Marks v. City of Mandan

• Decision Date: 06 February 1941
• Docket Number: No. 6663.,6663.
• Citation: 70 N.D. 474,296 N.W. 39
• Parties: MARKS et al. v. CITY OF MANDAN et al. (STUTSMAN, Intervener).
• Court: North Dakota Supreme Court

70 N.D. 474

296 N.W. 39

MARKS et al.

v.CITY OF MANDAN et al. (STUTSMAN, Intervener).

No. 6663.

Supreme Court of North Dakota.

Jan. 6, 1941.

Rehearing Denied Feb. 6, 1941.

Syllabus by the Court.

1. Chapter 174, Session Laws of North Dakota, 1923, as amended by Chapter 171, Session Laws of North Dakota, 1929, obligates a municipality to levy a general tax to make good a deficiency in a special assessment fund upon the maturity of the last special improvement warrants drawn against the fund.

2. The requirement of Chapter 174, Session Laws 1923, as amended by Session Laws 1929, relative to the levy of a general tax to pay deficiencies in special assessment funds, does not impinge upon constitutional inhibitions against double taxation or the requirements of due process of law and equality and uniformity; nor does it violate section 185 of the North Dakota constitution which prohibits a city from loaning or giving its credit to, or making donations to or in aid of any individual, association, or corporation, except for the reasonable support of the poor.

3. The extent to which a municipality may go in bearing the expense of a sewer system through general taxation lies within the field of legislative discretion; and its reasonable exercise, even to the extent of permitting or requiring the city to assume deficiencies that may arise in the collection of assessments levied against private property, does not invade the constitutional rights of a general taxpayer of the city.

4. The convenient and sanitary disposition of sewage is conducive to the health and comfort of the population of a city; and such a system is of general utility to the entire population, even though the more direct and proximate benefits accrue to the owners of property abutting on the sewer mains.

5. Chapter 174, Session Laws N.D.1923, as amended by Chapter 171, Session Laws N.D.1929, does not create an indebtedness of a municipality within the meaning of section 184 of the North Dakota constitution with regard to special improvement warrants, until and unless there is a deficiency in the special improvement fund at the time the last warrant drawn against such matures, and those statutes are, therefore, not violative of that section of the constitution.

6. Chapter 174, Session Laws N.D.1923, is not invalid as violative of section 61 of the North Dakota constitution.

Appeal from District Court, Morton County; H. L. Berry, Judge.

Mandamus proceeding by Bradley C. Marks and others against the City of Mandan, N. D., a municipal corporation, and others, to compel the city to levy a general tax to pay deficiency existing in special assessment funds, wherein Ada S. Stutsman intervened. From an adverse judgment, plaintiffs appeal.

Reversed.

CHRISTIANSON, J., dissenting in part.L. J. Palda, Jr., of Minot, and C. L. Young, of Bismarck, for plaintiffs-appellants.

John F. Sullivan, J. P. Fleck, and C. F. Kelsch, all of Mandan, for defendants-respondents.

W. H. Stutsman, of Mandan, for intervener-respondent.

MORRIS, Judge.

The plaintiffs in this action are the owners and holders of a special assessment warrant issued by the city of Mandan in connection with the payment of the costs of construction of a sewer system in sewer district No. 6 of that city.

The warrant is dated November 13, 1930, in the sum of $150, and is payable on the thirteenth day of November, 1939. It bears interest at the rate of seven per cent per annum, payable semiannually.

The warrant contains, among others, the following provision: “The faith and credit of the City of Mandan, North Dakota, are hereby irrevocably pledged to levy the special assessments for the total cost of the improvement on account of which this warrant is issued, to cause the same to be collected and paid into the said fund applicable to the payment thereof, to levy a tax upon all taxable property of the city for the payment of any deficiency which may exist in said fund upon the maturity of all warrants of this series, and to cause each step authorized by law to be taken for the punctual payment of the principal and interest of this warrant at maturity.”

By this proceeding the plaintiffs by mandamus seek to compel the city of Mandan to levy a general tax upon all the taxable property within the city to pay a deficiency which now exists in the fund on which this warrant is drawn. This deficiency arose because of the failure of certain property owners to pay the special assessments levied against their property. The financial condition of the city at any time is not disclosed; and no question is raised involving section 183 of the constitution of North Dakota, which prescribes debt limits for municipalities.

At the time the warrant in this case was issued, section 3716, C.L.N.D.1913, had been amended by chapter 174, Session Laws N.D.1923, and again amended by chapter 171, Session Laws N.D.1929. Both the 1923 and 1929 amendments contain this provision: “Whenever all special assessments collected for a specific improvement are insufficient to pay the special improvement warrants issued against such improvement with interest the city council or city commission, as the case may be, shall upon the maturity of the last special improvement warrant levy a tax upon all of the taxable property in the city for the payment of such deficiency”.

Prior to its amendment, section 3716 provided that: “Whenever all special assessments levied for a specific improvement shall have been collected and applied in payment of the warrants issued for such improvement, and a deficiency remains, the city council shall levy a tax upon all the taxable property in the city for the payment of such deficiency”.

In case No. 1, 296 N.W. 34, involving warrants issued prior to the amendment, we hold that no duty devolves upon the city to levy a general tax to pay a remainingdeficiency until all special assessments levied for the specific improvement for which the warrants in question were issued have been collected and applied. In that case it appeared that the special assessments had not all been collected. Consequently, the condition precedent to the right to levy the general tax had not been met. Section 3716, in its original form, does not provide for the levy of a general tax to pay deficiencies growing out of the failure of property owners to pay their special assessments.

[1] This case involves the effect of the amendments of 1923 and 1929. In determining the effect of the amendments, we again examine the statute to determine what the intention of the legislature was. The very fact that the legislature amended the statute and drastically changed its wording indicates with certainty that the legislature intended to change the meaning of the statute.

[2] A city may become generally liable upon special improvement warrants unless the statute forbids. Pine Tree Lumber Company v. City of Fargo, 12 N.D. 360, 96 N.W. 357;Dakota Trust Company v. Hankinson, 53 N.D. 356, 205 N.W. 990. It follows that the legislature may by statute render the city liable either generally or for certain deficiencies arising in special assessment funds.

Prior to the enactment of chapter 62, Session Laws N.D.1905, of which the original section 3716 was a part, the plan of making special improvements provided by the statute was such as to “enable a city to make special improvements upon its streets, and to reimburse itself for the cost of the same through special assessments of property abutting upon and benefited by the improvements, to the extent of assessments made, and this without cost to the general taxpayer.” Pine Tree Lumber Company v. City of Fargo, 12 N.D. 360, 96 N.W. 357.

In that case, however, it was further said, “The paving of its streets was a municipal improvement contracted for by the city, and, when completed, of general utility. Unless there is something in the general incorporation act or general statutes which otherwise directs, or by necessary implication limits the right of a city to become generally liable upon its contracts for this class of improvements, or something in the contract with the city by which the claimant is limited in his recovery to the special funds to be raised from the assessment of abutting property, we can see no reason why the city cannot be held generally liable for debts it has thus contracted.”

The above case was decided in 1903. In 1905 the legislature passed chapter 62 of the session laws of that year, whereby it set up a new system providing for special improvements.

Concerning this chapter, we said in Schieber v. City of Mohall, et al., 66 N.D. 593, 609, 268 N.W. 445, 453, that “There is nothing plainer in the whole chapter than that the city is not to be held responsible generally for the cost of the improvement. The cost is to be paid by the property benefited, from a fund raised by taxation of said property, and from no other source.” See also Bankers' Trust & Savings Bank v. Anamoose, 51 N.D. 596, 200 N.W. 103. That was the law prior to the amendment of section 3716 by chapter 174, Session Laws N.D.1923.

A number of constitutional questions have been raised. It is urged that if the statute in question be construed so as to render the city generally liable for deficiencies in its special improvement funds, and to authorize the levy of a general tax for the payment of such deficiencies, it violates section 13 of the North Dakota constitution, and section 14 of the United States constitution. These sections embrace what is generally known as the due process of law clause.

[3][4] In support of this contention, it is urged that the tax is levied for a private purpose; and further, that the general taxpayer has had no notice or opportunity to be heard regarding the validity or the extent of the tax to be imposed upon his property.

In considering this same objection to the levy of a general tax to create a revolving fund to pay delinquent assessments on property purchased by a city at a delinquent assessment...