Sebewaing Industries, Inc. v. Village of Sebewaing, 423

• Decision Date: 05 October 1953
• Docket Number: No. 423,423
• Citation: 60 N.W.2d 444,337 Mich. 530
• Parties: SEBEWAING INDUSTRIES, Inc. v. VILLAGE OF SEBEWAING et al. Motion
• Court: Michigan Supreme Court

Page 444

60 N.W.2d 444

337 Mich. 530

SEBEWAING INDUSTRIES, Inc. v. VILLAGE OF SEBEWAING et al.

Motion No. 423.

Supreme Court of Michigan.

Oct. 5, 1953.

Howell Van Auken, Detroit, Lucking, Van Auken & Schumann, Detroit, for appellant.

C. W. Hatfield, Sebewaing, Warner, Norcross & Judd, Grand Rapids, for appellees.

Thomas R. McAllister, Bad Axe, for A. C. Hoeh et al.

Miller, Canfield, Paddock & Stone, Detroit, for Fairbanks-Morse Co., amici curiae.

Before the Entire Bench.

DETHMERS, Chief Justice.

I do not concur in affirmance. Mr. Justice ADAMS writes that it is necessary 'to determine whether the method used by the village to purchase and finance equipment falls within one of the methods prescribed by statute or constitution * * * or is * * * a permitted alternative not specifically mentioned in either the statute or constitution.' He finds that it does not fall within Const. 1908, art. 8, §§ 23, 24 and 25, or either of the two alternatives provided in § 5, the general village act, P.A. 1895, No. 3 C.L. 1948, § 72.5, Stat.Ann. § 5.1424. I agree. In that connection, he develops the reasons for that view as relates to the noted sections of the Constitution and the second alternative (pertaining to a borrowing approved by three fifths of electors) contained in section 5 of the statute, without discussing the inapplicability of its first alternative. Defendants' projected course of action does not fall within the first alternative because that clearly applies to and contemplates expenditures for improvements to be made out of revenues from taxes derived from the exercise of the general taxing power. The words 'the council may then raise and expend such sum as it may deem advisable' make obvious the legislative intent that the sum thereby authorized to be 'expended' is a sum which is to be 'raised', and the entire section makes manifest that the word 'raise', as therein used, means the levying of a tax. Even if it were to be conceded that the word 'expend', as there employed, is broad enough to include the spending of current revenues of the utility or reserves built up from previous revenues, on the theory that the express grant of power to operate the utility gives rise to the implied right to operate it at a profit and to use such profits for the benefit of the utility, the first alternative in section 5 definitely does not authorize defendant to borrow or become obligated for the cost of purchased equipment, to pledge future utility revenues for that purpose, to agree to raise electric rates to consumers in the future, if necessary for the purpose of paying the obligation, or to promise not to dispose of, but, on the contrary, to keep the utility in operation and competition out of business until the equipment is paid for, all as provided in defendants' contract with the seller. That the intended transaction involves borrowing, secured by specific pledges and funds of defendant, there can be no doubt. The equipment is to be delivered to defendant in exchange for its delivery to seller of coupon-bearing revenue certificates, due at specified dates, serially, with interest thereon at 3- 1/2%. Even though the obligations to be incurred by defendant are not, under the holdings of cited cases, debts within the meaning of constitutional limitations because they do not constitute charges against the general fund or revenues to be derived from taxation on which such limitations were designed to place a ceiling, the revenue certificates are, nevertheless, evidences of indebtedness, chargeable against future revenues--promises to pay in the future, with interest, an obligation presently assumed. The first alternative of section 5 of the statute contains no express, implied, or included authority therefor.

Having determined that defendants' proposal does not fall within the mentioned or any other constitutional or statutory provisions or grants of power, Mr. Justice Adams points out that no constitutional or statutory provision prohibits it and concludes that, therefore, the methods provided in the statute are not exclusive and 'the right to use an alternative method of financing is implied', quoting, in support of such theory of implied power, from Torrent v. City of Muskegon, 47 Mich. 115, 10 N.W. 132. With that conclusion I do not agree.

Villages are not autonomous entities with inherent powers. They have only those granted by the state through constitutional provision or statutory enactment. Despite the holding in cases such as Gallup v. City of Saginaw, 170 Mich. 195, 135 N.W. 1060, and City of Pontiac v. Ducharme, 278 Mich. 474, 270 N.W. 754, that cities enjoy a general grant of rights and powers under the home rule act, subject only to certain enumerated restrictions, instead of the former method of having only enumerated rights and powers definitely specified, the home rule act and the constitutional provision upon which it is based have not altered the fact that cities must find their powers in the statute directly and can exercise only those expressly or impliedly conferred by statute. Streat v. Vermilya, 268 Mich. 1, 255 N.W. 604; City of Niles v. Michigan Gas & Electric Co., 273 Mich. 255, 262 N.W. 900; Skutt v. City of Grand Rapids, 275 Mich. 258, 266 N.W. 344; City of Pontiac v. Ducharme, supra; Hudson Motor Car Co. v. City of Detroit, 282 Mich. 69, 275 N.W. 770, 113 A.L.R. 1472. Not only is defendants' projected course of action outside the contemplation of sections 23, 24 and 25 of article 8, but in the area in which those sections have application they are not self-executing, do not of themselves confer power upon a municipality, but require statutory implementation. Sault Ste. Marie City Commission v. Sault Ste. Marie City Attorney, 313 Mich. 644, 21 N.W.2d 906. In this connection it is of interest to note that section 20 of article 8, in directing the legislature to provide by general law for the incorporation of cities and villages, provides that such law shall restrict their powers of borrowing money and contracting debts. If it be found, then, that section 5 of the act operates restrictively in this particular, it can scarcely be said to be without constitutional sanction.

The power contended for by defendant not having been expressly granted nor prohibited, is it to be implied from others which are conferred? The quotation from Torrent v. City of Muskegon, supra, that charters cannot be expected to spell out in detail all powers conferred upon a city and that, of necessity, something must be left to implication was apt enough when, as there, the question was whether a city might acquire a city hall without express statutory authorization. The statute conferring the express power to function as a city being silent on the subject of where the functions of city government should be performed, it was but natural to infer from that express grant of power the implied right to function in a building acquired by the city for that purpose. The case is not authority, however, for the proposition that from the express power to operate as a city an implied power could be inferred to borrow money and assume an obligation for the purpose of acquiring a city hall. Neither does it follow from the express power conferred upon defendant to acquire and improve its utility that a power is to be implied to borrow for that purpose. Further distinguishing the instant case from Torrent is the fact that here the statute is not silent on the subject for which an implied power is asserted by defendant. Section 5 of the statute expressly provides two methods of financing the acquisition of the equipment in question. Expressum facit cessare tacitum. That which is expressed puts an end to or renders ineffective that which is implied. Galloway v. Holmes, 1 Doug. (Mich.) 330. So stated in the opinion of four members of this court, the other four concurring in the result, in Taylor v. Michigan Public Utilities Commission, 217 Mich. 400, 186 N.W. 485. Expressio unius est exclusio alterius. Express mention in a statute of one thing implies the exclusion of other similar things. Perry v. Village of Cheboygan, 55 Mich. 250, 21 N.W. 333; Weinberg v. Regents of the University of Michigan, 97 Mich. 246, 56 N.W. 605; Marshall v. Wabash Railway Co., 201 Mich. 167, 167 N.W. 19, 8 A.L.R. 435; Taylor v. Michigan Public Utilities Commission, supra; Van Sweden v. Van Sweden, 250 Mich. 238, 230 N.W. 191. When a statute creates an entity, grants it powers and prescribes the mode of their exercise, that mode must be followed and none other. Taylor v. Michigan Public Utilities Commission, supra. (Four Justices.) (2 Lewis' Sutherland Statutory Construction [2d Ed.] §§ 491-493). When powers are granted by statute to its creature the enumeration thereof in a particular field must be deemed to exclude all others of a similar nature in that same field. So held in Bank of Michigan v. Niles, 1 Doug. (Mich.) 401, in which this court, in considering powers conferred upon a bank by its charter, said:

'The very grant of specified powers under restrictions, is an exclusion of other powers in reference to the same subject matter, not granted by the charter: * * *'. Similarly, as relates to the powers of a corporation created under a general statute, four members of this court, speaking in People v. Gansley, 191 Mich. 357, 158 N.W. 195, 200, said:

'* * * it has been held that the powers are simply such as the statute confers, and that the enumeration of them implies exclusion of all others. Thomas v. Railroad Co., 101 U.S. 71, 25 L.Ed. 950; Pennsylvania R. Co v. [St. Louis, A. & T. H.] Railroad Co., 118 U.S. 290, 309, 6 S.Ct. 1094, 30 L.Ed. 83.'

In Michigan Wolverine Student Co-op v. Wm. Goodyear & Co., 314 Mich. 590, 22 N.W.2d 884, 888, this court said:

'While section 57, supra, states in the affirmative, the manner in which a corporation may sell all or substantially all of its assets, under a well-established rule of statutory...