City of Raytown v. Kemp

• Decision Date: 11 September 1961
• Docket Number: No. 48799,48799
• Citation: City of Raytown v. Kemp, 349 S.W.2d 363 (Mo. 1961)
• Parties: CITY OF RAYTOWN, Missouri, Respondent, v. Jess F. KEMP and Elma Kemp, Appellants. In the Matter of the Petition of the City of Raytown, Missouri, for a Pro Forma Decree Authorizing the Issuance and Adjudicating the Validity of $935,000 Principal Amount of Sewerage System Bonds, Series 1961, of Said City.
• Court: Missouri Supreme Court

Page 363

349 S.W.2d 363

CITY OF RAYTOWN, Missouri, Respondent, v. Jess F. KEMP and Elma Kemp, Appellants In the Matter of the Petition of the City of Raytown Missouri, for a Pro Forma Decree Authorizing the Issuance and Adjudicating the Validity of $935,000 Principal Amount of Sewerage System Bonds, Series 1961, of Said City.

No. 48799.

Supreme Court of Missouri, En Banc.

Sept. 11, 1961 As Modified on Court's Own Motion Sept. 25, 1961.

John C. Mills, III, Kansas City, for appellants.

J. H. Greene, Jr., Raytown, Robert B. Fizzell, Robert B. Fizzell, Jr., Norman E. Gaar, Stinson, Mag, Thomson, McEvers & Fizzell, Kansas City, for respondent.

STORCKMAN, Judge.

This is a proceeding by the City of Raytown, Missouri, a municipal corporation, filed in the Circuit Court of Jackson County pursuant to the provisions of Secs. 108.310 to 108.350, RSMo 1959, V.A.M.S. seeking to authorize the issuance and to adjudicate the validity of Sewerage System Bonds in the principal amount of $935,000. Jess F. Kemp and Elma Kemp filed their intervening petition whereby they sought to have the bonds declared invalid, illegal and void on constitutional and other grounds. The trial court found the issues in favor of the petitioner, City of Raytown, and against the intervenors, and adjudged and decreed that the City was authorized to issue the bonds and that the bonds when issued would constitute general obligations of the City payable from ad valorem taxes. The intervenors' motion for new trial was overruled and they appealed.

Since the questions presented involve the construction of Art. VI, Sec. 26(d) of the Constitution of Missouri 1945, V.A.M.S., and the due process provisions of the Fourteenth Amendment to the Constitution of the United States and Art. I, Sec. 10 of the Constitution of Missouri 1945, this court has appellate jurisdiction. Art. V, Sec. 3, Constitution of Missouri 1945; State ex rel. Askew v. Kopp, Mo., 330 S.W.2d 882, 886; Moots v. City of Trenton, 358 Mo. 273, 214 S.W.2d 31, 32.

There is no dispute as to the facts. The City of Raytown is a municipal corporation of the fourth class having a population according to the 1960 census of 17,083. In 1957 the voters of Raytown authorized and the City has since issued, sold and delivered three series of bonds for the purpose of constructing, extending and improving the City's sanitary sewerage system. These improvements were of three types: (1) The construction of main trunk line sewers, (2) the construction of lateral sewers, and (3) the construction of sewerage disposal works. The area of the City having doubled by reason of annexations, the voters in 1960 authorized the issuance by the City of three additional series of sanitary sewerage system bonds. Proposition No. 1 was to issue general obligation bonds to the amount of $600,000 for the purpose of acquiring right of ways, constructing, extending and improving the sanitary sewerage system of the City. Proposition No. 2 was to issue general obligation bonds of the City to the amount of $935,000 for the purpose of acquiring rights of ways, constructing, extending and improving the sanitary sewerage system of the City by constructing lateral sewers. Proposition No. 3 was to issue sewerage system revenue bonds to the amount of $665,000 for the purpose of extending and improving the sanitary sewerage system of the City.

The bonds, the validity of which are here in question, are those described by Proposition No. 2 which as stated in Ordinance No. 644 of the City of Raytown is as follows:

'Proposition to issue the general obligation bonds of the City of Raytown, Missouri, to the amount of $935,000 for the purpose of acquiring rights-of-way, constructing, extending and improving the sanitary sewerage system of said City by constructing lateral sewers, the governing body of said City to provide in due course that all of the cost of any such improvements shall be levied and assessed on property benefited by such improvements and that the City shall collect any special assessments so levied and use the same to reimburse the City for the amount paid or to be paid by it on the general obligation bonds of the City issued for such improvements.

'The authorization of said bonds will authorize the levy and collection of an annual tax in addition to the other taxes provided for by law on all tangible taxable property in said City sufficient to pay the interest and principal of said bonds as they fall due and to retire the same within twenty years from the date thereof.'

The first paragraph of the foregoing quotation appeared on the ballot at the special bond election in describing the particular proposition submitted to the electorate. The City bases its right to issue the bonds in question on Sec. 95.125, RSMo 1959, V.A.M.S.

The intervenors' first contention is that Sec. 92.125 is unconstitutional and void in that it deprives landowners in the City of Raytown of their property without due process of law in violation of Art. I, Sec. 10, of the Constitution of Missouri, and the Fourteenth Amendment to the Constitution of the United States. They specifically assert that the statute is vague, indefinite and incomplete in that it sets no standards, fixes no procedure for the City to follow 'in levying special assessments to pay the bonds' and fails to provide any notice to property owners proposed to be assessed or for any hearing on a proposed assessment.

Section 95.125, insofar as here pertinent, provides: 'Any city, whether organized under the general laws of this state or by special charter or by constitutional charter, by a vote of two-thirds of the qualified electors thereof voting thereon, may become indebted, not exceeding in the aggregate an additional ten per cent of the value of the taxable tangible property therein as shown by the last completed assessment for state and county purposes, for the purpose of * * * acquiring right of ways, constructing, extending and improving sanitary or storm sewer systems; provided, that the governing body of such city may provide that any portion or all of the cost of any such improvement be levied and assessed by such governing body on property benefited by such improvement, and, when so provided, such city shall collect any special assessments so levied and shall use the same to reimburse the city for the amount paid or to be paid by it on the bonds of the city issued for such improvement.'

This statute is based upon Art. VI, Sec. 26 (d) of the Constitution of Missouri 1945. The language of the statute and the constitutional provision are almost identical. There is no difference in substance or legal effect.

The intervenors cite a number of cases dealing with the fundamentals of due process of law as related to the assessment of benefits for public improvements. Generally these authorities are exemplified by this statement from 14 McQuillin on Municipal Corporations, 3rd Ed., Sec. 38.106, p. 253: "It has always been the general rule in this country, in every system of assessment and taxation, to give the person to be assessed an opportunity to be heard at some state of the proceeding. That 'due process of law' requires this has been uniformly recognized." Among Missouri cases urged by the intervenors in support of their contention are Giers Improvement Corp. v. Investment Service, Inc., 361 Mo. 504, 235 S.W.2d 355; City of St. Louis v. Senter Commission Co., 336 Mo. 1209, 84 S.W.2d 133; State ex rel. Webster Groves Sanitary Sewer Dist. v. Smith, 342 Mo. 365, 115 S.W.2d 816; and City of St. Louis v. Bell Place Realty Co., 259 Mo. 126, 168 S.W. 721. The City does not dispute that the levy of special assessments to pay the cost of local improvements must comply with the requirements of due process of law but urges that the validity of the procedure for determining benefits and levying and collecting assessments is not presently at issue, that the City is authorized to provide by ordinance proper procedures for assessing benefits and that it cannot be anticipated that the City will not provide a procedure in keeping with the requirements of due process of law. So far as the record shows, benefit districts have not been established and no assessments have been made. The only question before us at the present time is whether Sec. 95.125 is invalid in that it does not contain detailed procedures for assessing benefits in a manner consistent with due process of law.

The right to levy taxes is vested primarily in the state. The power to tax for local or municipal purposes may be, and generally is, delegated to and exercised by the legislative body of the municipality. The authority to tax must be expressly granted or necessarily incident to the powers conferred upon the municipality and in case of doubt the power to tax is denied. Kansas City Grading Co. v. Holden, 107 Mo. 305, 17 S.W. 798, 799; Siemens v. Shreeve, 317 Mo. 736, 296 S.W. 415, 416; Moots v. City of Trenton, 358 Mo. 273, 214 S.W.2d 31, 33; Giers Improvement Corp. v. Investment Service, Inc., 361 Mo. 504, 235 S.W.2d 355, 358; Holland Furnace Co. v. City of Chaffee, Mo.App., 279 S.W.2d 63, 68. The Giers case involved an attack upon the validity of special tax bills issued by a city for sewer purposes. The court upheld the assessment and, inter alia, made this ruling, 235 S.W.2d 358: 'But there are matters governmental in character, including taxation, over which a city may exercise authority delegated to it. In the case of city organized under general law the delegation is by statute.'

The authority of a city to incur the indebtedness provided for by Sec. 95.125 carries with it the mandatory duty to collect a tax sufficient to pay the principal and interest of the indebtedness as they become due. Art. VI, Sec. 26(f), Constitution of Missouri; Sec. 95.135, RSMo 1959, V.A.M.S.; State ex rel. City of Jefferson v. Hackmann, 287 Mo. 156, 229 S.W. 1082, 1085[5, 6].

In addition to granting a city the right to incur...