Summary
stating that "[i]t has long been the practice in this state for legislative bodies of political subdivisions to enact statutes or ordinances appropriating money to pay claims which are by law unenforceable against the subdivisions, but which on principles of justice and equity constitute moral obligations of the subdivisions" but agreeing with the lower court's statement that: "public officials, it would seem, should consider themselves rather as trustees than philanthropists in the appropriation and disbursement of public funds"
Summary of this case from Opinion No. 2004-340Opinion
No. 33062
Decided March 18, 1953.
Municipal corporations — Authority to pay moral obligation unenforceable in law — Liability for mere gratuity to injured person — Not authorized to assume — Recognition of moral or equitable claims — Primarily for municipality to determine — Moral obligation cannot be fixed as a matter of law.
1. A municipality has the authority to enact an ordinance appropriating money to pay a claim which is by law unenforceable against it but which on principles of justice and equity constitutes a moral obligation of the municipality.
2. An obligation may be recognized by a municipality, where such obligation would be enforceable at law were it not for some rule which exempts the municipality in the particular instance from legal liability, or where the obligation is legally unenforceable but is binding upon the municipality in conscience and according to natural justice.
3. A municipality is without authority to assume a liability for a mere gratuity to an injured person, where there is no equitable or moral claim predicating such gratuity.
4. The extent to which moral or equitable claims against a municipality should be recognized is primarily for the legislative authority of the municipality to determine, provided, only, that such municipality may not expend any money for other than a city purpose or give it away.
5. Where the facts out of which such a moral obligation is claimed to have arisen are disputed, the legislative body of a municipality can not as a matter of law fix by ordinance a moral obligation; the contention concerning such obligation falls within the province of the courts.
APPEAL from the Court of Appeals for Lucas county.
On March 23, 1948, William H. Caton, hereinafter designated relator, instituted an action in mandamus against Ronald T. Anderson, finance director of the city of Toledo, Rudy Klein, auditor, Scott E. Rosa, treasurer, and Carl F. Diefenbach, clerk of council, hereinafter designated respondents.
The issues are made by an amended petition and a demurrer thereto.
The demurrer is on the grounds that the amended petition does not state a cause of action and of misjoinder of defendants. The latter ground was not urged in this court, and so the questions herein have been considered only in reference to the first ground. The facts stated in the amended petition are as follows:
While employed by the city of Toledo as a bridge tender, relator, on or about June 8, 1935, sustained an injury to his left arm, while working on a high level bridge, as a result of frequent contacts by such arm with bridge girders. As a result of the injuries relator was compelled to leave the employ of the city on June 8, 1935, and on August 2 of that year his left arm was amputated.
On May 4, 1937, relator notified the personnel claims adjuster of Toledo of his injuries and the adjuster prepared relator's part of an application for compensation from the State Insurance Fund. Relator signed the application and the adjuster retained it for the purpose of completing and filing it with the Industrial Commission. The adjuster failed to file the application with the Industrial Commission within the time prescribed by law, and for that reason the application was denied.
On December 20, 1939, the council of the city of Toledo enacted emergency ordinance No. 524-39 which recited in its preamble that the claim of relator for injuries sustained while in the course of his employment by the city had been refused by the Industrial Commission for failure to file it in time, and that relator should and ought to be compensated for the loss of his arm and for future surgical and medical treatment.
Section one of the ordinance approved payment of $1,000 by the city to relator on account of the loss of his arm and other personal injuries. Subsequent portions of the ordinance appropriated the $1,000, authorized the city auditor to draw his warrant in payment of it, and provided that the acceptance of the sum of $1,000 would constitute a release by relator of all claims against the city. The claim was paid.
On December 8, 1947, the council of the city passed ordinance No. 624-47 which recites that the city had made settlement under authority of ordinance No. 924-39 for injuries sustained by relator while in the employ of the city; that the settlement was made without full knowledge of all the facts and under a gross misapprehension of the extent and severity of relator's injury; that it would be unconscionable to maintain that the inadequate amount of $1,000 was in full settlement; that a greater disability does exist; that relator ought to be further compensated for the loss of his left arm; and that there exists a valid moral claim to compensate relator for expenses incurred and to be incurred as a result of his injury.
Section one of ordinance No. 624-47 amends the prior ordinance and approves the claim of relator in the sum of $3,000 on account of the loss of his arm; section two appropriates the additional sum of $2,000 from the general fund and authorizes the city auditor to draw a warrant against the appropriation; and section three amends a release clause based upon the acceptance of the total sum of $3,000.
Relator, after alleging the performance of the formal requisites making the ordinance effective, says that he made a demand on the respondent auditor that he issue a warrant for the payment of the sum of $2,000, which such respondent refused to do; and that there are sufficient funds in the general fund to pay the claim. Relator prays for a writ of mandamus to compel the auditor and other respondents to take the necessary steps to pay the claim.
The Court of Common Pleas sustained the demurrer of the respondents.
The Court of Appeals affirmed the judgment of the Court of Common Pleas.
The cause is before this court upon the allowance of a motion to certify the record.
Mr. M.L. Okun and Mr. Dale K. Anderson, for appellant.
Mr. John J. McCarthy, director of law, and Mr. Thomas W. Christian, for appellees.
The sole question presented to this court is whether relator's amended petition states a cause of action.
The respondents argue that on the facts pleaded there is no moral obligation on the part of the city to pay the claim, contending that a moral obligation of a municipality is an obligation of such a nature that it would be enforceable at law except for the exemption from liability of the municipality because of its governmental capacity.
The general rule throughout the country recognizes the authority of a governmental subdivision to assume and pay moral obligations.
In 1 Cooley on Taxation (4 Ed.), 412, 413, 414, Section 194, appears the following statement:
"There are some cases in which taxation has been allowed for the benefit of private persons on considerations not of charity so much as of justice. Any exercise of the powers of government is liable to cause injury to particular individuals. When the injury is merely incidental, these individuals have no legal claim to indemnification. Nevertheless, it seems eminently proper and just, in some exceptional cases, to recognize a moral obligation resting on the public to share with the persons injured the damage sustained; and this can only be done by means of taxation. All governments are accustomed to recognize and pay equitable claims of this nature under some circumstances; claims, for instance, for the destruction of private property in war, and sometimes for incidental injuries occasioned by the construction of a public work, or for loss in performing a contract to construct it. In these cases the Legislature is not confined in making compensation within the strict limits of common-law remedies, but it may recognize moral or equitable obligations, such as a just man would be likely to recognize in his own affairs, whether by law required to do so or not. And what the Legislature may do for the state, the municipalities, under proper legislation, may do for themselves. Taxation to raise money to pay a claim based on a moral obligation, and not enforceable at law, is for a public purpose, and is proper unless forbidden by some constitutional provisions. * * *
"The term `moral obligation' has been defined as `a duty which would be enforceable at law were it not for some positive rule which exempts the party in that particular instance from legal liability.' It has also been defined as one `which cannot be enforced by action but which is binding on the party who incurs it, in conscience and according to natural justice.' A `moral obligation' means that some direct benefit was received by the state as a state or some direct injury has been suffered by the claimant under circumstances where in fairness the state might be asked to respond, and there must be something more than a mere gratuity involved. In regard to the question whether the facts existing in any case bring it within the class of claims which the Legislature ought to recognize as founded upon equitable and moral obligations, it would seem that generally such question is largely one for the Legislature to decide for itself."
Examples of the application of the foregoing rule are found in two well-considered cases. In Evans v. Berry, Comptroller, 262 N.Y. 61, 186 N.E. 203, 89 A.L.R., 387, it was held that such an assumption of liability by a city to an injured person does not constitute a gift or gratuity, if it is in legitimate recognition of an equitable claim, and that the extent to which moral and equitable claims against a city should be recognized is primarily for the city to determine.
The court said:
"A moral obligation is a duty assumed in obedience to the rules of right conduct. People differ as to the standard of right conduct. Some take as their standard of moral duty the letter of the law; others the golden rule. The question is not as to our own standard but the standard which the city may adopt. Is it an impossible, quixotic standard whereby the money of the city may be given away without regard to any visible equity or does it rest on common-sense conceptions of moral duty? The city may be just but it may not distribute largess."
In the case of Board of Education of Calloway County v. Talbott, Aud., 261 Ky. 66, 86 S.W.2d 1059, it was declared that a Legislature may make appropriations in recognition of moral or equitable obligations such as a just man would be likely to recognize in his own affairs whether by law he is required to do so or not. See, also, 15 McQuillin Municipal Corporations (3 Ed.), 64, Section 39.24.
It has long been the practice in this state for legislative bodies of political subdivisions to enact statutes or ordinances appropriating money to pay claims which are by law unenforceable against the subdivisions, but which on principles of justice and equity constitute moral obligations of the subdivisions. Examples of such practice can be found in the cases of Board of Education v. McLandsborough, 36 Ohio St. 227, 38 Am. Rep., 582, wherein it was held by this court that the General Assembly may pass an act exonerating an officer and his sureties from the payment of money which was stolen or otherwise lost without his fault, and may direct that a tax be levied to pay for such loss, and Board of Education v. State, 51 Ohio St. 531, 38 N.E. 614, 46 Am. St. Rep., 588, 25 L.R.A., 770, wherein this court, although holding that the General Assembly can not by recitations of fact prevent a board of education from contesting the validity of a statute requiring it to pay a moral obligation, discussed and recognized the authority of the board of education to pay such a claim in a proper case.
In the latter case is the following statement by Bradbury, J.:
"It may be conceded that the General Assembly may authorize one of the political subdivisions of the state to levy a tax to pay a demand not legally enforceable, but founded upon a moral consideration, or may even command that the levy shall be made for that purpose, and yet deny to it the power to determine conclusively the existence of such obligation.
"* * *
"If, in the case under consideration, the relator has paid out money for the benefit of the respondent, for which, by some mistake, accident or error, he has never received credit, it is morally bound to make it good and this moral obligation is sufficient to support the statute in question. * * * Where, however, the facts, out of which a moral (or legal) obligation is claimed to arise, are disputed, the contention falls within the province of the courts, under the distribution of governmental powers prescribed by our Constitution. Sec. 1, of Article IV of the Constitution of 1851."
We agree with the Court of Appeals that the facts stated in the amended petition do not show that the negligence of the personnel claims adjuster in failing to file relator's application with the Industrial Commission makes the city legally responsible for such failure, and with that court's statement that "public officials, it would seem, should consider themselves rather as trustees than philanthropists in the appropriation and disbursement of public funds." However, the amended petition relies on the finding of the council of the city of Toledo that relator's claim constitutes a moral obligation which the city recognizes. For the purpose of the demurrer, the ordinance must be presumed to have been validly enacted and the facts therein found by the council to be true. As stated in Board of Education v. State, supra, the determination as to whether upon the production of evidence there actually is a moral obligation is properly a question for the court upon the trial of the cause.
The judgment of the Court of Appeals is reversed and the cause remanded to the Court of Common Pleas for further proceedings.
Judgment reversed.
MIDDLETON, TAFT, MATTHIAS, HART and ZIMMERMAN, JJ., concur.