Allydonn Realty Corp. v. Holyoke Hous. Auth.

• Decision Date: 21 November 1939
• Citation: 304 Mass. 288,23 N.E.2d 665
• Parties: ALLYDONN REALTY CORPORATION et al. v. HOLYOKE HOUSING AUTHORITY et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

304 Mass. 288

23 N.E.2d 665

ALLYDONN REALTY CORPORATION et al.

v.HOLYOKE HOUSING AUTHORITY et al.

Supreme Judicial Court of Massachusetts, Hampden.

Nov. 21, 1939.

Report from Superior Court, Hampden County; D. T. O'Connell, Judge.

Proceeding by Allydonn Realty Corporation and others to restrain the City of Holyoke, Holyoke Housing Authority and others from expending money by the city in connection with the proposed construction by Holyoke Housing Authority of a low rent housing project. On report from the Superior Court.

Petition dismissed.J. B. Ely, of Boston, and T. C. Maher, of Holyoke, and F. M. Kingsbury, of Springfield, for plaintiffs.

J. R. Nolen, of Holyoke, for Holyoke Housing Authority.

E. O. Proctor, Asst. Atty. Gen., and J. I. Robinson, of Springfield, for the Commonwealth.

QUA, Justice.

The primary object of this petition by Allydonn Realty Corporation and ten individual taxable inhabitants of Holyoke is to restrain the respondent city of Holyoke from expending money under a ‘co-operative agreement’ which the city has entered into with Holyoke Housing Authority in connection with the proposed construction by the latter of a low-rent housing project in the respondent city. Jurisdiction rests upon G.L.(Ter.Ed.) c. 40 § 53. It is unnecessary in this instance to determine whether the corporate petitioner was properly joined with the ten individuals. The Attorney General was allowed to appear for the Commonwealth under G.L.(Ter.Ed.) c. 12, § 3.

The only question argued, upon which alone a decision is sought, is whether the Housing Authority Law, G.L.(Ter.Ed.) c. 121, §§ 26i to 26ii, inclusive, as inserted by St.1938, c. 484, § 1, is constitutional. The answer in essence depends upon whether under that law public moneys and the power of taxation are to be utilized for purposes that are in their nature public, or for the private advantage of particular persons.

The act is entitled, ‘An Act to Relate the Massachusetts Housing Authority Law to the United States Housing Act of Nineteen Hundred and Thirty-seven.’ See U.S.C. 1934 ed.Sup. IV, Title 42, § 1401 et seq., 42 U.S.C.A. § 1401 et seq. Its provisions may be briefly reviewed. ‘Low-rent housing’ is defined as ‘decent, safe and sanitary dwellings within the financial reach of families of low income, and developed and administered to promote serviceability, efficiency, economy and stability * * *.’ ‘Families of low income’ are ‘families who are in the lowest income group and who cannot afford to pay enough to cause private enterprise in their locality or in the same metropolitan area to build an adequate supply of decent, safe and sanitary dwellings for their use.’ A ‘Sub-standard area’ is ‘any area wherein dwellings predominate which, by reason of dilapidation, overcrowding, faulty arrangement or design, lack of ventilation, light or sanitation facilities, or any combination of these factors, are detrimental to safety, health or morals.’ A ‘project’ may consist in the removal of buildings from a sub-standard area, or in providing decent, safe and sanitary dwellings for families of low income, or in a combination of the two. Section 26J. It is declared that sub-standard areas exist in ‘certain portions' of the Commonwealth; that there is not an adequate supply of low-rent housing for families of low income within a reasonable distance of the principal centers of employment; that ‘this situation tends to cause an increase and spread of disease and crime and constitutes a menance to the health, safety, morals, welfare and comfort of the inhabitants of the commonwealth and is detrimental to property values therein’; and that ‘this situation cannot readily be remedied by the ordinary operations of private enterprise.’ Section 26K. Provision follows for the creation in cities and towns of housing authorities as public bodies politic and corporate, which, however, are to exercise no powers until the city council of a city, with the approval of the mayor, determines that a housing authority is needed therein for the clearance of sub-standard areas or the provision of low-rent housing for families of low income, or until a town votes for the organization of such an authority for such purpose. In determining the need for the clearance of sub-standard areas or for lowrent housing the city council or the town is to take into consideration ‘the need for relieving congestion of population, the existence of insanitary or unsafe inhabited dwellings, and the shortage of safe or sanitary dwellings available for families of low income at rentals which they can afford.’ Section 26L. A housing authority, with the approval of the State board of housing and of the mayor of a city or the selectmen of a town, may enter into agreements with the Federal government, including the United States Housing Authority, relative to the acceptance or borrowing of funds for projects and, with like approval, may contract with the Federal government for purchasing or leasing a clearance or low-rent housing project. Section 26Q. Housing authorities are granted the incidental powers necessary to carry out their projects, including the power to determine what areas are ‘substandard,’ the power of eminent domain, the power to make contracts for construction, reconstruction, alteration or repair of clearance or low-rent housing projects, to act as agent of, or to cooperate with, the Federal government in said projects, to lease and operate such projects, to borrow money upon its bonds and notes secured by mortgage on its property or pledge of its revenue, and to make by-laws and regulations to carry its powers into effect. Section 26R. Projects are subject to the approval of the State housing board as to health, sanitation, safety, and financing. Section 26S. Cities and towns may apporpriate sums limited in proportion to their valuations in aid of housing authorities for various purposes in connection with projects, including sums necessary for defraying such part of the development, acquisition and operating costs as will not be met by loans or grants of the Federal government or otherwise. Sections 26U, 26V. Real estate and tangible personal property of a housing authority held in connection with a project financed by the Federal government are exempt from taxation, but the authority may be required to pay to the city annually a charge for municipal services supplied to the project. Section 26W. Projects, after completion, are to be maintained and operated by the housing authorities. It is declared to be the policy of the Commonwealth that rents be fixed at the lowest possible rates consistent with providing decent, safe and sanitary dwelling accommodations, and that no project shall be operated for profit or as a source of revenue to the Commonwealth or to the city or town. Rentals shall be within the financial reach of laborers and wage earners of low income. Accommodations rented or leased to a tenant shall consist of the least number of rooms deemed necessary to provide safe and sanitary accommodations to the proposed occupants without overcrowding. Families are not to be accepted as tenants whose annual income exceeds five (in some cases six) times the annual rental. There is a provision against discrimination among applicants. Section 26AA. No project involving the construction of new dwellings shall be undertaken ‘unless the project includes the elimination by demolition, condemnation and effective closing of unsafe or unsanitary buildings situated in the same city or town containing dwelling units substantially equal in number to the number of newly constructed dwelling units provided by the project.’ Section 26CC. Obligations of a housing authority are not to bind the Commonwealth or the municipality. Section 26GG.

The distinction between a use or service which is public and therefore a proper object of governmental expenditure and one which is private and therefore an improper object to which to devote money belonging to all of the people has been discussed at length in its application to various situations in a number of instances coming before this court. Lowell v. Boston, 111 Mass. 454, 15 Am.Rep. 39;Mead v. Acton, 139 Mass. 341, 1 N.E. 413;Opinion of the Justices, 150 Mass. 592, 24 N.E. 1084,8 L.R.A. 487;Moore v. Sanford, 151 Mass. 285, 288, 289, 290, 24 N.E. 323,7 L.R.A. 151;Kingman v. Brockton, 153 Mass. 255, 26 N.E. 998,11 L.R.A. 123;Opinion of the Justices, 155 Mass. 598, 30 N.E. 1142,15 L.R.A. 809;Opinion of the Justices, 175 Mass. 599, 57 N.E. 675,49 L.R.A. 564; Opinion of the Justices, 182 Mass. 605, 66 N.E. 25,60 L.R.A. 592; Opinion of the Justices, 186 Mass. 603, 72 N.E. 95;Opinion of the Justices, 190 Mass. 611, 613, 77 N.E. 820;Opinion of the Justices, 204 Mass. 607, 91 N.E. 405, 27 L.R.A.,N.S., 483; Opinion of the Justices, 211 Mass. 624, 98 N.E. 611, 42 L.R.A.,N.S., 221; Salisbury Land & Improvement Co. v. Commonwealth, 215 Mass. 371, 102 N.E. 619, 46 L.R.A.,N.S., 1196; Opinion of the Justices, Mass., 8 N.E.2d 753. Some of these cases have become generally recognized as leading cases. They do not, however, establish any universal test. Each case must be decided with reference to the object sought to be accomplished and to the degree and manner in which that object affects the public welfare. Frequently an object presents a double aspect in that it may in some respects result in conferring a benefit upon the public and in other respects it may result in conferring a benefit upon or in paying money to private individuals. In such instances the cases tend to distinguish between those results which are primary and those which are secondary or incidental and to classify the object according to its primary consequences and effects. At any rate it is plain that an expenditure is not necessarily barred because individuals as such may profit, nor is it necessarily valid because of incidental benefit to the public. See Horrigan v. Mayor of Pittsfield,...