On appeal from the former Supreme Court.
For affirmance: Chief Justice Vanderbilt and Justices Oliphant, Wachenfeld, and Ackerson. For reversal: Justice Heher. The opinion of the court was delivered by Wachenfeld, J.
[1 NJ Page 518] Appellant seeks to set aside the resolution adopted by the Board of Commissioners of the City of Passaic on November 18, 1947 approving a settlement of $37,000 in satisfaction of a claim by Percy S. Simon, an architect, for the preparation of plans and specifications for a veterans' housing project in the City.
In the latter part of 1946 Nicholas Martini, then Mayor and Director of Public Works of the City, conferred with State housing officials relative to a permanent veterans' housing project for the municipality. He sponsored a resolution passed by the Board of Commissioners on January 21, 1947 declaring a shortage in dwelling accommodations and at the same time the Board authorized the Mayor to negotiate for the acquisition of property for the project and "to do any and all things necessary to consummate the plan for proposed permanent veterans' housing he submitted to the Public Housing Development Authority in the State Department of Economic Development and the Board of Commissioners; and to obtain the grant of state funds for said project."
On the same date by letter he contracted with Percy S. Simon, an architect, to prepare preliminary and final plans and specifications and to supervise construction of the five-story apartment at a fee of five per cent of the total cost of construction. This letter contract was filed by Martini in the Mayor's office but was not given general publication at the time.
The Board thereafter unanimously approved the housing agreement between the State Administrator and the City and it was signed on April 23, 1947, the State agreeing to contribute $613,490 to the cost of the project. Construction bids were received on the plans as drawn and were approved by the State Administrator.
An election was held on May 13, 1947 in which Martini and DeMuro were re-elected but two members of the former Board were defeated. An hour before the new administration assumed office on May 20, 1947, Martini filed the letter contract with the City Clerk and its contents became generally known for the first time.
Upon assuming office the new Board assigned the various departments to the elected Commissioners, designating DeMuro Mayor and Director of the Department of Public Works. The Board reserved to itself the power to "levy all taxes, apportion and appropriate all funds and approve all bills, accounts, payrolls and claims and order payment thereof." The following June 3 an ordinance authorizing the issue of bonds of the City
amounting to $820,000 to finance the emergency housing was passed on first reading. It specifically referred to Simon's plans and approved them in the following terms:
"Section 3.(a) The improvements hereby authorized * * * all to be done in accordance with plans and specifications therefor prepared by Percy S. Simon, architect, entitled: 'Veterans Housing Project for City of Passaic', dated April 3, 1947, filed in the office of the City Clerk and hereby approved * * *" (Emphasis added.)
The submitted construction bids were analyzed by Simon and presented to the Board, which on June 5, 1947 unanimously resolved to award the contracts "in accordance with plans and specifications submitted." The ordinance providing for the housing bond issue, after a public hearing on June 24, was passed upon second and third reading.
The plans and specifications as drawn by Simon required certain changes and corrections by other architects and substantial additional expenditures were incurred. Due to these difficulties, the Board on July 23 relieved Simon from his duties of supervision of the project and terminated his contract. The following month DeMuro by letter ...