Rexroad, Inc. v. Sanitary and Imp. Dist. No. 66 of Sarpy County

Decision Date02 May 1986
Docket NumberNo. 85-075,85-075
Citation386 N.W.2d 433,222 Neb. 618
PartiesREXROAD, INC., Appellant, v. SANITARY AND IMPROVEMENT DISTRICT NO. 66 OF SARPY COUNTY, Nebraska, Appellee.
CourtNebraska Supreme Court

Syllabus by the Court

1. Sanitary and Improvement Districts: Legislature: Political Subdivisions. A sanitary and improvement district, existing pursuant to the sanitary and improvement districts act, Neb.Rev.Stat. §§ 31-727 et seq. (Reissue 1984), is a legislative creature, a political subdivision of the State of Nebraska.

2. Standing. Before one is entitled to invoke jurisdiction of a court, one must have standing--some real interest in a cause of action, a right (legal or equitable), title, or interest in the subject matter in controversy. To establish such standing, a litigant must demonstrate a danger of injury to the litigant, resulting from an action to be contested. Generally, sufficient standing as a party in litigation may not be based merely on a general interest common to all members of the public.

3. Sanitary and Improvement Districts: Standing: Contracts. Only a taxpayer of a sanitary and improvement district organized pursuant to the sanitary and improvement districts act, Neb.Rev.Stat. §§ 31-727 et seq. (Reissue 1984), has standing to contest validity of contractual obligations for expenditure of such district's funds.

Dean J. Jungers of Hascall, Jungers & Garvey, Bellevue, for appellant.

Mark A. Klinker, Omaha, for appellee.

KRIVOSHA, C.J., and BOSLAUGH, WHITE, HASTINGS, CAPORALE, SHANAHAN, and GRANT, JJ.

SHANAHAN, Justice.

Rexroad, Inc., appeals the judgment of the district court for Sarpy County denying relief to Rexroad and dismissing its petition which sought nullification of action taken by the board of trustees of Sanitary and Improvement District No. 66 of Sarpy County, Nebraska (S.I.D.), and an award of damages. We affirm.

Rexroad is engaged in garbage collection and collected from some S.I.D. residents for a fee of $5.50 per month for each resident served. Rexroad did not have a written agreement with its customers within S.I.D. Rather, as was the standard in the industry, oral service contracts for garbage collection were terminable at will.

S.I.D. existed and operated as a political subdivision pursuant to the sanitary and improvement districts act, Neb.Rev.Stat. §§ 31-727 et seq. (Reissue 1984). In 1982 S.I.D. assessed its residents to defray expenses for a garbage collection contract to be obtained by the district. On April 28, 1983, S.I.D. mailed its bid forms and specifications to prospective collectors, including Rexroad, and then, in a local newspaper of general circulation, published its specifications and solicitation for sealed bids regarding a contract for garbage collection from July 1, 1983, to June 30, 1984. S.I.D.'s board of trustees had not passed a resolution declaring the "advisability and necessity" for a garbage collection contract. See § 31-744. On May 24 S.I.D.'s board of trustees met in public session, opened bids for the collection contract, and, on the basis of such bids, awarded the collection contract to All Way Sanitation, the low bidder. A written agreement between S.I.D. and All Way was signed on June 30, requiring a collection fee of $4.45 per month for each resident served within the district. S.I.D. notified all its residents about All Way's collection service to be commenced on July 1 pursuant to the contract with the district. As a result of the All Way-S.I.D. contract, 23 S.I.D. residents terminated their service from Rexroad. Rexroad had no office as a place of business within S.I.D. and was not a taxpayer of S.I.D.

Rexroad filed suit against S.I.D. and alleged its loss of S.I.D. customers and the failure of S.I.D.'s trustees to pass a resolution of advisability and necessity concerning the contract sought for garbage collection within the district. Rexroad claimed the action taken by the S.I.D.'s board of trustees was "ultra vires and outside of the authority" conferred by Nebraska law. Rexroad sought nullification of the garbage collection contract and requested damages attributable to loss of Rexroad's former customers within S.I.D. In its answer S.I.D. countered that Rexroad lacked standing to contest action taken by S.I.D.'s board of trustees regarding the contract in question, that is, Rexroad was "not a taxpayer or property owner" within S.I.D.

At conclusion of the trial the district court found that Rexroad was "not a taxpayer or property owner within [S.I.D.], and therefore [Rexroad] lacks standing to challenge [S.I.D.'s] actions." The district court dismissed Rexroad's petition with prejudice.

Rexroad's assignments of error are based on the premise that S.I.D.'s board of trustees acted outside authority existing under Nebraska law governing sanitary and improvement districts.

Purposes and powers of a sanitary and improvement district are found in § 31-727(1), namely,

installing electric service lines and conduits, a sewer system, a water system, a civil defense warning system, a system of sidewalks, public roads, streets, and highways, public waterways, docks or wharfs, and related appurtenances, to contract for water for fire protection and for resale to residents of the district, to contract for police protection and security services, and to contract for gas and for electricity for street lighting for the public streets and highways within such proposed district, to construct and to contract for the construction of dikes and levees for flood protection for the district, and to acquire, improve, and operate public parks, playgrounds, and recreational facilities.

As authorized by statute, a majority of owners having an interest in real property within the limits of a proposed sanitary and improvement district may form such district by signing and properly filing "articles of association" with an appropriate petition praying that the district, so formed, be declared a sanitary and improvement district under Nebraska law. See § 31-727(1) and (4). As a consequence of the articles of association for a sanitary and improvement district, the owners of real estate within the district, so formed, are obligated to pay taxes on their property within the district and pay special assessments on real estate within that district. See § 31-727(2). Owners of real estate within a proposed district who have not signed the articles of association may object to organization of a sanitary and improvement district. § 31-729. Initial trustees of a sanitary and improvement district must own real estate within the proposed district. §§ 31-727(3), 31-730. After a sanitary and improvement district becomes a "body corporate and politic," § 31-732, trustees for such district must be owners of real estate within the district and must have been elected by resident owners or owners of real estate, voters eligible by virtue of property ownership or lease. See § 31-735(1) and (2). No corporation is deemed a resident owner for purposes of voting for trustees of a sanitary and improvement district. See § 31-735(3). The common denominator of the preceding statutes for a voice in the conduct of a sanitary and improvement...

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