85 N.Y.S. 488 | N.Y. App. Div. | 1904
The defendants assert that the bonds in question are invalid for the reasons, fa'st, that the plaintiff had no power to issue bonds for street paving or improvement purposes ; and, second, that even if it did have such power, the proceedings adopted by plaintiff for the making and issuing of these bonds were not in accordance with the requirements of law.
We shall consider these objections in the order stated.
■ W.e feel no hesitation in deciding that the village did have power to issue bonds for the purpose of raising and providing funds with which to pay its share of the cost of paving streets.
The village of Canandaigua was originally incorporated in 1815 under a special act of the Legislature (chap. 254.) By chapter 666 of the Laws of 1893 the original act and the acts amending the same .were revised and consolidated, and the corporation exists at present under the provisions of the act of 1893 and its amendments.
By subdivision 50 of section 3 of title 3 of its charter created as above plaintiff was empowered “ to do all such acts, perform all such duties, and exercise all such powers as are * * * authorized, imposed, conferred, or granted by any general act of the Legislature of this State, applicable to villages therein, incorporated under a special act.”
Section 128 of said Village Law (as amd. by Laws of 1903, chap. 617), provides: “ If authorized by an election, money may be borrowed by a village upon its bonds or other obligations, payable in future fiscal years for the purpose of purchasing, constructing and maintaining the following village improvements : * * * 3. Laying out, widening, altering, grading or paving streets, and for the purchase of a steam roller, stone crusher and engine, and other road making machinery.”'
It follows from these statutory provisions thus quoted that plaintiff was authorized to issue bonds to provide for indebtedness incurred in paving and improving its streets unless there is some provision in its charter which is inconsistent with the powers granted by the Village Law. We do not think there is any such provision. Defendants urge upon our consideration two provisions which they claim are thus inconsistent, but we do not agree with their contention in this respect made.
Section 4 of title 7 of the act already referred to, constituting plaintiff’s charter, provides: “ Money cannot be borrowed by the said trustees on the credit of the village; nor can any debt or liability be incurred by the village, except as is provided by law, for the ordinary expenses of the village within the income of the current year, applicable to that purpose.”
These provisions do not cover this case. The 1st clause quoted plainly prohibits any attempt by the trustees to make general loans upon the credit of the village. The 2d clause voices a prohibition against incurring extraordinary debts or liabilities by the village for ordinary expenses. It relates to the ordinary current financial management of the village from year to year, and does not speak with reference to an extraordinary expenditure such as we now have before our consideration when authorized by a vote of the taxpayers in a proper manner.
The second provision called to our attention by; defendants as
It seems to us hardly to have been worth while to refer to this section as bearing upon the question before us, because it is manifestly one of several sections relating to the acquisition of lands for public use by exercise of the right of eminent domain within the corporate limits of said village for roads, avenues, streets, etc. We do not discover any relation or connection whatever between this section thus referred to and the paving of streets.
Upon the other hand, in opposition to the contention of defendants upon this point, the provisions of plaintiff’s charter seem to necessarily imply and call for the power to issue bonds as plaintiff has attempted.
Section 2 of title 9 provides that the trustees of the village shall have power to “ pave, plank, flag or otherwise improve the streets, roadways, crosswalks and sidewalks,” Section 31 of the same title provides that “ on the written petition or consent of a majority in number and in feet frontage of the owners of the real estate adjoining, abutting or fronting on any of the streets, highways or public grounds of said village, the board of trustees shall have the power to cause said street, highway or public grounds, and the gutters therein, to be paved or curbed with stone or other suitable material.” Said section, then further provides that in case the paving of any street is properly ordered without the petition of the property owners, not more than one-half nor less than one-third of the expense of the improvement shall be assessed upon the adjoining property; that in case the improvement is ordered upon the petition of the property owners not more than two-thirds nor less than one-third of said expense shall be so assessed. The balance in eithei case must be paid by the village. We find in the charter no provision which seems to us directly to provide for the payment by
We, therefore, conclude that neither the letter nor the spirit.of the statutes applicable prohibited the plaintiff from issuing the bonds.
We now pass to the consideration of the second objection urged, by defendants, that the proper steps were not taken to secure a legal issue of bonds for the purposes indicated. This contention is, in our judgment, much more serious. In fact, we feel constrained to agree with it and hold that proper steps were not taken.
It is conceded that the trustees did not have the power to issue the bonds except upon a vote of the taxpayers of the village in accordance with the provisions of law. Sections 55, 59 and 60 of the Village Law provide for the submission to the taxpayers of a village of a proposition to borrow money as plaintiff is attempting to borrow it here by the issue of bonds. The question of the issue of these bonds, however, was not submitted under those provisions, but instead was submitted at a special meeting of taxpayers called under the provisions of section 2 of title 7 of the plaintiff’s.charter
The initial question suggests itself whether this section and the succeeding one which related to it were intended to refer to or cover the issue of municipal bonds. They are found in a title which treats of the “ Assessment and collection of taxes.” The wording of section 2 of title 7 does not seem especially apt in describing a meeting called to vote upon such an issue of bonds. The provisions of the Village Law for a meeting to vote upon such a question speak of the submission of a “ proposition ” upon any question which may be lawfully decided thereat, while it will be noticed that the section in plaintiffs charter referred to authorizes the trustees to call a special tax meeting to vote upon “ appropriations ” for special purposes. The word “ appropriations,” especially when' compared with the. much broader one “ propositions,” found in the Village Law, does, not upon a natural construction well describe a proposed issue of bonds extending over a pei'iod of years.
Passing by this, however, we come to other considerations based upon section 3 of title 7 of plaintiffs charter. This provides: “ Every appropriation of money for any purpose not expressly-included or in excess of the amount specified in section one of this title, shall be deemed a special purpose. Before any tax for a special purpose can be levied, a resolution specifying the ptirpose, and the amount required, and whether it shall be raised in one sum or in annual installments and, if in annual installments, the number thereof, and the amount of each, shall be passed by the board of trustees, and a copy of such resolutions, with a notice that the same shall be submitted to vote by ballot at the next annual tax meeting, or at a special tax meeting, called for that purpose, shall be published in three of the village newspapers at least once in each of the two weeks next preceding such tax meeting. And at the same time, and in the same notice shall be published the several amounts to be raised by tax as provided by section one of this title.”
The resolution adopted by plaintiff’s trustees providing for the special meeting so far as applicable, reads as follows:
*342 ■“Resolved, That a special tax meeting of the qualified electors, of the Village of Canandaigua be and hereby is called to be held at the Town Hall in the Village of Canandaigua, N. Y., on Tuesday, the 5th day of May, 1903, commencing at 10 o’clock in the morning and closing at 4 o’clock in the afternoon, at which time and place there will be submitted to vote of the electors of said Village qualified to vote at said meeting, the following resolutions
“ Resolution Number One.
“ Resolved, That the Board of Trustees of the Village of Canandaigua be and hereby is authorized to borrow on the credit of. the Village of Canandaigua a sum not exceeding the sum of two hundred thousand dollars ($200,000) and to issue bonds of said Village therefor from time to time as the same may be needed for the purpose hereinafter specified, at the lowest obtainable rate of interest, and payable at such time or times as it may. determine in conformity to the provisions of law applicable thereto, and that the same be issued and sold in all other respects in conformity to the provisions of Section 129 of the Village Law and of the General Municipal Law of the State of New York, and to expend the money' so borrowed for the purpose1 of defraying the expense of grading and paving the streets of said Village in conformity to the provisions of Section 31 of Title -9 of the Village Charter. That a sum sufficient to pay the interest and principal of said bonds, as the same shall become due, be raised by an annual tax, as other taxes for general purposes in said Village are raised.”
The notice calling the special meeting consisted of said resolution and the following addition : “ Notice is hereby given that at the time and place above specified the foregoing resolutions will be submitted to vote by ballot of the qualified electors of the Village of Canandaigua, N. Y., entitled to vote at a tax meeting of said Village.”
The notice composed as above (so far as material here) was duly published as provided by section 2 of title 7 of plaintiff’s charter, already referred to. It will be observed, however, that the resolution did not comply with section 3 of said title in “ specifying the purpose and the amount required, and whether'it shall be raised' in one sum or in annual installments, and if in annual installments, the number thereof and the amount of each.” The resolution adopted
The learned counsel for the plaintiff, however, insists that the provisions requiring said details are not applicable to this case, because the preceding part of said section 3 provides that only those appropriations of money shall be deemed for a special purpose which are “not expressly included or in excess of the amount specified in section one of this title,” and that section 1 provides that a general tax may be raised for the following purposes: “1. A sum sufficient to pay all installments of principal and interest on any bonded debt of the village of Canandaigua.” He argues, therefore, that the vote for the issue of these bonds was an appropriation for .general and not special purposes, and that, therefore, the provisions requiring the statement of the details referred to before any tax for a special purpose can be levied do not apply. The trouble with this argument, however, as it seems to us, is that the authority invoked for calling the meeting at which these bonds were voted for is found in. the provisions of section 2, already quoted, that “ the trustees of said village are hereby authorized and empowered to call a special tax meeting to vote upon appropriations for special purposes.” It, therefore, follows that either the vote was for an appropriation for a special purpose requiring a statement in the notice of the meeting of certain details, which were not given, or else that the appropriation, not being for a special purpose, finds no authority in a meeting which could only be called to act upon appropriations for special' purposes. Whichever view is adopted discloses to our mind a fatal objection to the validity of the proceedings whereby plaintiff sought for the authority to issue these bonds.
Perhaps it might be suggested, although it is not so done in plaintiff’s brief, that the requirement for the statement of the details indicated is only applicable “ before any tax for a special purpose can be levied,” and that, therefore, without such statement, authority might be given for the original issue of the bonds, leaving the subsequent levying of taxes wherewith to pay the same subject to the limitations and conditions above referred to.
We do not think, however, that the various portions of sections
■ Section 2 provides for a special tax meeting. Section 3 defines an appropriation for a special purpose, and then, treating of the special tax which constitutes and makes effective the special appropriation, requires the resolution giving the details referred to. We do not think, if otherwise legal, that it would be possible to proceed to the issue of these bonds under portions of the sections quoted, while other provisions therein were disregarded. They relate to a single subject, and must be observed in their entirety.
Except for the restrictions contained in section 5 of the General Municipal Law, to which we shall hereafter refer, there' are other provisions in plaintiff’s charter, not referred to by its counsel, which we deem more available for the purpose of sustaining the validity of the proceedings under review than those called to our attention and which we have discussed.
Subdivisions 6, 7 and 8 of section 3 of title 3 of plaintiff’s charter provide that the board of trustees shall be “ authorized and fully empowered:
“ 6. To give notice in the manner prescribed by this act * * * of all special tax meetings, which notice shall specify * * * the question or questions to be voted upon at any special tax meeting.
“ 7. To call special tax meetings in said village for such purposes, and at such times, as the intérests of the village, in their judgment, shall require, due notice of any such meeting, and of the questions to be voted on thereat, being given as hereinbefore provided.
“ 8. To carry into effect every resolution adopted at any tax ' meeting of such village legally convened, which such meeting shall have authority to adopt.”
Section 3 of title 2 (as amd. hy Laws of 1894, chap. 131) provides that notice of any special tax meeting of the electors called by the board of trustees as above provided shall be given by publication in three newspapers printed and published in said village once in each week ftir three consecutive insertions next preceding such election.
These sections seem to us more broadly and appropriately to provide for a special meeting of taxpayers to vote upon such a question , as the "issue of bonds than those found in title 7 and cited by plain
There are, however, certain requirements found outside of plaintiffs charter which in our opinion prevent the sections last quoted by us from being a sufficient authority for the proceedings in'question as they were taken. Because these limitations are found in section 5 of the General Municipal Law (General Laws, chap. 17), and because plaintiffs counsel has referred to that section as in some way helping to give validity to the proceedings, we pass to its consideration.
It declares that “ A funded debt shall not be contracted by a inunicipal corporation, except for a specific object, expressly stated in the ordinance or resolution proposing it; nor unless such ordinance or resolution' shall be passed by a two-third vote of all the members elected to the board or council adopting it, or submitted to, and approved by the electors of the town or county, or taxpayers of the village or city when required by law. Such ordinance or resolution shall provide for raising annually Toy tax, a sum sufficient to pay the interest and the principal as the same shall become due.” The last clause is the one which we deem especially important at this point of consideration.
We have no doubt that the bonds proposed to be issued constituted a funded debt within the meaning of this section. (People ex rel. Peene v. Carpenter, 31 App. Div. 603.)
The resolution presented to and voted upon by the. taxpayers contained, as its only compliance with the provision to which we have especially called attention, the following clause : “ That a sum sufficient to pay the interest and principal of said bonds, as the same shall become due, be raised by an annual tax, as other taxes for general purposes in said Village are raised.” There wras nothing in the resolution which in any way fixed the time within which or the installments by which the bonds to be issued should become due. The only limitation upon this subject was the statutory one contained in section 129 of the Village Law that such bonds “ shall become due withm thuty years from the date of issue, and unless the whole amount of the indebtedness represented thereby is to be paid within five years from their date they shall be so issued as to provide for
It seems to us that the latter construction is the more reasonable and proper one. The statutes have been passed which compel trustees to go to the taxpayers for authority before they may issue such bonds as these, and we believe that such a construction should be placed upon these statutes as will compel the submission to the taxpayers of the information which will enable them to act and vote intelligently upon the propositions submitted. If the requirement of the General Municipal Law upon this point may be complied with by any such general clause as was inserted in plaintiff’s resolution, we fail to see any object whatever for it. Other provisions having given authority to issue the bonds, it would necessarily follow that installments of principal and interest would have to be met by the proper assessment and'levying of taxes .from year to year as they became due, and nothing was gained by a provision expressly authorizing such taxation. It would follow as a matter of course and necessity. If, upon the other hand, this provision be construed as requiring the resolution submitted to the taxpayers to state with reasonable detail how the bonds were to be paid and how much would be required, each year by taxation to meet them, we can easily see some force in the statute. We believe it was intended to require the submission of such detail's as far as practicable in order to enable the taxpayers to vote intelligently. If we apply this construction to the facts of this case, it will be seen that it would- have
These views lead to the conclusion that judgment must be entered . determining that the bonds in question are not valid and legal obligations of plaintiff and that defendants’ bid and award be terminated and held for naught, and that their certified check heretofore deposited be returned to them, with costs.
All concurred.
Judgment directed in favor of defendants, determining that the bonds in question are not valid and legal obligations of the plaintiff and that the defendants’ bid and award be terminated and held for naught and that their certified check heretofore deposited be. returned to them, with costs.
As amd. by Laws of 1894, chap. 131.— [Rep.