City of Pueblo v. Shutt Investment Co.

Mr. .Justice Steele

delivered the opinion of the court.

We will consider but two assignments of error: 1. That the court erred in overruling the demurrer to.the plaintiff’s complaint. 2. That the court erred in refusing to set aside the *528 award of tlic commissioners.

The complaint states that the company plaintiff has for its object buying, selling, and improving real estate in the state of Colorado. This court held in Denver v. McClellan, 9 Colo. 11 , that, “Private corporations arc creatures of statute, and derive their powers solely therefrom. Upon weighty considerations of public policy, and of private equity as well, the principle has been universally recognized that the charters or general laws through which these corporations derive their existence absolutely control their action; that a contract made or an act done by them which is not in any manner authorized by some express provision of the charter or law of incorporation, or which may not be clearly implied therefrom, is ultra vires; and that such usurpation of power may be relied upon as a complete defense to a suit growing out of the unauthorized act or contract.”

The purchase of a claim for damages is not within the power of this corporation, as shown by its articles of incorporation; nor was there any allegation in the complaint showing the necessity for the purchase in the pursuit of its business, nor was proof of such necessity offered. No damages accrued to the plaintiff after it purchased the property, but its claim to damages is based solely upon the assignment from E. W. Shutt, which was made some time after the sale of the lots. Such dealing in litigation is entirely foreign to the objects of its creation; and it is, at least, doubtful whether claims of this kind against municipalities of the state can be made the subject of bargain and sale by corporations organized under our statutes.

The plaintiff was not entitled to judgment for damages to lots 23 and 24, because these lots are not included in the assignment from E. W. Shutt.

The commissioners appointed by the court were not appointed pursuant to the statute; they constituted, however, a judicial body, when appointed, and their conduct must be controlled by the same rules which control the conduct of juries and other *529 bodies of like character. The affidavits filed in support of the motion to set aside the award allege that the commissioners took -the ex parte statements of many persons concerning the damages to he assessed against the city, without notice to the city, and that the persons whose statements were received were not required to be sworn; that the statements were not taken by the commissioners as a body, but were taken by them individually. The statements of the commissioners, made in the form of an affidivit, virtually admit the facts stated in the affidavits in support of the motion to set aside the award. It is highly improper for commissioners to receive evidence without ■notice to the parties, or to receive as evidence the opinions of ^persons not sworn as witness; but in this case the commissioners mot only took the opinions of persons not sworn, but took those opinions at second hand. Such conduct must result in setting ■aside the award. The city of Pueblo, if the commissioners were unable to agree upon the amount of damages without the examination of witnesses, was entitled to he notified, in order that it might have an opportunity to present witnesses in support of its contention as to the amount of damages.

In the following cases it has been held that what will be misconduct on the part of a juror, will, as a general rule, be such -on the part of an arbitrator; that it is gross misconduct to seek ■evidence, or the opinions of others in regard to the case, or anything material to its decision, in the absence of the defeated party; that the arbitrator may not, on his own responsibility, hear statements concerning- the matter in controversy; and that, if evidence is taken by the arbitrators in the absence of the defeated party, without notice to him, the award is void. Vessel Owners’ Towing Co. v. Taylor, 126 Ill. 250 ; Shively v. Knoblock, 35 N. E. Rep. 1028; Mosher v. Shea, 102 Ill. 169 ; Carter v. Sacramento, 28 Pac. Rep. 108 ; Elmendorf v. Harris, 23 Wend. 628 ; Emery v. Downing, 7 Gill. 488; Wood v. Helme, *530 14 R. I. 325.

Counsel for appellee claim that “the judgment and opinion of the court of appeals is now binding as the ‘law of the case/ because such opinion or judgment was not excepted to, nor is there any assignment of error contained in the record questioning the correctness or legality thereof.” Exceptions are not required to be taken in cases brought directly from the court of appeals to this court, and there can be no good reason for requiring exceptions to a judgment of the court of appeals which directs a new trial. The city, in this case, could not take an appeal from the judgment of the court of appeals, and it was not until judgment in a sum in excess of $2,500 was rendered against it, that its right to appeal to this court accrued: The city now asks this court to review the judgment of the district court rendered against it. This is a right the defendant has; and it becomes our duty to review it, and .to reverse it if we do not agree with the district court, notwithstanding the fact that the court of appeals-may have, in the same litigation, rendered a decision at variance with our views; nor is the right or duty aifected in any way bjr the failure of the city to take exceptions to, or assign error upon,, the. judgment of the court of appeals.

For the reasons assigned, the cause is reversed and remanded* Reversed.