*1 Further, if is in even the evidence COUNTY, voiding of the Dwight
sufficient to call for the ex rel. KNOX Executive, is entitled to defend KESSEL, County policy, National Union from showing a claim is excluded Plaintiff-Appellant, coverage pursuant paragraph v. act, it arose from an application because TENNESSEE; CITY, Lenoir LENOIR a director or or omission about which error Board, McCur Robert S. Utilities knowledge or information. It is officer had Denton, Clayton, Timothy ry, Wil Alice alleged unnecessary that each act or omis McNabb, Cheatham, Idus Thomas liam thereof, sion, knowledge or an insured’s Hamby, Defen Conner and Gerald 1823(e). writing pursuant dants-Appellees. of National Union’s foundation and basis policy fully contained in the ex defense is Tennessee, Supreme Court of otherwise, thereby allow clusions. To hold at Knoxville. ing FDIC to enforce under July honoring policy’s exclu policy without clause, “giving the FDIC sionary would be gold.” ability to transmute lead into Montross, Sav., FSB Dallas
Sunbelt do not
supra,
er to transform an insurance contract negotiable of a instrument. decision of
Accordingly, we affirm the Appeals reversing the chan-
the Court of summary judgment. This grant of
cellor’s to the trial court where
case is remanded present shall be allowed to
National Union misrepresentation and nondisclosure de- against both the FDIC
fenses against
Thompson estate.4 Costs are taxed appellants. DROWOTA,
REID, C.J., and O’BRIEN DAUGHTREY, JJ., concur. regarding parties an issue whether warranty 4. The raised therein made in the resentation policy insur- FDIC had negotiations ance, determined that of a contract the chancellor therefor, application policy or in or in two notice of claims in one vided behalf, shall be deemed or in his assured Obviously, is best years. of this issue resolution policy pre- or void the or defeat material left to the chancellor. misrepresenta- attaching, unless such vent its warranty actual intent to is made with tion or deceive, represented in- the matter or unless of loss. creases the risk
383 Chapter is chancellor held that constitutional, plaintiff appealed. agree We with the chancellor’s decision and affirm. begin analysis
We our with the firmly rule that in order for the established provisions XI, of Article Section 8 to come play, into the local act under attack must general contravene some law that has man Ruble, Deputy Director, Michael S. Law datory, Knoxville, application. statewide Leech v. plaintiff-appellant. 270, (Tenn. Wayne County, 588 S.W.2d Littleton, Nashville, Robert B. Terry 1979). Hence, specific question before Vann, Hathcock, Jr., Alfred L. Robert G. us is Chapter whether 205 conflicts with a Hinton, City, Lenoir defendants-appel- provision equivalents of the current lees. mandatory, ap statute that has statewide plication. OPINION Municipal The 1969 System Electric Tax DAUGHTREY, Justice. Law, Equivalent in Chap- effect at the time appeal, In this we are asked to declare adopted, ter 205 specifically authorized private unconstitutional passed act equivalents pursuant the distribution of tax governs 1970 that tax-equiv- acts. A section of that 1969 payments alent on property owned statute, superseded, provided now as fol- Lenoir Utilities utility Board. The lows: provides electric service both in Loudon Nothing in this shall be con- [statute] (where County located) Lenoir is change strued to any way amend in portions adjacent County. Knox Un- any private act as now or hereafter en- Chapter der the terms of 205 of the Private provides payments acted which 1970, Acts of the entire amount of the tax- of local taxes on the electric equivalent payments utility assessed to the any municipality paid municipality City, of Lenoir relates, which such act and such though even property giving some of the acts as from time to time amended shall payments rise to the located Knox remain full force and effect notwith- County. standing hereof. Seeking to share in the distribution of (1969). Hence, T.C.A. 7-52-306 insofar payments,
these Knox County brought suit Chapter may have conflicted with declaratory judgment, for a claiming that law, the 1969 tax it was not Chapter 205 of the Private Acts of 1970 challenge to constitutional under XI, violates Article Section 8 of the Tennes- XI, because, by Article Section 8 its own see provision Constitution. That of the terms, the 1969 statute was not intended to state constitution reads as follows: mandatory, application. have statewide Legislature power shall have no suspend any general 1987, however, By law for the benefit the Tennessee any particular individual, pass Assembly nor to apparently General had decided any law for the benefit of degree individuals that there should be some of unifor general mity regard inconsistent with the tax-equivalent law created with land; pass result, granting passed nor to law As a the “Mu individuals, rights, priv- nicipal System Equivalent individual Electric Law ileges, immunities, 1987,” exemptions 84, Acts Ch. codified as may be, by than such as the same law County 7-52-301—310. Knox §§ extended argues “general member of the communi- now that this statute is a ty, may bring who himself purposes able law” for state constitutional affecting only within of such law.... the distri- City, somewhat button Lenoir is there- Act differ XI, statute; they fore under superseded unconstitutional Article Sec- from those tion because these are not Except appear now in T.C.A. 7-52-304. in compliance general distributed with the 7-52-305, regard- for a new *3 law. ing amendatory contracts ten- the effect of municipality by dered to a the Tennessee least, Superficially, argument ap- at Valley remaining Authority, the substan- have pears purpose merit. In the and provisions dis- govern tive of the 1987 Act Act, construction of the 1987 the section therefore, sections, is these tribution. It purpose legislation stated of the new is “to question that of control the of allocation provide complete the law of this state with the tax this case between respect payments in lieu of taxes on the County City. Knox and Lenoir property [municipal] and of all operations systems_” electric T.C.A. 7-52- § provisions of the distribution Most 302(a). This also same section reflects a legislative a intent to con- Act reflect legislative “repeal specific intention trol of to allow the terms calculation but provisions any private of act or home rule regard to T.C.A. flexibility with allocation. government metropolitan charter or char- 7-52-306, example, compet- permits for § relating payments ter ... in lieu of per- ing taxing jurisdictions and to “make reading Id. taxes.” But a close of the full among form them contracts distribution “complete reveals that the term equivalent of the aforementioned tax preclude validity law” does not all parties contracts amounts.” The to such affecting acts private pay- distribution of “may on provide ... distribution Rather, to repeal ments. the intent such satisfactory basis is to the contract- 7-52-302(a), private qualified by acts is § ing parties,” must be “con- but contract as follows: respects sistent in all with the [calculation] (a) purpose provide The is of this provisions This sec- of ... 7-52-304.” § complete law of this State re- tion also validates all contracts and “estab- payments spect to in lieu of taxes on arrangements”1 lished that for distribution property of all electric were in existence on the effective date systems operated by incorpo- owned and the 1987 Act. towns, counties, by by rated cities or section, “payments entitled next metropolitan governments, and to taxing pre- jurisdictions,” sets out specific provisions any private act allocating statutory scribed method metropolitan or home rule charter taxing juris- among between thereof, charter, any part provided dictions which service relating to in lieu of in- taxes However, by applies only utility. cluding provisions relating to certain pre-existing there extent is no payments, such the distribution of “contract, arrangement autho- established provisions to repeal any but not ..., or rized or under 7-52-306 validated § private or charters or acts provisions act thereof. metropolitan government or home rule or added). 7-52-302(a) (emphasis T.C.A. § (emphasis charter ...” 7-52-307 § statutory that follow ad- added). questions: much how is to be dress two providing “operations Finally, after (calculation pay- in lieu of paid adjacent states” ments) and to must be whom question specifically Act addresses taxing one jur- when more than distributed (allocation by private act or home rule pay- “distribution isdiction involved metropolitan 7- ments). government charter” for calculation of formulas by payment accepted the tax- arrangement” is has been defined 1. An "established ing jurisdiction year municipali- for the fiscal or calendar which the 7-52-306 "one under year immediately year preceding fiscal be- ty has made a distribution to another understanding ginning July taxing jurisdiction by general 1987.” 52-309. This they’re doing, section does have the effect not affect and it also does repealing pri- allocation any distribution.” Floor of House debate provisions, vate acts and only charter Repre- Bill 689 the Tennessee House of those which “direct that the tax (March 23, 1987). sentatives amount to be taxing distributed to each that, regardless We conclude of its stat- district is to be an amount arrived at “complete ed intent to law” of applying the current ad valorem tax rate in municipal utility equivalents, the 1987 depreciated original district to the cost permits Act specifically the allocation of system’s tangible of the electric proper- payments among taxing jurisdictions to be ty-” We qual- conclude that it was this established means of a act such *4 repealer ified legisla- to which the Chapter opinion 205. We offer no as to 7-52-302, ture had reference in when § current, obviously the fairness of the one- stated an intent to provi- “certain arrangement Chapter sided contained in private affecting sions” of acts distribu- only 205. We conclude that if Knox Coun- tion, “but not repeal any provi- to ty arrangement, wishes to alter that it will sions of such Chap- acts.” Because have legislature, to address its case to the ter 205 does pro- not utilize the formula rather than the courts. 7-52-309, in scribed validity is not § affected repealer provision in this judgment of the trial court is af- section. appellant. firmed. Costs are taxed to the Moreover, because none of the Chapter in 205 conflicts with REID, C.J., and DROWOTA and Act, Chapter the 1987 205 is unaffected ANDERSON, JJ., concur. statute, the final section T.C.A. 7-§ 52-310, repeals “parts those O’BRIEN, J., separate dissents. See private act ... in conflict herewith ... to opinion. conflict_” the extent of such This vision, above, like the others discussed O’BRIEN, Justice, dissenting. clearly demonstrates although leg- that complaint in this case filed in was islature intended bring some uniformity by plaintiff, rel., County, 1989 Knox ex tax-equivalent payment schemes, es- Dwight Kessel, Executive, County against pecially in the calculation of amounts City Lenoir City Lenoir Utilities paid, there “gen- was no intent to create a supervisory Board as the board of the Mu- imposes eral law” mandatory, a state- nicipal Electric Plant of City. Lenoir wide method of distribution of action was for a declaratory judgment Indeed, validating (and, extent, to some rights determine County of Knox even encouraging) the existence of equivalent payments, pursuant receive tax acts, contracts, arrange- and “established seq. spe- 7-52-301 et The bill § ments” for the distribution of cifically requested chancery court competing jurisdictions, the General As- find and determine that Section 205 of the sembly negated any gen- intent to create a passed by Private Acts the General Assem- law, purposes XI, eral of Article Section bly year 1970 to be unconstitutional 8. This conclusion inescapable, only not XI, and in violation of Article 8 and Arti- § wording from the of the 1987 Act but also II, cle 28 of the Tennessee Constitution. § legislative from a review of the history of requested It was also that the Court find its enactment. point As the defendants out City and determine that the Lenoir Utilities appeal, in their on question during brief a Municipality City Board and the of Lenoir debate committee from a of the member County past to Knox were liable Representatives concerning House of equivalent payments, require legislation defen- existing effect of the new on practices comply dants to with the terms response drew this of T.C.A. 7-52-301, seq., in sponsor, Representative from the House et reference to such Bragg: grandfathers anything payment. John “It
386 by the moot rendered of 1970 has been filed motions parties
Subsequently both
Equivalent law.
passage
of the 1987
The motion
summary judgment.
request that the
limited to a
plaintiff was
on the
recent cases
of the most
Two
Acts
of the Private
find
205
Court
Tullahoma
in this State are
issue
XI,
Article
8
1970 to be
violation
Tennessee,
F.2d 683
County,
v. Coffee
Plaintiff
Constitution.
of the Tennessee
989,
denied,
Cir.1964),
379 U.S.
(6th
cert.
amend the
for leave to
also filed a motion
(1965);
698,
13 L.Ed.2d
S.Ct.
complaint prayed
complaint. The amended
rel.
ex
Shelbyville
Bedford
property
relief for a rule
as alternative
415 S.W.2d
220 Tenn.
County,
Board
City Utilities
owned
Lenoir
a
case recites
(1967). The Tullahoma
applicable
County
Knox
beginning
subject,
history of the
lengthy
on the
Prior to
action
county taxes.
Act of
Valley Authority
the Tennessee
with
court sus-
complaint the trial
amended
amended 1935
1933, including Sec.
summary
motion for
defendant’s
tained
(16
U.S.C.A.
amended
Sec.
finding that T.C.A.
judgment,
analysis
831Z). The court’s
831i and
§§
pay the
utilities to
seq., permitted the
et
paragraph
Sec.
pinpoints the fourth
accordance,
lieu of tax
para
This
Act,
in 1940.
as amended
*5
ruled
Act. The court
that
Private
graph provided:
governed
Acts of 1970
205 of the Private
construed
“Nothing herein shall be
City
Lenoir
the
lieu
tax
of
Corporation
authority of the
limit the
nor
neither the statute
Board and
Utilities
power to
sale of
contracts for the
XI,
8 of
Article
Act violated
the Private
provide
or
permit
municipalities,
Constitution.
the Tennessee
may
rates which
power at
the resale of
judgment
appealed the
Plaintiff
tax-equiva-
to cover
an amount
include
(1) issue,
one
Appeals presenting
Court of
in lieu
municipality
payments to the
lent
action
of the trial court’s
requesting review
municipal taxes
State, county, and
of
the
Chapter 205 of
determining
that
system property
or
upon any distribution
1970 was constitutional.
Acts of
Private
agen-
any
municipality,
by the
owned
defendants,
Ap-
of
the Court
motion of
On
thereof,
upon
proper
a
cy
conditioned
the case to this Court
peals transferred
municipality
by the
distribution
of
17. The constitution-
pursuant to T.R.A.P.
lieu
State
by it in
amounts collected
of
issue, it
being
only
the
ality
the statute
of
distri-
upon any such
county taxes
this Court.
properly transferred to
was
being
the
property;
system or
bution
the
Chapter 205 of
insists that
Plaintiff
either
Congress that
intention of
Article
1970 violates both
Private Acts of
in which
or the State
municipality
of the State of
XI,
Constitution
8 of the
shall
situated
municipality forth in
general law set
Tennessee
to the State
proper distribution
7-52-301,
seq., captioned as the
et
T.C.A. §
equiv-
portion
county
of
Equivalent
System Tax
Municipal Electric
municipality
by the
so collected
alent
Law of 1987.
upon
county
prop-
system or
any such distribution
hand,
argue
defendants
the other
On
supplied).
(Emphasis
erty.”
Acts of
Chapter 205 of the Private
pay-
pertaining to the distribution
Appeals con-
Court
The Sixth Circuit
by Lenoir
made in lieu of taxes
ments
amend-
of the
by the enactment
cluded that
does not contravene
City’s
System,
Electric
gen-
a
simply expressed
Congress
ment the
System
Municipal Electric
of the
the tenets
proper
should be
intention that there
eral
They say Equivalent Law.
of tax
intend for
Assembly did not
General
counties,
did
but
made to the States
appli-
mandatory state-wide
to have
statute
intention
implement such
not undertake
provisions.
of its
cability as to all
either
effect
to that
by imposing duties
States,
municipali-
T.V.A.,
upon
upon
question of
that the
quite clear
It seems
exclusively to local
ties, leaving
matter
Chapter 205
constitutionality of Private
regulation.
expended
control or
municipal purposes
Such distribution
deter-
exclusively by
would be determined
governing body
city.
mined
of the
municipality
State or
In the
itself.
ignored
The Private Act
T.C.A. §
distribution,
absence of a
seq.,
provided tax-equivalents
et
municipality would be entitled to retain the
computed
among
were
allocated
entire
representing tax-equivalent
fund
taxing jurisdictions
in which the munici-
upon
and no action
lie
would
pality’s
electric
was located and
county
any part
of the
recover
which such
con-
were
See
at
of Tullahoma
pay,
ducted. The defendants did not
nor
F.2d,
687. The Court declined to fol
plaintiffs
did
assert
action to demand
low the decision of this Court in Ruther
payment,
any tax-equivalent
authorized
County City Murfreesboro,
ford
complaint
or directed until this
filed in
In City Tenn.
tion. Thus a for failure conflicting Repeal —Ex- comply. cept expressly pro- as herein otherwise vided, acts, including parts all acts or 7-52-307—mandates act, rule, parts any private or home municipality’s governing body, in the reso- charter, metropolitan government in con- 7-52-304(4) provided lution for in shall flict are to the extent of such herewith equivalents] direct [tax repealed. conflict herewith taxing jurisdictions in which its electric plant only excep- in service is irrefutable, located. Act, It is that the as stated in being tion to the extent such tax caption, was intended to for the taxing jurisdictions] laws, are conflicting including [to of all contract, provided otherwise estab- any private act or home rule or arrangement, provi- lished or distribution metropolitan pertain- charter any private sions of act or home rule or ing taxes, including in lieu of Metropolitan Government Charter. provisions relating to the distribution of
No other reasonable construction can be
given the Act. The rule
is set out
caption
unambig-
of an Act is
Where
Oyster
Anderson Fish
Company
&
susceptible
only
interpreta-
uous and
one
Olds,
197 Tenn.
277 S.W.2d
345-
tion,
enlarged by
construction
cannot be
legislative
intent controls
to cover matters not set out therein.
[T]he
Chicago
construction of statutes.
Rector,
&
supra, p.
ex rel.
Evans,
Southern Airlines
Inc. v.
*8
equally
It is
certain that this
is
Court
218,
(1951).
Tenn.
Dance,
Thank-you
186 Tenn.
visory Intergovernmental of Commission contents not conform to the actual of that, that, I and I think know Relations subject Caption to The Munici- Bills. The agreement it’s a we’re in Bill, passed Company as Ch. 220 pal Gas in payment for uniform across Tennessee states, Acts of by municipal, locally lieu taxes local of payments for provide AN ACT To owned, But to the gas systems. leaves it property and of taxes on the the amount of entity local to determine operated gas owned and passes payments systems of of all just It money.
n towns, permits in incorporated language cities or coun- The the 1987 statute ties, by metropolitan governments; or pro- to no to other conclusion than its intent incorporated authorize such cities or tax-equivalents properly rate the calculated towns, counties, metropolitan gov- in among taxing jurisdictions accor- ernments contract to as to distribu- concluding part dance terms. with its The payments among tion of such certain lo- that, specifically except act states taxing jurisdictions cal any and validate therein, expressly provided parts acts or all for, existing existing contracts estab- acts, including private act, parts any of of arrangements for, lished distribution government rule, metropolitan home thereof; provide to for charter, are to the conflict therewith absence of contract or ar- established repealed. extent of conflict Private such rangement; to for of Chapter no purpose 205 serves than including all laws in conflict herewith exclusively to distribute to Lenoir private any of act or home rule or equivalent payments tax the Le- made metropolitan per- charter System. noir There is no Electric taining payments to of lieu taxes ex- repeal. doubt about its cept provisions relating to the dis- complaint prays payment for the of any tribution payments; such of past equivalent payments, including act vide that this remedial nature penalties and interest. The record indi- construed; liberally shall be and to part cates that no effort was made on the Annotated, amend Tennessee Code Title County tax-equiva- of any Knox collect 7, Chapter 39. lent until latter two Bills were filed the same simply exchange At that time there was an sponsors. gas statute, “repeal[s] of correspondence parties. between specific provisions any private act ... or The Public Acts of 1969 effect. were thereof, any part relating payments specifically provided T.C.A. 7-52-306 except provisions lieu of taxes relating private efficacy any continued act any payments.” distribution of such then in place enacted therefore involving The Bill Municipal Sys- Electric provided in lieu of taxes on relating tems include to the dis- systems the electric of municipalities. No tribution such pay- further action was taken to enforce Municipal T.C.A. 7-52-302. The Elec- approximately year ment until and a half tric Purpose Plant statute —Construction Tax-Equiv- after the enactment the 1987 “repeal[s] specific provisions passage alent of that Act Law. Until relating act ... lieu legal efficacy Private including certain re- question. debatable lating to the distribution However, would it was law. It payments." ... tax-equiva- reasonable for the division of It is appropriate to look the two stat- begin lent as of the effective utes to establish intent. Reyn- See Hart v. Equivalent July date of the Act on 1 olds, al., et 48 Tenn. The 1987. comparison in this case beyond establishes I dissent. equivocation legislature the intent of the seq. the enactment of T.C.A. et general
It is the rule that acts superseded
are held to be as far as is
necessary give general effect to a statu-
tory plan applicability. of statewide *10 Word,
ex rel. Strader 508 S.W.2d (Tenn.1974).