Lakeside Village Imp. Dist. v. Jefferson County, 56928

• Decision Date: 05 April 1985
• Docket Number: No. 56928,56928
• Parties: LAKESIDE VILLAGE IMPROVEMENT DISTRICT, Jefferson County, Kansas, Appellant, v. JEFFERSON COUNTY, Kansas, Appellees.
• Court: Kansas Supreme Court

Page 1286

697 P.2d 1286

237 Kan. 106

LAKESIDE VILLAGE IMPROVEMENT DISTRICT, Jefferson County, Kansas, Appellant, v. JEFFERSON COUNTY, Kansas, Appellees.

No. 56928.

Supreme Court of Kansas.

April 5, 1985.

Syllabus by the Court

1. A statute should never be given a construction that leads to uncertainty, injustice or confusion if it is possible to construe it otherwise.

2. When reviewing the constitutionality of a statute this court must presume the statute is constitutional; all doubts must be resolved in favor of the statute's validity; and before a statute may be stricken down, it must be clearly shown that it violates the Constitution. It is the court's duty to uphold the statute under challenge, if possible, rather than defeat it, and if there is any reasonable way to construe the statute as constitutionally valid, that should be done.

3. It is a fundamental rule of statutory construction, to which all others are subordinate, that the purpose or intent of the legislature governs when that intent can be ascertained from the statute, even though words, phrases or clauses at some place in the statute must be omitted or inserted.

4. Language contained in K.S.A. 19-2770 (Weeks) in the form in effect from March 18, 1974, to July 1, 1976, is construed and held not to be a delegation of authority to improvement districts to issue, in their discretion, general obligation bonds of the counties in which they lie.

5. In a declaratory action seeking determination of whether certain bond issues are valid obligations of the issuing improvement district or of the county in which the improvement district lies, the record is examined and it is held: (1) the district court did not err in concluding the bonds are valid obligations of the improvement district rather than the county; and (2) the district court erred in holding K.S.A. 19-2770 (Weeks) unconstitutional in the form in effect from March 18, 1974, to July 1, 1976.

Fred W. Rausch, Jr., Topeka, argued the cause and was on brief, for appellant.

James D. Waugh of Cosgrove, Webb & Oman, Topeka, argued the cause, and J Craig Anderson, of the same firm, and John K. Bork, Co. Atty., were with him on brief, for appellees.

McFARLAND, Justice:

This is a declaratory judgment action seeking determination of whether plaintiff Lakeside Village Improvement District, Jefferson County, Kansas, or defendant Jefferson County, Kansas, is responsible for payment of certain bonds issued by the Improvement District. The district court held all the bonds were valid obligations of the District and none were valid obligations of Jefferson County. Lakeside Village Improvement District appeals therefrom.

The case was tried upon stipulated facts; said stipulation is reproduced in pertinent part as follows:

"1. Plaintiff is an improvement district organized by order of the Board of County Commissioners of Jefferson County, Kansas on June 12, 1970, pursuant to Chapter 180, 1945 Laws of Kansas, and any amendments thereto and supplements thereof as of June 12, 1970.... (On August 4, 1972, the name of Jefferson County Improvement District No. 1 was changed to Lakeside Village Improvement District by order of the Board of County Commissioners of Jefferson County, Kansas).

....

"4. Between July 1, 1974 and July 1, 1976, plaintiff district caused to be issued and sold eight bond issues, as follows:

a. Lakeside Village Improvement District Water Improvement Bonds, Series 1975, dated April 1, 1975, in the aggregate principal amount of $42,600.

b. Lakeside Village Improvement District Internal Improvement Bonds, Series 1975, dated May 1, 1975 in the aggregate principal amount of $99,820.

c. Lakeside Village Improvement District Water Improvement Bonds, Series 1975-2, dated August 1, 1975 in the aggregate principal amount of $34,439.28.

d. Lakeside Village Improvement District Internal Improvement Bonds, Series 1975-2, dated August 1, 1975, in the aggregate principal amount of $98,283.58.

e. Lakeside Village Improvement District General Obligation Bond, Series 1976-A (roads), dated March 1, 1976 in the aggregate principal amount of $99,431.83.

f. Lakeside Village Improvement District General Obligation Bond, Series 1976-B (park), dated March 1, 1976 in the aggregate principal amount of $44,744.31.

g. Lakeside Village Improvement District General Obligation Bonds, Series 1976-C (sanitary waste water) dated March 1, 1976 in the aggregate principal amount of $79,546.07.

h. Lakeside Village Improvement District General Obligation Bonds, Series 1976-D (water), dated March 1, 1976 in the aggregate principal amount of $99,431.83.

....

"7. Subsequent to July 1, 1976, plaintiff district caused to be issued and sold three bond issues, as follows:

a. Lakeside Village Improvement District General Obligation Bonds, Series 1978-1 (roads), dated June 1, 1978, in the aggregate principal amount of $46,700.27.

b. Lakeside Village Improvement District General Obligation Bonds, Series 1978-2 (parks), dated June 1, 1978, in the aggregate principal amount of $37,852.85.

c. Lakeside Village Improvement District General Obligation Bonds, Series 1980-1 (water and sanitation), dated September 1, 1980, in the aggregate principal amount of $98,373.00.

....

"8. With respect to the bond issues referred to in paragraph 7 above, plaintiff district did not request, and defendant county did not approve, that the bond issues be general obligations of the county, as contemplated by K.S.A. 19-2770.

....

"10. Despite the efforts by defendant county in attempting to collect the special assessments which have been levied in accordance to the actions shown to have been taken in the transcripts, and pursuant to law, insufficient moneys will be collected in order to keep the bond issues (or some of them) from being in default in the near future.

"11. Plaintiff district has attempted to obtain authority from the Board of Tax Appeals to issue no-fund warrants in order to keep the above bond issues from the danger of being in default, but the Board of Tax Appeals has refused and will continue to refuse to grant permission to issue no-fund warrants unless the Board knows which of the parties (plaintiff district or defendant county) will be liable for the payment of such no-fund warrants.

"12. A genuine, actual and justiciable controversy exists between the parties hereto, the question being whether or not the bond issues listed in paragraphs 4 and 7 above, or any of them, constitute general obligation bonds of defendant county, payable from the levy of special assessments against the property benefited, and if not so paid, by ad valorem tax which may be levied without limit as to rate or amount on all the taxable tangible property located within the county. Plaintiff district claims, and defendant county denies, that all of such bonds are such general obligation bonds."

The bonds enumerated in paragraph four of the stipulation (bearing 1975 and 1976 dates) were issued by Lakeside Village Improvement District under the authority of K.S.A. 19-2770 (Weeks) as it existed from March 18, 1974, to July 1, 1976. This 1974 version of K.S.A. 19-2770 provides:

"That whenever the board of directors of any improvement district shall under the authority vested in it by this act, cause any public work or improvement to be made, payment for which is to be made by levy of special assessments, it may in its discretion, instead of levying the entire assessment therefor at one time, provide for the payment of the same by installments, and authorize the issuance of general obligation bonds of the county therefor payable in installments of equal amounts each year, for such number of years as may be deemed advisable. If such installments are deemed proper by the board of directors they shall cause notice of the method of payment to be inserted in the official published notice as set out in the next preceding section. Such improvement bonds shall be issued as provided by law, but no bonds shall be issued under this provision until thirty days after the last day of the protest period as set out in the next preceding section; and during said thirty days any person against whose property any special assessment shall have been levied may pay the same in full and thereby discharge his property from the lien thereof."

The bonds enumerated in paragraph seven of the stipulation (bearing 1978 and 1980 dates) were issued by Lakeside Village Improvement District under the authority of K.S.A. 19-2770 as amended in 1976 (our present statute). K.S.A. 19-2770 provides:

"(a) Whenever the board of directors of any improvement district shall under the authority vested in it by this act, cause any public work or improvement to be made, payment for which is to be made by levy of special assessments, it may in its discretion, instead of levying the entire assessment therefor at one time, provide for the payment of the same by installments and may issue improvement bonds of the district therefor. Prior to the issuance of any such improvement bonds, the board of directors shall cause notice thereof to be published as provided in K.S.A. 19-2769. Such improvement bonds shall be issued as provided by law, but no bonds shall be issued under the provision of this act until thirty (30) days after the last day of the protest period as set out in K.S.A. 19-2769. During said thirty (30) days any person against whose property any special assessment shall have been levied may pay the same in full and thereby discharge such property from the lien thereof. Any improvement bonds issued under the authority of this subsection shall be payable from the levy of special assessments against the property benefited and, if not so paid, by the levy of an ad valorem tax on all taxable tangible property located within such improvement district, in an amount sufficient to pay the principal of and interest on such improvement bonds.

"(b) In lieu of issuing improvement bonds...