Borin v. City of Erick
| Decision Date | 14 April 1942 |
| Docket Number | 30065. |
| Parties | BORIN et al. v. CITY OF ERICK et al. |
| Court | Oklahoma Supreme Court |
Rehearing Denied May 12, 1942.
As Corrected June 1, 1942.
Syllabus by the Court.
Where a city council inaugurates a definite plan, as reflected by the minutes of their meetings and other official acts, to construct a municipal power plant at a specified cost to be paid in part with funds in the nature of a grant from the federal government, and the balance to be supplied by the sale of bonds to be voted pursuant to section 27, article 10 of the Constitution, an ordinance calling the bond election and the ballot submitted pursuant thereto which on their face submit only the proposition whether bonds in a specified sum naming the amount representing the balance as aforesaid shall be voted for the construction of a power plant, without disclosing the federal grant and the actual contemplated cost of the plant, do not truly specify the purpose for which the money is to be used within the meaning of section 16, article 10, of the Constitution, and the sale and delivery of the bonds may be enjoined in a proper action.
Appeal from District Court, Beckham County; T. R. Wise, Judge.
Action by C. S. Borin against the City of Erick and others to restrain the sale and delivery of certain bonds issued pursuant to an allegedly illegal election wherein the Southwestern Light & Power Company intervened. From an adverse judgment, the plaintiff and intervenor appeal.
Reversed and remanded with directions.
H. C. Ivester, of Sayre, and Donald Royse, of Elk City, for plaintiff in error C. S. Borin.
Melton, McElroy & Vaughn and S. I. McElhoes, all of Chickasha, for plaintiff in error Southwestern Light & Power Co.
Euen D. Ellis, City Atty., of Erick, and Walter G. Ellis, of Sayre, for defendants in error.
This is an action by a resident taxpayer against the city of Erick, its executive and administrative officers and certain municipal bond dealers to restrain the sale and delivery of certain bonds issued pursuant to an alleged illegal election. The Southwestern Light & Power Company, a corporation, as intervener, seeks the same relief. Judgment was for defendants, and plaintiff and the intervener appeal.
The bonds have been approved by the Attorney General as ex-officio bond commissioner under authority of 62 O.S.1941, §§ 11, 13, and are now about to be delivered to the defendant bond dealers pursuant to sale contracts.
It is contended that the election was illegal and the bonds consequently voidable for the reason that the ordinance proclaiming the election and the proposition submitted on the ballot did not specify the true purpose for which the money was to be used, all of which is allegedly in violation of section 16, article 10, of the Constitution, and 11 O.S.1941, § 61.
Under the agreed statement of facts and the exhibits therein contained it appears that the defendant city through its proper officers enacted an ordinance in due form calling an election pursuant to section 27, article 10, of the Constitution, and related statutes, for the purpose of voting bonds in the sum of $60,000 in excess of the city's normal debt as limited by section 26, article 10, of the Constitution, in order to raise funds for the construction and equipment of a municipal power plant. The question was duly submitted to the voters. The bonds carried, and were issued. Contracts for their sale were entered into, and the bonds approved by the Attorney General as aforesaid. Before their delivery to the purchasers this action was commenced.
The agreed statement of facts also contains numerous minutes of former meetings of the city council whereby it is definitely shown that the proposed bond issue was for the express purpose of raising $60,000 to supplement a grant of approximately $50,000 promised by the Public Works Administration of the Federal Government to be used for the construction of a power plant to cost in the neighborhood of $110,000. Though this purpose was not mentioned either in the ordinance calling the election or in the ballot submitted to the voters, the publicity for the election as conducted by the city officials reflected the foregoing minutes disclosing the actual purpose of constructing a $110,000 plant with the Federal grant and the funds to be derived from the bonds.
The record shows that subsequent to the election the Federal Government withdrew its grant, and the defendant councilmen now propose to deliver the bonds to the purchasers and use the proceeds for the construction of a $60,000 plant instead of one to cost $110,000 as originally contemplated.
Plaintiff says that the ordinance calling an election to enact a bonded indebtedness of $60,000 to raise funds for the erection of a power plant did not truly reflect the avowed purpose for which the money was to be used, that is, to supplement a Federal grant of $50,000 to be used in the construction of a plant to cost $110,000; that the purpose for which the money was to be used had never been to construct a $60,000 plant, notwithstanding the ordinance and the ballot may have so stated. Plaintiff insists that by reason of these facts the ordinance or law calling the election, and the measure voted by the people, were in violation of section 16, article 10, supra, rendering the bonds either void or voidable. Said section 16 reads as follows: "All laws authorizing the borrowing of money by and on behalf of the State, county, or other political subdivision of the State, shall specify the purpose for which the money is to be used, and the money so borrowed shall be used for no other purpose."
Defendants say that since the ordinance and the ballot revealed only the purpose of raising $60,000 to construct and equip a power plant, the proceeds of the bonds may now be used for that purpose, and that the plaintiff may not go beyond the ordinance and ballot to prove a contrary purpose. They assert that plaintiff is now trying to defeat the election and annul the bonds merely by showing that certain campaign promises of members of the council and other parties reflected a purpose other than that mentioned in the ordinance and the ballot.
But plaintiff is not relying wholly on the campaign promises. He is relying principally on the public records of the council. They show plainly that the bond election was the culmination of an effort to construct a power plant partially with funds from the Federal Government. The purpose for which the money was to be used, as clearly set out in those records, was not to construct a $60,000 plant, but one to cost $110,000.
In our opinion it cannot reasonably be said that the laws of the city, that is, the ordinance aforesaid and the proposition as voted by the people, authorizing the borrowing of the $60,000, actually specified the purpose for which the money was to be used, as contemplated by section 16, article 10, above.
The purpose must be declared by the lawmaking body and then properly submitted to a vote of the people. If the ordinance and the ballot fail to declare the real purpose there would be a clear violation of said section 16. O'Neil Engineering Co. v. Incorporated Town of Ryan, 32 Okl. 738, 124 P. 19. The full purpose of the council, as reflected by the minutes of its meetings, was to construct a plant at a cost of $110,000, and raise $60,000 thereof by a bond issue and to pay the balance with funds to be received from the Federal Government. This purpose was not abandoned until after the election when the Government withdrew its grant.
Can it be said within reason that the ordinance and the ballot stating that the $60,000 was for the purpose of constructing the plant, actually specified the real...
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