Does Delay In Payment to a City Contractor Warrant An Interest Award ?
In Vider v. City of Chicago, 164 Ill. 354, 45 N.E. 720 (1896), the City of Chicago had contracted with a construction company to improve a street, and the contract was to be paid out of the proceeds of a special assessment on the property on that street.
The contractor improved the street, but the city stayed collection of the assessment for one year; it then collected it and paid it one year late.
The contractor sued, seeking damages caused bythe delay in payment.
The supreme court rejected the claim, holding that, while the delay in collecting and paying the funds was without legal justification, the delay in payment did not warrant an interest award. Vider, 164 Ill. at 358-59. the court further stated that the city's action "was a clear violation of duty which the city owed to plaintiff in error, but the action was not fraudulent, nor did it render the city guilty of a tort." Vider, 164 Ill. at 359.
It further noted that the city's action "did not amount to a tort, and it cannot be held liable for damages in the form of interest." Vider, 164 Ill. at 359.