TOCH, LLC, an Oklahoma Limited Liability Company Plaintiff/Appellee, v. CITY OF TULSA, an Incorporated Municipality, Defendant/Appellant, and TULSA HOTEL PARTNERS, LLC, an Oklahoma Limited Liability Company, Intervenor/Appellant.
Case Number: 118682
THE SUPREME COURT OF THE STATE OF OKLAHOMA
Decided: 09/29/2020
2020 OK 81
DARBY, V.C.J.
ON APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY HONORABLE LINDA G. MORRISSEY, DISTRICT JUDGE
NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL.
¶0 Plaintiff requested a declaratory judgment that Tulsa Tourism Improvement District No. 1 was improperly created. All parties sought summary judgment. The district court granted summary judgment in Plaintiff‘s favor. We retained Defendant‘s and Intervenor‘s appeal.
REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.
John M. Thetford, Evan M. McLemore, and Grant B. Thetford, Levinson, Smith & Huffman, P.C., Tulsa, OK, for Plaintiff/Appellee, Toch, LLC.
Gerald M. Bender, T. Michelle McGrew, and R. Lawson Vaughn, Tulsa, OK, for Defendant/Appellant, City of Tulsa.
Frederic Dorwart, Jared M. Burden, and J. Kyden Creekpaum, Frederic Dorwart, Lawyers PLLC, Tulsa, OK, for Intervenor/Appellant, Tulsa Hotel Partners, LLC.
DARBY, V.C.J.,
¶1 The City of Tulsa (City), Defendant, passed an ordinance creating a tourism improvement district that encompassed all properties within City which had hotels or motels with 110 or more rooms available for occupancy. Toch, LLC, Plaintiff/Appellee, owns Aloft Downtown Tulsa (Aloft) with 180 rooms. Toch filed a petition in Tulsa County District Court requesting a declaratory judgment that the ordinance is invalid for a variety of reasons, including that the district does not include all hotels with at least 50 rooms available. The court granted summary judgment to Toch based on its determination that City exceeded the authority granted in
I. BACKGROUND
¶2 In October 2018, City proposed an ordinance to create Tulsa Tourism Improvement District No. 1 (TID). City limited the prospective district to “those properties within the geographical area of the City of Tulsa on which a hotel or motel, which in either case has one-hundred ten (110) or more rooms available for occupancy, is located.” The proffered assessment-area map outlined the Tulsa corporate limits with bullet points noting the location of each hotel. The attached estimated-assessment roll listed thirty-three hotels and motels and contained hotel names, property owners, and legal descriptions for each property. Pet. Ex. A. The resolution stated that the “list of each Property
¶3 On November 5, 2018, Trevor Henson filed a letter with City which stated in relevant part:
I have been hired by multiple hotel owners to file an official objection to any creation of a Second Improvement District Assessment1 in Tulsa applying to hotels in excess of 110 Rooms within the City of Tulsa and in the proposed improvement district. The parties joining in this objection are the owners and operators of the hotels listed as follows:
. . .
Aloft Downtown Tulsa[ Footnote: Lee Levinson is the owner of the Aloft Downtown Tulsa hotel.]
Pet. Ex. B. On November 7, 2018, Henson filed a second opposition letter with City. Later that day at the City Council hearing, Henson, John Snyder, Lee Levinson, and three other individuals all made public comments in opposition to the creation of the TID. Joint Mot. for Summ. J. Ex. 3. Also at the hearing, Henson presented City Council with a copy of both previously filed objection letters before it voted unanimously in favor of the TID.
II. PROCEDURAL HISTORY
¶4 On December 6, 2018, Toch filed a petition in Tulsa County District Court requesting invalidation of the TID for a plethora of reasons, including that the creation and boundaries of the assessment roll were arbitrary, creation of the TID was outside of the authorities granted to City under
¶5 Over the next nine months, Toch filed a motion for summary judgment, Tulsa Hotel Partners (Intervenor) filed a motion to intervene, and City and Intervenor (together “Appellants“) filed a joint-motion for summary judgment. Prior to the hearing on summary judgment, Toch argued that the TID violated both
¶6 At the hearing on the motions for summary judgment, Toch argued that City did not have the authority to require 110 rooms, instead of 50, as a basis for inclusion in the TID and City had no legislative purpose to set the higher floor except attempting to garner enough support for passage. When questioned by the court about the statute potentially requiring inclusion of all hotels with 50 or more rooms, Appellants asserted that the legislature‘s use of the disjunctive or expressed a choice and the legislature would have written “at least 50” if it intended municipalities to include all hotels with 50 or more rooms. Appellants argued that the legislature intended to provide flexibility so municipalities could determine their own special needs and draw appropriate distinctions. Further, Appellants argued that if the statute was ambiguous, the city council “makes the call on how to apply it.”
¶7 In February 2020, the district court granted in part and denied in part Toch‘s motion for summary judgment and denied Appellants’ motion for summary judgment. The journal entry incorporated the court‘s twenty-one page order, wherein the court summarized Toch‘s arguments on summary judgment down to three points, but only granted the motion based on the first: “the TID was improperly created because the City did not use the 50 room threshold as authorized by
¶8 The district court determined that, “any citizen of Tulsa and certainly any hotel in the TID could at any time bring an action for determination of whether [City] has followed the law in creating the TID.” Order 20-21. The court ultimately ruled:
The Legislature did not grant to [City] the authority to legislate the number of rooms a hotel must have in order to be subject to the TID. The level set by the legislature, “50 or more rooms” is “perfectly clear” and unambiguous. . . . . A number of questions raised by [Toch] are not reached in the determination of this matter because the enabling statute simply does not grant authority to [City] to set a threshold for creation of a TID. The threshold created by the legislature is 50 or more rooms.
Order 20-21 (emphasis added). In performing a partial analysis of the TID as a special law under
¶9 Appellants timely filed a petition in error and now argue in relevant part that the district court erred in granting summary judgment when it (1) held that any citizen of Tulsa and certainly any hotel in the TID could bring an action to challenge the City‘s proper creation of the TID at any time, and (2) found sua sponte that municipalities can create a TID under
¶10 In their Brief in Chief, Appellants allege that
¶11 Appellants argue that within the context of the tourism statute, the language “50 or more” can only be interpreted as a floor because
¶12 Appellants further argue that the district court erred in allowing Toch to challenge the TID. Appellants note that
¶13 In response, Toch claims that Appellants failed to apply the correct standard of review, Toch has standing, and the district court properly held that
¶14 In reply, Appellants maintain that Toch considers key statutory language out of context and ignores the portion of the statute which allows municipalities unfettered discretion to define the geographical area of improvement districts. Appellants explain that “rather than mandating what properties must be included in such an improvement district, [the phrase ‘50 or more rooms‘] sets a floor regarding what properties may be included in an improvement district.” Reply 5 (emphasis original). Appellants further note that standing is a legal issue that appellate courts review de novo.
III. STANDARD OF REVIEW
¶15 Summary judgment settles only questions of law, therefore, we review de novo the grant thereof. Am. Biomedical Grp. v. Techtrol, Inc., 2016 OK 55, ¶ 2, 374 P.3d 820, 822. “Summary judgment will be affirmed only if the appellate court determines that there is no dispute as to any material fact and that the moving party is entitled to judgment as a matter of law.” Horton v. Hamilton, 2015 OK 6, ¶ 8, 345 P.3d 357, 360; see also
IV. ANALYSIS
¶16 The issue before this Court is whether City exceeded its legislative authority in enacting the TID. Because the “mandatory scope of a legally cognizable cause of action may present a jurisdictional question,” we must first address whether
A. Title 11, Section 39-108(D)
¶17
Within thirty (30) days after the governing body has concluded the hearing; determined the advisability of constructing the improvement and the type and character of the improvement; and created the improvement district, any person who, during the hearing, filed a written protest with the governing body protesting the construction of the improvement may commence an action in district court to correct or set aside the determination of the governing body. After the lapse of thirty (30) days succeeding the determination of the governing body, any action attacking the validity of the proceedings and the amount of benefit to be derived from the improvement is perpetually barred.
¶18 “An agency relationship generally exists if two parties agree one is to act for the other.” Sur. Bail Bondsmen of Okla., Inc. v. Ins. Comm‘r, 2010 OK 73, ¶ 23, 243 P.3d 1177, 1185 (quoting McGee v. Alexander, 2001 OK 78, ¶ 29, 37 P.3d 800, 807). “[A] principal cannot do an act through an agent which the principal could not do directly.” Sur. Bail Bondsmen of Okla., 2010 OK 73, ¶ 24, 243 P.3d at 1185. Here, the petition stated that Toch brought the action on behalf of the parties that objected to the creation of the TID and noted that Toch owns and operates Aloft. Toch did not appear and object at the hearing, but at least one party appeared at the hearing and filed a written objection on behalf of Aloft. Because Toch filed the petition in this matter as owner, operator, and on behalf of Aloft, we find Toch met the statutory prerequisite and properly brought this action.
¶19 Municipalities possess and can exercise only those powers expressly or impliedly granted by the state. City of Hartshorne v. Marathon Oil Co., 1979 OK 48, ¶ 4, 593 P.2d 97, 99; Ex parte Holmes, 1933 OK 62, ¶ 11, 18 P.2d 1053, 1054; see In re De-Annexation of Certain Real Prop. from City of Seminole, 2004 OK 60, ¶ 10, 102 P.3d 120, 125-26. A city has no power to enact an ordinance that includes persons or principles not clearly within the terms of the delegated powers. Ex parte Holmes, 1933 OK 62, ¶ 11, 18 P.2d at 1054. “[W]hen any fairly reasonable doubt exists as to the grant of the power, such doubt is resolved by the courts against the corporation, and the existence of the power is denied.” Id.
¶20 Under
¶21 In 1978, the Oklahoma Legislature created the Oklahoma Improvement District Act (Act),
In addition to those purposes set out in Section 39-103 of this title, the governing body of any municipality having a population of more than one thousand five hundred (1,500) may create one or more districts and levy assessments for the purpose of providing or causing to be provided any maintenance, cleaning, security, shuttle service, upkeep, marketing, management or other services which confer special benefits upon property within the district by preserving, enhancing or extending the value or usefulness of any improvement described in Section 39-103 of this title, whether or not the improvement was financed or constructed pursuant to this act and such governing body may exclude or modify such assessments according to benefits received on properties which are exempt from ad valorem taxation, except those assessments provided for by Section 39-103 of this title. Without limiting or expanding the preceding sentence or any other provision of this act, such a district may be comprised of a designated geographical area within the municipality and limited to only those properties within such geographical area on which a hotel or motel having 50 or more rooms available for occupancy is located, if the sole purpose of the district is to provide marketing services for private or public events reasonably calculated to increase occupancy and room rates for such properties as a class.
¶22 “Such intent must be gleaned from the statute in view of its general purpose and object.” Grimes v. City of Okla. City, 2002 OK 47, ¶ 6, 49 P.3d 719, 723. In seeking intent, the court may look at each part of the statute, other statutes on the same subject, and the consequences of any particular interpretation. Okla. Ass‘n of Broadcasters, Inc. v. City of Norman, 2016 OK 119, ¶ 16, 390 P.3d 689, 694. We presume that the legislature “expressed its intent and that it intended what it expressed.” Heath v. Guardian Interlock Network, Inc., 2016 OK 18, ¶ 14, 369 P.3d 374, 379. In the absence of
¶23 We first ask whether the statute mandates particular language a municipality must use to describe a proposed district. It clearly does not. By use of the word may, the statutory language permits, or allows, districts comprised of areas within the municipality and further limited to only properties on which a hotel with 50 or more rooms is located.
¶24 Toch argues the disputed clause creates a level--meaning City is only allowed to create a district for marketing hotels if it includes all hotels with 50 or more rooms. But that interpretation is not consistent with the common meaning and usage of or. “If you are offered coffee or tea, you may pick either (or, in this case, neither), or you may for whatever reason order both. This is the ordinary sense of the word, understood by everyone and universally accommodated by the simple or.” And/or, Garner‘s Modern American Usage 45 (3d ed. 2009) (emphasis original).
¶25 On a deeper grammatical level, or is a “disjunctive particle used to express an alternative or give a choice of one among two or more things.” Or, Black‘s Law Dictionary 987 (5th ed. 1979); State ex rel. Wise v. Whistler, 1977 OK 61, ¶ 8, 562 P.2d 860, 862. We have stated numerous times that the Legislature‘s use of the word or shows intent to treat the terms on either side of it as separate and distinct, or give a choice among options.10 The United States Supreme Court has noted that “[w]hile [or] can sometimes introduce an appositive--a word or phrase that is synonymous with what precedes it (‘Vienna or Wien,’ ‘Batman or the Caped Crusader‘)--its ordinary use is almost always disjunctive, that is, the words it connects are to ‘be given separate meanings.‘” United States v. Woods, 571 U.S. 31, 45-46, 134 S. Ct. 557, 567, 187 L. Ed. 2d 472 (2013) (quoting Reiter v. Sonotone Corp., 442 U.S. 330, 339 (1979)). Further, “[c]anons of construction ordinarily suggest that terms connected by a disjunctive be given separate meanings, unless the context dictates otherwise.” Reiter, 442 U.S. at 339.
¶26 Appellants argue that the context of the phrase “50 or more” within the tourism statute and Act clearly shows the legislature intended for municipalities to have flexibility in creating districts appropriate to their own needs and is a floor for which hotels may be included, not a level or threshold. We agree. The disputed provision preemptively explains that it is not meant to limit or expand any of the other provisions in the statute or Act.
¶27 While Toch argues that the legislature knows how to create a floor using the words, “more than,” the legislature is not restricted to only one method of sentence construction to create a floor. Further, a one-size-fits-all hotel improvement district would not make sense for both large municipalities, like Tulsa or Oklahoma City, and smaller municipalities across the state. Municipalities have different needs, and assessments must be tailored to specifically help the people assessed. See City of Lawton v. Akers, 1958 OK 292, ¶¶ 18-23, 333 P.2d 520, 525-26.
¶28 The legislature‘s use of the word limited also indicates this provision‘s permissive nature, which is consistent with the tenor of the entire act. Black‘s Law Dictionary defines limited: “Restricted; bounded; prescribed. Confined within positive bounds; restricted in duration, extent, or scope.”
¶29 The district court improperly strained its interpretation of the language describing which hotels may be included to instead describe which hotels must be included. Had this been the legislature‘s intent, instead of “limited to only,” the wording would be, “and include all” properties within the areas on which a hotel with 50 or more rooms is located. Courts should not interpret statutes to mean something the legislature did not intend or express, especially where the resulting interpretation is absurd in light of the Act as a whole. See Ledbetter v. Okla. Alcoholic Beverage Laws Enf‘t Comm‘n, 1988 OK 117, ¶ 7, 764 P.2d 172, 179 (“Statutory construction that would lead to an absurdity must be avoided and a rational construction should be given to a statute if the language fairly permits.“).
¶30 The legislature intended to ensure that districts formed under
¶31 Nothing in the statute prevents a municipality from proposing a district limited to only properties on which hotels with 50 or more or even 500 or more rooms are located. The TID falls within the permitted description because the designated areas are within the municipality and are limited to only properties therein on which hotels having 50 or more rooms are located. City did not exceed the authority granted in
V. CONCLUSION
¶32
REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.
Darby, V.C.J., Winchester, Edmondson, Colbert, and Combs, JJ., concur;
Gurich, C.J., Kauger, Kane, and Rowe (by separate writing), JJ., dissent.
Kane, J., dissenting:
I believe the trial court construed the statute correctly.
Rowe, J., dissenting, with whom Gurich, C.J. and Kauger, J., join:
¶1 The fundamental rule of statutory construction is to ascertain and give effect to the legislative intent, which is first sought in the language of a statute. Fanning v. Brown, 2004 OK 7, ¶ 10, 85 P.3d 841. When the language is plain and unambiguous, no occasion exists for application of rules of construction, and the statute will be accorded meaning as expressed by the language employed. City of Durant v. Cicio, 2002 OK 52, ¶ 13, 50 P.3d 218. In the interpretation of statutes, we do not limit our consideration to a single word or phrase. Instead, we construe together the various provisions of relevant enactments, in light of their underlying general purpose and objective, to ascertain legislative intent. World Publishing Co. v. Miller, 2001 OK 49, ¶ 7, 32 P.3d 829, 832; McNeill v. City of Tulsa, 1998 OK 2, ¶ 11, 953 P.2d 329.
¶2 The majority‘s interpretation of
Without limiting or expanding the preceding sentence or any other provision of this act, such a district may be comprised of a designated geographical area within the municipality and limited to only those properties within such geographical area on which a hotel or motel having 50 or more rooms available for occupancy is located, if the sole purpose of the district is to provide marketing services for private or public events reasonably calculated to increase occupancy and room rates for such properties as a class. (Emphasis added.)
¶3 The phrase “for such properties as a class” clearly expresses the Legislature‘s intent that “50 rooms or more” was meant to be something other than a floor; it was meant to be the level from which all improvements districts must be created. Additional rules of construction employed by the majority are unnecessary. The statute as a whole clearly and unambiguously defines the class of properties for an improvement district that a municipality having a population of more than 1,500 may create if the sole purpose of the district is to provide marketing services to benefit the entire class.1
¶4 The Legislature has designated one class for the subject improvement district which as an entire class may be burdened with the special assessment (i.e., properties on which a hotel or motel having 50 or more rooms available for occupancy is located).
¶5 City of Tulsa arbitrarily created a special class of hotels or motels--those with greater than 110 rooms--which are subject to an assessment of 3% of the gross proceeds per room. This special class was arbitrarily chosen because City of Tulsa could not get a majority vote for the subject improvement district for hotels or motels with 50 or more, 75 or more, or 100 or more rooms.2 City of Tulsa exceeded its legislative authority when it impermissibly modified the statute to create a subclass for the improvement district other than that designated by the statute.
¶6 Additionally,
¶7 I agree with the trial court that
¶8 Accordingly, I respectfully dissent.