This is an action filed by plaintiff Board of Education of the Vocational School of the County of Union for a declaratory judgment pursuant to R.R. 4:92A in the form of a summary judgment pursuant to R.R. 4:58-1. The action seeks to determine the validity of an agreement signed on August 12, 1960 between the 1960 board of education and defendant architectural firm. Plaintiff board is created under R.S. 18:15-39 and N.J.S.A. 18:15-58.8, and conducts a vocational school in and for Union County. It was established in 1959. R.S. 18:15-39 provides:
"When it has been determined by resolution of the state board of education that a need exists in any county for county industrial, agricultural or household arts schools, the state board of education
shall transmit a copy of the resolution to the board of chosen freeholders of the county. Upon receiving the copy, the board of chosen freeholders shall vote on the question whether such schools shall be established in the county in accordance with the recommendation. If the board of freeholders by a majority vote favors the establishment of such schools in the county, such schools shall be forthwith established and maintained in the county and shall be known as the 'vocational schools in the county of ' (here insert the name of the county in which the schools are located)."
N.J.S.A. 18:15-58.8 provides:
"For such county vocational school established in accordance with this act there shall be a board of education consisting of the county superintendent of schools and four persons to be appointed by the director of the Board of Chosen Freeholders, with the advice and consent of such board. Not more than two appointed members shall be members of the same political parties, but no changes for adjustment of party representation shall be made in the board, except as vacancies occur. In making the first appointments to a board, one person shall be appointed to serve for one year, one for two years, one for three years, and one for four years, from November 1st next succeeding the date of their respective appointments. Persons so appointed shall also serve from the date of their respective appointments until November 1st, next ensuing. Thereafter annually, during the month of October, a member of the board shall be appointed to serve for a term of four years to take the place of the member whose term shall expire on November 1st, then next ensuing.
Vacancies in the board caused by the death, resignation or removal of a member shall be reported forthwith by the secretary of the board to the director of the Board of Chosen Freeholders, who, within thirty days thereafter and in the manner herein prescribed for making appointments for a full term, shall appoint a person to fill the vacancy for the unexpired term."
The board derives it power or authority from N.J.S.A. 18:15-51. Defendant is a New Jersey partnership with its principal office at 1155 Magnolia Avenue, Elizabeth, New Jersey.
In May 1960 defendant firm was selected as the architect by the board of education. On August 12, 1960 an agreement was entered into between the two parties. This agreement provided that for a stated valuable consideration defendant firm was to provide complete architectural services for a proposed school which the board intended to erect on a site to be
selected in the future in Union County. Presently, the school facilities directed by the board are conducted in rented premises in Scotch Plains and Mountainside. Pursuant to N.J.S.A. 18:15-46 and 18:15-58.8 the board is composed of five members, four of whom are appointed by the director of the board of chosen freeholders of the county with the advice and consent of that board; the fifth member, the county superintendent of schools, is a permanent member.
N.J.S.A. 18:15-46 and 18:15-58.8 provide that once a vocational school board has been created, the terms of the members, with the exception of the superintendent of schools, the permanent member, shall be staggered; one member is appointed for one year, one for two years, one for three years, and one for four years. Thereafter, the term of each member shall be four years. Thus, the term of one member expires each year and a new member must be appointed.
The agreement of August 12, 1960 was signed by the following five members of the board: President Coffrey, Mrs. Redden, Mr. Weber, Mr. Volosin and Dr. William H. West, the county superintendent of schools. With the exception of Dr. West, none of the four mentioned members is a member of the board today, or was at the time the board filed its complaint.
Prior to May 1960 the then board of education interviewed nine different architects or architectural firms, and on May 31, 1960 by resolution authorized the proper board officers to enter into a contract with defendant firm. The minutes of the May 31, 1960 meeting indicate that the board interviewed nine different architectural firms. The minutes then say:
"Mr. Weber moved that the architectural firm of Finne, Lyman, and Finne be appointed to work with the Director and the Board in preparing plans and specifications for our first school, in accordance with the fees as stipulated in the firm's letter of May 27, 1960. Seconded by Mr. Volosin. Mr. Volosin stated that he seconded the motion because he was highly impressed with the work of this firm on the Junior High School building in Iselin and the elementary school known as Deerfield in Linden. Mr. Weber commented that he knew of the firm's good work in industry and, therefore, had confidence
in their ability to handle this assignment. Mr. Caffrey commented that he had made personal investigation of the firm and found that both the Superintendent of Schools in Linden and Woodbridge and the general contractors on the respective jobs were well satisfied with this firm and its work. * * * The President called for a roll call vote which resulted in 'ayes' by Messrs. Caffrey, Volosin, and Weber, and a 'nay' by West. Motion carried."
In order to obtain funds for its operations, both current and capital, the board must initially apply to the board of school estimate pursuant to N.J.S.A. 18:15-55, 56. In the case of moneys required for a current school year the board prepares an estimate of needs and submits it to the board of school estimate. N.J.S.A. 18:15-55. The latter then certifies the amount to be appropriated and delivers its certificate to the board of freeholders, whereupon the freeholders "shall, upon receipt of the certificate, appropriate, in the same manner as other appropriations are made by it, the amount so certified * * *." N.J.S.A. 18:15-56. Where a board of education of a county vocational school seeks capital funds, the procedure is the same, with the exception that the statute provides that the freeholders "may" appropriate funds, rather than "shall" appropriate funds, as in the case of current expenses. N.J.S.A. 18:15-57 and 18:15-58.13.
In August 1960, when the contract in question was executed, no funds had been made available by the board of freeholders for a capital expansion program. At its November 15, 1960 meeting the board deemed it advisable to have defendant firm prepare a cost study preliminary to the institution of a land acquisition program. The first application made by the board to the board of school estimate for certification of the amount necessary for the construction of the proposed vocational school was on December 21, 1960. The board requested $3,889,400, and the board of school estimate on the same day approved this sum and forwarded its certification to the board of freeholders. On July 7, 1961 the freeholders denied the request for the capital expansion program. On October 3, 1961 the then board of education passed a resolution requesting $675,000 for the acquisition of two
pieces of real property within the county for the development of one school in the near future on one site, and the second site for future development of a school, and submitted this request to the board of school estimate. This request was the result of a report made to plaintiff board by defendant firm concerning an examination of various plots referred to the firm by Director Baxel of the Union County Vocational School. On November 21, 1961 the board of school estimate reduced the amount, approved $250,000 for the acquisition of one site in Scotch Plains fronting on Raritan Road, known as the McCollum tract, and authorized the board to proceed to acquire title to the said McCollum tract in Scotch Plains, which it did on May 10, 1962. The tract had an area of from 38 to 43 acres.
The question of engaging the services of educational consultants, whose fees were to be deducted from those of defendant firm, was reopened at the board meeting of April 9, 1962. At the same meeting it was decided to close the land investigation which had been initiated two years previously, and the possibilities for utilization of the structure on the McCollum tract were also discussed.
At its June 11, 1962 meeting the board agreed to request authority from the board of freeholders to use the surplus that was realized from the funds allocated for land acquisition for the employment of an educational consultant pursuant to the August 12, 1960 agreement, to aid the defendant firm in rendering its services.
On June 25, 1962 defendant firm received a letter from Director Baxel complimenting the firm for its "rendering and sketch" and informing it that the board had "requested release of some service money from the Freeholders but have not received a reply as yet."
On October 15, 1962 the board passed a resolution requesting approval to expend $18,000 from the unexpended money authorized for the land acquisition in order to "have a sketch and drawings prepared by the Board's architect for use by the members of the Board of School Estimate in considering the
resolution, providing the Board is able to contract for such special services with the architect * * *." The relevant portions of the minutes of the October 15, 1962 meeting are:
"The purpose of this meeting was to consider and act upon resolutions requesting funds for building and furnishing a school. The Secretary read two resolutions that had been prepared in advance. After some discussion Mr. Simmons moved the following resolution requesting funds in the land account be made available for preliminary drawings, etc. as stated in the resolution below: seconded by Mr. Volosin:
'Whereas the Board of Education of the Vocational School in the County of Union has on October 15, 1962, adopted a resolution on the need for funds for the purpose of erecting buildings for school purposes, and the purchase and installation of furnishings and equipment therein, on land owned in Scotch Plains, and
Whereas, the Board recognizes that because of the date of this action it will be impractical to expect the Board of Estimate to give proper consideration to the resolution within the next few weeks, during which time it will be possible to have a sketch and drawings prepared by the Board's architect for use by the members of the Board of School Estimate in considering the resolution, provided the Board is able to contract for such special services with the architect; now therefore,
Be it resolved by the Board of Education of the Vocational School in the County of Union as follows:
Section 1. The Board of Education hereby decides that it is necessary to request permission to use from the balance of funds in the account for the purchase of land, a sum not to exceed $18,000 for the hiring of special consultant and architectural services to prepare preliminary plans and sketches to show what is intended to be procured with the funds requested in the previous resolution. * * *'" (Emphasis added)
At the same meeting the board again certified its need for capital funds to the board of school estimate and recognized in the above resolution that it had an architect.
On December 17, 1962 the board of school estimate declined either to approve the $18,000 expenditure or to certify the request for the capital funds to the board of freeholders.
On September 9, 1963 the board again requested $3,750,000 for the capital expansion program, but the board of school estimate took no action on the request and no funds were appropriated. ...