City of Muskegon Heights v. Danigelis, 167.

• Decision Date: 24 February 1931
• Docket Number: No. 167.,167.
• Citation: 253 Mich. 260,235 N.W. 83
• Parties: CITY OF MUSKEGON HEIGHTS v. DANIGELIS et al.
• Court: Michigan Supreme Court

253 Mich. 260

235 N.W. 83

CITY OF MUSKEGON HEIGHTS

v.DANIGELIS et al.

No. 167.

Supreme Court of Michigan.

Feb. 24, 1931.

Appeal from Circuit Court, Muskegon County, in chancery; John Vanderwerp, Judge.

Proceeding under the Declaratory Judgment Act by the City of Muskegon Heights against George Danigelis and another. Decree for plaintiff, and defendants appeal.

Affirmed.

Argued before the Entire Bench.

Lou L. Landman, of Muskegon, for appellants.

William J. Balgooyen, of Muskegon Heights, for appellee.

Ganson Taggart, of Grand Rapids, amicus curiae.

WIEST, J.

This is a proceeding under Act No. 36, Public Acts 1929 (Comp. Laws 1929, § 13903 et seq.), authorizing courts of record to make binding declarations of rights.

A controversy exists relative to the validity of bonds authorized by the city of Muskegon Heights to raise money for the relief of destitute inhabitants. The city petitioned the circuit court to make a declaration of rights in the premises and summoned two principal taxpayers to reply and present issuable questions. Issues of fact were presented, evidence taken, points of law raised, and the court found the bonds valid. We review by appeal.

Widespread and acute distress exists among unemployed inhabitants of the city. This was brought to the attention of the city council by many taxpayers. The budget fund for relief of the poor was exhausted. In November, 1930, the city council declared the existence of an emergency justifying the issuance of bonds to the amount of $25,000, and so legislated under authority assumed to be given by subdivision 2, § 95, chap. 8, City Charter.

The city operates under a home-rule charter. The bidder, acting upon the advice of counsel, declined to take the bonds because of questioned validity thereof. The city charter, chapter 8, § 95, provides:

‘The city council is hereby authorized to borrow money, and issue bonds for the payment therefor for the following purposes: * * * (2) For emergency purposes in accordance with the provisions of the Home Rule Act of the State of Michigan.’

The Home Rule Act, Comp. Laws 1929, § 2231, provides:

‘Each city may in its charter provide:

‘(1) For the borrowing of money on the credit of the city and issuing bonds therefor, for any purpose within the scope of its powers: Provided, That the net bonded indebtedness incurred for all public purposes shall not at any time exceed ten (10) per centum of the assessed value of all the real and personal property in the city: Provided further, That in case of fire, flood or other calamity, the legislative body may borrow for the relief of the inhabitants of the city and for the preservation of municipal property, a sum not to exceed one-fourth of one (1/4 of 1) per centum of the assessed value of all the real and personal property in the city, due in not more than three (3) years, even if such loan would cause the indebtedness of the city to exceed the limit fixed in its charter.’

This statute places a limitation upon bonded indebtedness, permits extension in case of fire, flood, or other calamity, but then only for the relief of the inhabitants or preservation of municipal property. The Home Rule Act, Comp. Laws 1929, § 2241, subdivision (e), clothed the municipal legislative body with power to authorize an issue of emergency bonds as defined by the act, without any action by the electors. If the distress of the unemployed inhabitants of the city constituted a condition or situation coming within the term ‘calamity,’ as employed in the statute, then the bonds, as authorized, are valid. Can it be said that the term ‘calamity,’ as employed in the statute, relates to a condition not occasioned by a disaster but under which deep distress is occasioned many inhabitants? The statute provides for relief in case of fire. Such relief, of course, does not extend to compensation for loss of property, but only to alleviation or prevention of suffering occasioned by such a disaster. In case of flood the municipality restores no private loss, but may extend relief to distressed inhabitants. On the other hand, the term ‘calamity’ is found in the statute in the company of other terms, clearly indicating physical causes occasioning...