Sholtz v. Mccord

• Decision Date: 05 October 1933
• Citation: 150 So. 234,112 Fla. 248
• Parties: SHOLTZ, Governor, et al. v. McCORD.
• Court: Florida Supreme Court

150 So. 234

112 Fla. 248

SHOLTZ, Governor, et al. v. McCORD.

Florida Supreme Court

October 5, 1933

En Banc.

Suit by Guyte P. McCord against David Sholtz, as Governor of the state, and others, as and constituting the Board of Commissioners of State Institutions of the State of Florida. From a decree in favor of the complainant, granting an injunction and denying the defendants' motion to dismiss the bill of complaint, the defendants appeal.

Affirmed. Appeal from Circuit Court, Leon County; J. B Johnson, Judge.

COUNSEL

Cary D Landis, Atty. Gen., and H. E. Carter and Robt. J. Pleus Asst. Attys. Gen., for appellants.

Guyte P. McCord, of Tallahassee, and F. P. Fleming, of Jacksonville, for appellee.

OPINION

WHITFIELD Justice.

In a bill of complaint brought by a citizen and resident taxpayer of the state, it is in effect alleged that the board of commissioners of state institutions, consisting of the Governor and the six administrative officers of the executive department, contemplate and assert that they intend to procure from the United States under the 'National Industrial Recovery Act' of Congress 'a grant, loan and/or advance of money for the purpose of erecting' stated buildings at the Florida State Hospital for the Insane and at the Florida State Prison; the amount being $500,000 30 per cent. of the amount 'to be an outright grant from the United States'; that 'for the purpose of securing the repayment of the balance of seventy per cent of the said $500,000.00 or the sum of $350,000.00, the said Board of Commissioners of State Institutions * * * are now preparing to either lease or deed outright to the United States Government, or its Emergency Administration, or other proper representatives thereof, the land upon which the proposed projects will be erected; and following which, said Board of Commissioners of State Institutions are preparing to enter into a lease agreement wherein and whereby they will agree to pay to the United States Government, or its Emergency Administration; or other proper representatives thereof, a sum of money monthly or annually over a period of years until said sum of $350,000, together with interest approximating 4% per annum thereon shall have been paid; said period not to exceed thirty years in duration'; 'that the transaction so contemplated as aforesaid is pursuant to section 203(a)(3) of said National Industrial Recovery Act, and upon completion of the amortized payments as provided in said contemplated agreement, and without further cost, the said Board of Commissioners of State Institutions could procure a conveyance of the projects involved at their option.'

It is alleged that the contemplated transaction is illegal and violates sections 2, 4, and 6 of article 9 of the state Constitution; and that it will increase complainant's taxes and cause him irreparable damage. It is prayed that the board be enjoined from doing anything about the execution of any papers, contracts, leases, or other documents 'concerning or in any manner pertaining to the securing of money, directly of indirectly wherewith to construct' a building or other project at either of said institutions.

By answer and motion to dismiss the bill of complaint, the defendant members of the board admit a purpose to take contemplated action as alleged, and deny its illegality and irreparable damage to the complainant. The defendants aver 'that the transaction contemplated by them is in compliance with the terms of the National Industrial Recovery Act as cited in the bill of complaint, and allege that the Section thereof under which they are proceeding, was specifically placed in said Act for the purpose of being used by States or political subdivisions thereof which were forbidden to created a debt and issue bonds as evidence thereof, or which had exceeded their debt limitation; and that a covenant in a lease to pay rent is in no sense a debt nor is a lease containing such covenant in any manner an evidence of indebtedness or a bond; and therefore, the contemplated transaction in no manner violates any provision of the Constitution of Florida, but on the other hand is in full compliance and accord with the letter and spirit thereof. * * * that by chapter 15858, Acts 1933, a due, legal and proper appropriation was made for Florida State Hospital in the sum of $511,333.75, to cover necessary and regular expense, and $58,194 to cover incidentals, and that a due, legal and proper appropriation was made for the State Prison Farm in the sum of $254,421 for necessary and regular expense, and the sum of $10,000 for a new female ward. And these defendants allege that each of said sums is an annual appropriation, and the said Chapter covered the biennium period from July 1, 1933, to July 1, 1935. And these defendants allege that the contemplated rental payments under the terms of the contemplated transaction will, together with all other necessary and/or regular and/or incidental expenses of said institutions, be well within the said appropriation as fixed by law; * * * that there is dire and immediate need for the proposed projects at the State Institutions involved for the proper and efficient management thereof, and these defendants are under a duty to provide therefor, and that the contemplated transaction has in mind providing the said projects for the use and benefit of the State at a minimum of cost to the State and without the creation of a debt or liability therefor or the issuance of any bond or other similar evidence of indebtedness to secure the same.'

The grounds of the motion (embraced in the answer) to dismiss the bill of complaint are:

'(a) That said bill of complaint is without equity, and shows upon its face that it contains no ground for equitable relief against these defendants.

'(b) That said bill of complaint shows upon its face that the contemplated transaction is valid, legal and constitutional, and in no manner violates the constitutional rights of the plaintiff or any other citizen or taxpayer of Florida.

'(c) That said bill of complaint shows upon its face that the contemplated transaction is not the creation of a debt, and the issuance of a bond or other similar evidence thereof, but that the said transaction involves a lease by the defendants containing a covenant to pay rent, which does not constitute a debt, or amount to the issuance of a bond or other evidence of such debt.'

The court, upon consideration of the bill, answer, and motion to dismiss, granted an injunction and denied the motion to dismiss the bill of complaint. Defendants appealed.

The answer admits the allegations of a purpose by the board to procure 'a grant, loan and/or advance of money' to the amount and for the purpose stated, and that the board 'will agree to pay * * * a sum of money monthly or annually over a period of years until said sum of $350,000 together with interest approximating 4% per annum thereon shall have been paid; said period not to exceed thirty years in duration.'...