Bair v. Layton City Corp.

• Decision Date: 27 February 1957
• Docket Number: No. 8585,8585
• Citation: 307 P.2d 895,6 Utah 2d 138
• Parties: d 138 Marion BAIR, Plaintiff, v. LAYTON CITY CORPORATION, a municipal corporation, Elias A. Dawson, James E. Biggs, Dean Morgan, Irvin W. Adams, Richard L. Stevenson, Jr., Richard Cook, John M. Park, North Davis County Sewer District, Ray J. Dawson, A. O. Stoker, Clarence J. Stoker, Albert Mitchell, Richard S. Stevenson, Jr., Ervin J. Wall, J. Alex Patterson, Lawrence E. Holt, Arthur Mitchell, Joseph Cook, Golden F. Layton and Vird Cook, Defendants.
• Court: Utah Supreme Court

Page 895

307 P.2d 895

6 Utah 2d 138

Marion BAIR, Plaintiff, v. LAYTON CITY CORPORATION, a municipal corporation, Elias A Dawson, James E. Biggs, Dean Morgan, Irvin W. Adams, Richard L. Stevenson, Jr., Richard Cook, John M. Park, North Davis County Sewer District, Ray J. Dawson, A. O. Stoker, Clarence J. Stoker, Albert Mitchell, Richard S. Stevenson, Jr., Ervin J. Wall, J. Alex Patterson, Lawrence E. Holt, Arthur Mitchell, Joseph Cook, Golden F. Layton and Vird Cook, Defendants.

No. 8585.

Supreme Court of Utah.

Feb. 27, 1957.

George B. Handy, Ogden, for plaintiff.

William H. King, Clearfield, for defendants.

WADE, Justice.

Plaintiff, Marion Bair, a resident, property owner and taxpayer of the defendants Layton City and North Davis County Sewer District, commenced this original proceeding in this court seeking to enjoin such defendants from performing a contract entered into between them on November 29, 1955. Defendant Layton City is a third class city and one of eight cities in the north part of Davis County and one city in Weber County in the defendant North Davis County Sewer District. This District occupies the territory between the Wasatch Mountain Range on the east and the Great Salt Lake on the west and was organized as a Sewer Improvement District for the disposition and treatment of sewer disposal, under Title 17, Chapter 6, Utah Code Annotated 1953. The city and other cities and some government plants had sewer facilities prior to the organization of the District and the purpose of the District was to provide additional out fall lines and treatment plants to take care of the sewage from such cities and governmental plants.

Plaintiff's claim for injunctive relief is based on the following contentions: (1) The contract creates a debt of the City in excess of the taxes of the current year without submission to the qualified electors in violation of Article 14, section 3 of Utah's Constitution ¹ and in excess of 12% of the value of the taxable property of the City in violation of Article 14, Section 4 of our Constitution. ² (2) There is no constitutional or statutory authority for the City to enter into such contract. (3) The contract is a lending of the City's credit to the District contrary to Article 6, Section 31 of our Constitution. ³ (4) The provisions of the contract are ambiguous and unreasonable and attempt to bind the City's governing body with respect to governmental matters contrary to the Constitution.

1. Whether this contract creates a debt of the city contrary to the constitutional debt limitation depends on the existing facts and circumstances, and the terms of the contract. So a short review of such facts and circumstances and the terms of the contract is in order.

Within the territorial boundaries of the district the United States maintains and operates the Clearfield Naval Supply Depot, Hill Air Force Base and Hill Air Force Base West Sector. Approximately 15,000 persons are employed in these plants and during the war there were many more employees. All of the territorial area of the district is within the Weber Basin Water Conservancy District. The population of the district has about doubled from 1940 to 1950, when it had about 22,000 inhabitants and with the coming of adequate water supply it is anticipated that it will more than double that number by 1973.

Near the beginning of World War II the United States constructed several out fall sewer lines to provide sanitary facilities for the military plants and for nearby housing facilities. After the war in order to relieve the United States of operating such facilities the communities of Layton, Syracuse, Sunset, Clearfield, Roy, Clinton and Latona formed an unincorporated association known as the North Davis Metropolitan Sewer which entered into a lease and purchase agreement with the United States to acquire such facilities. Soon thereafter it became apparent that more sewer out fall lines and a sewage treatment plant were vitally needed. To provide these additional facilities and to provide legal machinery for the authorization, issuance and sale of bonds to raise the necessary money to construct the additional facilities, the Davis County Board of County Commissioners adopted a resolution with the concurrence of the Weber County Board of County Commissioners creating the North Davis County Sewer District and immediately thereafter the Board of Trustees organized the district. That district is now working in harmony with the State Water Pollution Control Board in order to supply the sanitary requirements for the sewage out fall from this area which at present flows untreated into the Great Salt Lake.

The district now operates and contemplates the construction and operation of additional sewage disposal and treatment facilities. To that end an election has been held and the electorate of the district has authorized the district to issue $2,100,000 of general obligation bonds and $800,000 of revenue bonds. The city of Layton, as well as other cities within the district, now owns and operates a sewer system but lacks adequate facilities for the disposition and treatment of the sewage which is collected in the sewer systems and the city desires that the district shall construct and operate adequate facilities for the disposal and treatment of the sewage which is collected in the district.

On November 29, 1955, the city enacted an ordinance authorizing and directing the execution of such contract, which contract was duly entered into on that day. Under the contract the district agrees to proceed promptly with the construction of additional sewage disposal and treatment facilities and to use its existing facilities with the additional facilities, as soon as constructed, in the disposal and treatment of the sewage from the city. The city agrees to connect its sanitary sewage system to the disposal facilities of the district for disposal and treatment therein and to pay the district for such services for each calendar month from January, 1956, during the life of the contract in accordance with a schedule of rates for the various sewer connections on the city's sewer system at the end of such month. The city further agrees to supply the district on the 15th of each month with an itemized statement of the facts necessary to determine the amount due from the city to the district for the preceding month and to pay such amount on that day.

The contract also contains the following provisions 'The district shall never have the right to demand payment of any obligation devolving on the city under this agreement from funds raised or to be raised by taxation, and all obligations so devolving on the city shall never be construed to be a debt of the city of such king as to require the levy and collection of a tax to discharge such obligation, it being expressly understood by the parties hereto that the district shall not have the right to require the city to make any payment due hereunder from any source other than moneys received by the city from the operation of its sanitary sewer system, and that all payments to be so made hereunder shall constitute operating expenses of such sanitary sewer system; provided, however, that nothing in this paragraph contained shall be so construed as to preclude the making of such payments by the city from any money or revenues which it may have on hand available for such purpose. The city agrees to impose such rates and charges for services supplied by its sanitary sewer system as will make possible the prompt payment of all expenses incurred in operating and maintaining such system, including the payments due hereunder, and the prompt payment of all obligations of the city payable from the revenues of such system.

'The city agrees that it will during the term of this agreement do all things necessary to the proper maintenance and operation of its sanitary sewer system, and that it will keep in force at all times during the term of this agreement an ordinance requiring all buildings and structures in said city used for residence, commercial or industrial purposes, and which are within reasonable distance of an established sewer collection main, to be connected to such main.

'4. This agreement shall take effect from and after its execution and shall continue in force for a period of fity (50) years from such date or until all of the bonds of the district hereinabove described, and any bonds issued to refund such bonds, shall have been fully paid and retired, whichever termination date shall be later.

'5. The district is hereby granted the right to bring such suits and to institute such litigation against the city and its officials as may be necessary to require the full performance by the city of all the agreements herein contained and all duties devolving on it under the provisions hereof, which suits may, but without limitation, include suits for mandamus or injunction.

'6. In case by reason of force majeure either party hereto shall be rendered unable, wholly or in part, to carry out its obligations under this agreement, other than the obligation of the city to make the payments required under the terms hereof, then each such party shall give notice and full particulars of such force majeure in writing to the other party within a reasonable time after occurrence of the event or cause relied on, and the obligations of the party giving such notice, so far as they are affected by such force majeure, shall be suspended during the continuance of the inability then claimed, but for no longer period, and such party shall endeavor to remove and overcome such inability with all reasonable dispatch. The term 'force majeure' as employed herein shall mean acts of God, strikes, lockouts, or other industrial disturbances, acts of the public enemy, orders of any kind of the government of the United States or the State of Utah, insurrections, riots, epidemics, landslides, lightning, earth-quakes, fires,...