239 P. 719 | Cal. | 1925
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *52 The petitioner herein seeks a writ of mandate directed to the respondents herein in their capacity, respectively, of president and secretary of the petitioner, an irrigation district, commanding the said respondents in their foregoing capacity to forthwith sign and attest certain bonds and coupons of said irrigation district as designated in its said application for said writ. The facts set forth in said application as the basis thereof substantially show that the petitioner is and for some period prior to the filing of said application was an irrigation district duly organized and existing as such under the laws of the state of California and that the respondents were and are the duly elected, qualified, and acting officers thereof; that on April 5, 1924, one Ed Fletcher, sole surviving partner of a certain copartnership doing business under the firm name and style of the Cuyamaca Water Company, gave to the petitioner herein an option to purchase a certain water system then and theretofore owned by said copartnership on and along the San Diego River in the county of San Diego, state of California, for the sum of $1,100,000; that the petitioner *53 duly accepted said option and thereafter and by an order of the board of directors of said petitioner, duly authorized and taken pursuant to a petition of the requisite number of the qualified electors within said irrigation district requesting the same, a special election was called, to be held within said irrigation district on the seventh day of November, 1924, at which election there was to be submitted to the electors of said district the question as to whether or not bonds of said district should be issued in the sum of $2,500,000 in par value for the purpose of acquiring said water system of said Cuyamaca Water Company, and also of acquiring waters, water rights, reservoir sites, and other property for the use and purposes of said district in order to enable it to carry out and comply with the provisions of the California Irrigation District Act, under which it was organized, and any other act supplementary thereto authorizing such districts to acquire property and construct works. That said election was thereafter duly and regularly held on the seventh day of November, 1924, at which said election a majority of the said qualified electors of said district voted in favor of the issuance of such bonds. Copies of said order and call of said bond election and of the notice thereof and of the propositions submitted thereat and of the vote of the electors of said district voting at said election and of the canvass showing the result thereof are attached as exhibits to said application. That thereafter, and on November 10, 1924, the board of directors of said district, by resolution duly passed and adopted, provided and directed that in conformity with the constitution and laws of the state of California and of the proceedings theretofore had and taken by said district and pursuant to the said bond election thus held in conformity therewith, a bonded indebtedness of said district be created in the principal sum of $2,500,000 and that in evidence thereof bonds of said district be issued in and to the extent of said sum consisting of 2,500 bonds of the denomination of $1,000 each and in the form specified by law. That thereafter the said board of directors of said district, pursuant to the proceedings theretofore had, caused 2,500 bonds of said district in said amount and in due form to be prepared and presented to the respondents herein as the president and secretary, respectively, of said irrigation district for their, and each of *54 their, respective signatures and attestation and requested said officials to so sign and attest the same and the interest coupons attached thereto, but that the said respondents, as said officials of said district respectively have refused and continued to refuse to sign or attest said bonds or any of them or the interest coupons attached thereto or any of them. Following these averments the petitioner presents certain alleged urgent reasons for the presentation of its said application to this court and prays for the issuance of said writ. The petitioner herein did not in its said application undertake to set forth or enlighten this court as to the reasons proffered by the respondents herein for their and each of their refusal to sign and attest said bonds, but notwithstanding the defect in their said application in that regard, an alternative writ of mandate was issued and made returnable before this court at a later date. In response to said alternative writ of mandate the respondents herein appeared and presented their and each of their return to said writ, wherein they purported to set forth fully the facts and reasons upon which their and each of their refusal to sign and attest said bonds was predicated and by so doing eked out the deficiencies of the petitioner's application in that regard. In their said return to said writ the respondents set forth the fact that the petitioner was organized on the first day of November, 1913, under the provisions of an act of the legislature approved March 31, 1897, providing for the organization of irrigation districts and under the various acts amendatory thereof up to and including the date of its said organization. That under the terms of said prior acts certain provisions and requirements were specified relating to the vote of the qualified electors within the boundaries of each irrigation district, whereby its organization was to be accomplished and the benefits and burdens attendant upon and following such organization were defined. The respondents aver that by virtue of such organization of said irrigation district, under the terms of said original and amendatory acts of the legislature as they existed at the date thereof, a contract was created by operation of law between the state of California and the persons whose property was affected by the creation and organization of said irrigation district, under the terms and conditions of which the property owners of said district consented *55 to the imposition upon themselves and their lands of such burdens in the way of bond issues as were to be resolved upon, voted and issued in the manner provided by the aforesaid acts of the legislature as the same existed at the date of said organization of said irrigation district and not otherwise. The respondents proceed to aver that, since the organization of said district, the legislature has adopted various acts amendatory of the aforesaid acts in existence at the time of the formation of said district, by the terms of which numerous changes have been made in the manner and method by which irrigation districts may issue bonds; and particularly has changed the provisions of section 30 of said original act in the respect that said original section provided that as a prerequisite to the calling of a special election to determine the question as to whether or not bonds should issue, a petition by a majority of the holders of title representing a majority in value of the lands in said district according to the equalized assessment-roll thereof was required; whereas, by the change or changes made in said original section by said subsequent acts or amendments thereof, a petition signed by 500 electors residing within said district and including the holders of title representing twenty per cent in value of said lands instead of a majority in value thereof as provided in said former act, was required. In addition to this alleged radical change in this particular section of the law as it read at the date of the organization of said district, the respondents set forth numerous other changes in the law affecting the issuance of bonds within such districts and also affecting the manner and method of the sale of such bonds and the provisions to be made for the payment thereof. The respondents also point out other changes effected by said subsequent legislation relating to the working methods of such irrigation districts differing materially from those contemplated by said prior acts in force at the time of the organization of said district, all of which the respondents aver were effected without the consent or knowledge of the land owners within said district and all of which were in violation of the aforesaid contract alleged to have been created between the state of California and the said land owners of said district by the organization of said district under such pre-existing laws. The respondents *56 further aver that the bonds of said district, which were voted to be issued as alleged in the petition herein, were purported to be voted for and authorized under such later statutes and under the changed terms and conditions created thereby and hence have been voted for, authorized, and attempted to be issued in violation of said contract and are void, and that therefore the respondents have acted properly in their refusal to sign or attest said bonds or the coupons attached thereto for the additional reason that said later enacted laws, under which said bonds have been attempted to be voted for and issued, are not only in violation of said contract, but are also in violation of the provisions of the federal constitution, which prohibit any state from enacting laws impairing the obligations of contracts; and also of the said constitution and of the state constitution forbidding the taking of private property without due process of law.
The respondents set forth in their return as another and further reason why they and each of them were and are justified in their refusal to sign and attest said bonds the following facts: They aver that theretofore and on the fourteenth day of May, 1914, an election was duly and regularly called and held within said irrigation district at which there was submitted to the qualified electors thereof the question as to whether bonds of said district to the amount of $1,232,500 should be issued for the purpose of acquiring water, water rights, and other property, constructing necessary irrigation canals and works and otherwise carrying out the purposes of said district and the provisions of the act under which the same was organized. That said election was called and held and said proposed bond issue submitted to said electors of said district under a certain plan prepared by the hydraulic engineer of said district and which contemplated the utilization of a certain underground storage basin lying at the lower end of El Cajon Valley in the county of San Diego by sinking wells and by the installation of pumping plants at said point; and also contemplated the building of a dam and the creation of a storage reservoir in the gravel-beds of said region at a sufficient elevation to enable the consumers of water within said district to be supplied with gravity water. That said election was called and held in the manner provided by section 30 of the Irrigation District Act, as the same stood *57 at the time of such election, and resulted in the favorable vote of the requisite number of the electors of said district upon the issuance of said bonds; that thereafter and pursuant to said election the board of directors of said district caused bonds of said district in said amount of $1,232,500 to be prepared and signed by the proper officers thereof, and that thereafter there were sold and disposed of during the years 1914, 1915, and 1916 of said bonds the amount of $66,000 in par value thereof and no more, which latter amount of said bonds, with the exception of $10,000 in par value thereof redeemed by said district, are now outstanding in the hands of bona fide purchasers thereof; that the proceeds of said bonds so sold and disposed of were used by said district for the purpose of carrying out the plans and work provided for in the said engineer's report, but that the remainder of said authorized issue of such bonds amounting to the sum of $1,166,500 in par value thereof remained in the custody of said district available for the uses for which the same were voted, but not availed of by their sale or disposition therefor. That thereafter and while said bonds so remained unsold and undisposed of by said district, the board of directors of said district, purporting to act under sections 106, 107, and 108 of said Irrigation Act, called and held an election of the qualified electors of said district for the purpose of the election of directors thereat and also for the purpose of voting upon a proposition to destroy all of said remaining unsold bonds. The respondents proceed to set forth a number of respects in which said election was irregular and not in conformity with law, and then proceed to aver that at said election the votes of the qualified electors voting thereat were unanimously in favor of the destruction of said bonds; and that thereafter and pursuant to said election and on the seventh and eighth days of March, 1923, the directors of said district destroyed said unissued bonds. The respondents aver that said proceedings for the destruction of said bonds and which were consummated in the destruction thereof were wholly irregular, insufficient, and void and without authorization by the voters of said district, but that the same was accomplished at a time when the directors of said district had abandoned the plan of water development set forth in the report of the said hydraulic engineer of said district, upon the basis of *58 which said first bond election had been called and had for some years previous thereto been and then were purchasing water for the use of the inhabitants of said district from the Cuyamaca Water Company. The respondents aver that these bonds are still existing and valid obligations of the district, notwithstanding their attempted revocation and destruction and that as such the sum represented in their par value is still available for the purposes for which the new bond issue has been voted, and hence that the issuance of said new bonds was unnecessary and for that reason improper, and that respondents were and are justified in their refusal to sign and attest the same.
The respondents, as a further return to said alternative writ and additional reason for their refusal to comply with its mandate, allege that the option referred to in the petitioner's application providing for the purchase of the Cuyamaca Water Company's system to be paid for through the issue and sale of the bonds in question contains a provision by the terms and agreements of which the petitioner, if such option is exercised, is to sell and transmit to the Cuyamaca Water Company water at the fixed rate of nine cents per thousand gallons to be used in furnishing water for domestic uses to the inhabitants of the city of East San Diego and certain other communities lying outside of the boundaries of said irrigation district; and this, the respondents aver, the district has no legal authority to do or agree to do, and hence said option is in that regard ultravires and void as beyond the power of said irrigation district to perform, and hence that the portion of said bond issue providing the amount of money necessary for the exercise of said option and the fulfillment of the terms and conditions thereof would be illegal and the bonds issued and to be sold therefore void. Wherefore, the respondents pray that the alternative writ issued herein be dismissed and the permanent writ sought herein be denied.
To the foregoing return of the respondents herein the petitioner rests its response upon a demurrer and by so doing admits the averments of fact embraced therein. We shall therefore take up the legal questions involved in the application for said writ and the response thereto in the order of their presentation. The first contention of the respondents herein is that since the petitioner herein *59
was organized as an irrigation district in the year 1913 by a vote of the electors therein acting under the provisions of the Irrigation District Act of 1897 and the acts amendatory thereto in existence at the date of its said organization, the organization of said district by that means thereunder constituted a contract between the state and the individual property owners who as such electors voted to thus create said irrigation district, the obligations of which could not be changed or impaired by subsequent legislation. In making this contention the respondents chiefly rely upon the case ofMerchants Nat. Bank of San Diego v. Escondido Irr. Dist.,
The second contention which the respondents make is based upon the showing made in their said return to the alternative writ issued herein to the effect that there had been a prior issue of bonds voted for by said district to the amount in par value of $1,232,500, of which but $66,000 worth in par value had actually been issued and sold, and that as to said unissued bonds the electors of the district had *63 voted to revoke and destroy the same under the provisions of sections 106, 107, and 108 of the Irrigation District Act, but which vote and the election at which the same was authorized was for certain reasons assigned by the respondents irregular and void, and hence said unissued bonds have continued to be and are validly voted and existing bonds of said district and available as such for sale and for the application of their proceeds to the purposes for which the present bond issue is sought, and hence that such present bond issue is unnecessary, and the respondents are therefore justified in their refusal to sign and attest said bonds presently sought to be issued and sold. Section 106 of the Irrigation District Act (Stats. 1897, pp. 254-286) provides as follows:
"Whenever there remains in the hands of the board of directors of any irrigation district heretofore organized, or organized under the provisions of this Act, after the completion of its ditch system, and the payment of all demands against such district, any bonds voted to be issued by said district, but not sold, and not necessary to be sold for the raising of funds for the use of such district, said board of directors may call a special election for the purpose of voting upon a proposition to destroy said unsold bonds, or so many of them as may be deemed best, or may submit such proposition at a general election."
It would seem from a reading of this section of said act that as a prerequisite to the exercise of the power given to the board of directors of an irrigation district to call an election for the purpose of voting upon a proposition to destroy unsold bonds, the said board of directors must have made a finding to the fact of the "completion of its ditch system and the payment of all demands against such district," and also that the bonds voted to be issued by said district, but not sold, were "not necessary to be sold for the use of said district." Upon the hearing had upon the return on the alternative writ issued herein it was stipulated that the board of directors did in fact make an oral finding as to the foregoing facts at the time of the issuance of its call for said election. It is the contention of the respondents, first, that said oral findings would not be sufficient; and, second, that such findings, even if sufficient in form, would not be in accord with the facts. As to the first of these *64
contentions it has been decided that the findings of bodies of this character as to the existence of particular facts upon which their orders are to be predicated need not be in writing unless the statute so expressly requires (Chase v. Trout,
It is therefore evident, both from the absence of any averment or showing of the respondents to the contrary, but also from their stipulation as well as from the fact that at said election the electors who voted thereat voted unanimously in favor of the destruction of said bonds, that no substantial rights of the said district or of the property owners or electors thereof were injuriously affected by any of the alleged irregularities in the calling or holding of said election or by the destruction of said bonds which was effectuated as a result thereof.
The final contention which the respondents make is that the provision in the option agreement by which the water supply and ditch system of the Cuyamaca Water Company is to be acquired through the medium of the recently voted bond issue, to the effect that the district, if such option is exercised, is to sell to the said company a sufficient quantity of water to enable it to supply water to certain regions outside of the boundaries of the irrigation district, is a void provision; and hence that the entire option *67
is void and thus forms no sufficient basis for the issuance of the bonds in question; and that they are therefore justified in refusing to sign or attest the same. This contention has no merit (Hewitt v. Pleasant Valley Irr. Dist.,
It is our conclusion from the foregoing considerations that the respondents herein have failed to show any sufficient justification for their and each of their failure and refusal to sign and attest the bonds in question and the coupons attached thereto; and that the peremptory writ should issue as prayed for. It is so ordered.
Lawlor, J., Shenk, J., Seawell, J., Lennon, J., and Waste, J., concurred.