Wells v. Housing Authority of City of Wilmington
| Decision Date | 15 June 1938 |
| Docket Number | 609. |
| Citation | 197 S.E. 693,213 N.C. 744 |
| Parties | WELLS v. HOUSING AUTHORITY OF CITY OF WILMINGTON et al. |
| Court | North Carolina Supreme Court |
Appeal from Superior Court, New Hanover County; N. A. Sinclair Judge.
Proceeding by Harold W. Wells, a resident and taxpayer of the City of Wilmington, N. C., suing for himself and in behalf of all other taxpayers similarly situated who desired to come in make themselves parties to the cause and contribute to the cost thereof, to enjoin the Housing Authority of the City of Wilmington, N. C., and the City of Wilmington, from proceeding under the Housing Authorities Act, Pub. Laws 1935 c. 408, in the construction of apartments and dwellings for rent.
From a judgment dismissing the action, plaintiff appeals.
Affirmed.
The functions of government may not constitutionally be impeded by the levy of a duty on the instruments used to carry its purposes into effect, and the exemption must be extended to all municipal corporations without legalistic distinction. Const. art. 5, § 5.
In his complaint, plaintiff admitted compliance with the procedure laid down in the Housing Authorities Act, Pub. Laws 1935, c 456, and the organization of the body itself. He alleges, however, that the Act is unconstitutional, in that it comprehends no public purpose, and that the agency set up under it is not a municipal corporation within the meaning of the Constitution, but a corporation merely for private gain, engaged in a private enterprise; that its incorporation in the manner set out in the statute was unconstitutional; that the City of Wilmington cannot, under authority of Chapter 408, Public Laws of 1935, convey to the Housing Authority any of its property with or without consideration. That the Housing Authority is an agent of the City of Wilmington and the City will be responsible for its bonds and other obligations. That defendant, Wilmington Housing Authority, has represented that its property will be exempt from taxation and has arranged to borrow about $700,000, and build apartments and dwellings for rent, and the City intends to make to it conveyances and donations of city property; that carrying into effect the scheme proposed will destroy the value of real estate in the city and take the property of plaintiff without due process of law, and do irreparable injury to plaintiff and other taxpayers like situated.
Plaintiff asked for a permanent injunction to restrain defendants from proceeding under the cited laws.
The answer denies the parts of the complaint alleging unconstitutionality in the Housing Authorities Act and in the operation of Chapter 408, Public Laws of 1935, and avers that defendant Housing Authority is a municipal corporation under the Constitution; that its property will be free from taxation by the State, county, and municipalities; that it is an independent municipality and the City of Wilmington will not be liable for its obligations.
Upon the hearing, Sinclair, Judge, found all the facts and legal inferences in favor of the defendants and dismissed the action, and plaintiff appealed.
Aaron Goldberg, of Wilmington, for appellant.
William B. Campbell and Alan A. Marshall, both of Wilmington, for appellees.
The plaintiff contends that Chapter 456 of the Public Laws of 1935, known as the Housing Authorities Act of 1935, is unconstitutional since the purposes sought to be accomplished by the Act are not of a public nature, that the body created under it has not been given any governmental function and is not a municipal corporation; that the City of Wilmington is without power to convey any of its property to this corporation, and that the property, in the hands of the corporation, if conveyed, would not be exempt from taxation.
These contentions are somewhat sketchily supported by argument and citations in the brief, and counsel for plaintiff made no oral argument. Perhaps, as sometimes happens in "friendly suits", his function in this case is similar to that of the "devil's advocate" at the canonization of a saint. But the decision of the case will have an effect beyond the immediate litigation, and the matters involved must have that careful consideration their importance demands.
Is the Act under consideration constitutionally valid, and is the agency set up for its administration a municipal corporation within the meaning of the Constitution?
The case of Webb v. Port Commission, 205 N.C. 663, 172 S.E. 377, is very similar to the case at bar, and must be considered as decisive of most of the questions raised, but there is a difference in the declared purpose of the two acts which merits attention.
The Court accepted without question that the purpose of the Port Commission Act was public in its nature and a proper subject for the exercise of governmental power, stating the proposition as follows: "* * * the 'Port Commission of Morehead City,' is not a private or business corporation, but is a public corporation, created by the General Assembly as an agency of the state to perform a well-recognized governmental function, to wit, to provide facilities for the transportation of goods, wares, and merchandise both into and out of the state by means of carriers over land and water." Webb v. Port Commission, supra (page 382).
The purpose of the Housing Authorities Act is to accomplish "slum clearance",-to rehabilitate crowded and congested areas in cities and towns where unsanitary and other conditions exist conducive to disease and public disorder, menacing the safety and welfare of society. In this the plaintiff insists there is no public purpose justifying the exercise of the governmental function.
Our attention is directed to the fact that in the statute the Housing Authorities Act is declared to be "a public body and a body corporate and politic, exercising public powers". Ordinarily, courts will not permit a simple declaration of the Legislature to give a character to a body, or a transaction, which appears to be inconsistent with the facts of the case. In an analogous matter, the courts have declined to permit the Legislature to declare what is "a necessary purpose" under Article 7, Section 7, of the Constitution, holding this to be a matter for the courts. Sing v. Charlotte, 213 N.C. 60, 195 S.E. 271; Glenn v. Commissioners, 201 N.C. 233, 159 S.E. 439.
In the same manner the court will determine what is a "public purpose", looking to the end sought to be reached and to the means to be used, rather than to statutory declarations to aid its decision. Webb v. Port Commission, supra.
The powers given to the agency created under the Housing Authorities Act are not dissimilar to those given to towns and cities in the Constitution and laws, particularly Chapter 56 of the Consolidated Statutes, relating to municipal corporations. Under the powers given such municipal corporations to enact ordinances for the welfare and safety of their inhabitants, a town, within reasonable limitations, may zone its territory and designate what areas may be devoted to business and what to residence; where noisome or offensive occupations may be carried on and where they may not; may close places where practices are carried on in violation of law; may designate what kind of buildings may be erected in given localities; and, generally, may regulate numerous matters where necessary to the public welfare or safety. Any or all of these powers might be vested in a separate municipal authority, if convenience required, without offending against any constitutional principle of which we are aware.
The same necessity that prompted the subdivision of political authority, in the creation of cities and towns, to the end that government should be brought closer to the people in congested areas, and thus be able to deal more directly with problems of health, safety, police protection, and public convenience, progressively demands that government should be further refined and subdivided, within the limits of its general powers and purposes, to deal with new conditions, constantly appearing in sharper outline, where community initiative has failed and authority alone can prevail.
It is not questioned that it is a proper function of government to promote the health, safety, and morals of its citizens. The Housing Authorities Act depends for its validity, as a proper exercise of governmental authority, upon its declared objective in removing a serious menace to society, not disconnected with political exigency, in the populous areas to which it applies.
It differs in one particular from the usual type of municipality,-the ownership of the instrumentalities by which the public purpose is to be served. But we cannot see that such ownership detracts from the public or municipal character of the agency employed. Webb v. Port Commission, 205 N.C. 663, at page 673, 172 S.E. 377; Willmon v. Powell, 91 Cal.App. 1, 266 P. 1029.
The State cannot enact laws, and cities and towns cannot pass effective ordinances, forbidding disease, vice, and crime to enter into the slums of overcrowded areas, there defeating every purpose for which civilized government exists, and spreading influences detrimental to law and order; but experience has shown that this result can be more effectively brought about by the removal of physical surroundings conducive to these conditions. This is the objective of the Act,...
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