Ladd v. Reynolds

• Decision Date: 07 October 1954
• Docket Number: 2108; Commonwealth docket,35,equity docket,1954
• Citation: 2 Pa. D. & C.2d 78
• Parties: Ladd et al. v. Reynolds et al
• Court: Pennsylvania Commonwealth Court

2 Pa. D. & C.2d 78

Ladd et al. v. Reynolds et al

equity docket, No. 2108; Commonwealth docket, 1954, No. 35

Common Pleas Court of Dauphin County, Pennsylvania

October 7, 1954

Storey, Bailey & Rupp, for plaintiffs.

Frank F. Truscott, Attorney General; Elmer T Bolla, Deputy Attorney General; and Robert M Maurer, Assistant Deputy Attorney General, for the Secretary of Welfare.

Warren W. Holmes and Edward A. Collins, for the General State Authority.

OPINION

Preliminary objections to complaint.

SOHN J.

The matter before us arises as the result of a bill in equity filed by plaintiffs, who are residents of Birmingham Township, Delaware County, Pa., to restrain the Secretary of Welfare, Alan D. Reynolds, the General State Authority, and its executive director, John N. Forker, from acquiring certain land in Delaware County, comprising approximately 514 acres, and from erecting on said land a State mental hospital. The bill is filed by plaintiffs as citizens of the Commonwealth and as taxpayers into the General Fund. It is essentially a taxpayers' bill.

The complaint alleges that the Secretary of Welfare has requested the General State Authority to acquire the particular property described in Birmingham Township, Delaware County, and that the General State Authority, with the approval of the Governor, has appointed appraisers to fix the fair value of the property, placing a ceiling price of $ 1,500 per acre thereon, and that plaintiffs believe that the appraisers are prepared to report to the authority.

A further allegation of the complaint is that certain moneys from the General Fund of the Commonwealth have been appropriated to the General State Authority and that the latter has already spent money in appraising the land and will, unless restrained, spend additional large sums in acquiring the land and building the hospital, and that plaintiffs are informed and believe that the sum of $ 19,000,000 is contemplated as the cost of the proposed acquisition of the land and the building of the hospital thereon. Plaintiffs further allege that a similar State mental hospital is located approximately 10 miles from the proposed site, that there has been allocated to that hospital over $ 7,000,-000 for the enlargement of its facilities, that the new hospital will be a duplication thereof, and that the proposed site for the new hospital does not have an ample water supply and does not provide sewerage and drainage, and that it will not meet the needs of expansion within Delaware County in future years.

The complaint then goes on to allege that there is no-authority in law for defendant, the Secretary of Welfare, to arrange with the General State Authority for the acquisition of the land or for the construction of a hospital thereon, and that there is no authority for the General State Authority to acquire the property and build the mental hospital, and that plaintiffs and other taxpayers of the Commonwealth of Pennsylvania will be irreparably damaged unless defendants are restrained from spending this money, and that plaintiffs bring this action on their own behalf and on behalf of all other taxpayers.

Defendants, the General State Authority and John N. Forker, have filed preliminary objections, as has the other defendant, Alan D. Reynolds. These objections are in the nature of demurrers. They refer to the Act of August 19, 1953, P. L. 1152, as the authority for the erection of a new State mental hospital and both refer to the Act of March 31, 1949, P. L. 372, 71 PS § 1707, as authorizing the General State Authority to acquire land and construct an institution such as the mental hospital contemplated in this action.

The preliminary objections of both defendants also aver that plaintiffs have failed to state that they pay taxes into the funds of the General State Authority and question the rights of the plaintiffs to bring this action as taxpayers.

Twenty-two different residents of Birmingham Township, Delaware County, Pa., taxpayers into the General Fund of the Commonwealth of Pennsylvania, also petition to intervene as parties plaintiff. Defendants have filed answers to the petition averring that the proposed intervenors are in no different position than were original plaintiffs and that their interests are already adequately represented, and if they should be permitted to intervene the preliminary objections apply to them as well as to original plaintiffs.

Four separate questions seem to be involved by the filing of the above-described pleadings. They are as follows:

1. Are plaintiffs, as taxpayers, entitled to bring this class action on behalf of all taxpayers?

2. Does the title to the Act of August 19, 1953, P. L. 1152, " providing for the selection of suitable lands in Delaware County for the erection thereon of a new State mental hospital", clearly express the subject contained in the second paragraph of the act which provides for the acquisition of lands and the construction of a mental hospital?

3. Has the General State Authority any lawful power to acquire the lands in Delaware County and to construct thereon a mental hospital?

4. Should the petition of additional taxpayers to intervene as parties plaintiff be allowed?

With respect to the first question involved, plaintiffs aver only that they are " taxpayers of the Commonwealth paying taxes into the General Fund as well as into other funds of the Commonwealth of Pennsylvania." This is not enough. In this connection we must refer to the language of Mr. Justice Linn of the Supreme Court in Chester County Institution District et al. v. Commonwealth et al., 341 Pa. 49 (1941), where on page 64, he says:

" 4. The taxpayers joining in the bill show no ground for equitable relief; there is not even an averment that their taxes will be increased ; if the State takes over the operation and pays the bills the taxpayer plaintiffs will probably pay less, for the purpose, than they paid before. So far as the averment of irreparable damage is concerned, it is sufficient to say that the legislature had the power to pass the Act; presumably, the legislature gave adequate consideration to the effect on the taxpayers of the county ; we find nothing authorizing the Court to say that the legislature exceeded its power on the ground suggested." (Italics supplied.)

Plaintiffs ask that defendants be enjoined " from expending moneys or obligating funds of the Commonwealth of Pennsylvania and/or of the General State Authority for the purpose of acquiring the land aforementioned or for erecting a mental hospital thereon."

In Naugle v. Vaux, Secretary of Health, 68 D. & C. 135 (1949), we have the well-considered and able opinion of Superior Court Judge Woodside, then a member of this court, that a taxpayer seeking to enjoin the expenditure of public funds must allege with particularity that he is a taxpayer to the very fund which he seeks to restrain. On page 140 he says:

" Since a plaintiff's right to maintain a taxpayer's bill 'depends entirely on whether he is a bona fide taxpayer' and rests solely upon 'the ground that his pecuniary interest has been invaded,' it must follow that he must be a taxpayer to the particular fund from which the alleged unlawful expenditure is to be made. As this is necessary to his right to maintain the bill he must allege it in the bill. See Equity Rule 34; Goslin, Admr., v. Edmunds, 325 Pa. 154, 159 (1937); Watkins and Miller v. Watkins et ux., 101 Pa.Super 426, 429 (1931). Not having done so, the preliminary objections to the bill must be sustained."

Plaintiffs have not alleged in their complaint, nor can they prove, any pecuniary interest in the authority's funds. The financing of authority projects, including the acquisition of land, is provided by the Act of March 31, 1949, P. L. 372. It is without question that such projects are financed from the proceeds of the authority's own bonds, and not by appropriations from the General Fund of the Commonwealth. In section 4(p ) of The General State Authority Act of March 31, 1949, P. L. 372, the legislature specifically provides that:

" . . . the Authority shall have no power at any time or in any manner to pledge the credit or taxing power of the Commonwealth . . . nor shall any of its obligations or debts be deemed to be obligations of the Commonwealth . . . nor shall the Commonwealth . . . be liable for the payment of principal of, or interest on, such obligations."

See Kelley v. Earle, 325 Pa. 337 (1937).

In addition, we have been unable to find that the legislature has passed any appropriation bill providing for the acquisition of the land in question or for the construction of a new State mental hospital in Delaware County. The acquisition of land for the construction of a hospital cannot be accomplished by way of any general appropriation bill which is limited by law to providing for the ordinary expenses of the executive, legislative and judicial departments of the Commonwealth. This is provided in article III, sec. 15, of the Pennsylvania State Constitution. Therefore, it must follow that it is not a fact, as alleged by plaintiffs in paragraph 8 of the complaint, that " Money of the Commonwealth of Pennsylvania, appropriated to the General State Authority from the General Fund of the Commonwealth, has already been spent and large sums will be spent in the appraising and acquiring of said land and in the erection of a hospital thereon."

As a result, no expenditure of taxpayers' money is involved in the proposed acquisition of land and erection of a hospital as complained by plaintiffs, and therefore plaintiffs as taxpayers of the Commonwealth have no standing to enjoin the General State Authority in this action. See annotation 131 A. L. R. 1230 under the heading " ...