Ameritel Inns v. Greater Boise Auditorium

• Decision Date: 11 August 2005
• Docket Number: No. 30698.,30698.
• Citation: 119 P.3d 624,141 Idaho 849
• Parties: AMERITEL INNS, INC.; H. Scott Brown and Edna Brown, husband and wife; Dave Wilder and Cathie Wilder, husband and wife; Steve Bertoni and Julie Bertoni, husband and wife; and George Mc Donough and Aurora Mc Donough, husband and wife, Plaintiffs-Appellants, v. GREATER BOISE AUDITORIUM DISTRICT, Larry May, Michael D. Fitzgerald, Marcy Timm, C. Dan Brown, Stephenson S. Youngerman, and Ed Pilkerton, Defendants-Respondents.
• Court: Idaho Supreme Court

Page 624

119 P.3d 624

141 Idaho 849

AMERITEL INNS, INC.; H. Scott Brown and Edna Brown, husband and wife; Dave Wilder and Cathie Wilder, husband and wife; Steve Bertoni and Julie Bertoni, husband and wife; and George Mc Donough and Aurora Mc Donough, husband and wife, Plaintiffs-Appellants, v. GREATER BOISE AUDITORIUM DISTRICT, Larry May, Michael D. Fitzgerald, Marcy Timm, C. Dan Brown, Stephenson S. Youngerman, and Ed Pilkerton, Defendants-Respondents.

No. 30698.

Supreme Court of Idaho, Boise, March 2005 Term.

August 11, 2005.

Brook B. Bond, Boise, for appellants.

Hawley, Troxell, Ennis & Hawley, Boise, for respondents. Eugene Ritti argued.

EISMANN, Justice.

This is an appeal from a judgment dismissing an action seeking to prevent the Greater Boise Auditorium District from expending public funds or employee time to influence a bond election. The district court held that the plaintiffs did not have standing to bring this action and that the Auditorium District was authorized to expend public funds to promote passage of the bond measure. We reverse, holding that AmeriTel Inns, Inc., has standing to bring this action and that the Auditorium District did not have authority to use public funds to influence a contested election.

I. FACTS AND PROCEDURAL HISTORY

The defendant Greater Boise Auditorium District (Auditorium District) is an auditorium district organized in 1959 pursuant to Idaho Code §§ 67-4901 et seq. It was organized to "build, operate, maintain, market and manage for public, commercial and/or industrial purposes by any available means public auditoriums, exhibition halls, convention centers, sports arenas and facilities of a similar nature." I.C. § 67-4902 (2001). The individuals named as defendants were the elected directors of the auditorium district and its general manager.

The Auditorium District owns and operates the Boise Centre on the Grove, a convention center located in the heart of downtown Boise. It desired to expand that facility by constructing a second convention center nearby and wanted to finance that construction by issuing bonds. This proposed expansion was called the Capital Station project. It scheduled an election to be held on February 3, 2004, in order to obtain voter approval to issue the bonds.

The plaintiff AmeriTel Inns, Inc., (AmeriTel) is a corporation that operates three hotels within the geographic boundaries of the Auditorium District, and the remaining plaintiffs are qualified electors who reside within the District. On January 16, 2004, they filed this action seeking to restrain the Defendants from using any public funds, including the Auditorium District's facilities or employees, to advocate voter approval of issuing the bonds. On January 21, 2004, the Plaintiffs filed an amended complaint adding a claim that the Defendants violated the open meeting laws in Idaho Code §§ 67-2340 et seq.

The district court heard the Plaintiffs' request for a temporary restraining order on January 22, 2004. The next day it issued a written decision denying the requested restraining order. The court determined: (1) the Plaintiffs did not have standing to challenge the Auditorium District's use of public funds to promote passage of the bond issue; (2) the District's use of public funds to promote the passage of the bond issue was not prohibited by any statutory or constitutional provision; (3) the Plaintiffs had not shown that they would be irreparably harmed if the restraining order was not issued; and (4) the Plaintiffs did not offer any evidence showing a violation of the open meeting laws.

On January 28, 2004, the district court issued a written notice informing the parties that with the denial of the requested temporary restraining order, there did not appear to be anything more for the court to determine. It gave notice that it would dismiss the complaint within twenty days unless the Plaintiffs could demonstrate that there was an unresolved issue remaining for the court's determination.

The bond election was held on February 3, 2004. The voters did not give the issue the two-thirds majority vote required for approval.

On February 17, 2004, the Plaintiffs responded to the district court's notice of intent to dismiss by requesting permission to file a second amended complaint. The proposed second amended complaint sought a declaratory judgment that Auditorium District's expenditure of public funds to support the passage of the bond issue violated state law and a judgment requiring the Defendants to reimburse the Auditorium District for all such expenditures. On March 18, 2004, the district court heard oral argument on the Plaintiffs' request to file the second amended complaint. By order entered on March 31, 2004, it denied that request, and by judgment entered the same date it dismissed the Plaintiffs' amended complaint with prejudice. The Plaintiffs then timely appealed.

II. ISSUES ON APPEAL

A. Is this case moot?

B. Do any of the Plaintiffs have standing to bring this action?

C. Can the Auditorium District use its funds to campaign in a bond election?

III. ANALYSIS

A. Is This Case Moot?

Because the election has already been held, the Defendants contend that the issue raised by the Plaintiffs is moot. It is too late to enjoin them from using public funds to campaign in favor of the bond issue. An injunction cannot restrain an act already completed. Brady v. City of Homedale, 130 Idaho 569, 944 P.2d 704 (1997).

An issue becomes moot if it does not present a real and substantial controversy that is capable of being concluded through judicial decree of specific relief. State v. Rogers, 140 Idaho 223, 91 P.3d 1127 (2004). There are three recognized exceptions to the mootness doctrine: (1) when there is the possibility of collateral legal consequences imposed on the person raising the issue; (2) when the challenged conduct is likely to evade judicial review and thus is capable of repetition; and (3) when an otherwise moot issue raises concerns of substantial public interest. Id. The substantive issue presented in this case is whether public entities can use public funds to campaign in an election. That is an issue of substantial public interest that this Court has not yet addressed. We will therefore address the issue to provide guidance and direction in the future.

B. Do any of the Plaintiffs Have Standing to Bring this Action?

The district court found that none of the Plaintiffs have standing to bring this action. This Court must decide that issue before reaching the merits of the case. Young v. City of Ketchum, 137 Idaho 102, 44 P.3d 1157 (2002). A person wishing to invoke a court's jurisdiction must have standing to raise the issue to be litigated. Id. It is not enough that the party is a concerned citizen who seeks to ensure that a governmental entity abides by the law. Thomson v. City of Lewiston, 137 Idaho 473, 50 P.3d 488 (2002). To have standing, a litigant must allege or demonstrate an injury in fact and a substantial likelihood that the judicial relief requested will prevent or redress the claimed injury. Id. A citizen or taxpayer may not challenge a governmental enactment where the injury is one suffered alike by all citizens and taxpayers of the jurisdiction. Id.

1. Do the individual Plaintiffs have standing? The individual Plaintiffs contend that they have standing because they are voters who were opposed to the Auditorium District incurring indebtedness to expand the convention center. Relying upon Van Valkenburgh v. Citizens for Term Limits, 135 Idaho 121, 15 P.3d 1129 (2000), they contend that the Auditorium District's use of public funds to promote passage of the bond issue greatly diminished the likelihood that the bond issue would be defeated. The petitioners in Van Valkenburgh sought to challenge a statute requiring the Secretary of State to place on ballots information advising voters whether a particular Congressional candidate had taken or broken a term limits pledge. The Van Valkenburgh Court held that the petitioners had standing to litigate that issue. When so holding, the Van Valkenburgh Court relied upon three factors: (1) "The Petitioners allege the law violates their right to vote because the law will infringe on the rights of qualified voters to cast their votes effectively by `greatly diminishing the likelihood the candidate of their choice will prevail in the election'"; (2) "[T]he Petitioners allege the law infringes on their right to vote because it constitutes a state invasion of the privacy and sanctity of the voting booth"; and (3) The challenged statute "adversely impacts only those registered voters who oppose the term limits pledge, or who support candidates who oppose the term limits pledge." 135 Idaho at 125, 15 P.3d at 1133. All three of those factors do not exist in this case. There is no allegation that the Auditorium District did anything that would invade the privacy and sanctity of the voting booth. The remaining factors — that the individual Plaintiffs opposed the bond issue and that the Auditorium District's spending of public funds to campaign increased the chances of its passage — are not sufficient to give them standing.

2. Does AmeriTel have standing? AmeriTel contends that it had standing because it is a taxpayer, the proposed expansion of the convention center would negatively impact AmeriTel's business, and the Auditorium District was using tax monies to finance speech with which AmeriTel disagreed, in violation of its First Amendment rights. We need only address the first two arguments because we find that AmeriTel has standing based upon the facts that it is a taxpayer and that it alleged that the proposed expansion of the convention center would have negatively impacted its business by competing with it regarding the rental of meeting space.

In its proposed second amended complaint, AmeriTel alleged that "the substantial expansion of meeting facilities proposed in the Capital Station project ....