While plaintiff's shopping center was under construction, defendant second-class municipality prepared for installation of a stop light to aid traffic going to and from the center. A contractor was hired and the design was approved, but funds were not budgeted for the project. With the shopping center nearing completion, it was agreed that plaintiff would pay the cost of installation and defendant city would reimburse him out of the following year's budget. The city, without calling for bids on the contract, hired a contractor and plaintiff paid the cost of the traffic signal and its installation. In plaintiff's suit on the reimbursement contract, the trial court held the contract void and unenforceable because the method of formation contravened statutes prohibiting a municipality from borrowing unappropriated funds, and letting contracts without a call for bids; however, plaintiff was allowed recovery on unjust enrichment principles for the value of the benefits conferred. On appeal, the Washington Supreme Court modified the decree, and held: Violation of statutory municipal budgeting and bidding requirements renders a municipal contract void, but plaintiff may recover in quasi-contract the reasonable value of the improvement when the improvement retained by the city is within the authority of the city to provide. Edwards v. Renton, 67 Wash. Dec. 2d 586,409 P.2d 153 (1965).
Annual Survey of Washington Law,
Quasi-Contractual Recovery When Municipal Contract Ultra Vies,
Wash. L. & Rev.
Available at: https://digitalcommons.law.uw.edu/wlr/vol41/iss3/20