State ex rel. City of Blue Springs v. McWilliams

• Decision Date: 31 July 1934
• Docket Number: 33473
• Citation: 74 S.W.2d 363,335 Mo. 816
• Parties: State of Missouri at the Relation of Blue Springs, a Municipal Corporation, Relator, v. W. T. McWilliams, as City Clerk of Blue Springs, and W. A. Hire, as Treasurer of Blue Springs
• Court: Missouri Supreme Court

74 S.W.2d 363

335 Mo. 816

State of Missouri at the Relation of Blue Springs, a Municipal Corporation, Relator, v. W. T. McWilliams, as City Clerk of Blue Springs, and W. A. Hire, as Treasurer of Blue Springs

No. 33473

Supreme Court of Missouri

July 31, 1934

Alternative writ quashed.

Jerome Walsh, Andrew Ellison and Henry Depping for relator.

The revenue bonds ordered to be issued by the ordinance are not void. No indebtedness is incurred on the part of the relator within the meaning of Article X, Sections 12 and 12a, of the Constitution of Missouri by the issuance of so-called "Revenue Bonds," payable solely from the income of the waterworks plant to be constructed from the proceeds thereof. State ex rel. Smith v. Neosho, 203 Mo. 40 101 S.W. 99; Bell v. Fayette, 325 Mo. 75, 28 S.W.2d 356; Barnes v. Lehi City, 297 P. 878; City of Bowling Green v. Kirby, 295 S.W. 1005; Frankfort Trust Co. v. Loveland, 3 F.2d 114; Shields v Loveland, 218 P. 913; Searle v. Town of Haxtun, 271 P. 629; Twitchell v. Seattle, 179 P. 127; Shelton v. Los Angeles, 275 P. 421; Johnston v Stewart, 226 N.W. 164; Lang v. Cavalier, 228 N.W. 819; Carr v. Fenstermacher, 228 N.W. 114; Butler v. Ashland, 232 P. 655; Larimer v. Fort Collins, 189 P. 929; City of Dawson v. Bolton, 143 S.E. 119; Uhler v. Olympia, 151 P. 117; Kline v. Louisville, 6 S.W.2d 1104; Scott v. Tacoma, 142 P. 467; City of Pawhuska v. Pawhuska Oil Co., 248 P. 336; Kasch v. Miller, 104 Ohio St. 281, 135 N.E. 813; Kansas City v. Ward, 134 Mo. 185; Briggs v. Greenville County, 135 S.E. 153; Wright v. Hardwick, 152 Ga. 302, 109 S.E. 903; Kansas City v. Bacon, 147 Mo. 282; Henderson v. City of Enterprise, 80 So. 115; Maffitt v. Decatur, 322 Ill. 82, 152 N.E. 602; Fox v. Bicknell, 141 N.E. 222; Walsh v. Cleveland, 271 F. 705; Winston v. Spokane, 41 P. 888; Brockenbrough v. Board of Water Commrs., 46 S.E. 28, 134 N.C. 1; Quill v. Indianapolis, 23 N.E. 788; Kelly v. Minneapolis, 65 N.W. 115; Vallelly v. Park Commissioners, 111 N.W. 615.

R. H. Musser for respondents.

Article VIII, Chapter 38, Revised Statutes 1929, is the legislative grant of powers to cities of the fourth class and Section 6946 thereof, creates them. By this section -- its name is given at birth -- its rights perpetual may sue and be sued . . . may receive bequests, gifts and donations, of all kinds of property . . . It appears to be true that there is an implied power as a function of city government to establish and create water systems, as well by the city itself as by contract or franchise grants to others, this in the absence of express grant, being implied as necessary to promote public health, welfare, convenience and contentment. 20 Amer. & Eng. Enc. (2 Ed.) 1139, 1140, 1143, 1147, 1176; City of Joplin v. Leckie, 78 Mo.App. 8; 19 R. C. L. 768, 777, 789. That the constitutional limitations are not violated are indicated by the several decisions cited by the relator -- and this seems to find support in many courts in the several states. 19 R. C. L. 985.

Culver & Phillip, amici curiae.

(1) Where a statute confers a power on a municipality to be exercised in a certain way, it necessarily includes in itself a negative, namely: that the thing shall not be done otherwise. (a) A municipal corporation possesses and can exercise only the following powers: (1) Those granted in express words; (2) those necessarily or fairly implied in or incident to the powers expressly granted; (3) those essential to the declared objects and purposes of the corporation -- not simply convenient, but those that are indispensable. And any fair, reasonable doubt concerning the existence of a power is resolved by the courts against the corporation, and the power is denied. There is such a superabundance of authorities on the above proposition in Missouri and elsewhere, and the doctrine is so firmly entrenched that it is unnecessary to cite cases. Among the many cases in Missouri so holding, are those of: City of Independence v. Cleveland, 167 Mo. 395, 67 S.W. 216; St. Louis v. Dreisoerner, 243 Mo. 217, 147 S.W. 998. (b) Where the statute has authorized a municipality to exercise a power and prescribed the manner of its exercise, the right to exercise the power given in any other manner is necessarily denied. State ex rel. v. Holtcamp, 14 S.W.2d 646; Heidelberg v. St. Francois County, 100 Mo. 69, 12 S.W. 914; Unionville v. Martin, 95 Mo.App. 28, 68 S.W. 605; Van Eaton v. Town of Sidney, 231 N.W. 475. (2) The city of Blue Springs cannot issue revenue bonds without first securing the approval of the voters at an election held for that purpose. Secs. 7661-7671, Art. XXXI, Chap. 38, R. S. 1929. (3) The city of Blue Springs is obligated by law and has impliedly agreed to credit the income of the plant when acquired with reasonable hydrant rentals and water furnished the city for public purposes, which moneys when so paid into the income of the plant acquired go to the bondholder, and this is in violation of the Constitution. Secs. 12 and 12a, Art. X, Const. Mo.; Secs. 7667-7669-7671, R. S. 1929; Hight v. Harrisonville, 328 Mo. 549; City of Campbell v. Arkansas-Missouri Power Co., 55 F.2d 560.

Atwood, J. All concur, except Ellison, J., not sitting.

OPINION

ATWOOD

This is an original proceeding in mandamus, brought by Blue Springs, Missouri, a city of the fourth class, to compel the clerk and treasurer of that city to prepare, print, execute, attest and deliver to the United States of America, or its agency, the Federal Emergency Administration of Public Works, revenue bonds aggregating $ 80,000 payable to the United States of America, which the city by its Ordinance No. 51 elected to borrow of said Federal agency for use in constructing a waterworks plant to be owned by the city, subject to lien of the bonds on the plant and income therefrom, the principal and interest of which revenue bonds, it is alleged, are to be paid solely from the "earnings, increment and profit" arising from the operation of the plant. Attached to the petition as exhibits are letters from the clerk and treasurer, addressed to the city mayor and board of aldermen, declining to print, attest and deliver the bonds as ordered, together with a copy of the ordinance of the city authorizing the borrowing of the money, providing for issuance of the bonds and directing the clerk and treasurer to prepare, print, execute, attest and deliver the same as aforesaid.

The parties stipulated that the petition should be taken as and for the alternative writ. Respondents thereupon filed return wherein, among other things, they alleged "that said revenue bonds have not been approved, at an election held for that purpose, by two-thirds (2/3) of the legal voters of the city of Blue Springs, Missouri, as required by Section 7217, Revised Statutes of Missouri, 1929;" that there has "been no compliance with Sections 2915 and 2920 of the Revised Statutes of Missouri, 1929, requiring that said revenue bonds be presented to the State Auditor of Missouri for registration;" and that "on the date of the passage of said Ordinance No. 51 and on the date of the making of said application for said loan and grant, the indebtedness of the city of Blue Springs, Missouri, was five per cent of the total assessed valuation of the property within the limits of said city, and that should respondents carry out the orders and instructions of said Ordinance Number 51, they would be in the position of performing actions that were wholly useless and nugatory for the reasons hereinbefore stated, and as stated in the letters of respondents to the mayor and board of aldermen of the city of Blue Springs, Missouri, which are Exhibits 'D' and 'E' attached to relator's amended petition for mandamus, and for the further reason that said revenue bonds would constitute an indebtedness of said city in excess of five per cent (5%) of the total assessed valuation of the property within the limits of said city as prohibited by Section 12 of Article X of the Constitution of Missouri." Relator thereupon filed motion for judgment on the pleadings.

Relator's brief is addressed mainly to the proposition that "no indebtedness is incurred on the part of the relator within the meaning of the constitutional provisions by the issuance of so-called 'revenue bonds' payable solely from the income of the waterworks plant to be constructed from the proceeds thereof." A question more fundamental and possibly decisive of this case is whether or not relator has power to issue revenue bonds in the manner disclosed in this proceeding.

"It is a general and undisputed proposition of law that a municipal corporation possesses and can exercise the following powers and no others: (1) those granted in express words; (2) those necessarily or fairly implied in or incident to the powers expressly granted; (3) those essential to the declared objects and purposes of the corporation -- not simply convenient, but indispensable. Any fair, reasonable doubt concerning the existence of power is resolved by the courts against the corporation, and the power is denied." [1 Dillon on Municipal Corporations (3 Ed.), sec. 89; St. Louis v. Bell Telephone Co., 96 Mo. 623, 628, 10 S.W. 197; City of Nevada to use of Gilfillan v. Eddy, 123 Mo. 546, 557, 558, 27 S.W. 471; City of Independence v. Cleveland, 167 Mo. 384, 388, 67 S.W. 216; St. Louis v. Dreisoerner, 243 Mo. 217, 223, 147 S.W. 998; Hays v. City of Poplar Bluff, 263 Mo. 516, 531, 532, 173 S.W. 676; Van Eaton v. Town of Sidney, 211 Iowa 986, 231 N.W. 475.] As said by the Supreme Court of Iowa, speaking through Dillon, C. J., in City of Clinton v. Cedar Rapids, 24 Iowa 455, 475: "Municipal corporations owe their origin to, and derive their powers and rights wholly from, the Legislature."

Another equally well-recognized...