Attorney Gen. ex rel. Eaves v. State Bridge Comm'n

• Decision Date: 05 October 1936
• Citation: 269 N.W. 388,277 Mich. 373
• Parties: ATTORNEY GENERAL ex rel. EAVES v. STATE BRIDGE COMMISSION et al.*
• Court: Michigan Supreme Court

277 Mich. 373

269 N.W. 388

ATTORNEY GENERAL ex rel. EAVES

v.STATE BRIDGE COMMISSION et al.*

Supreme Court of Michigan.

FN* For opinion on rehearing, see 270 N. W. 308.

No. 118.

Oct. 5, 1936.

Suit by David H. Crowley, Attorney General, on the relation of William C. Eaves, against the State Bridge Commission, Varnum B. Steinbaugh, and others, constituting the State Bridge Commission, and another.From an adverse decree, the plaintiff appeals.

Affirmed.

Appeal from Circuit Court, St. Clair County, in Chancery; Fred W. George, Judge.

Argued before the Entire Bench, except POTTER and TOY, JJ.

Avery & Covington, of Port Huron, for appellant.

George C. Watson, of Port Huron, for appellees.

BUSHNELL, Justice.

The parties agree upon the facts and the questions involved.

The state bridge commission, created by ActNo. 147 of the Public Acts of 1935, is authorized to acquire, improve, construct, operate, and maintain certain specified public works, which, by definition in the act, shall include ‘all property, rights, easements and franchises relating thereto and deemed necessary or convenient for their operation, and shall embrace an international bridge over, and ferries across the Saint Clair River at or near Port Huron.’

Section 2.

The commission has entered into a contract for the sale of revenue bonds of the state, payable only from tolls to be earned by the completed bridge, for the purpose of purchasing the Port Huron-Sarnia Ferry Company, paying the cost of constructing the main span of the international bridge and acquiring the franchise of the St. Clair Transit Company to construct that part of the main span which crosses Canadian waters, the Canadian company being authorized to construct, maintain, and operate the Canadian portion of the proposed bridge and to fix and charge tolls for transit.

The controlling Canadian laws are chapter 64, Statutes of Canada for 1928, as amended by chapter 59 of 1930 and chapter 65 of 1934, 24-25 George V.

The Act of Congress which grants federal consent to the crossing of navigable waters is Public Act 411, 49 Stat. 1051, approved August 30, 1935.

The several acts require rates of tolls sufficient to pay the reasonable costs of maintenance, repairs, and operation, and provide for the amortizing of the costs of construction; thereafter the rates shall only provide for maintenance, repairs, and operation.

The amount of the bond issue required for the purchase of the existing ferry and the construction of the main span is estimated at $1,900,000.The estimated cost of the Michigan approach is $629,000, of which $119,000 is for the right of way.The cost of the Canadian approach, $635,000, will be paid by the Province of Ontario and the Dominion government.The cost of the American approach is to be borne equally by the state and national governments, and the right of way is to be paid for by the state highway department.The money contributions of the state of Michigan and Province of Ontario are not to be repaid out of tolls.

The proposed plans show a main span of 1,490 feet, with the American and Canadian approaches 2,352 and 2,550 feet respectively.

Plaintiff, a taxpayer, who sought to enjoin the issuance and delivery of the proposed bonds, appeals from the denial of an injunction.He argues that the Michigan Act violates the State Constitution and that the members of the commission have not been appointed as required by the Act.

Article 8, section 26, of the Constitution states that ‘The Legislature may by general law provide for the laying out, constructing, improvement and maintenance of highways, bridges and culverts by the State,’ etc.Appellant says the act in question is local and special in character.Article 5, § 30, which was recently considered in City of Dearborn v. Board of Supervisors, 275 Mich. 151, 266 N.W. 304, reads: ‘The Legislature shall pass no local or special act in any case where a general act can be made applicable, and whether a general act can be made applicable shall be a judicial question.No local or special act, excepting acts repealing local or special acts in effect January one, nineteen hundred nine and receiving a two-thirds vote of the Legislature shall take effect until approved by a majority of the electors voting thereon in the district to be affected.’

The bridge in question is international in character and will be used by those from all parts of both nations who desire to enter or leave the United States through Port Huron.Its only so-called local characteristic is that its American approach is at Port Huron.If the act in question were deemed to be local or special in its nature, what limits should have been placed by the Legislature upon those who should vote upon the question?Can those who live in Wayne county and who use the Port Huron gateway be said to be unaffected?Assuming that the act is to be construed as a local or special act, what district is affected and how shall its limits be determined?Is it the city of Port Huron?Are nearby cities and villages to be excluded?To state the question is to give the answer.So far as the state of Michigan is concerned, practically all of its citizens are affected directly or indirectly by the means of ingress and egress at Port Huron just as they are at the city of Detroit.The geography of Michigan requires all of its citizens to be particularly interested in transportation across, over, and under the waters of the state, otherwise they might remain without means of vehicular transportation except to the south and west.

The scope of the act is not limited to an international bridge and ferries at or near Port Huron, although it does embrace such objects.

The deputy state highway commissioner, who is also chairman of the bridge commission, testified that the report of the state planning commission recommended this location for the construction of an international bridge.He said that this route from Chicago to points on the Atlantic seaboard is nearly 50 miles shorter than by other roads.

Bridges are essential parts of highways, and as said in Moreton v. Secretary of State, 240 Mich. 584, 216 N.W. 450, 452: ‘If ever the building and maintenance of highways was a matter of purely local concern, that time passed with the coming of the automobile into general use as a means of transportation.Good roads became economically necessary.To secure them, the old local public road policy was abandoned; and by appropriate legislation there was adopted a complete and comprehensive state-wide system, the basic theory of which is, that a building of a highway in any section of the state is of interest to every other section; that it is a matter of state-wide concern rather than of any particular locality.* * * The extent of the territory to which it [the appropriation] is applied, whether to a limited area or to the entire territory of the state, would seem to furnish a reasonably accurate test as to whether it is for general or local purposes.’

The act is neither local nor special in character and therefore does not offend the constitutional sections quoted.

Appellant says the act contravenes sections 10and11 of article 10 of the Constitution, which are as follows:

‘Sec. 10.The State may contract debts to meet deficits in revenue, but such debts shall not in the aggregate at any time, exceed two hundred fifty thousand dollars.The State may also contract debts to repel invasion, suppress insurrection, defend the State or aid the United States in time of war.The money so raised shall be applied to the purposes for which it is raised or to the payment of the debts contracted.The State may borrow not to exceed fifty million dollars for the improvement of highways and pledge its credit, and issue bonds therefor on such terms as shall be provided by law.’

‘Sec. 11.No scrip, certificate or other evidence of state indebtedness shall be issued, except for such debts as are expressly authorized in this constitution.’

It is suggested that this phase of the case is one of first impression in this state.If the proposed bonds are an obligation of the state, the act is unconstitutional and their issuance should be enjoined.The act provides, section 8: ‘The commission is hereby authorized to provide by resolution for the issuance of revenue bonds of the state for the purpose of paying the cost as hereinabove defined of any one or more public works which said commission is authorized by this act to acquire or construct, which resolution shall recite an estimate of such cost.The principal and interest of such bonds shall be payable solely from the special fund herein provided for such payment.* * * All bonds issued under this act shall contain a statement on their face that the state shall not be obligated to pay the same or the interest thereon except from the revenues of the works.’

The subject of self-liquidating public works has recently received our consideration in Young v. City of Ann Arbor, 267 Mich. 241, 255 N.W. 579;Block v. City of Charlvoix, 267 Mich. 255, 255 N.W. 579, andGilbert v. Traverse City, 267 Mich. 257, 255 N.W. 585.We shall not repeat that which we have so recently stated.

Appellant contends for the rule that the bonds in question are an evidence of state indebtedness.

A recent Arizona case states that:

‘Three rules have resulted which are, together with the cases supporting them, stated by the court in State v. City of Miami, 113 Fla. 280, 152 So. 6, 9.The cases cited are so numerous they seem exhaustive of the subject.We give the rules as stated by that court, omitting the cases:

“There is respectable authority (perhaps the weight of authority is to this effect) which affirms the proposition that municipal obligations, which are not payable from taxes, but are provided to be payable solely from the revenues of an independent revenue producing asset or utility, do not constitute a debt of the municipality, within the prohibition of a constitutional or...