Kirby v. Omaha Bridge Commission

• Decision Date: 13 June 1934
• Docket Number: 29144
• Parties: CHARLES B. KIRBY ET AL., APPELLANTS, v. OMAHA BRIDGE COMMISSION ET AL., APPELLEES
• Court: Nebraska Supreme Court

255 N.W. 776

127 Neb. 382

CHARLES B. KIRBY ET AL., APPELLANTS, v. OMAHA BRIDGE COMMISSION ET AL., APPELLEES

No. 29144

Supreme Court of Nebraska

June 13, 1934

APPEAL from the district court for Douglas county: WILLIAM G HASTINGS, JUDGE. Affirmed.

AFFIRMED.

Syllabus by the Court.

Record examined, and held that the construction of the bridge across the Missouri river, as here contemplated, is within the statutory powers expressly granted to the city of Omaha, will involve no illegal expenditure of its public funds, and will in no manner increase the burden of municipal taxation or adversely affect the rights of its taxpayers. Further, that the " revenue bonds," intended to be used in payment for this improvement, in the manner and form in which they are proposed to be authorized and issued, will not create nor become a general obligation of such city.

Appeal from District Court, Douglas County; Hastings, Judge.

Suit by Charles B. Kirby and another against the Omaha Bridge Commission, a corporation, and others. From a judgment in favor of the defendants, the plaintiffs appeal.

Affirmed.

James E. Rait, for appellants.

Seymour L. Smith, Kenneth S. Finlayson and L. J. TePoel, contra.

Heard before ROSE, GOOD, EBERLY, DAY and PAINE, JJ., and LESLIE and RYAN, District Judges.

OPINION

EBERLY, J.

This suit was instituted by Charles B. Kirby and Elizabeth J. Lindsey, resident taxpayers of the city of Omaha, against the city of Omaha and certain individuals named who are members of the city council thereof, Roy N. Towl as mayor thereof and ex officio member of the Omaha bridge commission, the Omaha bridge commission, a corporation organized and existing under and by virtue of chapter 14, art. 12, Comp. St. 1929, and the individuals named as members constituting the same, as in the amended petition set forth. So far as we are concerned with this pleading on appeal, we are confined to the substance thereof, as stated in appellants' brief, viz., "that the defendants will, unless enjoined, issue $ 1,650,000 in bonds of the city of Omaha, or so much as may be necessary, and will sell the same to the United States of America and with the proceeds thereof will proceed with the erection of a bridge across the Missouri river at South Omaha, Nebraska;" further, that "these bonds purport to be revenue bonds payable solely out of revenues to be derived from tolls charged for the use of the bridge (so constructed), but plaintiffs say such tolls will be insufficient and that the obligation imposed upon the city of Omaha by the laws of Nebraska and the act of congress under which the bridge is to be erected require the city of Omaha to obtain a fund sufficient to amortize said bonds, and that, in the event that such funds are insufficient, the bonds will then become a general liability and obligation of the city of Omaha."

The intent of the proper authorities to issue and sell the bonds to the extent and for the purpose alleged is admitted in the answer, but the additional allegations contained in the petition are denied by the defendants. The issue thus presented is, in substance, will the "revenue bonds" of the city of Omaha, if issued as contemplated, constitute the general obligation of the city of Omaha?

There was a trial on the merits in the district court for Douglas county, which resulted in a decree finding "generally in favor of the defendants upon all issues presented," and further finding "that the proposed construction of the bridge across the Missouri river, as shown by the pleadings and the evidence, will not involve any illegal expenditure of the public money of the city of Omaha, and said construction of the proposed bridge will not create a general liability or obligation of the city of Omaha for the payment of the bonds to be issued therefor, and that said bonds in the manner and form in which they are proposed to be authorized and issued do not become a general obligation of the city of Omaha." Plaintiffs' cause of action was thereupon dismissed, and they appeal.

The limitation of the issue for decision, as above suggested, is required. For, while it is the undoubted rule that, "when bonds or other evidences of indebtedness are about to be issued by public officers illegally or without complying with the statute authorizing their issue, equity has jurisdiction to grant an injunction," still, "to entitle a taxpayer or other person to sue for such an injunction he must show that he is interested in the matter and will be damaged if the improper acts are not prevented by injunction, and that he has no other adequate remedy." 32 C. J. 268.

These principles may be said to be in harmony with the pronouncements of this court in a similar class of taxpayers' suits involving analogous if not identical issues, wherein we have approved as a general doctrine the following: A private person seeking the aid of equity to restrain an act of a municipal body must show some special injury peculiar to himself aside from and independent of the general injury to the public, which either entails an illegal expenditure of public funds or involves an illegal increase in the burden of municipal taxation. Chizek v. City of Omaha, 126 Neb. 333, 253 N.W. 441; Kittle v. Fremont, 1 Neb. 329; Shed v. Hawthorne, 3 Neb. 179; Ray v. Colby & Tenney, 5 Neb. (Unof.) 151; Hill v. Pierson, 45 Neb. 503, 63 N.W. 835; Clark v. Interstate Independent Telephone Co., 72 Neb. 883, 101 N.W. 977; George v. Peckham, 73 Neb. 794, 103 N.W. 664; Bischof v. Merchants' Nat. Bank, 75 Neb. 838, 106 N.W. 996; Letherman v. Hauser, 77 Neb. 731, 110 N.W. 745; Lee v. City of McCook, 82 Neb. 26, 116 N.W. 955; Woods v. Lincoln Traction Co., 83 Neb. 23, 118 N.W. 1067; Gleason v. Loose-Wiles Cracker & Candy Co., 88 Neb. 83, 129 N.W. 173; Powers v. Flansburg, 90 Neb. 467, 133 N.W. 844; Brown v. Easterday, 110 Neb. 729, 194 N.W. 798; World Realty Co. v. City of Omaha, 113 Neb. 396, 203 N.W. 574.

Nor are the principles thus announced in any manner inconsistent with Interstate Power Co. v. City of Ainsworth, 125 Neb. 419, 250 N.W. 649, or Carr v. Fenstermacher, 119 Neb. 172, 228 N.W. 114. The point here under consideration was not formally discussed in either of these decisions. It may be noted, however, that in the City of Ainsworth case it is stated in the opinion that the plaintiff, Interstate Power Company, "is a taxpayer in the defendant city, in which it owns and operates an electric distribution system." As owner of a competing business it was thus threatened with an injury peculiar to itself. For reasons set forth in that opinion, it was as such accorded full relief. In the Fenstermacher case the two plaintiffs allege, as their qualifications to bring the action, "that they are resident taxpayers and users of electricity furnished by means of the plant." While it may be questioned whether these allegations are sufficient to disclose a threatened injury peculiar to themselves, and different from other taxpayers, the cause was considered on its merits and for reasons stated in the opinion relief was denied.

As a preface to our examination of the questions presented by this appeal, it may be said that this cause arises out of what is commonly known as the "United States recovery program." This program has for one of its objectives the providing of gainful employment for those who have been deprived of the opportunity to labor by the "depression." In it are involved the proper cooperation of the state and federal authorities to the end that by the construction of self-liquidating works of internal improvement people in want may receive the benefits that the public works administration was intended to assure. The legislative enactments involved, both federal and state, may rightfully be taken for the purposes of construction as highly remedial in their nature, and necessarily construed in that light.

During the year 1933 public works administration funds were allocated for the construction of this highway bridge by proper federal officials. The project was approved by both the Omaha bridge commission, hereinafter referred to as bridge commission, and also by the corporate authorities of the city of Omaha. On December 5, 1933, the city council of Omaha, by a unanimous vote, passed a resolution declaring its purpose to finance this project from the sale of "revenue bonds" to be authorized and issued pursuant to section 2, ch. 27, Laws 1931. This act in terms empowers the council of the city of Omaha, in its discretion, to issue revenue bonds payable solely from the earnings of the bridge to be constructed, without a vote of the electors, where, as in this case, such bridge is to be built more than a mile from an existing highway bridge, and which act also in terms negatives any general liability on or because of such bonds on the part of the city issuing the same. It may be stated that all steps required by legislation applicable to be taken by the parties concerned, to accomplish the construction of this proposed internal improvement, have been regularly taken up to and including the approval by the proper United States officials of certain plans, specifications, drawings, and maps of the location of this proposed bridge submitted to such officials for that purpose by the bridge commission as assignee of Charles B. Morearty.

The authority for the proposed construction of this bridge on the part of defendants is derived from chapter 176, Laws 1929 entitled "An act authorizing and empowering cities of the metropolitan class to acquire by purchase, condemnation, bargain and sale, lease, sublease, gift or otherwise, and to construct and contract for the construction of bridges or viaducts within the city limits and five miles outside thereof, within the state of...