds derived from the sale of the certificates, for the payment of those taxes.
It will further be noticed that immediately preceding the reference to the payment of taxes, the contract *Page 193 provides that the title to the real property may be subject to the unmatured intercepting sewer and drainage system assessments, and expressly provides that these assessments be paid out of the revenues from the operation of the public market. Had the contract not contained a provision that the taxes and assessments due and payable after November 5, 1931, be paid from the funds realized from the sale of the certificates, it might be assumed that they should be paid out of the revenues from the operation of the public market, as previously specified with reference to the payment of the sewer and drainage system assessments.
By specifically providing the manner of discharging certain incumbrances existing against the property at the time of conveyance to the city, it is apparent that the city did not intend to assume any general obligation in connection with the acquisition or operation of the public market utility. Moreover, it is unreasonable to assume that the city undertook to pay the entire purchase price of the public market utility, except unmatured intercepting sewer and drainage system assessments and taxes and assessments accruing subsequent to November 5, 1931, out of its general funds, and that it was proposing to issue public utility certificates merely for the purpose of raising funds to pay such taxes and assessments. Regardless, however, of what might have been the intention of the city in this respect, we must look to the ordinances of the city to ascertain its authority for entering into the contract. As already pointed out, none of the ordinances which have been called to our attention permitted the city to acquire this public market utility otherwise than by the issuance of public market utility certificates. Any one who makes a contract with a municipal corporation is *Page 194 bound to take notice of limitations of its power to contract.
The fact that the city, at the instance of the plaintiff, by resolutions Nos. 20557 and 20649, dated October 6, 1932, and April 13, 1933, respectively, subrogated its rights under the contract to the lien of the mortgage given by the plaintiff to secure the repayment to Reconstruction Finance Corporation of the sum of $775,000 loaned by that corporation to the plaintiff, does not in any way affect the conclusion as to the necessary construction of the contract above announced. There is nothing recited in those resolutions which would tend to indicate that the city construed the contract between itself and the plaintiff as creating a general obligation on the part of the city to pay the purchase price of the public market. Both of the resolutions recite that the contract between the city and the plaintiff was entered into under authority of ordinance No. 61566 and resolution No. 20291.
It does not necessarily follow that the demurrer to the complaint should be sustained because the purchase price of the public market utility is payable from funds derived from the sale of public market utility certificates and from revenues derived from the operation of the market.
The allegations of the complaint, which are to be taken as admitted, are to the effect that the plaintiff, Public Market Company of Portland, has performed all the terms and conditions of the contract between itself and the city to be performed by it, and that the city has failed, refused and neglected to perform its part of the contract. The facts stated in the complaint clearly indicate that the plaintiff is entitled to an accounting against the city. Equity has jurisdiction of *Page 195 such an accounting and the plaintiff is entitled to that relief, as the pleadings now stand. Whether or not plaintiff is entitled to require the city to perform specifically the terms of its contract by proceeding to sell or attempt to sell the public market utility certificates, or has a right to relief by way of mandamus or some other proceeding, it is not necessary at this time to determine. But before it would be entitled to any such relief, it would be necessary, or at least helpful, to have an accounting and determine the amount which the market company might have a right to collect from the city.
The demurrer, therefore, should be overruled and the cause remanded to the circuit court with permission to the city to file an answer to the complaint, if it so desires, in order to determine whether or not the plaintiff has fully performed its part of the contract, and to ascertain what relief, if any, should be granted the plaintiff.
ROSSMAN, J., concurs in this dissent. *Page 196