Jones v. City of Centralia, 22463.

• Decision Date: 29 May 1930
• Docket Number: 22463.
• Citation: 157 Wash. 194,289 P. 3
• Court: Washington Supreme Court
• Parties: JONES v. CITY OF CENTRALIA et al.

289 P. 3

157 Wash. 194

JONES v. CITY OF CENTRALIA et al.

No. 22463.

Supreme Court of Washington, En Banc.

May 29, 1930

Appeal from Superior Court, Lewis County; W. O. Chapman, Judge.

Action by H. M. Jones, on behalf of himself and all other persons similarly interested, against the City of Centralia and others. From a judgment of dismissal, plaintiff appeals.

Affirmed.

See also, 289 P. 14.

Cleland & Clifford, of Olympia, and C. D. Cunningham, of Centralia for appellant.

J. H Jahnke, of Centralia, Preston, Thorgrimson & Turner, of Seattle, and Yantis & Brodie, of Olympia, for respondents.

Roberts, Skeel & Holman, of Seattle, amicus curiae.

BEALS J.

Plaintiff instituted this action, on behalf of himself and all other persons similarly interested, against city of Centralia, a municipal corporation, the mayor and city commissioners of Centralia, and the other defendants as persons having some special interest in the subject matter of the litigation, for the purpose of obtaining a decree declaring the proceedings of the defendants city commissioners, taken with the view of establishing a hydro-electric plant, system, and development as a municipal property, invalid, and for the purpose of procuring a judgment to the effect that the city treasury be reimbursed for certain expenditures made therefrom on account of the purchase, construction, or installation of the plant above referred to.

A brief statement of the facts leading up to the bringing of this lawsuit is necessary to an understanding of the present situation. The city of Centralia has for a period of years owned and operated an electric current distributing system, by which it distributed within the city, for its own use, and for sale to private users, electric current which it purchased from private producers. The city commissioners, deeming it advisable that the city acquire a plant for the production of its own electric current, by Ordinance No. 646 called a special municipal election for February 25, 1929, at which the voters of the city should pass upon a proposed plan or system, which, if adopted, should provide for the acquisition of necessary property rights incident thereto and for the construction of a hydro-electric producing plant. The plan, as submitted to the voters, also provided for the issuance of $650,000 in special utility bonds, to cover a portion of the cost of the plant. At this time the city had in its treasury approximately $300,000, which it had derived from the earnings of its electric current distribution system, which fund it was proposed should also be used in paying for the new plant. The election was held as scheduled, a majority of the voters exceeding the number required by law voting in favor of the adoption of the proposition, and the city commissioners forthwith proceeded to obey the mandate of the electors of their city and entered into contracts and expended money with the purpose of constructing the plant and placing the same in condition to deliver electric current to the city's distributing system as already constructed. Thereafter, in an action instituted by an elector and taxpayer of the city, the special election above referred to was held illegal because of insufficient notice thereof. Dunn v. Centralia, 153 Wash. 495, 280 P. 26.

Work upon the plant was proceeding when this action was commenced, and, at the time of the trial below, defendant Fisher, a contractor, had practically completed the dam near the site of the proposed plant and had performed much work upon the canal required by the plans as adopted by the commissioners.

After the filing of the opinion of this court in the case of Dunn v. Centralia, supra, the city commissioners passed Ordinance No. 658, which purported to adopt the plan as it had been originally adopted by the city commissioners and the electors, which ordinance contained a further provision as follows: 'That as part of such system and plan said city adopts and ratifies all those certain contracts heretofore entered into by said city for the construction of said diversion dam, headworks and canal, and the purchase and installation of the machinery, equipment and appliances for said hydro-electric power plant, including all obligations attempted to be incurred under said contracts and all Work done and to be done, and all payments made and to be made thereunder.'

An election was called pursuant to this ordinance for September 30, 1929, in which there was submitted to the electors of the city a proposition in form as follows: 'Shall Ordinance No. 658, passed September 3, 1929, be ratified, and the City of Centralia, Washington, pursuant to the plan specified and adopted by said ordinance, purchase, acquire and construct a hydro-electric power plant, diversion dam, head works, canal, transmission line, sub-station, and appurtenances and additions to the present light distribution system of said city, estimated to cost $955,000.00, and as a part of such plan to adopt and ratify those certain contracts heretofore entered into by said city for the construction of the diversion dam, head works and canal, and the purchase and installation of the machinery for said hydro-electric power plant, and for the purpose of paying therefor to issue its special revenue bonds in the sum of $650,000, payable solely from the revenues of said light and power system, serially in from five to nineteen years, with interest not exceeding 6% per annum, and pay the balance of such cost out of moneys, securities and gross earnings of said light and power system, all as provided in said ordinance No. 658'--the voters being given an opportunity to vote either in favor of or against the proposition as stated. The electors expressed themselves as in favor of the adoption of the proposition by a vote of 1,600 for and 223 against. October 1, 1929, the city commissioners by resolution ratified all of the contracts theretofore entered into for the purpose of constructing the electric plant, whereupon this action was instituted. While this cause was pending in the court below, the city commissioners passed Ordinance No. 662, reciting the passage of the original ordinance providing for the acquisition of the plant, the submission of the same to popular vote, and its adoption by the voters, the decision of this court holding the election invalid, the passage of Ordinance No. 658, its submission to the people at a special election, and the adoption by the voters of the proposition as submitted; that the legality of the proceedings was once more under attack for the reason, among others, that the estimates for the work had not been included in the 1929 budget; that it was proposed that the cost of the project should be borne solely out of the special fund created by the hydro-electric distribution system and by the sale of bonds payable only out of a special fund; that the work was in process of completion; and that an emergency existed, a budget emergency being declared. A supplemental answer was filed, in which the passage of Ordinance No. 662 was pleaded.

Thereafter the plaintiff herein instituted another action setting up substantially the same allegations as are contained in his complaint in this cause, with the addition of allegations reciting the passage of Ordinance No. 662, alleging that this latter ordinance was invalid, and praying for an injunction against the same. To this complaint in the second cause of action an answer was filed containing admissions, denials, and an affirmative defense, together with a prayer that the two actions be consolidated for trial or the second action dismissed.

Thereafter, and just prior to the commencement of the trial of this action, the superior court, over plaintiff's objection entered an order dismissing the second action, holding that the issues therein would be determined upon the trial of this cause, from which order plaintiff has prosecuted an appeal. Thereafter this suit proceeded to trial, and, after a full hearing, the court ruled against plaintiff on all the issues and entered a judgment of dismissal, from which plaintiff appeals.

It appears that during the month of December, 1928, the city officials, assuming to act on behalf of the city, entered into an agreement in writing with respondent Pacific Development Company, with a view to the purchase by the city of water rights on the Nisqually river in Thurston county for a consideration of $125,000, making a down payment from the city treasury in the sum of $5,000; that later, and prior to the election of September 30, 1929, the commissioners made further payments aggregating $70,000 on account of the purchase of the water rights; that, during the month of May, 1929, the commissioners entered into a written contract with respondent Elza T. Fisher for the digging of a canal between nine and ten miles in length at an agreed price of a little less than $90,000, and that the commissioners later contracted with respondent Fisher for the construction of a dam and incidental labor and material at the price of something over $75,000, and that large payments were made on account of these contracts.

Two of the original defendants in the action, with whom contracts had been entered into, were dismissed therefrom after they answered; it appearing that they had neither furnished material under their contracts nor received any money on account thereof.

After the enactment by the city commissioners of Ordinance No. 658 above referred to, which, among other things, called a municipal election for September 30, 1929, the city commissioners expended city funds in an advertising campaign in order, as they say, to advise the electors of the city as to the situation concerning the different matters comprising the proposition...