City of Eugene v. Willamette Valley Co.

Decision Date27 October 1908
Citation52 Or. 490,97 P. 817
PartiesCITY OF EUGENE v. WILLAMETTE VALLEY CO.
CourtOregon Supreme Court

Appeal from Circuit Court, Lane County; L.T. Harris, Judge.

Suit by the city of Eugene against the Willamette Valley Company. From a decree for plaintiff, defendant appeals. Affirmed.

This is a suit by the city of Eugene, a municipal corporation against the Willamette Valley Company, a private corporation to enforce the specific performance of a contract to convey real property. The complaint states generally that the charter of the city of Eugene, filed in the office of the Secretary of State February 18, 1905 (Sp.Laws Or. 1905. p 243), empowers the common council to construct or purchase acquire, and operate a complete system of waterworks, with all necessary appliances, and such real property, within or without the city, as may be necessary or convenient therefor (chapter 10 § 94 [page 270]); that a proper initiative petition was duly filed, designed to amend sections 108 and 112 of the charter of Eugene (pages 274, 275) setting forth a copy of the bill, which proposition was duly submitted to the legal voters of that city at a special election held for that purpose April 18, 1908, and which measure was carried by a majority of all votes cast thereat, the result thereof being declared by proclamation of the mayor; that by section 108, as amended, the plaintiff was authorized to issue and sell municipal water bonds in a sum not exceeding $300,000, which securities were to bear interest at a rate not greater than 5 per cent. and not to be sold for less than their face value; that none of the bonds or the money derived from the sale thereof were to be used in buying an existing waterworks, or any part thereof, unless such purchase was first approved by a majority vote of the qualified electors of the city, voting thereon at a general or special election at which the proposition might be submitted; that at all times herein stated the defendant was and is the owner of certain real and personal property, particularly describing the same, which, on March 28, 1908, it proposed in writing to sell to the plaintiff for the sum of $140,000, and also for a stated compensation stipulated to furnish annually the necessary steam or electric power successfully to operate the water plant; that such offer was duly referred to the legal voters of the city at an election held for that purpose April 18, 1908, and the proposition was carried by a majority of all the votes cast thereat; that on May 5, 1908, an ordinance was duly passed authorizing and directing the issuance and sale of water bonds of the city of the face value of $300,000, for the purpose of purchasing a complete waterworks system for the city, which ordinance provides that such securities should not be sold for less than their face value; that they should bear interest at a rate not exceeding 5 per cent. and payable semiannually, and that the principal should be payable January 1, 1948; that the city recorder duly advertised that sealed bids would be received by the council until July 7, 1908, at the hour of 7:30 p.m. on that day, for the purchase of such bonds, and within the time so specified the defendant filed with the city recorder its bid to purchase from the plaintiff such bonds of the face value of $140,000; that on July 21, 1908, the plaintiff accepted such bid, and thereupon awarded to the defendant bonds of the value and kind specified; that pursuant to such notice a written contract was subscribed by the parties hereto for the reciprocal sale and purchase of the real and personal property specified, for the consideration of $140,000, which sum was payable in such bonds by delivery thereof within 60 days, upon the receipt of which the defendant was to execute legal conveyances and transfers of such property to the plaintiff and deliver to it the possession thereof; that the form of the bonds agreed upon is as set forth in the complaint; that on August 20, 1908, the defendant notified the plaintiff that the bonds would not be accepted, nor a conveyance or transfer of the property be made to plaintiff, because of the invalidity of the securities, stating wherein they were claimed to be of no legal force; that the plaintiff has fully kept and performed its part of the contract, but the defendant refuses to comply with any of the terms thereof; and that the plaintiff is ready and willing to fulfill all the terms of its agreement with the defendant. A demurrer to the complaint, on the ground that it did not state facts sufficient to constitute a cause of suit, was overruled, and, the defendant declining further to plead or answer, the relief prayed for was granted; and it appeals.

A.C. Woodcock, for appellant.

J.M. Williams and L.E. Bean, for respondent.

MOORE J. (after stating the facts as above).

It is argued by defendant's counsel that in attempting to amend sections 108 and 112 of the city charter (Sp.Laws 1905, pp. 274, 275), two distinct propositions were united, so that voters were deprived of an opportunity to express an opinion as to the merits of the separate measures and were induced to vote for both, which they might not have done if the questions had been submitted singly. The organic law contains the following clause: "The legislative assembly shall not enact, amend, or repeal any charter or act of incorporation for any municipality, city, or town. The legal voters of every city and town are hereby granted power to enact and amend their municipal charter, subject to the Constitution and criminal laws of the state of Oregon." Const.Or. art. 11, § 2, as amended June 4, 1906. It will thus be seen that the legislative assembly has been deprived of the power specified, which is reserved to, and may be exercised by the legal voters of a city or town. As the Legislature could, heretofore, have changed a municipal charter or altered any part of it, except that vested rights could not be impaired or destroyed, it would seem necessarily to follow that, under the amended clause of the Organic Act quoted, the qualified voters of every town and city possessed the same measure of power. If the doctrine suggested is not applicable, the enactment or amendment of a municipal charter, by voting for separate sections, might destroy the efficacy of the proposed plan of city government, or very much delay its adoption. But, however this may be, we shall treat the case as if the legal principle asserted was controlling, and that two or more separate propositions cannot be united, when they are referred to the electors of a municipality for approval or rejection. 21 Am. & Eng.Ency.Law (2d Ed.) 47. Assuming that any bonds issued pursuant to municipal legislation, secured in the manner thus asserted, are invalid, it would be inequitable to compel the defendant to convey and transfer to the plaintiff the property specified, when any doubt exists in respect to the certainty of the payment of the consideration stipulated to be given therefor.

The qualified electors of Eugene being thus authorized to amend the act of incorporation of that city, are the alterations therein obnoxious to the legal principle thus maintained by the defendant's counsel? In order thoroughly to investigate this subject, the measure committed to the voters, and asserted to have been passed by them, is here set forth in extenso, to wit:

"Proposed by Initiative Petition.

"For amending sections 108 and 112 of the city charter of the city of Eugene, by striking out authority to issue $100,000 of electric light bonds, and $75,000 of gaslight bonds, and increasing the issuable water bonds from $100,000 to $300,000; fixing the character and manner of issue of said bonds, and the disposition of water revenues; authorizing condemnation proceedings in building water plant; and providing for water board and fixing its duties.

"Vote Yes or No.
"300 Yes.
"301 No.
"(On Official Ballot, No. 300 and 301).

"A Bill

"To propose by initiative petition a law to amend Sections 108 and 112 of the Charter of the City of Eugene being Chapter 252 of the Laws of the State of Oregon for the year 1905, entitled, 'An act to re-incorporate the city of Eugene, and to repeal all acts and parts of acts in conflict herewith,' filed in the office of the Secretary of State, February 18th, 1905.

"Be it enacted by the People of the State of Oregon:

"Be it enacted by the People of the City of Eugene:

"Section 1. That sections 108 and 112 of the charter of the city of Eugene, being chapter 252 of the Laws of the State of Oregon for the year 1905, entitled, 'An act to re-incorporate the city of Eugene and to repeal all acts and parts of acts in conflict herewith,' filed in the office of the Secretary of State, February 18th, 1905, be and the same are hereby amended so as to read as follows:

"Sec 108. For the purpose of securing a complete and adequate water plant for the city of Eugene, and its inhabitants, including real estate, rights of way and easements in lands, and water rights whether within or without the city limits, necessary for the construction and operation of said system, and for collecting, conducting and distributing said water, and all dams, reservoirs, pipes, conduits, structures and appliances of every kind, reasonable and necessary to said system, the said city is authorized to issue and sell its negotiable bonds to the amount necessary to such purpose, but not exceeding in the aggregate sum of three hundred thousand dollars and the said common council is hereby authorized to maintain such suits, actions, and proceedings as may be...

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10 cases
  • Ronnow v. City of Las Vegas
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