Dade County v. General Waterworks Corp., 41511

• Decision Date: 20 July 1972
• Docket Number: No. 41511,41511
• Parties: DADE COUNTY, a political subdivision of the State of Florida, Appellant, v. GENERAL WATERWORKS CORPORATION, a Pennsylvania corporation, et al., Appellees.
• Court: Florida Supreme Court

Page 633

267 So.2d 633

DADE COUNTY, a political subdivision of the State of Florida, Appellant, v. GENERAL WATERWORKS CORPORATION, a Pennsylvania corporation, et al., Appellees.

No. 41511.

Supreme Court of Florida.

July 20, 1972.

Rehearing Denied Nov. 6, 1972.

Stuart L. Simon and John R. Farrell, Special Counsel, Miami, for appellant.

Darrey A. Davis, of McCarthy, Steel, Hector & Davis, Miami, for appellees.

Robert M. Ervin, and F. Perry Odom, of Ervin, Pennington, Varn & Jacobs, Tallahassee, for Florida Waterworks Assn., Inc., as amicus curiae.

John U. Lloyd, Fort Lauderdale, for Broward County, as amicus curiae.

William C. McLean, Jr., Tampa, for Hillsborough County, as amicus curiae.

McCAIN, Justice.

This direct appeal comes to us from a final judgment of the Circuit Court of Dade County dismissing the plaintiff-County's fourth amended complaint in condemnation. We have jurisdiction over the appeal as one construing a controlling provision of the Florida Constitution. Fla.Const., Article V, section 4(2), F.S.A.

On January 7, 1969, the Dade County Board of County Commissioners announced a policy of County acquisition and operation of all thirty-one privately owned water and sewer systems operating within Dade County. Such acquisition was declared to be the only feasible means of controlling existing pollution and of providing adequate water and sewer service to meet present and anticipated future needs within the County.

On March 12, 1969, as a means of implementing its policy with regard to the utilities, the Board adopted Resolution No. R--314--69, authorizing the acquisition of the capital stock of six listed companies, including appellee General Waterworks, either by negotiation or through eminent domain. ¹ Thereupon the County on July 17, 1969, filed a petition in the Circuit Court pursuant to Fla.Stat. § 73.021, F.S.A., seeking to condemn all the corporate stock of the named corporations.

After some preliminary procedural maneuvers, defendant-appellees moved to dismiss the petition, challenging the County's authority to acquire shares of corporate stock by eminent domain, and asserting that the actual share certificates had a situs in Pennsylvania, outside the jurisdiction of the Court. The merits of this motion were never resolved. During its pendency, the trial court allowed the County to amend its condemnation petition to permit acquisition of the physical assets of appellees directly. Resolution No. R--209--70, adopted by the Board on February 18, 1970, accompanied the second amended petition. This resolution incorporated relevant portions of the initial resolution, but provided for direct appropriation of the real and personal property of appellees. As a result, the challenge to acquisition of the capital stock was never decided.

Thereafter, the trial court determined to hold a pre-trial in limine hearing under Fla.Stat. § 73.061(1), F.S.A. ² to resolve certain issues of law raised by appellees' affirmative defenses. Two of these are of consequence on this appeal: (1) the contention that the County, in initiating eminent domain proceedings, acted in bad faith and without the requisite necessity; and (2) the assertion that the County did not intend to compensate appellees for socalled 'contributed property' admittedly owned by them. ³ We will consider these issues in order.

Appellees' argument as to point one emanates from the following statement appearing in both resolutions adopted by the Board of County Commissioners:

'Section 3. The County Manager and County Attorney are authorized and directed to acquire such property by negotiation and purchase or through eminent domain proceedings, Subject to approval and determination of the fiscal feasibility by the Board of the purchase price established either through negotiation or through eminent domain proceedings.' (Emphasis supplied)

It was contended at the trial level and again here that to condition the efficacy of the eminent domain judgment on a finding of 'fiscal feasibility' by the County discredited the County's affirmation of necessity and good faith. It appears that the trial judge read into Dade County's intent to reserve judgment on fiscal feasibility an intent to abandon the proceedings unless the method of valuation advocated by the County (i.e., capitalization of the regulated earnings of the utilities) was adopted at trial. In his final judgment the trial judge dismissed the County's fourth amended petition, stating, inter alia,

'There is a marked difference between a condemning authority undertaking to prescribe in advance the sole measure of compensation or method by which it shall be determined, and ultimately declining to complete the acquisition of property, for economic or other considerations, by exercising the procedural prerogative afforded by the provisions of Section 73.111, Florida Statutes.'

We disagree with the trial judge that the record establishes that the County was committed to a single method of valuation but this question will be dealt with infra. At this point we confine our discussion to the County's showing of necessity and good faith.

The 1968 Florida Constitution, Article X, Section 6(a) provides that no private property shall be taken 'except for a public purpose and will full compensation therefor . . .' Appellees do not contend that the taking of private utility companies with the intention of creating a unified public utility system does not constitute a public purpose. But we note in this regard that the Legislature, by general law, has authorized counties to condemn private water supply systems for the purpose of creating county water systems. Fla.Stat. § 153.03, F.S.A. This statute amounts to a Legislative declaration that creating of a county water system is a public purpose, and as such it would necessarily be accorded great weight by this Court were the issue raised. Wilton v. St. Johns County, 98 Fla. 26, 123 So. 527, 65 A.L.R. 488 (1929). In any event, the purpose must be considered a public one in the context of this appeal, since the issue is not properly before us.

Fla.Stat. § 73.021, F.S.A., sets forth the requirements for a petition in condemnation. Among these are the following:

'73.021 Petition; contents.--Those having the right to exercise the power of eminent domain may file a petition therefor in the circuit court of the county wherein the property lies, which petition shall set forth:

'(1) The authority under which and the use for which the property is to be acquired, And that the property is necessary for that use;

'(5) A statement that the petitioner has surveyed and located its line or area of construction, And intends in good faith to construct the project on or over the described property; . . .' (Emphasis supplied)

Thus, the statute requires that the property sought to be condemned be necessary for the declared public purpose of the condemning authority, and that there be a good faith intent on the part of the condemning authority to use the property, once acquired, for such purpose.

In our judgment the County's petition meets the statutory requirements of necessity and good faith. Given Dade County's declared public purpose of creating a public utility system for the entire County, it would be difficult, if not impossible, for General Waterworks to argue that its facilities were not 'necessary for that use'. Indeed, appellees make no such contention. Nor does the petition disclose any intent to use the acquired property for other than public utility purposes. As a practical matter, it seems unlikely that the specialized plant and equipment of a private waterworks company could be economically converted to a different public use, and we find no indication that the County intends to do so if it acquires the property through condemnation. Thus, we are satisfied that the County is operating within the framework of the express statutory provisions applicable pursuant to Fla.Stat. § 73.021, F.S.A.

But it is also argued that the County must show a broader necessity; in essence, a necessity that condemnation be resorted to at all. Appellees assert that such a showing cannot be made if the condemnor reserves the right to abandon the proceedings in the event the judgment is outside its financial wherewithal. We are not aware of any such requirement in either the statutes or the case law. The necessity argued for by the utilities appears to be an absolute necessity, such that the condemnor may not even seek condemnation if a possibility of later abandonment exists. But the Constitution only requires that the property be acquired for a public purpose, not for an absolute public necessity. In our view, a purpose may be public without being of such compelling necessity that condemnation is required whatever the price.

Statutory authority supports this position. Fla.Stat. § 73.111, F.S.A. expressly permits abandonment following entry of a judgment in condemnation, by allowing the condemnor to refrain from paying the amount of the judgment into the registry of the Court. As we said in Florida Central and Pacific R. Co. v. Bear, 43 Fla. 319, 31 So. 287 (1901), an early case interpreting a similar statutory provision:

'. . . There is nothing in our statute which deprives the petitioner of the right to abandon the proceedings at any time before it pays or secures the compensation of the landowner, and the statute expressly makes the failure to pay into court an abandonment of the proceedings, and declares then null and void.'

See also State ex rel. Curtis v. Himes, 119 Fla. 428, 161 So. 560 (1935). In light of the fact that all element domain proceedings are subject to the express conditions of Fla.Stat. § 73.111, F.S.A., we conclude that it was not improper for Dade County to recognize the possibility of later abandonment in its authorizing resolution. Such a result is especially appropriate where, as here, the proper method of valuation of the properties is...