*CLARK v. The MAYOR, ALDERMEN and COMMON COUNCIL OF THE CITY OF WASHINGTON.

Municipal corporations.

Municipal corporations, acting within the limits of the powers conferred upon them by the legislature, in the exercise of a special franchise granted to them, and the performance of a special duty imposed upon them, are responsible for the acts and contracts of their agents, duly appointed and authorized, within the scope of the authority of such agents, in the same manner as other corporations and private individuals are responsible on their promises, express and implied.1

Where, by the charter granted by congress to the city of Washington, the corporation was empowered to authorize the drawing of lotteries," for effecting certain improvements in the city, and upon certain terms and conditions: Held, that the corporation was liable to the holder of a ticket in such a lottery, for a prize drawn against its number, although the managers appoin ted by the corporation to superintend such lottery were empowered to sell, and had sold, the entire lottery, to a lottery-dealer, for a gross sum, who was, by his agreement with them, to execute the details of the scheme, as to the sale of the tickets, the drawings, and the payment of the prizes.

It seems, that the power granted in the charter "to authorize the drawing of lotteries," cannot be exercised so as to discharge the corporation from its liability, either by granting the lottery or selling the privilege to others, or in any other manner; but the lotteries to be authorized by the corporation must be drawn under its superintendence, for its own account, and on its own responsibility.

Clark v. Corporation of Washington, 2 Cr. C. C. 502, reversed.

ERROR to the Circuit Court for the District of Columbia. This was an action of assumpsit, brought by the plaintiff in error, to recover of the defendants the amount of a prize drawn in a lottery called "the fifth class of the National Lottery." A verdict was found for the plaintiff, in the court below, subject to the opinion of the court, on a case agreed; on which, judgment was rendered for the defendants, and the cause was brought by writ of error to this court.

By the constitution of the United States, congress has *power to [*41 exercise exclusive legislation, in all cases whatsoever, over the district, which being ceded by particular states, may become the seat of the government of the Union. The district of Columbia having been ceded for that purpose, congress passed an act, creating a municipal corporation for the city of Washington; and by the act of the 4th May 1812, for amending the charter, gave the corporation "full power and authority to authorize the drawing of lotteries, for effecting any important improvement in the city, which the ordinary funds or revenue thereof will not accomplish; provided, that the amount to be raised in each year shall not exceed the sum of $10,000; and provided also, that the object for which the money is intended to be raised, shall be first submitted to the president of the United States, and shall be approved by him." For the purpose of carrying this power into execution, ten successive resolutions were passed by the corporation, the first of which was approved by the president of the United States on the 23d of November 1812, and the last on the 21st of May 1821, each of them for raising $10,000 by lottery, for the several objects of endowing two public scnool-houses, on the Lancasterian system; of building a work-house and penitentiary, and a town-house or city hall. On the 24th of July 1815, the

1 Williams v. Dunkirk, 3 Lans. 44; Memphis v. Brown, 20 Wall. 289.

Clark v. City of Washington.

corporation passed an ordinance for carrying into effect the first three of the above resolutions, and appointed certain managers by name, viz., John Davidson, Thomas H. Gillis, Andrew Way, jr., Moses Young, William Brent, Daniel Rapine and Samuel N. Smallwood, whose duty it was made to agree on and propose a scheme or schemes of a lottery or lotteries, to raise the sum of $30,000 (clear of all expenses), and to sell and dispose of the tickets therein to the best advantage, with the least possible delay, and diligently to attend the drawing of the said lottery or lotteries, which should be in the city of Washington; and within 60 days after the drawings of the same, respectively (the time of each drawing not to exceed two years), to pay and satisfy the fortunate adventurers for prizes; and within 70 days, to pay over the balance, after deducting all necessary expenses, into the city treasury; and giving to said managers full power and authority to *42] appoint all necessary *agents, clerks and servants, to do and perform all such acts and things as might he necessary to carry into effect the provisions of the ordinance. Another ordinance was passed on the 17th of November 1818, for the purpose of carrying into effect the 4th, 5th, 6th and 7th of the aforesaid resolutions, by which (inter alia) the mayor was authorized to appoint seven citizens to act as managers for the purpose aforesaid, whose duty was declared to be, to agree on a scheme of a lottery to raise the sum of $40,000 (clear of expenses), and to sell the said lottery, or dispose of the tickets therein to the best advantage, with the least possible delay, and diligently to attend the drawing of the said lottery, which should be in the city of Washington; provided, however, that if the said managers, or a majority of them, should sell the said lottery, the individual or individuals purchasing the same, should have the power of making a scheme for the aforesaid lottery, and within 60 days after the drawing (the time of drawing not to exceed one year), to pay and satisfy the fortunate adventurers for prizes; and within 70 days, to pay over the balance, after deducting all necessary expenses, into the city treasury, with the like power and authority to the managers, as in the former act, to appoint all necessary agents, clerks and servants, &c. The mayor appointed, under the authority of the last mentioned act, seven citizens to act as managers for the purposes aforesaid, the same as those appointed by name in the former act, except that, in the last, Roger C. Weightman took the place of Samuel N. Smallwood. On the 25th of October 1819, another ordinance was passed, by which the managers appointed under the ordinance of 1815, were empowered to sell and dispose of the lotteries to which that ordinance referred, or so much thereof as yet remained to be drawn, in such classes, and on such terms and conditions, as should appear to them right and expedient.

In pursuance of the ordinances of 1815 and 1819, the managers sold to David Gillespie, of New-York, a lottery called the "Fifth class of the Grand National lottery," for the sum of $10,000, to be paid before the commencement of the drawing thereof; and the following articles of agreement were entered into for that purpose.

*"Memorandum of an agreement, made and entered into this 14th

*43] day of May 1821, between Roger C. Weightman, John Davidson,

Thomas H. Gillis, Andrew Way, jun., Moses Young, William Brent and Daniel Rapine, as managers of the lotteries anthorized by an act of the Board of Aldermen and Board of Common Council of the city of Washington, for

Clark v. City of Washington.

the purposes therein mentioned, approved July 24th, 1815, of the one part. and David Gillespie, of the city of New York, in the state of New York, of the other part: Whereas, by an act of the Board of Aldermen and Board of Common Council of the said city of Washington, approved October 25th, 1819, supplementary to the act aforsesaid, the said managers are authorized and empowered to sell and dispose of the said lotteries, in such classes, and on such terms and conditions, as shall appear to them right and expedient, and according to the true intent and meaning of the act aforesaid; and that the said managers, for the purpose of raising the sum of $10,000, in conformity with the provisions of the said first-mentioned act, and in pursuance of the power and authority in them vested by the said supplementary act, have agreed to sell and dispose of, to the said David Gillespie, a lottery, denominated the fifth class of the Grand National lottery, to be drawn according to the scheme hereunto annexed; and the said David Gillespie, in consideration thereof, hereby agrees to pay to the said managers the sum of $10,000, before the commencement of the drawing the said lottery or class, at his own proper cost, charge and expense; to pay and defray all, and all manner of costs, charges and expenses of the said lottery or class, excepting the expense of drawing the same, and to draw the same in the city of Washington, in the presence of the said managers, and to finish and conclude the said drawing, within two years from the date hereof, and to pay all the prizes, within sixty days from the completion of the said drawing. It is further understood and agreed, by and between the said parties, that the said David Gillespie is to provide, at his own cost and expense, two competent clerks, to assist in the drawing of the said lottery or class; and to execute and deliver, before the commencement of the drawing of the said lottery or class, and within thirty days from the date hereof, to the said managers, a bond, with such security *as may be approved by them, in the penal sum of $35,000, conditioned for the true, fair and faithful drawing of [*44 the said lottery or class, and according to the said scheme; for the punctual payment of all prizes, and for conducting the said lottery or class, fairly and honestly, and according to this agreement, and the true intent and meaning of the said acts of the said Board of Aldermen and Board of Common Council."

The bond with security, as required by the above agreement, was given by Gillespie on the 28th of May 1821. On the 22d of the same month, an ordinance of the corporation was passed, authorizing the managers to appoint a president, whose duty it should be, in addition to the duties imposed by the ordinances of 1815 and 1819, to sign all contracts, with the concurrence of a majority of the managers, and to sign all the lottery-tickets, in every scheme or schemes sold by them. The 2d section of the ordinance allowed each of the managers of the city lotteries three dollars each day he had been, or should be, employed; and the 7th section enacted, that this compensation, except for the class now contracted for," should be provided for and paid. out of the proceeds of lotteries thereafter contracted for.

Under this authority, Thomas H. Gillis was appointed president, who signed the following ticket, No. 2929, on which the suit was brought, and which was indorsed, "Undrawn, 29th day over. D. Gillespie, per J. James.” The ticket was purchased by the plaintiff, from an agent of Gillespie, at

Clark v. City of Washington.

Richmond, Virginia, and drew the prize of $100,000, in the fifth class of the

lottery.

$100,000 Highest Prize.

William Brent,

FIFTH CLASS.

This ticket will entitle the possessor to such prize as may be drawn to its Number, if demanded within twelve months after the completion of the drawing: subject to a deduction of fifteen per cent. Payable sixty days after the drawing is finished. Washington City, February 1821.

By Authority of
Congress.

Thos. II. Gillis, Manager.

*The drawing of the lottery was advertised in two newspapers *45] printed in the city of Washington; in the National Intelligencer, from the 18th of May 1821, and in the Washington City Gazette, from the 17th of July 1821, until the completion of the lottery. These advertisements. exhibited the scheme agreed upon between the managers and Gillespie, and annexed to their contract, gave notice of the time when the drawing would take place, of the number of days to be employed in the drawings, and that they would be completed as soon as possible, under the superintendance of the managers, whose names were annexed. To each of these advertisements was appended an advertisement, signed by Gillespie, as "agent for the managers," for the sale of tickets, at his "Fortunate office, Pennsylvania Avenue, Washington City." The lottery was drawn in pursuance of the advertisements, and the managers superintended the drawing. In its progress, a postponement took place; and an advertisement appeared, purporting to be signed by three of the managers, giving notice of the postponement, and its cause. Another advertisement soon afterwards followed, purporting to be signed by the president, by order of the board, giving notice when the drawing would recommence.

As soon as the scheme was agreed on, all the tickets, amounting to 50,000 in number, were delivered by the managers to Gillespie, some of them signed, and others unsigned, by the president, the latter of which it was necessary to take to him to be signed, before they could be sold. Some time after the drawing commenced, the president refused to sign tickets, unless an equivalent in prize-tickets, either paid or taken in by Gillespie, or drawn on hand, or unless the notes of individuals which Gillespie had taken, payable to himself, for tickets sold, were deposited with them. When Gillespie's clerk and agent, Webb, presented tickets to be signed, he was obliged, at the same time, to deposit such prize-tickets or promissory notes; and, on some occasions, when tickets were called for, and wanted, the managers refused to sign the same, for want of such equivalent. The amount of the prize-tickets so deposited with the managers was about $141,779. The managers, on such occasions, *objected to trusting Gillespie with the

*46] disposal of the tickets, much beyond the penalty of his bond, and

Clark v. City of Washington.

Webb, who was a witness in the cause, understood, from the conversations and transactions between the parties at the time, that this precaution arose from doubts which had been circulated respecting Gillespie's solvency.

January 26th. This cause was argued by the Attorney-General and Webster, for the plaintiff; and Jones, for the defendants.

On the part of the plaintiff, it was insisted, that the power of authorizing the drawing of lotteries, was a franchise, which the city corporation could not sell, so as to avoid their liability for the abuse of the trust and confidence reposed in them by the legislature. It was admitted, that, in general, municipal corporations are not liable to be sued on contracts made by their agents. The suit must be brought against the agents. But that proceeds on the ground, that these quasi corporations have no funds; but where a grant is made, conferring a special franchise, and imposing special duties, there is the same responsibility in them, as in any incorporated banking or insurance company. Here, the contract was with the managers, as the agents of the corporation, acting within the scope of their authority. 15 Johns. 1; 7 Cranch 299; 2 Taunt. 595; 1 Ves. 352. Where special duties are imposed upon corporations, which can only be performed through the instrumentality of their agents, the law will raise an implied assumpsit, under the same circumstances as in dealings with private individuals. It is enough, to show a ratification of the acts of the agents, by receiving the benefit of the act, or otherwise. In short, they are responsible, under these circumstances, for their promises, whether express or implied, in writing or by parol. 7 Mass. 169; 16 East 6; 3 Mass. 364; 7 Cranch 299; 2 Livermore Agency 198; 1 Bro. C. C. 469: 18 Mass. 372; 15 Johns. 1; 10 Mass. 397; 15 Ibid. 125; Fowle v. Corporation of Alexandria, 11 Wheat. 320; 2 Taunt. 595; 15 East 408; 3 P. Wms. 423; Cowp. 86; 4 Taunt. 576, in note; 2 Vern. 146; Paley Agency 143-45; 3 Stark. Ev. 1621. And it was contended, that the fact of their contract *be[*47 ing clothed with the forms of a legislative or political act of the corporation, or the authority being conferred on their agents by such an act, could make no difference in respect to their liability. But as the principal grounds of the argument on the part of the plaintiff are fully stated in the opinion of the court, it has been deemed superfluous to enlarge upon them.

On the part of the defendants, it was argued, that the documentary evidence given by the plaintiff was inadmissible, and incompetent to charge the defendants in the present action. 1st. Because, if the papers given in evidence imported any contract chargeable on the corporation, through their supposed agents, the managers, or through their supposed agent, Gillespie, no foundation was laid for their admission, by any preliminary evidence to authenticate them as the acts either of the managers or of Gillespie, far less of the corporation; but, the papers (all that are any wise essential, being taken from newspapers, or other printed papers) were left to their own internal and unvouched evidence of their authenticity, as the acts of the persons whom they purport to implicate. 2d. Because, if authenticated as the acts of Gillespie, there is nothing to connect him with the managers, in the relation of principal and agent; but that relation is assumed from the mere acts of the supposed agent himself. 3d. Because, whatever privity