Allied Chemical Corp. v. Iberville Parish Police Jury

• Decision Date: 21 January 1983
• Docket Number: Nos. 82-C-1360,CIBA-GEIGY,82-C-1361 and 82-C-1874,s. 82-C-1360
• Citation: 426 So.2d 1336
• Parties: ALLIED CHEMICAL CORPORATION, et al. v. IBERVILLE PARISH POLICE JURY, et al.CORPORATION v. IBERVILLE PARISH POLICE JURY, et al. COSMAR, INC., et al. v. WATERWORKS DISTRICT NO. 2 OF the PARISH OF IBERVILLE, et al.
• Court: Louisiana Supreme Court

Page 1336

426 So.2d 1336

ALLIED CHEMICAL CORPORATION, et al. v. IBERVILLE PARISH POLICE JURY, et al.

CIBA-GEIGY CORPORATION v. IBERVILLE PARISH POLICE JURY, et al.

COSMAR, INC., et al. v. WATERWORKS DISTRICT NO. 2 OF the PARISH OF IBERVILLE, et al.

Nos. 82-C-1360, 82-C-1361 and 82-C-1874.

Supreme Court of Louisiana.

Jan. 21, 1983.

Rehearing Denied March 11, 1983.

Dissenting Opinion March 14, 1983.

Houston Gascon, III, Dist. Atty., William L. Kimball, Sp. Counsel, Port Allen, J. Hugh Martin, Foley, Judel, Beck, Bewley & Martin, New Orleans, for applicant in Nos. 82-C-1360 and 82-C-1361, respondents in No. 82-C-1874.

Victor A. Sachse, III, Claude F. Reynaud, Jr., Breazeale, Sachse & Wilson, Baton Rouge, for applicant in No. 82-C-1874.

BLANCHE, Justice.

These cases, which were not consolidated by the trial court or the court of appeal, involve the same factual and legal issues and are consolidated by this court for purposes of review. In each of the cases, the plaintiffs brought suit to contest the validity of an ad valorem tax on property located within Iberville Parish Waterworks District Number 2. The trial court sustained the defendants' exceptions of no right and no cause of action in each of the three suits which were filed; the court of appeal upheld the trial court's rulings. We affirm.

The facts alleged in the plaintiffs' petitions are not disputed by the parties. Plaintiffs, Cosmar, Incorporated, American Petrofina, Incorporated, Borg Warner Corporation, Carville Properties, Inc., Allied Chemical Corporation, and Ciba-Geigy Corporation are owners of property within the territorial limits of a special service district, Iberville Parish Waterworks District Number 2. This property owned by the companies in the Waterworks District is also included within the boundaries of an industrial area created by the Iberville Parish Police Jury pursuant to the provisions of La.R.S. 33:130.11, et seq.

On August 19, 1980, the Police Jury of Iberville Parish adopted a resolution. Section one of this resolution authorizes Waterworks District Number 2 to conduct a special election on the following proposition:

"Shall Waterworks District No. 2 of the Parish of Iberville, Louisiana, incur debt and issue bonds to the amount of One Million Five Hundred Thousand Dollars ($1,500,000) to run twenty-five .(25) years from date thereof, with interest at a rate not exceeding nine percentum (9%) per annum, for the purpose of constructing and acquiring improvements to the waterworks system of said Waterworks District, to continue existing waterworks services now provided therein, including additions to the water treatment plant and enlargements of water storage facilities in connection therewith, title to which shall be in the Public, which bonds will be general obligations of said Waterworks District and will be payable from ad valorem taxes to be levied and collected in the manner provided by Article VI, Section 33 of the Constitution of the State of Louisiana of 1974, and statutory authority supplemental thereto?"

The bond proposition was approved by a majority of the voters in the Waterworks District on November 4, 1980.

Section Two of the August 19, 1980 Iberville Parish Police Jury resolution provides that, in the event the said proposition is approved by the electorate, the general obligation bonds are to be secured by the annual levy of an ad valorem tax on "all property" within the corporate limits of Waterworks District Number 2.

All parties plaintiff maintain in their suits that La.R.S. 33:130.18 prohibits a special service district, such as Waterworks District Number 2, from levying an ad valorem tax on their property which is within an industrial area. ¹ Each of the three suits filed seeks declaratory relief from the Iberville Parish Police Jury's resolution that it will tax "all property" in the Waterworks District Number 2.

Allied Chemical Corporation and Ciba-Geigy Corporation pray in their suits, which name Iberville Parish Police Jury and the Board of Commissioners of Iberville Parish Waterworks District No. 2 as defendants, that the Waterworks District Number 2 ad valorem tax be declared illegal for it violates their statutory exemption, La.R.S. 33:130.18. Alternatively, they ask that the tax be declared unconstitutional as violative of due process. In an amended petition, they pray for a declaration that the ad valorem tax only applies to the areas in Waterworks District Number 2 which are not included within an industrial area. Cosmar, Incorporated, Borg Warner Corporation, American Petrofina, Incorporated, and Carville Properties, Inc. brought suit against Waterworks District Number 2 and the Parish of Iberville. They ask that the bond issue supported by the tax be declared illegal, or, alternatively, that their land in the industrial area be declared free from any increased ad valorem taxes.

The defendants responded to each of these actions by filing peremptory exception of no right and no cause of action. Each exception asserts that the plaintiffs had no cause or right of action to bring their suits via ordinaria. The defendants contend that Part XVI, Chapter 32, Title 13 of the Louisiana Revised Statutes of 1950, as amended (R.S. 13:5121 to 13:5130), sets forth the exclusive method for contesting the validity of bonds or the taxes which support those bonds. La.R.S. 13:5121 to 13:5130 requires that the person who desires to contest the issuance of the bonds shall file a "motion for judgment." The court then orders that the motion be published twice within fifteen days and fixes a date for a hearing on the motion. Since the plaintiffs did not file "motions for judgment" within sixty days from the promulgation of the results of the bond election, the defendants argue that La. Const. art. VI, § 35(A) dictates that the plaintiffs' right or cause of action to contest the validity of the bond issue or tax is forever barred.

We have stated that a peremptory exception of no cause of action concedes, for the purposes of its trial, the correctness of the well-pleaded allegations of fact and tenders the issue that on the face of the petition, no case is presented entitling the mover, in law, to the relief sought. Louisiana State Board of Medical Examiners v. England, 252 La. 1000, 215 So.2d 640 (1968); Louisiana Farms Co. v. Yazoo and M.V.R. Co., 172 La. 569, 134 So. 747 (1931). If the petition alleges sufficient facts to establish a case cognizable in law, an exception of no cause of action must fail. Rebman v. Reed, 286 So.2d 341 (La.1973).

Each plaintiff alleges that the Iberville Parish Police Jury has passed a resolution which would levy an ad valorem tax on their tax-exempt property in Waterworks District Number 2. Conceding these facts to be true, we must determine whether the law affords a remedy to the plaintiffs.

Needless to say, the parties disagree as to which remedies are available. The plaintiffs contend that they can seek declaratory relief through a proceeding via ordinaria by La.R.S. 18:1294. ² Defendants on the other hand, argue that La. Const. art. 6, § 35(A) together with La.R.S. 13:5121-5130 (The Bond Validation Statute) provide the sole remedy for attacking the validity of bond and the supporting tax. Accordingly, they assert that declaratory relief through a suit via ordinaria is not available to the plaintiffs. The court of appeal, in the cases involving Allied Chemical Corporation ³ and Ciba-Geigy, ⁴ found that the plaintiffs' exclusive remedy is to proceed under the provision of La.R.S. 47:2110. ⁵ Since that statute does not provide for declaratory relief as prayed for by the plaintiffs, the court sustained the trial court's ruling that the plaintiffs' petitions failed to state a cause or right of action. In the case involving Cosmar, et al., the court of appeal did not make a finding as to appropriate remedy which the plaintiffs should pursue, but merely held that the plaintiffs did not state a cause of action for they failed to follow the proper procedure set forth in the Bond Validation Statute (La.R.S. 13:5121--5130). ⁶

We find that the availability of remedies set forth in La.R.S. 47:2110 and La.R.S. 18:1294 is dependent upon the authority by which the tax is imposed. La.R.S. 47:2110 sets forth the proper method by which the payment of an ad valorem tax may be resisted when the tax is not authorized by an election. That statute applies only when the tax is imposed "... by the state, or any political subdivision thereof under the authority granted to it by the legislature or by the constitution." ⁷

La.R.S. 18:1294, on the other hand, is applicable only when the tax is authorized by an election. La.R.S. 18:1294 is included in Chapter 6-A of the Election Code which is titled "Bond, Debt and Tax Elections." The purpose of this chapter is stated in La.R.S. 18:1281 as follows:

The purpose of this Chapter is to implement Article VI, Section 22 of the Louisiana Constitution of 1974 by establishing a uniform procedure for the conduct of elections to authorize the issue of bonds, the assumption of indebtedness, and the imposition or increase of taxes by political subdivisions. The procedure for elections set forth in this Chapter shall apply to and shall supersede those provisions of the Louisiana Constitution of 1921 which were continued as statues under authority of Part II of Article XIV of the Louisiana Constitution of 1974 and existing laws of the State of Louisiana, notwithstanding any contrary provisions contained therein. However, nothing contained in this Chapter shall repeal the limitations in effect on January 1, 1975 on the authority of political subdivisions to impose or increase taxes.

The ad valorem tax sought to be imposed in Waterworks District Number 2 and which is contested by the plaintiffs in their suits, is not authorized by an election. As stated in La. Const. art. VI, § 33, only the issuance of the general obligation bonds requires approval by the...