123 Kan. 542 | Kan. | 1927
This is an action by a property owner and taxpayer of the city of Hill City, owning property abutting one of the paving projects in question, to enjoin the city and its officials from issuing further temporary notes for paving improvements, and from paying those previously issued, and from issuing bonds to redeem such temporary notes and .to pay the cost of such paving improvements, and to enjoin the levying of special assessments against the property of plaintiff and others similarly situated, and praying that the assessment made be set aside, and for a mandatory order that defendants restore funds of the city to their proper funds, and to enjoin the carrying out of the terms of a certain contract for the sale of bonds for paving improvements. The bank which had contraetéd to purchase the bonds intervened. „ The case was tried to the court, judgment was rendered denying plaintiff the relief sought, except as to an item of interest on the temporary notes. Plaintiff has appealed from the adverse judgment, and the intervening bank has appealed from the judgment respecting interest on thé temporary notes.
The controversy grows out of street paving initiated in Hill City in 1925, and later completed. The improvements are spoken of by the parties as five separate projects. No question is raised.in this court as to the legality of the proceedings in any of the projects prior to the passage of the respective ordinances authorizing the improvements, hence we need not state those proceedings. It is not possible, with the brevity necessary in an opinion, to state all the details shown by the abstract concerning each of these projects. Perhaps the following will be sufficient. As to project No. 1: The ordinance authorizing the improvement was passed August 3, 1925, and on that date the engineers’ preliminary statement was filed; notice to bidders was published August 6; on August 11 the contract was executed for the work. As to project No. 2: The ordinance authorizing the improvement was passed August 11, 1925; on August 15 the contract was executed for this work. As to project No. 3: The ordinance authorizing the improvement was passed December 2, 1925; on December 4 the contract was executed for this work. As to project No. 4: The ordinance authorizing the improvements was passed December 2,1925; on December 4 the contract was executed for.this work. As to project No. 5: The ordinance authorizing the improvement was passed December 21, 1925; on December 26 the
On August 11, 1925, the Fidelity National Bank and Trust Company of Kansas City, Mo., made a written .proposal, which was accepted, to the mayor and council, “For $100,000, more or less legally issued internal improvement bonds of your city delivered to us. . said bonds to be of denomination of $1,000, bearing interest at the rate of 4% per cent. . . . We will pay par and accrued interest to date of delivery. . . . We agree to carry your temporary notes at 4% per cent. This bid is to cover all bonds issued in connection with paving contracts awarded in 1925 . . .” On August 13 the city clerk had published in the official paper a notice that “On and after the 13th day of August, 1925, the city of Hill City, Kansas, will have for sale approximately $100,000 worth of internal improvement bonds. The city desires the best rate of interest that will bring par and accrued interest for the bonds. Purchasers of these bonds will be expected to do necessary temporary financing in connection with the paving program.” On’August 27 a motion was passed by the city council “That the contract entered into between the city of Hill City, and the Fidelity National Bank and Trust Company for the sale of bonds, be and the same is hereby confirmed as per terms of contract on file in the office of the city clerk.” On September 27 Frank Grecian presented to the mayor and council a petition, signed by 67 residents of the city, praying that the bonds be sold as provided by law to the highest bidder, in case the state school fund commission did not purchase them, and on the same day Grecian notified the city officials in writing that he had a reliable and responsible purchaser for such bonds in any
Temporary notes, 44 in number, for the total sum of $125,227.70, were issued. The trust company has paid that amount to the city, and the city has paid such amount to the contractor and to the engineers. These temporary notes, when executed, bore a due date of June 1,1926. They bore interest at the rate of 4% per cent from date to maturity, and Nos. 1 to 17, inclusive, provided that they should bear interest after maturity at the rate of 6 per cent, and Nos. 18 to 44, inclusive, provided that they should bear interest after maturity at the rate of 8 per cent until paid.
The city of Hill City owned a waterworks and electric light plant. At the time it was installed, some years ago, iron water pipes had been laid, on or across the streets improved by the several paving projects above mentioned. The city officials thought the pipes might rust and need replacement, which could not well be done after the pavement was laid, and deemed it advisable to replace the iron pipes in such streets with lead pipes. On August 3, 1925, an ordinance was passed reciting in the preamble the street improvements authorized by project No. 1, and providing:
“That all water connections within the area of the proposed pavement and all properties not now connected but deemed advisable by the council shall be so connected with lead-pipe water connections under the supervision of the water superintendent.
“The cost of making such connections shall be considered a part' of the cost of improving such streets and shall be paid for from funds derived from the sale of bonds for the improvement of said streets.”
On August 11 a similar ordinance was passed with reference .to street improvements in project No. 2. With reference to the other projects no ordinances were passed relating to the lead-pipe water connections, but in the completion of all of the projects (except No. 4) the iron pipes were removed and the lead pipes put in, at a total cost, as contended by plaintiff, of $6,975.45. Defendants admit that $3,672.78 for these lead-pipe connections was charged to the paving fund, but express a doubt as to whether the balance of the amount claimed by plaintiff was charged to that fund.
A few bills, aggregating $113, for the paving work, were paid from
Turning now to the legal questions presented, plaintiff contends that the cost of the improvement of the water mains by the taking out of iron pipes and substituting lead pipes is not a proper charge in connection with the paving improvements. This contention must be sustained. The statute provides for the extension and improvement of the water system in plants municipally owned. We shall not stop to consider whether the proceedings should have been under R. S. 12-834 or R. S. 12-837, for the governing body of the city did not attempt to comply with either of these provisions. On behalf of defendants and of the intervener it is argued that the improvement'of the water mains and connections deemed advisable by the governing body of the city prior to the laying of the pavement was a necessary cost of the paving, and in that connection cite People v. City of Buffalo, 137 N. Y. S. 464. In that case a narrow pavement was widened. In the opinion it was said:
“The work of moving lamp-posts and hydrants is necessary in connection with widening the pavement. If it were not done, the .lamp-posts and hydrants would obstruct the new pavement. While it is not included in the plans and specifications nor in the contract, it is work which the commissioner of public works might do, if authorized thereto by the common council. City charter, §§ 271, 272, title X. When the common council ordered the improvement without other provision for this work, it, by reasonable implication, authorized the commissioner of public works to set back the lamp-posts and hydrants. When it ordered the expense to be included in the assessment, it provided for the payment thereof pursuant to section 272 of the charter. Section 279 of the charter authorizes the commissioner 'to lay water pipes’ without advertising for proposals to do the work, although the expense may exceed $500, and moving the hydrants comes fairly within the meaning of the term ‘to lay water pipes.’ ” (p. 466.)
Clearly this case cited does not support the action taken by the city officials in the case before us. There, by the provisions of the city charter, the common council had authority to order the removal of the lamp-posts and hydrants, and the court held that it did so; hence, the action was specifically authorized by law. Here there is no such authorization by statute for having the improvement of the Water mains charged in connection with the paving, and the statutory procedure for the improvement of the water mains was not complied with. The defendants and the intervener also cited Longworth v. Cincinnati, 34 Ohio St. 101, but what was done there also
Plaintiff contends that the contract for the sale of the bonds was void for the reason that it did not conform to the statute (Laws 1925, ch. 93), which apparently contemplates that the bonds shall first be offered to the state school fund commission, and if such commission does not purchase the bonds the issue may be advertised in the official paper and placed on sale for not less than par and accrued interest, or may be sold at public sale, and for the further reason that the contract for the sale of the bonds was for all bonds which might be issued for internal improvements on work commenced in the year 1925, when the city commission had for consideration only project No. 1, the cost of which would be approximately $50,000. Plaintiff further argues that the bonds could have
Plaintiff contends that the assessment ordinance is void for the reason that it does not show that the appraisement and assessment were made upon each block separately, as the statute provides.
The intervener has appealed from the ruling of the court that it could collect only 4% per cent interest on the temporary notes from their respective dates until they are paid. The intervener specially disclaimed any intent to collect 8 per cent after maturity on any of the notes, although some of them so provide, and says that some of the notes were so written by inadvertence, but does contend that since the contract for the purchase of the bonds and the carrying of temporary notes provided no due date for the temporary notes, and since a due date was later agreed upon between the city officials and the trust company, after which due date the notes should bear 6 per cent interest, and the notes were so drawn, that it should collect interest at the rate of 6 per cent after the due date of the note. The difficulty with this argument is that the contract between the trust company and the city, of August 11,1925, did in fact provide a due date for the temporary notes. It provided for the issuance of temporary notes until the bonds could be delivered, and contained the provision: “We agree to carry your temporary notes at 4% per cent.” It seems no other reasonable interpretation could be given to that contract than that it was contemplated at the time the contract was made that the temporary notes would run until the bonds could be issued; hence, the date of the issuing of the bonds was the due date of the temporary notes, as provided by the contract. The trial court correctly held that the intervener was entitled to interest on temporary notes at the rate of 4% per cent from their respective dates until the bonds were issued.
From what has been said it necessarily follows that the judgment of the court below will be affirmed in all respects except as to the amount paid for the improvement of the water pipes and connections.