*1 MOORE, Appellant, A. J.
CITY OF CORPUS CHRISTI et
al., Appellees.
No. 1165. Texas, Appeals
Court of Civil
Corpus Christi.
Oct. 1976.
Rehearing Denied Nov.
Harry Hoag, Christi, Corpus appel- L. lant. Aycock, City Atty.,
J. Bruce Gerald L. Benadum, Christi, Atty., Corpus Asst. Dist. for appellees. McCall, H. Paul B. Horton
Hobby McCall, Horton, Dallas, Parkhurst & W. Jr., Murdaugh, Gen., Atty. Asst. James Austin, amicus curiae.
OPINION BISSETT, Justice. election contest case. A. J.
This is a bond Christi, Texas, Moore, Corpus a resident “contestant”, brought hereinafter called Christi, City against suit Attorney City Secretary, and the General Texas, to contest bond elec- State City on June and held tion called for of the election were 1976. The results 30,1976. electorate, on June canvassed cast, of the votes autho- majority a small ($14,400,- of the bonds rized the issuance July filed on 000.00). The contest was Attorney Gener- against The suit jurisdictional grounds. al was dismissed before the court without a Following a trial August was rendered on jury, judgment valid. held that the election was duly timely perfect- has The contestant judgment from that appeal ed an Court. following proposi-
At said concerned, was tion, appeal is as this insofar submitted: of said
“Shall of said to issue authorized prices at such to be sold as shall be at such rates bear interest the discretion determined making Council, purpose for the to-wit: public improvements, permanent FA- A COMMUNITY-CONVENTION AN EXHIBIT INCLUDING CILITY ROOMS, BANQUET HALL, MEETING AUDITORIUM HALL, ADDITIONAL IMPROVEMENTS, FURTHER AND respec- effect that ACQUISITION writings AND DEVELOPMENT the SITE, to each writing AT “hand-delivered” OF THE THE BAYFRONT tive proof is not contestees THE AND CENTER FOR ARTS SCI- thereof, or on the date were delivered on ENCES ...” date, certainly not on or any other contestant, point, in his con- midnight. at We can- July before *3 upholding court erred in tends trial writings the were deliv- presume that not validity the the the of election because the time limit- within to the contestee ered present- proposition submitted the Election Code. 9.03 the by ed Article ed separate propositions two and distinct as Moreover, writings not set out do the upon: 1) community-convention be a voted any the election contest grounds the 2) additional im- facility auditorium the by the contestant in asserted grounds provements. ap- in this brought forward points of error intending Any person to contest an elec- writ- set out the grounds peal. only provisions tion must with comply the in the con- irregularities ings are asserted Ann. (1967). Tex. Election art. 9.03 Code not They are before the duct of election. requires statute that the contestant: appeal. us in this shall, thirty (30) days . day give after the return him original petition was Contestant’s writing a thereof in notice deliver to m., 30,1976 at a. and was July 9:30 on filed him, agent his attorney, written p. 4:30 at m. on the contestees served ground statement on which such grounds of only contest day. The same relies to sustain such contestant contest. was 1) the election were: alleged therein By day’ day the ‘return is meant the on notice not the election did because invalid which the cast in votes said election are of interest accordance the rate prescribe counted and the result official thereof requirements of Tex.Rev.Civ.Stat. with declared.” 2) the election (1964); 703 art. Ann. The two-fold certain violations of because of void was statute, being jurisdictional, mandatory, manner in which Election Code Texas waived, cannot must be served on The service of conducted. was the election the contestee within thirty days after on was made the contestees petition on official result election is declared. following the return date day the thirtieth District, Hospital v. Edna Moore 449 S.W.2d it was election. Since of the contested 508 1969, (Tex.Civ.App. Corpus Christi — with filed and was after contest served e.); Thetford, writ ref’d n. r. Walker v. 418 time, it met the statutorily prescribed in the 1967, S.W.2d 276 (Tex.Civ.App. — Austin no as to 9.03 both Article requirements of e.); n. r. writ ref’d Landrum v. Centennial election and to contest of intention tice High 2, Rural School Dist. 134 No. S.W.2d on grounds to relied as notice of 1939, 353 (Tex.Civ.App. writ dism’d — Austin Thus, the in the contest. contestant jdgmt. cor.). acquired jurisdiction court district grounds set bar, In the at case the time within contest insofar concerned, comply petition which to are requirements original in the out Steele, 496 Article 9.03 of the v. Election Code with re McCasland no more. See 1973, 30, no spect expired to notice July (Tex.Civ.App. on 1976 at 937 S.W.2d — Waco midnight. The claims contestant the writ). 5, writings, July dated 1976 and July contestant, peti signed by him and an amended attorney, his 5, 1976, al August contestees,
and hand-delivered to the met filed that was requirements upon We void statute. not do the election leged in agree. There proof proposition is no in the ground record that additional writings proposi personally either were and distinct separate two cluded from electorate prior served of the contestees on or tions, prevented which July proposition. 1976. The statement each of on each separately voting
723
Sterling
v.
ballots. Railroad Commission
contestees were not served with written
Co.,
Refining
218
ground
upon
147 Tex.
notice of that
attack
Oil &
5,1976.
(1949).
presumed
that all
August
election until
written
Since
S.W.2d
ground
persons eligible
of contest
to vote in a bond
notice of
additional
with the con
given
was not
to the contestees within thir- will familiarize themselves
in the
and the statements made
ty days after the official result of the elec-
tents of
ballots;
declared,
casting their
compliance
tion was
there was no
before
re
legislature would have
with Article 9.03 of the Election Code as to
otherwise the
record,
copy of the
ground.
quired
In that state of the
a verbatim
Brown,
acquire jurisdic-
on the ballot.
the district court did
Whiteside
respect to
(Tex.Civ.App.
tion of the election contest with
S.W.2d
— Austin
case,
ground
dism’d).
the election was
invalidity
set out
writ
In this
petition.
did
ground
amended
that the ballot
not invalid on the
rate of interest
specify
an exact
*4
error,
point
The
the record
under
bear,
or that
it did
the bonds would
presented,
here
cannot be considered in this
of the amount
properly inform the voters
point is overruled.
appeal. The
the bond
being
by approval
created
debt
contestant,
point
in his second
issue,
argued by the contestant
in his
(his remaining point),
error
contends that
brief.
the trial court erred in
elections,
municipal
respect
With
bond
election
the proposition
was valid because
appel
Article 703 has been construed
submitted to the electorate and
on two occasions.
late courts of
State
specify
ballot did not
an exact rate of inter-
instance that the afore
It was held in each
est which the bonds would bear. He claims
require
that an exact
said statute did
express
it was mandatory under the
proposi
in the
specified
interest be
provisions
rate of
art. 703
Tex.Rev.Civ.Stat.Ann.
tion,
com
there was a substantial
(1964)
but that
proposition
and the ballot
statutory requirement
specify
interest,
pliance with
an exact rate of
the omis-
specified only a maxi
proposition
sion of
where the
which rendered the election void.
Amstater
v.
interest.
agree.
We do not
mum rate
(Tex.Civ.App.
Andreas,
95
273 S.W.2d
— El
statute,
703,
Article
which was last
e.);
1954,
v.
writ ref’d n. r.
Cameron
Paso
1921, provides,
part:
amended in
249,
(Tex.Civ.
Waco,
254
8
City of
S.W.2d
proposition
“The
to be submitted shall
1928,
writ).
no
App. — Waco
distinctly specify:
a statute
is
deciding whether
In
3. The rate of interest.”
not,
legislative intent
is
mandatory or
of the en
determined from a consideration
statutory requirement
is no
There
nature,
act,
object, and the conse
tire
its
municipal
that the ballot in a
bond election
from the construction
quences that follow
specify
shall
“the rate of interest”. All
Fox,
(Tex.
v.
133
987
thereof. State
S.W.2d
required
is
is that
the ballot substan
1939,
ref’d);
Civ.App.
writ
Nichols
tially
proposition
submit the
to be voted on
— Austin
District, 356
Independent
v. Aldine
School
certainty
with such definiteness and
1962,
(Tex.Civ.App.
182
S.W.2d
England
v.
voters will not be misled.
— Houston
writ).
test
no
“There is no absolute
McCoy,
(Tex.Civ.App
269
813
S.W.2d
. —Tex
whether a stat
Lewie,
which it
be determined
1954,
dism’d);
arkana
writ
Turner v.
directory
mandatory
is
utory provision
(Tex.Civ.App.
In the instant within discretionary setting rate of in calling the notice specifically public exer terest on a bond issue must be stated that the bonds would “bear interest according judgment honest cised at such rates as shall be within determined of the bond market proscription discretion of Council”. That Bar at the time are sold. the bonds See language plain unmistakably clear. rington Cokinos, v. Tex. 338 S.W.2d character, purposes, chief features (1960); Wheeler, Scruggs 4 S.W.2d of the proposed bond election were set out 1927, writ (Tex.Civ.App. — Amarillo in sufficient detail ref’d). acquaint inform voters with all knowledge that It is a matter of common aspects of proposal. person No who had eco- according rates fluctuate previously proposition prior read the to the very has nomic conditions. There been misled, could have been deceived or last years few substantial increase respect confused with to the rate of interest municipal the rates of interest that was specified therein. The if the to be sold. Without bonds are knew that the bonds must bear some few, bonds, any, if substantial the sale of interest, and that the City Council could by pub- improvements be constructed could provide for the bonds to bear interest at the Legislature, in enact- agencies. lic The 61st highest rate allowed law. The voters ing art. 717k-2 Tex.Rev.Civ.Stat.Ann. could, also knew that September (Supp.1976), effective would, presumably fix lowest rate at net removed all limitations on the existing sold, considering which the bonds could be *5 public rate on securities effective interest the existing economic conditions at the time the issued from and after and sold put sale. The electorate was Act, recognized date the and being that the voters were asked to effective of exactly authorize interest are “many public agencies some rate not the fact day, known on but which would public sell presently to issue and unable by City determined in the future Coun- legal restrictions securities because of cil, within its discretion and the limits of public securi- the rate of interest that the law. voters of The bear, to may impossible makes ties Christi had a clear choice the matter. in urgently public improve- finance needed ” choice, They expressly made that au- . . ments. . thorized Council to set the exact statute, in provides, The Article 717k— speci- rate of in the clearly manner part: fied in proposition. nothing We see hereby Any public agency “Sec. 2. inherently wrong calling in any and sell issue or authorized to issue of an permits election which plainly price any of its public series securities at voters to allow the exact rate of interest bearing any rate prices or interest at proposed which the bonds will bear to be set rates, or as within shall be determined persons people whom the have cho- governing body of the discretion of the them, represent sen to and in their discre- excep- subject public agency, to the good tion and judgment. ”. provided. tions hereinafter . . The discretion of a in Act 3. this provisions “Sec. The performance subject public duties is concerning maximum price sale and the to review the courts. word “discre The public rates of interest which securities just proper tion” what is under means may apply public bear to all securi- shall circumstances, and is word for not a notwithstanding provisions re- ties or arbitrary will or Cow inconsiderate action. any general special or law or strictions Calvert, den v. & Tex. Broderick contrary, charter to the but shall not (1938). governing S.W.2d 1166 The any to max- body apply public of a securities whose municipality is constrained limits, exercise of net by legal its discretion imum of interest maximum is, proposition qualified submit the vot- effective interest at the time of “shall says ers. The law thereof, specifically issuance otherwise (5) separate things distinctly specify” five fixed the Constitution.” on. calling to be voted exceptions statute mentioned do (5) requirements are: These five to the at apply case bar. are for which the bonds purpose “1. The suggestion There is no case issued; fraud in any there was the choice of thereof; 2. The amount proposition. the words used in the apparent language contained interest; 3. The rate of therein followed the mandate of Article pay levy 4. sufficient taxes concerning fixing 717k-2 exact provide sinking the annual interest and rate of interest after the had been maturity; pay fund to the bonds at any voted. There is attempt no evidence date, or maturity 5. The that the bonds voters, mislead the or that were serially to mature issued justly misled. The Courts consider the ob given forty.” years not to exceed number taining of a fair election and the voters’ Art. Y.A.C.S. free choice and are anxious to sustain the (4) (5) requirements Four of these five were people expressed will of the as the result distinctly specified met. were as They regardless of the size of the herein re- set out below. Number majority vote. quirement “interest”, was not. Legislature, pas- at the time says “distinctly specify The law sage of Article 717k-2 was cognizant of purpose”: City’s for the election call paragraph 3 of Article and it is obvious stated, permanent . making public it considered that Article 703 did not improvements to-wit: A COMMUNITY- require an state exact FACILITY, CONVENTION INCLUDING Any rate of interest. other construction ROOMS, HALL, AN MEETING EXHIBIT would, many instances, prevent a solu- BANQUET HALL, ADDITIONAL AUDI- problem tion of the that Article 717k-2 was IMPROVEMENTS, TORIUM AND FUR- *6 designed to solve. ACQUISITION THER AND DEVELOP-
We hold that SITE, Tex.Rev.Civ.Stat. MENT THE AT THE BAY- OF (1964) Ann. art. 703 does not make man FRONT CENTER FOR THE AND ARTS datory specify an exact . . .” SCIENCES: rate of interest will bonds bear. says “distinctly specify The law regarding statement of inter rate City’s amount thereof”: The call for est in the that was submitted to stated, aggregate election “. . .in the of Corpus Christi was in substan $14,400,000.” principal of amount tial compliance with the statute. We says “distinctly 3. The law specify give refuse to the statute the technical con City’s rate of interest”: call for the contestant, which, struction asserted election stated: . . interest at done, issue, if would render the bond other rates as be shall determined within the dis- valid, wise point invalid. second cretion of the (Emphasis Council.” error is overruled. supplied.) judgment of the trial court is AF- says “distinctly 4. The law specify FIRMED. levy”: City’s call for the stat- . levy ed: “. . to and cause to NYE, Chief Justice (dissenting). assessed and collected annual ad valorem I respectfully dissent. When the taxes in an amount pay sufficient to was attempting Christi to sell to its provide annual on said bonds and a interest improvements citizens to the made sinking pay to said bonds at maturi- fund Bayfront Center, ty.” it was law to the rate requirement 703’s “distinctly specify the Article says
5. The law inform specified is to distinctly elec- City’s call for the interest be maturity date”: will serially they amount .to mature maximum public stated: twenty-five years obligation. to exceed the bond charged on date.” from their $14,400,000.00 interest The rate of lending” days in which very In these “truth in im period is twenty-five year over a live, requires everyone we the law not set at limit was If an outside portant. charged person a on, the rate of interest delay voted proposition was the time the and in in exact terms spelled must be out conceiv could of such bonds in the issuance is ex- person who advance. This is so the rate higher interest a much ably require ultimately will pected pay the interest rate than higher tax much resulting in a obligation. his know the total amount voting pub time the at the anticipated improvement within makes a vast This law By set authority to issue bonds. gave lic charges and society. prevents It hidden our receiving rate ting the maximum 5069.14-01, et practices. See Art. deceptive amount, governing a authority for such seq. (Supp.1976). go forward necessity have body would of the sale immediately with almost very close. results were The bond election (not to ex possible at the best bonds court could deter- way There is no voters) by the rate authorized ceed the or people some voted “for” mine the reason taking a chance by waiting and than If the rate of rather “against” proposition. make the would market distinctly set out as the bond interest had been in a new election election result undoubted- unmarketable requires, law hand, City could might if a ly would have been different. On the other evitable. proposed in favor at a lesser have been more the bonds dispose of hand, voters, the bond expenditure, or on the other authorized than that way taxpay have no may have failed. We to the enure would then the benefit mental inquiring into the knowing permission granted who ers of voters. process of the harm place. No their issuance holding of the two This is the result. would authority is grant In a case where sole au majority as the by the cited cases rate of taxes levy and collect a certain body to set governing thority permit given pur for a taxpayer’s property, fit in their see any rate that grant such author only pose, the voters Andreas, v. also Amstater See discretion. (not to such taxes ity levy and collect Paso (Tex.Civ.App. 273 S.W.2d — El rate), give a man but also exceed a stated e.); Cameron ref’d n. r. writ rate of taxes. and collect that levy date to (Tex.Civ.App. Waco, 8 S.W.2d — Waco are the sole beneficiaries The voters *7 1928, writ). no because the same levy, they authorize will opinion that such action they are of the notice call- that the majority states The are in They interests. their best subserve and unmistak- “plain is ing for the election rate, for in fixing the maximum terested in true, the but it violates This is ably clear”. to issue the bonds voting for the calling the which authorizes statute specific taxed at a rate consent to be they give their fur- majority states The the election. for by their vote. that authorized not to exceed the bonds that knew that the voters ther Waco, 249 8 City S.W.2d See Cameron and that interest rate of some must bear 1928, writ). no (Tex.Civ.App. — Waco for the bonds provide City could the Council allowed highest rate at the interest to bear City the did undisputed that is effect, setting would be law, this, in by in rate of interest the “distinctly specify” that highest rate If the rate. maximum the proposi- the descriptions of its two either of 10%, (Article for is be sold a bond could This, I believe the voters. given to Constitution), then I 11, Texas City. Section part the of the on a serious omission published notice to the though publicly the seriously present if the bond election doubt compliance generally is sufficient had the stat- voters a would have carried law, the any possible .at rate interest to be the it is that voters ed with City by not to exceed 10%”. this the inclusion set the Council were misled in election specific such implication goes is that with in and the purpose This the the detail leaving holding. bonds, majority and then of the amount rate of interest discretionary the out majority The the word also states City after the by the set permissive Article is because “shall” in was over. 717k-2, legislature enacting the in Article existing V.A.C.S. removed all limitations opinion my It is the net effective rate of interest on bonds City was The improvidently. Christi acted governing to be issued and sold a statutory duty to set out maxi- a under legislature agency. This is not true. The interest in the call mum rate of repeal did does not and this statute notice) (the public and also should ordinarily implication. The word “shall” is a itself short on the ballot have included impose duty imperative operates to interest rate. description of maximum as this The be enforced case. important where the especially The latter is given be that effect which is word must exacting detail on go to into attempted to out the intention of the necessary carry the bonds to the amount of the ballot as rules legislature by ordinary as determined It follows of the bonds. purpose refusal of of construction. deliberate given in also have should legislature (in “may” to insert the word rate of interest to detail the maximum setting to requirement out the as charged. “shall”, interest) place the word allow majority by its decision would part legisla- shows an intent on any city, any school district or other any mandatory. word as ture use latter for a bond governmental agency call Surely, legislature intended that had legis- completely disregard election and permissive or that this this word “shall” be rate of interest mandate that lative have so repealed, article was to it would majori- distinctly specified. The “shall” be clearly statute indicates stated. Where a cases, only old each of them ty relies on two “shall” was intended to be word election sets that if call clearly mandatory and it would be incon- specified maximum amount inter- out a legislative sistent with overall intent charged (4% in one est to be case 5% mandatory! for to be otherwise —it is other) specified is a suffi- 380, pp. C.J.S. 877-882. § Statutes compliance cient law. Art. 703 It is as has so stated majority true goes than (V.A.C.S.). majority further put that all that majority it cites. The the two cases which itself, calling as opposed ballot any other court goes further than just sure enough to make by holding governmental State will not be misled. It would voters completely disregard the man- agency may sufficient, instance, for the have been long statute so datory effect of the put “Proposi- on the have ballot charge they will not inferentially state that facility” tion: Bonds for convention —“For” legal of inter- the maximum more than “Against”. —or would “know” this maxi- est. *8 interest, agen- not because the However, case, mum rate of required cy specifically in- informed them as placed on the ballot actually presump- legal the total amount of Art. because formed the voters of but charged are bonds, expendi- its that all citizens purposes and the legislature If detail, of the law. knowledge then made no reference ture but give Al- had wished whatsoever of interest. setting
Christi absolute discretion be submitted to rate of interest on bonds to HOENEKE, Appellant, J. Milton voters, it would have so stated. The authorizing legislature did this LEHMAN, Jerry Appellee. to sell under Art. V.A.C.S. 717k— No. 15663. legislature But the did not authorize City to do this under Article V.A.C.S. Texas, Appeals Court Civil legislature I intended because believe the Antonio. San for the “know” in advance the voters to Oct. obligation. outside limit of bond just important It is for the inter-
required specified to set out a approved by
est on bonds the voters as specified
it is to set total amount of out the on. Both re-
bonds that are to be voted
quirements in concrete the total maxi- set obligation. you require
mum How can one not the other
requirement specific
while are all covered in the same stat-
ute? incongruity majority quite reasoning. evident its It over- point saying of error appellant’s
rules first that the con- says the statute which days, within 30 give
testant “shall”
etc., mandatory requirement. is a Since the statute in the
appellant did not follow instance, point contest on this can- Using a different stan-
not be considered. majority says that City,
dard for the is not mandato-
“shall” in the other statute comply comply or not
ry City “may” —the as it wishes. courts are
Although it is unfortunate that from time
required to set aside an election time, important it is far more statutory follow the
cities be importance.
law in matters of