Ackerman v. Boyd

• Court: Arizona Supreme Court
• Writing for the Court: La PRADE; UDALL
• Citation: Ackerman v. Boyd, 244 P.2d 351, 74 Ariz. 77 (Ariz. 1952)
• Decision Date: 05 May 1952
• Docket Number: No. 5658,5658
• Parties: ACKERMAN v. BOYD et al.

Page 351

244 P.2d 351

74 Ariz. 77

ACKERMAN v. BOYD et al.

No. 5658.

Supreme Court of Arizona.

May 5, 1952.

Willis R. Dees, of Tucson, for appellant and cross-appellee.

Robert Morrison, County Atty., and Morris K. Udall, Chief Deputy County Atty., of Tucson, for appellees and cross-appellants.

La PRADE, Justice.

This is an appeal and a cross-appeal from a judgment on the pleadings in a declaratory judgment action brought by a taxpayer to test the legality of a proposed bond issue by the Pima County Board of Supervisors.

On November 5, 1951, the Board of Supervisors passed a Resolution of Intention reciting that the bonded indebtedness of the county did not exceed 4% of its assessed valuation and that the issuance of $3,000,000 in bonds would not exceed that limit; that the county needed a new courthouse and county hospital, and thereby announced its intention to issue $2,500,000 in bonds to obtain land and construct a new courthouse, and $500,000 to construct a county hospital. It was the announced intention of the supervisors to issue the bonds under authority of Section 17-337 et seq., A.C.A. 1939, without calling a bond election. On January 29, 1952, plaintiff (appellant here), as a taxpayer and owner of certain real property which the county proposed to condemn as a site for the buildings, filed an action asking judgment declaring that the board of supervisors has no right to issue bonds for that purpose without the assent of a majority of real property taxpayers given at an election held for that purpose, and praying that an injunction issue restraining it from proceeding further with the bond issue. Defendants answered, admitting all allegations of fact but alleging that they were and are entitled to issue the bonds without an election. Defendants also counterclaimed, asking a declaratory judgment upholding the legality of the proposed bond issue. Plaintiff's reply admitted all allegations of fact in the counterclaim but denied defendants' right to relief by virtue of their failure to comply with Section 10-601 et seq., A.C.A. 1939. Both parties then moved for judgment on the pleadings, whereupon the trial court rendered judgment:

1. Upholding the right of the Board of Supervisors to issue bonds and construct the courthouse under Section 17-337 et seq., without holding a bond election.

2. Denying the Board of Supervisors the right to issue bonds for the construction of a county hospital under the purported authority of Section 17-337, upon the theory that a county hospital is not a 'court-house, jail or other county building' as contemplated by said Section 17-337.

From this judgment the plaintiff-appellant appeals contending that neither courthouse nor hospital can be built, when bonds are proposed to be issued for that purpose, without a bond election, and defendant-appellees appeal contending that both court-house and hospital can be erected and financed without a bond election.

Plaintiff assigns as error the partial granting of defendants' motion for judgment on the pleadings and holding that the board of supervisors may without a bond election issue bonds for construction of a courthouse, for the reason that Section 10-601 et seq. A.C.A. 1939 requires an affirmative vote by the real property taxpayers of the county before such bonds may be issued.

The basic issue involved is whether a county of the state of Arizona may borrow money to be evidenced by its bonds and with which moneys it proposes to construct a county courthouse and a county hospital without the assent of a majority of the real property taxpayers of the county, voting at such election, when the aggregate indebtedness of the county does not exceed four per centum of the taxable property in the county to be ascertained by the last assessment for state and county purposes.

Our statutes apparently set up two separate and distinct procedures relating to the circumstances and conditions that must exist as a condition precedent to the issuance of bonds and providing the modus operandi for their issuance and the terms and conditions of the bonds. These separate procedures are to be found in chapters 10 and 17 of the Arizona Code Annotated 1939. Chapter 10 is entitled 'Public Finances'; article 6 of said chapter, Section 10-601 et seq., is entitled 'County, Municipal, and School District Indebtedness'. Chapter 17 is entitled 'Counties and County Officers'. Article 3 of Chapter 17, Section 17-301 et seq., is entitled 'Board of Supervisors'. The comparable antecedent legislation for both chapters was in the Arizona Civil Code for 1913 and the Revised Code of 1928. In construing the antecedent provisions of Chapter 10, our court in the case of Board of Supervisors of Yavapai County v. Hawkins, 1914, 16 Ariz. 16, 140 P. 821, held that if a county desired to increase its indebtedness by a bond issue that this question had to be submitted to the qualified property taxpayers regardless of the fact that the proposed increase in indebtedness would not exceed the four per centum limitation. In Doan v. Board of Supervisors of Yuma County, 1920, 21 Ariz. 240, 187 P. 265, this court, in again interpreting the provisions of what is now Chapter 10, held that a county having a total indebtedness of less than four per centum of the valuation of its taxable property had power to issue and sell bonds to fund floating indebtedness without first obtaining the assent of qualified property taxpayers.

It is the position of the county that since the proposed indebtedness, when added to its existing indebtedness, does not exceed four per centum of the assessable property of the county, it was authorized to proceed with the construction of a courthouse and county hospital and secure the money with which to pay for same by the issuance of bonds and was not required to submit the question to a vote and obtain the assent of a majority of the real property taxpayers in the county voting at such election. Its chief reliance is Section 17-337, A.C.A. 1939, which reads as follows:

'When the aggregate indebtedness of any county does not exceed four per centum on the value of the taxable property within such county, ascertained by the last assessment for state and county taxes, and such county has not a suitable court-house, jail or other county buildings, the board of supervisors may erect the same and for that purpose and for purchasing the grounds therefor, may issue on behalf of such county, bonds not exceeding in the aggregate an amount which if added to the then existing indebtedness of the county does not exceed four per cent of the assessable property of the county. The board shall first adopt and enter a resolution of intention to issue such bonds and erect such buildings, stating the public need therefor, the estimated cost and the amount of the bonds to be issued.'

It will be noted that this section is silent on the question of an election. The county also relies upon Article 9, section 8 of the Arizona Constitution, the pertinent part of which reads as follows:

'No county, city, town, school district, or other municipal corporation shall for any purpose become indebted in any manner to an amount exceeding four per centum of the taxable property in such county, city, town, school district, or other municipal corporation, without the assent of a majority of the property taxpayers, who must also in all respects be qualified electors, therein voting at an election provided by law to be held for that purpose, the value of the taxable property therein to be ascertained by the last assessment for state and county purposes, previous to incurring such indebtedness; * * *.'

It is the position of the county that this constitutional provision authorizes and sanctions the enactment of Section 17-337, and that this provision clearly contemplated the issuance of bonds up to four per centum without an election. Plaintiff-appellant takes the position that under no circumstances can a county issue its bonds, except funding or refunding bonds, without an election thereon to be approved by a majority of the qualified real property taxpayers voting at the election. It relies upon the decision of this court in the Hawkins case, supra, and further calls to the attention of the court the provisions of Article 7, section 13 of the Constitution, which provides as follows:

'Questions upon bond issues or special assessments shall be submitted to the vote of real property taxpayers, who shall also in all respects be qualified electors of this state, and of the political subdivision thereof affected by such question.'

It is interesting and significant to note that this constitutional provision was not referred to by the court in either the Hawkins or Doan cases. An examination of the original briefs submitted...