122 N.W. 403 | N.D. | 1909
Section 130 of the Constitution of this state requires the legislative assembly to restrict the powers of municipal corporations as to levying taxes -and assessments, borrowing money and contracting debts, and prohibits the diversion of money raised by taxation, loan, or assessment for any purpose, to any other purpose, except by authority of law. Section- 183 provides that -the
The legislative assembly, in chapter 30 of the Political Code, commencing with section 2632, Rev. Codes 1905, has provided for the organization and incorporation of cities. Article 4 of said chapter, commencing with section 2678, enumerates the general powers of city councils in 78 paragraphs or articles. Paragraph'5 gives it power to borrow money on the credit of the corporation, for corporation purposes, and to issue bonds therefor in such amounts and forms, and on such conditions, as it shall prescribe, and provides that no such city shall become indebted in any manner, or for any purpose, to an amount, including existing indebtedness, exceeding 5 per cent, of the taxable property therein. Then follows the proviso, contained in the section of the Constitution, quoted, relating to an increase of such indebtedness, on a two-thirds vote, of 3 per cent., and the further proviso 'quoted relating to indebtedness in any amount, not exceeding 4 per cent., for the purpose of constructing or purchasing waterworks, with the additional power to issue bonds therefor, and the further proviso that the city, before or at the time of issuing any of the bonds mentioned, or incurring the indebtedness for which the same are to be issued, shall provide for a direct annual tax sufficient to pay the interest on such debt or bonds when it falls due, and to pay and discharge the principal when the same becomes due, and that such provisions shall be irrepealable until such debt is paid. The final paragraph of the section provides “further that none of the hereinbefore mentioned bonds shall be issued, either for special or general purposes, except as by law otherwise provided unless at an election, after twenty days’ notice in a newspaper published in the city stating the purpose for which such bonds are to be issued, and the amount thereof, the legal voters of said city, shall, by a majority vote, determine in favor of issuing such bonds.” Paragraph 11 of section 2678 gives
The city council of Fargo passed', and the mayor approved, on the 1st day of March, 1909, a resolution as follows:
“Be it resolved, by the city council of the city of Fargo:
“That, at the annual election, for elective officers for the city of Fargo, to be held on Monday, the 5th day of April, 1909, there shall be submitted to the legal voters of said city, the question, whether or not one hundred thousand dollars ($100,000.00), or such part thereof as may be required, in bonds of the said city, in denominations of one thousand dollars ($1,000.00), each, to mature as follows, to wit: Thirty -thousand dollars ($30,000.00) thereof in ten years from date of issue; thirty-five thousand dollars ($35,000.00) thereof in fifteen years from date of issue and thirty-five thousand ($35,000.00) residue thereof in twenty years from date of issue, and to bear interest at the rate of four per -centum per annum, payable semi-annually, shall be issued by the said city of Fargo for the sole purpose of defraying the cost -of building and constructing a new waterworks pumping station, and installing -therein a new high duty pump and necessary steam boilers and other needed machinery and appliances, and for building, constructing and equipping of a filtration plant in connection with said pumping station, and for paying such portion of the cost of constructing a water main of sufficient capacity, extending from the present location of the waterworks pumping station in Island Park -to the selected location for the new pumping station in block two (2) of South Park addition to the city of Fargo, over and above such part of the -cost thereof as can be assessed against the property along the route of the said water main, for furnishing to the inhabitants of the said -city of Fargo an adequate and pure supply of water; and for the purpose of installing an electric light plant in connection with the said pumping station for furnishing street and other lights and power.
*295 “That the city auditor be, and is hereby directed to have printed on the regular ballots for such annual election the following: 'For issuing bonds for waterworks, filtration and electric light plants and extensions’ and 'Against issuing bonds for waterworks, filteration and electric light plants and extensions.’
“That the city auditor be and he is hereby directed to give legal notice that such question will be submitted .to the legal voters of the said city of Fargo at such annual election, by publication of this resolution in the official newspaper of the city of Fargo and in the other daily newspapers of the said city, for twenty days next preceding the said election, as required by law.”
And the city auditor, in the notice for the annual election of the city of Fargo, included -the following notice:
“Notice is hereby given that the annual election in and for the city of Fargo, Cass county, North Dakota, will be held on Monday, the fifth day of April, 1909, at the following polling places in the several wards of the city, to wit: * * *
“Said election will be held for the election of one alderman in each of the seven wards of the city, and there will also be presented to the electors of the city for their votes the proposition of the issue by the city, of $100,000.00 four per cent, bonds, or such part thereof as may be required, for the construction of a new waterworks pumping station and filtration plant, etc., and for the purpose of installing an electric lighting plant in connection with said pumping station, which proposition is more fully set forth in a certified copy of the resolution adopted by the city council, which is published elsewhere in this issue of this newspaper.”
The question so submitted received more than a majority of the votes cast on the subject of bonds at such election, and thereafter the city council passed, and the mayor approved, an ordinance providing for the issuance of such bonds. The ballot contained the question, “Shall the city of Fargo issue $100,000.00 or such part thereof as may be required, in bonds of said city?” reciting the denominations, dates of payment, rate of interest, and the purposes stated in the resolution. The appellant brought this action, setting out these facts, and asking that all the proceedings relating to such bond issue, including the tax levy which was provided for in the ordinance mentioned, be adjudged null and void, and for an order enjoining and restraining the.mayor and auditor from executing or delivering any of the proposed bonds, and the auditor from cer
Three questions are presented for our consideration by this appeal: (1) That the notice of election does not specify the purpose for which the bonds are to be issued; (2) that the notice of election does not state the amount of bonds that are to be issued; (3) that by reason of the constitutional and statutory provisions heretofore quoted, providing for the issuance of bonds to an amount not exceeding 4 per cent of the assessed valuation, for the purpose of constructing or purchasing waterworks or constructing sewers, and for no other purpose whatever, and to issue bonds therefor, the proposition to issue bonds for the -construction of waterworks may not properly be coupled with a proposition to install an electric light plant.
We shall consider the first and third of these propositions together. Preliminary to the consideration of these objections we may say that it is well settled that incorporated cities have only the following powers: (1) Those granted in express words; (2) those necessarily implied or incident to the powers expressly granted; (3) those essential to the declared objects arid purposes of the corporation — not simply convenient, but indispensable; (4)- that doubtful claims of power, or doubt or ambiguity in the terms used by the Legislature, are resolved against the corporation. Voss v. Waterloo Water Company, 163 Ind. 69, 71 N. E. 208, 66 L. R. A. 95, 106 Am. St. Rep. 201, and cases cited; City of Champaign v. Harmon, 98 Ill. 491; Thompson v. Lee County, 3 Wall. 327, 18 L. Ed. 177; Minturn v. La Rue, 23 How. 435, 16 L. Ed. 574. It may also be stated as a rule that in considering the legality of a proposed bond issue by a cityr, courts construe the constitution and statutes more strictly -than they are construed in determining the validity of bonds already issued and disposed of. 21 Am. & Eng. Ency. of Law, 33, 45.
1. Neither the resolution authorizing the election, nor the notice published by the auditor, states the amount of the proposed bond issue. The language is “$100,000 or such part thereof as may he required.” The members of this -court are agreed that this failure to state the amount of bonds which it was proposed to issue invalidates the proceedings. The statute requires the notice to state the
In State ex rel. Lexington & St. Louis R. R. Co. v. Saline County Court, 45 Mo. 242, the Supreme Court of Missouri passed upon this question. A law authorized the court to subscribe stock in a railway company, but provided that the subscription should not be made unless a majority of the taxpayers should vote for it, specifying the amount. The court in submitting the question called on the electors to vote for or against an amount not exceeding $70,000. The court held that no amount was specified by the vote; that the question submitted left the precise amount undetermined. To the same effect, see City Council v. Dawson Waterworks Company, 106 Ga. 696, 32 S. E. 907, and Hillsborough County et al. v. Henderson et al., 45 Fla. 356, 33 South. 997. In the latter -case the law provided that the resolution submitting -the question of issuing bonds to a vote should determine the rate of interest to be paid on the bonds. The resolution submitted provided for a rate >of interest of not more than 4 per centum per annum. The -court held that this was not a substantial -compliance with the statute, and that the fact that the proposition was -carried by popular vote did not cure the defect, and that the .statute -had vested -the board with no authority to ask a waiver by the voters. The court says: “If the board can lawfully reserve for future determination by itself the interest which the bonds shall bear, so can it reserve any or all of the other matters required to be fixed in the resolution which it submits for ratification.” See authorities cited in opinion. It may be added that the Florida court meets some of the arguments in favor of the validity of the bonds by statements which are apropos in the case at bar. It held that while the maximum rate of interest permitted by the resolution providing for the -bonds was so low that it was .possible that the form of the resolution in stating 4 per cent, as a limit rather than as a fixed rate -of interest, did not materially affect the election; that this however, was mere matter of -conjecture, and did not affect the law of the case; that the fixing of a maximum rate implies the possibility of issuing the bonds at a lesser rate; and that, in principle, there was no difference between that resolution and one fixing a greater maximum rate, with a -correspondingly greater range of
In Smith et al. v. Mayor & Council of Dublin et al., 113 Ga. 833. 39 S. E. 327, an election, at which was submitted the question of issuing bonds in .the aggregate amount of $25,000, not more than $20,000 of the amount realized therefrom to be used fqr building a schoolhouse, and not more than $5,000 for enlarging the light and water plant of the city, and the surplus, if any, to be used in such manner as the mayor and council might see fit, was held invalid because not meeting the legal requirement that a notice of this character should specify the amount of bonds about to be issued, and for what purpose. The court held that the notice neither stated the amount nor the purpose.
Amang the reasons for requiring the amount and other particulars to be stated in the resolution and notice, and particularly in the notice, may be mentioned that it is from such notice and resolution that both the taxpayers and voters derive their knowledge that the election is to be held on the question of issuing bonds, and they are entitled to such information on the subject, including a statement of the amount of the proposed issue, as will enable them to consider, weigh, and discuss the merits of the proposition, and to avail themselves of the opportunity so given to acquire information, not only as to the necessity of .the proposed expenditure, but as to the amount necessary to carry out the plans of the council and to accomplish the purpose sought. It is perfectly clear that, in the absence of at least as specific information as is required by the statute, complete opportunity is not afforded .those interested to so investigate the various questions as to enable them to vote intelligently. Other authorities might be cited in support of our conclusion, but we deem it unnecessary to cite them. Our attention is called to only one authority apparently holding to the contrary. In Railway Company v. Village, 63 Neb. 624, 88 N. W. 661, the Supreme Court of Nebraska held that a similar submission of the statement of the amount was sufficient. Respondent seems to rest its case, as relates to this point, on that authority, but the court of Nebraska expressly states in the opinion that it. has been unable to find any law of that state requiring a specific amount to be stated. 'We find some other authorities to the same effect, but on examination it ap
• 2. Our decision might rest upon our conclusion on the proceeding point, but other questions have been raised; and, inasmuch as the city of Fargo will likely hold another election on the subject, and will not wish to proceed in the dark as to such questions, we will consider and pass upon them. We do so for the further reason that the state is interested in having these questions set at rest. The board of university and school lands desires to purchase any bonds issued by the city of Fargo, and is in the market for bonds issued by other municipalities in this state, and at its request, through the Governor, the Attorney General appeared in the case, made an argument, and submitted a brief.
With respect to the resolution and notice calling for the issuance of bonds for the double purpose, namely, waterworks and electric light plant, and requiring a vote on the two subjects in one, and that this is not submitting it in such a manner as to permit the voter to vote for or against either proposition independently of the other, the authorities are in apparent conflict. In view of this fact, and of -the further fact that the bonds have not been issued, and that it is more important that a safe rule should be announced by this court for the guidance of municipalities in submitting such questions than that either line of authorities should be followed, we feel at liberty to adopt that rule, based upon those principles which, to us, appear most nearly in consonance with the statute, the spirit of our institutions, and which will best protect the voter in the exercise of his franchise and the municipality against possble fraud. The authorities are nearly unanimous to the effect that a proceeding by which two questions are submitted, when such questions or their subjects and purposes are not naturally related or connected, is invalid, and renders any election at which such questions have been so submitted invalid. 21 Am. & Eng. Ency. of Law, 47; State ex rel. City of Bethany v. Allen, 186 Mo. 673, 85 S. W. 531; People v. County of Tazewell et al., 22 Ill. 147; Williams v. People, 132 Ill. 574, 24 N. E. 647; Board of Supervisors v. Miss. & Wabash Ry. Co., 21 Ill. 338; Village of Hempstead v. Seymour et al., 34 Misc. Rep. 92, 69 N. Y. Sup. 462; Village of North Tonawanda v. Western Transportation Co., 16 Abb. Prac. (N. S. N. Y.) 297; City of Denver et al. v. Hayes et al., 28 Colo. 110, 63 Pac. 311; People v.
The contention in the case at bar is that, because the resolution and notice read, “and for the purpose of installing of an electric light plant in connection with the said pumping station for furnishing street and other lights and power,” they present only a single question or purpose, and do not come within the rule laid down in most of the authorities referred to above. It is contended that the two purposes or objects, namely, a pumping station and electric light plant, are made one by the use of the phrase “in connection.” No serious contention is made that without the use of such words an electric light plant and waterworks or pumping station would be separate and distinct from each other. It appears to us that subjects which are so different, and which have no natural or necessary connection, cannot be made one, and the law and the reasoning of the courts evaded by a play upon words. A verbal joining does not connect them in fact, when they are connected neither naturally nor by statute. It is contended that the city will be enabled to economize in its proposed enterprise by connecting the two; that they may be placed under the same roof; that the same boilers may be used for pumping and furnishing light; or that, if electricity is procured from private parties and transmitted to the plants, it may be used for power for the pumping station. Courts are frequently required to announce general principles and rules in construing statutes, and for the guidance of municipalities as well as private parties. When the meaning of the statute is doubtful, so either of two constructions may be adopted, it is the duty of- courts to follow those which to them seem to be the best reasons, and those best calculated to protect the public against fraud and imposition, and
In the case at bar no question is made as to good faith or the merits of either proposition. It is no part of the province of this court to determine the merits, but it can readily be seen that some voters may feel that an urgent necessity exists for an improved water system, and little or none for an electric light plant, or vice
In Woodbridge v. City, 57 Minn. 256, 59 N. W. 296, the city charter provided for water and light bonds, and the question does not appear to have been raised as to whether they could be combined. The same is true of State ex rel. Caffery, 49 La. 1152, 22 So. 756. Coleman v. Town (Ala.) 47 South. 703, appears to be in point, but an examination discloses that the subjects are connected by statute. This is conceded by respondent. It is therefore not an authority. In Ellingwood et al. v. City of Reedsburg, 91 Wis. 131, 64 N. W. 885, it was held that the city had the right to issue bonds for water and light plants, but the question of combining was not raised, and the court was passing upon a far more comprehensive statute than our own. In Heilbron v. Cuthburt, 96 Ga. 312, 23 S. E. 206, we find no discussion of the point. People v. Counts, 89 Cal. 15, 26 Pac. 612, is not an authority. The bonds were for the con
In the Leavenworth Case, supra, the Kansas court says: “The statute reserves a large and clearly defined discretion in the matter to the people themselves. No plan involving the issuance of bonds can be carried out without their sanction. Even though the mayor and council may contract, they cannot pay by means of bonds unless the people approve. Every arrangement for indebtedness which the mayor and council may make involving city bonds must include an appeal to the ballot box, and must fail if the ballot box be found to contain a majority of adverse votes. This discretion of the -taxpayer the mayor and council cannot exercise and cannot control. Since, therefore, no bonds may be issued for any purpose, or for any set of purposes, unless the people be consulted and give their consent, every voter must have a fair opportunity to register an intelligent expression of his will. This the official ballot failed to provide.” In -Cain v. Smith, supra, the court says: “If the General Assembly was allowed to submit two, three, or more propositions
In City of Denver et al. v. Hayes et al., supra, the officers of the city of Denver were acting under a law almost identical with ours, and submitted the question of issuing bonds for different purposes to a vote in the same manner. It says: “That the action of the city council was fundamentally wrong we have not the slightest doubt. The purpose of the framers of the Constitution, which they expressed in the section under consideration, and the object of the General Assembly which is embodied in the city charter, were to prohibit municipal authorities from 'Creating a debt for municipal purposes, and from issuing bonds, unless a majority of the legal electors of the city gave their Consent thereto. By the proceedings under review no opportunity was given by the city council to the electors to express their will as to incurring a debt for any particular purpose, and the voice of the electors has never been heard. Neither the constitutional limitation nor the statutory provisions expressly declare that only one purpose may be submitted at the same election, nor that, if more than one purpose may be thus submitted, each shall be separately stated. But the object of neither can be attained, and effect to the language in which they are expressed cannot be given, unless such purposes be separately stated, and the amount proposed to be applied to each particular purpose designated. This must be done, not only in the ordinance which provides for the submission, but in the election notice; and the ballots must be so prepared that every elector may declare his choice as to each purpose, and the amount proposed to be applied thereto
In Gray v. Mounts, supra, is found a very lucid explanation of this doctrine, and the -court, among its observations on the subject, remorks: “The next matter urged against the validity of the proceedings is the union of two objects, and two separate appropriations for distinct objects, in one proposition, so that the elector could not vote for one and against the other. We think -this presents a fatal objection to the legality of the proceedings. The question to be submitted to the -voters was not simply whether it was their will to appropriate the fund, but there must be an object for the appropriation in order to constitute the proposition to the voted upon. The object is of t-he essence of the proposition. This -cannot -be denied. The appropriation for a given object is the proposition submitted, If there be -two objects, and a specified amount of funds to be devoted to -each, it is very plain that there are two propositions submitted at the same election. If they are submitted -together, it is very clear that the voter cannot vote for one and against, the other. He must vote against both, whereby he may defeat one, the success of which he desires, or he must vote for both, whereby he may cause the success of one’ which he desires to be defeated. If he fails to vote, he may thus aid in causing the defeat of his favorite measure, and the adoption of the- one he opposes. He has thus no liberty -of -choice. The plan of submitting the questions, for there are two, resembles more the common device of an auctioneer in disposing -of worthless goods, whereby a good article is mingled with them and made to draw bids, or the cunning tricks of the gamesters to induce wagers of the unwary, rather than the open, direct, and fair manner that always should prevail in elections -by the people. The very letter, as well as the spirit, of our election laws condemns this plan. It has never been heard of -that electors were, by any plan, denied the right of choosing one, and rejecting another, candidate for -office, to be voted for at the same election.”
An examination of the authorities satisfies us -that the -conflict is more apparent than real. We are, in addition to the reasons already referred to, impressed with some -others which we think serve to reinforce the contention that they are separate purposes.
In People v City Council, 23 Utah, 13, 64 Pac. 461, the Supreme Court of that state held that, under similar constitutional provisions, the power to incur- an indebtedness for water, light, and sewer purposes was absolutely within its own limits, and that the debt created by virtue of a 4 per cent, provision similar to ours for the three purposes named was additional to that permitted for general purposes, and that the purpose of the framers of the -Constitution, among others, was to separate the general -debt power from the special debt power.
We think it at least questionable and worthy of consideration whether the city can issue bonds intended for waterworks that they will necessarily fall within, or be included in, the ordinary 5 or 8 per -cent, debt limit of the Constitution, and in any event until it has exercised its right and power to issue them to the limit provided of 4 per cent, for the special purpose. This is suggested, but as it is not necessary to determine it in this case, and as counsel saw fit to leave the court without enlightenment, we leave it undecided. The order sustaining the demurrer is 'reversed, and the district court directed to enter a decree in accordance with the prayer of the complaint.