230 N.E.2d 396 (Ind. 1967), 31160, Hawkins v. City of Greenfield

Docket Nº31160.
Citation230 N.E.2d 396, 248 Ind. 593
Party NamePaul HAWKINS, a taxpayer of the City of Greenfield, Indiana and Hancock County, Indiana, on behalf of himself and other persons similarly situated, Appellants, v. CITY OF GREENFIELD, Robert Rodocker, Elijah Keith and Keith McClarnon as members of the Greenfield Economic Development Commission, Berry S. Hurley, as Mayor of the City of Greenfield, In
Case DateOctober 17, 1967
CourtSupreme Court of Indiana

Page 396

230 N.E.2d 396 (Ind. 1967)

248 Ind. 593

Paul HAWKINS, a taxpayer of the City of Greenfield, Indiana

and Hancock County, Indiana, on behalf of himself

and other persons similarly situated, Appellants,

v.

CITY OF GREENFIELD, Robert Rodocker, Elijah Keith and Keith

McClarnon as members of the Greenfield Economic Development

Commission, Berry S. Hurley, as Mayor of the City of

Greenfield, Indiana, Bert O. Bradley, Hamilton Hartwell, Max

Worland, Sr., Walter P. Worland, Jr., James Wilson, Jr., as

members of the Greenfield Common Council, George J. Mayer

Company, John J. Dillon, Attorney General of the State of

Indiana, Appellees.

No. 31160.

Supreme Court of Indiana.

October 17, 1967

Page 397

Page 398

[248 Ind. 595] Wolf & Robak, Raymond S. Robak, Greenfield, for appellants.

John J. Dillon, Atty. Gen., James W. Commons, Asst. Atty. Gen., Indianapolis, for appellee, John J. Dillon, Atty. Gen.

Kenneth McDermott, Greenfield, Harry T. Ice, Robert D. Risch, Robert D. McCord, Indianapolis, for appellees, except John J. Dillon, Atty. Gen., McDermott & Shumaker, Greenfield, Ice, Miller, Donadio & Ryan, Indianapolis, of counsel.

MOTE, Judge.

The constitutional validity of the Municipal Economic Development Act of 1965 is presented herein for our consideration and determination.

The action below was brought by Appellant, a taxpayer of the City of Greenfield on behalf of himself and all other persons similarly situated, against the City of Greenfield, the members of the Greenfield Economic Development Commission, the Mayor of the City, the members of the Greenfield [248 Ind. 596] Common Council, the George J. Mayer Company and the Attorney General of Indiana.

The said action sought relief and asked for a perpetual injunction against the defendants, Appellees herein, enjoining them from appropriating funds for the expenses of the Greenfield Economic Development Commission; from entering into and executing a lease agreement with the George J. Mayer Company; from issuing economic development revenue bonds; from constructing and furnishing with equipment an individual building; and for all proper relief.

The issues were formed by the complaint and answers by the defendants. Said complaint, among other things, alleged the following:

That the indebtedness of the City of Greenfield on its proposed economic development revenue bonds will exceed two (2%) percent of its net assessed valuation; that Chapter 402 of the Acts of the Indiana General Assembly for the year 1965 violates the provisions of Article 1, Section 23, of the Indiana Constitution and the 14th Amendment of the United States Constitution in that it authorizes the granting of privileges to persons (including Corporations) whom Economic Development Commissions wish to negotiate with to the exclusion of others with whom the Economic Development Commissions choose not to negotiate; that Chapter 402 of the [248 Ind. 597] Acts of the Indiana General Assembly for the year 1965 violates the provisions of Article 1, Section 21, of the Indiana Constitution; and the 14th Amendment of the United States Constitution in that it authorizes the levying of taxes and the condemnation of property for private rather than a public purpose; that Chapter 402 of the Acts of the Indiana General Assembly for the year 1965 violates the provisions of Article 10, Section 6, and Article 11, Section 12, of the Indiana Constitution in that such Act authorizes the lending of the credit of the City of Greenfield and the State of Indiana as well as the County of Hancock; that Chapter 402 of the Acts of the Indiana General Assembly for the year 1965 violates the provisions of Article 13, Section 1, of the Indiana Constitution in that it authorizes the incurring of indebtedness by a City in excess of two (2%) percent of the value of taxable property within such corporation as ascertained by the last assessment for State and County taxes previous to the incurring of such indebtedness; that the issuance of such revenue bonds would cause irreparable damage to the City of Greenfield, the plaintiff and to all others similarly situated in the following manner: (a) the continued operation of the Greenfield Economic Development Commission will be a waste of public funds as Chapter 402 of the Acts of the Indiana General Assembly for the year 1965 is unconstitutional; (b) the issuance of such revenue

Page 399

bonds will lessen the advantage of exemption from Federal income tax of interest payable on bona fide bonds of the City to be issued in the future; (c) the issuance of such revenue bonds by the City will risk a default in the payment of principal and interest of such bonds if the lease rental is not paid, which default would have an adverse effect on the credit rating of the City in issuing future bona fide bonds; (d) such water, electric and sewer extensions will be paid for by plaintiff and all other rate payers.

The trial court determined the issues and entered judgment as follows:

'1. The Court has jurisdiction of the parties and of the subject matter of the action.

  1. There is a real controversy between plaintiff and all others similarly situated and the defendants.

  2. Acquisition and leasing of industrial facilities as authorized by Chapter 402 of the Acts of the Indiana General Assembly for the year 1965 is for a public purpose.

  3. Such proceedings and the financing thereof by the issuance of revenue bonds payable only from lease rentals do not constitute the lending of credit or create any indebtedness.

    [248 Ind. 598] 5. Said Act does not grant privileges not available to all.

  4. Said Act is not in conflict with the following sections of the Indiana Constitution:

    Article 1 Section 23 1 21 10 6 11 12 13 1

    or the 14th Amendment of the United States Constitution.

  5. Plaintiff is not entitled to an injunction against defendants or any of them.

  6. Any findings of fact stating a conclusion of law is considered as being a conclusion of law, and any conclusion of law stating a finding of fact is considered as being a finding of fact.'

    Appellants' Motion for a New Trial was presented and overruled; they now assert error in such ruling to sustain this appeal. Essentially, Appellants urge that the decision below is contrary to law because of the constitutional invalidity, in four different particulars, of the Municipal Economic Development Act of 1965. We shall discuss in order each of the four assertions.

    First, appellants urge that the Act in question violates Article 10, Section 6, and Article 11, Section 12, of the Indiana State Constitution in that said Act authorizes the lending of credit of the City of Greenfield, Hancock County, Indiana. Said Articles and Sections provide as follows:

    'ARTICLE 10, SECTION 6. COUNTY INDEBTEDNESS FOR STOCK--STATE ASSUMPTION OF DEBTS.--No county shall subscribe for stock in any incorporated company, unless the same be paid for at the time of such subscription; nor shall any county loan its credit to any incorporated company, nor borrow money for the purpose of taking stock in any such company; nor shall the General Assembly ever, on behalf of the State, assume the debts of any county, city, town, or township; nor of any corporation whatever.

    [248 Ind. 599] ARTICLE 11, SECTION 12. STATE NOT TO BE STOCKHOLDER.--The State shall not be a stockholder in any bank, after the expiration of the present bank charter; nor shall the credit of the State ever be given, or loaned, in aid of any person, association or corporation; nor shall the State hereafter become a stockholder in any corporation or association.'

    To sustain their contention, Appellants have cited and quoted from various authorities

    Page 400

    from other jurisdictions, such as: State ex rel. Beck v. City of York (1957) 164 Neb. 223, 82 N.W.2d 269; Village of Moyie Springs, Idaho v. Aurora Mfg. Co. (1960) 82 Idaho 337, 353 P.2d 767; State v. Town of North Miami (Fla., 1952) 59 So.2d 779; State v. Clay County Development Authority (Fla., 1962) 140 So.2d 576. Appellants also cite and variously quote authorities in our own jurisdiction, such as: Ennis v. State Highway Commission (1952) 231 Ind. 311, 108 N.E.2d 687 and Orbison v. Welsh (1962) 242 Ind. 385, 179 N.E.2d 727.

    Perhaps we should preface our remarks by stating that we think it to be incumbent upon us to follow logical and substantial precedents and trends already established in our State. With this in mind, we would suggest that the two Indiana authorities cited by Appellants go far in negating their contentions. The proposed economic development revenue bonds payable solely from the lease rental to be paid by George J. Mayer Company, proposed lessee, to the City of Greenfield for the purposes enumerated in the said Act, do not appear to amount to a pledge of credit contrary to and in violation of Article 11, Section 12, of the Indiana Constitution above set forth where, as here, the so-called credit is not for the use of a private corporation. Under our latest decisions, it should be perfectly clear that the said Act of 1965 now under attack because of its asserted constitutional invalidity and as violative of Article 10, Section 6, and Article 11, Section 12, meets all the tests applicable. We regard the purpose and the public policy announced by its enactment to be completely within the framework of both Ennis and Orbison,[248 Ind. 600] supra. As a matter of fact, comparison of the language of the Act now under assault with the Acts involved in both Ennis and Orbison, supra, indicates an attempt to follow them closely, thus to remain within the borders of legislation already approved. (See the cited cases for extensive remarks on this subject.)

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9 practice notes
  • 636 P.2d 760 (Kan. 1981), 52961, State ex rel. Tomasic v. Kansas City
    • United States
    • Kansas Supreme Court of Kansas
    • November 25, 1981
    ...See, e. g., Opinion of the Justices of Jan. 11, 1962, 4 Storey 366, 54 Del. 366, 177 A.2d 205 (1962); Hawkins v. City of Greenfield, 248 Ind. 593, 230 N.E.2d 396 (1967); Hebert v. Police Jury of West Baton Rouge Parish, 200 So.2d 877 (La.Ct.App.1967); Gripentrog v. City of Wahpeton, 126 N.W......
  • 402 N.E.2d 1215 (Ind. 1980), 1179S309, Steup v. Indiana Housing Finance Authority
    • United States
    • Indiana Supreme Court of Indiana
    • April 2, 1980
    ...lame excuse for seeking a declaratory judgment that the proposal is constitutionally invalid." Hawkins v. City of Greenfield, (1967) 248 Ind. 593, 612, 230 N.E.2d 396, 407. The provisions of Ind.Code § 5-20-1-5 (Burns Supp.1979) do bear a fair and substantial relation to the object of ......
  • 467 S.E.2d 615 (N.C. 1996), 422PA95, Maready v. City of Winston-Salem
    • United States
    • North Carolina Supreme Court of North Carolina
    • March 8, 1996
    ...Haw. 566, 545 P.2d 1175 (1976); Potter v. Judge, 112 Ill.App.3d 81, 67 Ill.Dec. 585, 444 N.E.2d 821 (1983); Hawkins v. City of Greenfield, 248 Ind. 593, 230 N.E.2d 396 (1967); Brady v. City of Dubuque, 495 N.W.2d 701 (Iowa 1993); Duckworth v. City of Kansas City, 243 Kan. 386, 758 P.2d 201 ......
  • 474 N.E.2d 62 (Ind. 1985), 784S294, Eakin v. State ex rel. Capital Imp. Bd. of Managers of Marion County
    • United States
    • Indiana Supreme Court of Indiana
    • February 15, 1985
    ...See also South Bend Public Transportation Corp. v. City of South Bend, (1981) Ind., 428 N.E.2d 217; Hawkins v. City of Greenfield, (1967) 248 Ind. 593, 230 N.E.2d 396. Clearly, it is the constitutional sense of the word "indebtedness" which we must determine. To do this, we must l......
  • Request a trial to view additional results
9 cases
  • 636 P.2d 760 (Kan. 1981), 52961, State ex rel. Tomasic v. Kansas City
    • United States
    • Kansas Supreme Court of Kansas
    • November 25, 1981
    ...See, e. g., Opinion of the Justices of Jan. 11, 1962, 4 Storey 366, 54 Del. 366, 177 A.2d 205 (1962); Hawkins v. City of Greenfield, 248 Ind. 593, 230 N.E.2d 396 (1967); Hebert v. Police Jury of West Baton Rouge Parish, 200 So.2d 877 (La.Ct.App.1967); Gripentrog v. City of Wahpeton, 126 N.W......
  • 402 N.E.2d 1215 (Ind. 1980), 1179S309, Steup v. Indiana Housing Finance Authority
    • United States
    • Indiana Supreme Court of Indiana
    • April 2, 1980
    ...lame excuse for seeking a declaratory judgment that the proposal is constitutionally invalid." Hawkins v. City of Greenfield, (1967) 248 Ind. 593, 612, 230 N.E.2d 396, 407. The provisions of Ind.Code § 5-20-1-5 (Burns Supp.1979) do bear a fair and substantial relation to the object of ......
  • 467 S.E.2d 615 (N.C. 1996), 422PA95, Maready v. City of Winston-Salem
    • United States
    • North Carolina Supreme Court of North Carolina
    • March 8, 1996
    ...Haw. 566, 545 P.2d 1175 (1976); Potter v. Judge, 112 Ill.App.3d 81, 67 Ill.Dec. 585, 444 N.E.2d 821 (1983); Hawkins v. City of Greenfield, 248 Ind. 593, 230 N.E.2d 396 (1967); Brady v. City of Dubuque, 495 N.W.2d 701 (Iowa 1993); Duckworth v. City of Kansas City, 243 Kan. 386, 758 P.2d 201 ......
  • 474 N.E.2d 62 (Ind. 1985), 784S294, Eakin v. State ex rel. Capital Imp. Bd. of Managers of Marion County
    • United States
    • Indiana Supreme Court of Indiana
    • February 15, 1985
    ...See also South Bend Public Transportation Corp. v. City of South Bend, (1981) Ind., 428 N.E.2d 217; Hawkins v. City of Greenfield, (1967) 248 Ind. 593, 230 N.E.2d 396. Clearly, it is the constitutional sense of the word "indebtedness" which we must determine. To do this, we must l......
  • Request a trial to view additional results