Britt v. City of Wilmington
| Decision Date | 19 November 1952 |
| Docket Number | No. 593,593 |
| Court | North Carolina Supreme Court |
| Parties | BRITT, v. CITY OF WILMINGTON et al. |
McClelland & Burney, Wilmington, for plaintiff appellant.
Wm. B. Campbell, Wilmington, for defendant appellees.
The record before us generates some doubt as to whether this action is a bona fide adversary proceeding. while plaintiff alleges that the parking facilities the defendant proposes to furnish motorists are not 'for a proper public purpose of for the general welfare and benefit of the City and its inhabitants, but are for the private benefit of the users of such facilities', he stipulates in part that traffic congestion on the streets of Wilmington has reached the point that it creates a public nuisance and 'this traffic congestion is not capable of being adequately abated except by provision for sufficient off-street parking facilities; adequate off-street parking facilities have not been provided and parking spaces now existing must be forthwith supplemented by off-street parking facilities provided by public undertaking; and the provision of such off-street parking facilities is a public necessity.'
Thus it would seem that the parties to the action are seeking the same end--the approval by this Court of the proposed bond issue. If such is the case--and we do not so assert--we could not permit a single resident of defendant city to stipulate away the rights of all the taxpayers of the municipality. Instead, we shall decide the questions of law posed for decision upon the assumption they are presented in good faith upon the essential facts appearing of record, unhampered by stipulations of legal conclusions.
The authority of the defendant city to issue and market the proposed off-street parking facilities revenue bonds under the terms of the resolution adopted by its governing board rests upon the validity of certain stipulations and covenants contained in the bond resolution and of the enforcement ordinance adopted pursuant thereto. The plaintiff in his complaint attacks the right of the defendant city to (1) pledge the revenue derived from the off-street parking facilities to the payment of said bonds, (2) pledge revenue derived from the on-street meters to the payment of the proposed bonds, (3) consolidate into one project the on-street and off-street parking arrangements, and (4) maintain, and enforce by criminal prosecution, the ordinance adopted by the governing body of defendant regulating the operation of the off-street parking facilities.
We may concede, without deciding, that the proposed off-street parking undertaking is for a public purpose and is a proper municipal objective within the defendant's proprictary powers. If that be true, then, of course, the defendant has the power to pledge the revenues derived from the off-street parking facilities to the payment of the proposed revenue bonds. The very purpose of the Revenue Bond Act, General Statutes Ch. 160, Art. 33, is to permit municipalities to engage in non-governmental activities of a public nature by pledging the revenue derived from such undertakings to the payment of bonds issued in connection therewith. Thus it avoids pledging the credit of the municipality to the payment of a debt, for by such arrangements no debt is incurred within the meaning of the Constitution.
We deem it necessary therefore to discuss only two questions raised by plaintiff: The right of defendant (1) to pledge revenue derived from the on-street parking facilities to the payment of the proposed revenue bonds, and (2) to enforce by criminal prosecution the provisions of its ordinance regulating parking in the off-street parking lot.
A municipal corporation is dual in character and exercises two classes of powers--governmental and proprietary. It has a two-fold existence--one as a governmental agency, the other as a private corporation.
Any activity of the municipality which is discretionary, political, legislative, or public in nature and performed for the public good in behalf of the State rather than for itself comes within the class of governmental functions. When, however, the activity is commercial or chiefly for the private advantage of the compact community, it is private or proprietary. Millar v. Town of Wilson, 222 N.C. 340, 23 S.E.2d 42.
A municipal corporation cannot, even with express legislative sanction, engage in any private enterprise or assumeany function which is not in a legal sense public in nature, the word 'private' as used in opinions discussing the powers of a municipality being used to designate proprietary, as distinguished from governmental functions. Brown v. Board of Com'rs of Richmond County, 223 N.C. 744, 28 S.E.2d 104; Kennerly v. Town of Dallas, 215 N.C. 532, 2 S.E.2d 538; Williamson v. City of High Point, 213 N.C. 96, 195 S.E. 90; Nash v. Town of Tarboro, 227 N.C. 283, 42 S.E.2d 209; 5 McQuillin Mun. Corp., Rev.Ed. 1278; 37 A.J. 734.
When a municipality is acting 'in behalf of the State' in promoting or protecting the health, safety, security or general welfare of its citizens, it is an agency of the sovereign. When it engages in a public enterprise essentially for the benefit of the compact community, it is acting within its proprietary powers. In either event it must be for a public purpose or public use.
So then, generally speaking, the distinction is this: If the undertaking of the municipality is one in which only a governmental agency could engage, it is governmental in nature. It is proprietary and 'private' when any corporation, individual, or group of individuals could do the same thing. Since, in either event, the undertaking must be for a public purpose, any proprietary enterprise must, of necessity, at least incidentally promote or protect the general health, safety, security, or general welfare of the residents of the municipality. Nash v. Town of Tarboro, supra.
It follows that the mere fact the offstreet parking facilities defendant proposes to install tend to promote the safety, convenience, or general welfare of its citizens is not determinative.
The defendant is proceeding under the provisions of the statute known as the Revenue Bond Act of 1938, now General Statutes, Ch. 160, Art. 34. This Act was amended in 1951, Ch. 703, S.L.1951, so as to include 'parking facilities' as one of the 'undertakings' a city is authorized to finance by the issuance of revenue bonds, that is, bonds which are to be paid, both as to principal and interest, solely out of the revenue derived from the operation of the enterprise.
An examination of this Act makes it clearly appear that the parking facilities undertaking therein authorized is commercial in nature. The city is empowered to charge rates, fees, tolls, or charges for the facilities furnished--to 'impose such charges in connection with any such parking meters * * * as it may deem advisable * * *.' The off-street parking facilities are to be 'open to public use for a fee.' The property and parking facilities may, in the discretion of the governing board, be leased to individuals. The revenue derived from the imposition of the charges, rates, fees, and tolls is to be used to pay the principal and interest on the revenue bonds issued to finance the project.
The facts appearing of record fortify this conclusion. It is contemplated that the off-street parking project will produce...
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...for a public purpose. If so, it may be activated by the questioned appropriation of tax funds; otherwise not. Britt v. City of Wilmington, 236 N.C. 446, 73 S.E.2d 289. The initial responsibility for determining what is and what is not a public purpose rests with the legislature, and its fin......
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