City of Ft. Myers v. State

• Court: Florida Supreme Court
• Writing for the Court: TERRELL, J.
• Citation: City of Ft. Myers v. State, 95 Fla. 704, 117 So. 97 (Fla. 1928)
• Decision Date: 14 April 1928
• Parties: CITY OF FT. MYERS v. STATE et al. (LANGFORD et al., Interveners).

117 So. 97

95 Fla. 704

CITY OF FT. MYERS v. STATE et al. (LANGFORD et al., Interveners).

Florida Supreme Court

April 14, 1928

In Banc.

Proceeding by the City of Ft. Myers against the State to validate a bond issue, in which Carrie Langford and others, taxpayers intervened, and in which the Southern Paving Construction Company attempted to intervene. From a decree refusing to validate the bonds, the City of Ft. Myers appeals.

Affirmed.

Syllabus by the Court

SYLLABUS

Special assessments for local improvements cannot be collaterally attacked. Special assessments for local improvements cannot be collaterally attacked.

Special assessments to pay interest and principal of municipal bonds constituting direct obligation of municipality generally cannot be attacked in proceeding to validate bonds (Rev. Gen St. 1920, § 3296 et seq.). Special assessments, imposed for the purpose of paying the interest and principal on municipal bonds which are by law a direct obligation of the municipality, cannot generally be attacked in a proceeding to validate.

If validity or status of municipal bonds depends on validity of assessments such assessments could be attacked in proceeding to validate bonds (Rev. Gen. St. 1920, § 3296 et seq.). If the validity or status of the bonds is made to depend on the validity of the assessments rather than the power of the municipality to issue them, a different rule would control.

Anything affecting power or authority to issue bonds, regularity or legality of issue, including law and fact questions, as far as they could be lawfully prescribed, regulated, limited, or dispensed with by Legislature in first instance, or cured by validating act, may be put in repose by decree validating bond issue (Rev. Gen. St. 1920, § 3296 et seq.). In a bond validation proceeding prosecuted under section 3296, Revised General Statutes of Florida, any matter or thing affecting the power or authority of a municipality to issue bonds or the regularity or legality of their issue, including questions of both law and fact, in so far as those matters or things could be lawfully prescribed, regulated, limited, or dispensed with by the Legislature in the first instance, or subsequently cured by a validating act, may be put in repose by a decree rendered pursuant to said section 3296 et seq., Revised General Statutes of Florida 1920.

If resolution or proceedings on which municipal bonds are based conflicts with organic law, rule of repose, based on decree validating them, does not apply (Rev. Gen. St. 1920, § 3296 et seq.). If the resolution or other essential proceedings on which the bonds are based is a nullity because of conflict with organic law, the rule as to repose would not apply.

Statutory requirements in resolution for public improvements and to issue bonds therefor are necessary jurisdictional prerequisites to bonds' validity; sufficiency of resolutions to make public improvements and to issue bonds therefor may be tested in proceeding to validate bonds (Rev Gen. St. 1920, § 3296 et seq.). Statutory requirements in a resolution determining to make public improvements and to issue bonds therefor, not only go to the legality and regularity of the bonds, but to the power of the municipality to issue them, and are therefore necessary jurisdictional prerequisites to their validity. The sufficiency of such resolutions may be tested in a proceeding to validate.

Before adopting resolution authorizing public improvements and bonds therefor, city commission must determine benefits will accrue to property involved, amount thereof, manner of prorating and that special assessments will be made proportionate to benefits (Acts 1927, c. 12719, § 50, subsecs. (A), (B). Under chapter 12719, Acts of 1927, Laws of Florida, it is mandatory that, before the resolution authorizing public improvements as provided in subsection B can be legally adopted, the city commission must have determined that benefits will accrue to the property improved, the amount thereof, how such benefits will be prorated, and that special assessments will be made in proportion to said benefits as directed by subsection A.

Appeal from Circuit Court, Lee County; George W. Whitehurst, judge.

COUNSEL

Campbell & Campbell and W. A. Sheppard, Jr., all of Ft. Myers, P. H. Odom, J. Turner Butler, and John W. Dodge, all of Jacksonville, and Clements, Clements & Craven, of Ft. Myers, for appellant.

Henderson, Franklin & Christie, of Ft. Myers, for appellees.

OPINION

TERRELL J.

The appellant filed its petition August 31, 1927, in the circuit court of Lee county, as provided by section 3296 at seq., Revised General Statutes of Florida 1920, seeking to validate street improvement bonds in the sum of $1,250,000, issued pursuant to chapter 12719, Acts of 1927, Laws of Florida. Contemporary with the filing of the petition to validate, order was made on the state's attorney and the taxpayers affected requiring them to appear and show cause why the bonds should not be validated.

On the return day named in the petition, the state's attorney filed his pro forma answer announcing that no defense to the validation petition would be offered by the state of Florida. R. A. Henderson, Jr., a citizen and taxpayer, intervened, and filed his demurrer to the petition to validate, which was overruled. Katie Lloyd Guynne, Lucious C. Curtright, Carrie W. Langford, J. S. Wallis, Charles C. Pursley, David W. Ireland, and others, as citizens and taxpayers, filed their several answers resisting appellant's petition to validate; a demurrer being incorporated in each of said answers. Motions to strike certain portions of said answers were granted in part and overruled in part.

October 10, 1927, Southern Paving Construction Company, the successful bidder for, and having entered into, contract with appellant to make the street improvement that the bonds sought to be validated were issued to pay for, filed its petition for leave to intervene and be made a party to the proceedings to validate. That petition was denied.

On motion of defendants below (appellees here), the chancellor required the petitioner to file with, and make a part of, the proceedings to validate a copy of the plans and specifications of the proposed street improvements. On November 4, 1927, after full hearing on the pleadings and testimony duly taken, the chancellor entered his final decree denying the prayer of appellant's petition to validate its bonds in the amount stated. The appellant, city of Ft. Myers, entered its appeal from said final decree.

It is first contended that the motion to strike each and every the answers to the petition to validate should have been sustained in toto, because they question the legality of the special assessments laid for the purpose of paying principal and interest on the bonds sought to be validated, which cannot be done in a proceeding of this kind.

The law seems well settled that a special assessment for local improvements cannot be collaterally attacked. Loeb v. Columbia Township Trustees, 179 U.S. 472, 21 S.Ct. 174, 45 L.Ed. 280; City of Gladstone v. Throop (C. C. A.) 71 F. 341; Burlington Savings Bank v. City of Clinton, Ia. (C. C.) 106 F. 269; Board of Com'rs Franklin County, Ohio, v. Gardnier Savings Inst. (C. C. A.) 119 F. 36; Bass v. City of Casper, 28 Wyo. 387, 205 P. 1008, 208 P. 439; text 1016, 208 P. 439; Moore v. City of Yonkers, 149 C. C. A. 31, 235 F. 485, 9 A. L. R. 590; Gracen v. City of Savannah, 142 Ga. 141, 82 S.E. 453; Hamilton on Special Assessments, 726; 2 Smith on Modern Law of Municipal Corporations, § 1198, note 384; 34 Corpus Juris, 519. From these cases we deduce the rule that special assessments imposed for the purpose of paying the interest and principal on municipal bonds which are by law a direct obligation of the municipality cannot generally be attacked in a proceeding to validate. The reason for this rule is that the validity of such bonds depends on the power of the municipality to issue and pledge its resources and credit to protect them. If issued as directed under the terms of a valid statute, they may be validated, irrespective of the regularity of the assessments imposed to reimburse the city for liquidating them. A different rule would apply where the validity or status of the bond is made to depend on the validity of the assessment rather than the power of the municipality to issue them. Cases where the city merely agrees to collect and disburse the proceeds of improvement certificates authorized for specific purposes are not analogous to this, and have no place in this discussion.

The Legislature evidently had in mind the foregoing rule when it enacted the city charter of the city of Ft. Myers, because section M of section 50, authorizing the bonds here brought in question, in effect provides that, if any special assessment made to defray the whole or any part of the street improvement made thereunder shall be in whole or in part vacated, annulled or set aside, if the city commission shall be satisfied that any such assessment is so irregular or defective that the same cannot be enforced or collected, or if the commission shall have omitted to make the assessment when it might have done so, it may make a new assessment for the whole or any part of any improvement, and, if the second assessment shall be annulled, it may make other and additional assessments till a valid assessment is made. In this provision a direct, and not a collateral, attack on the assessments is contemplated, if their validity is questioned.

In our view, the serious questions presented here are those pertaining to the legality of the proceedings in the matter of issuing the bonds, and not those affecting the validity of the special assessments.

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