Smith v. Curran

• Decision Date: 18 September 1934
• Docket Number: Motion No. 394.
• Citation: 268 Mich. 366,256 N.W. 453
• Parties: SMITH et al., Common Council, v. CURRAN, Controller.
• Court: Michigan Supreme Court

268 Mich. 366

256 N.W. 453

SMITH et al., Common Council,

v.CURRAN, Controller.

Motion No. 394.

Supreme Court of Michigan.

Sept. 18, 1934.

Petition for mandamus by John W. Smith and others, comprising the Common Council of the City of Detroit, a municipal corporation of the State of Michigan, against William J. Curran, Controller of the City of Detroit.

Writ of mandamus denied.

See also, 267 Mich. 413, 255 N. W. 276.

Argued before the Entire Bench.

Raymond J. Kelly, Corp.Counsel, and Paul T. Dwyer, Asst. Corp.Counsel, both of Detroit, for petitioners.

Clarence J. Huddleston, of Detroit, for respondent.

FEAD, Justice.

The city of Detroit is engaged upon a project to refund $360,000,000 of bonds.Some are original obligations of the city.Some were issued by other municipalities and assumed by the city on annexation of territory of issuing districts.Some were approved by popular vote.Some were issued by the legislative bodies of municipalities without vote of the people.The records of some have been wholly lost.The city of Detroit had recognized its obligation for them, has levied taxes for many years, and made payments of principal and interest and provided sinking funds without protest or objection of taxpayers.In the refunding operation, however, approval of the validity of the bonds by counsel has been demanded and, because of the loss of records, the city desires the aid of a validation act of the Legislature.To provide a test case, the city controller has formally refused to issue the refunding bonds and the members of the common council have petitioned for a writ of mandamus to compel him to issue them.His defense is that the validation law, ActNo. 31, Special Session 1934, was adopted in violation of the Constitution, art. 5, § 22: ‘No bill shall be passed at a special session of the legislature on any other subjects than those expressly stated in the governor's proclamation or submitted by special message.’

March 15, 1934, the common council of the city of Detroit adopted a resolution assuming liability for all bonds above mentioned and providing for their inclusion in the refunding plan.On the same day a bill was introduced in the Legislature, convened in special session, which was afterwards enacted as Act 31.The act reads:

‘An Act to provide for the ratification, validation and confirmation of certain bonds heretofore issued by any city, or by any school district or territory which has become annexed to any city, acknowledgment of which bonded indebtedness has heretofore been or shall hereafter be made by such city; and authorizing the refunding of such bonds.

‘The People of the State of Michigan enact:

‘Validation of bonds of territory annexed to cities; refunding; bond limitation.Section 1.Whenever the legislative body of any city shall have adopted, prior to April fifteen, nineteen hundred thirty-four, a resolution by a majority vote of its members-elect, acknowledging as valid indebtedness of said city any outstanding bonds theretofore issued by said city, and any outstanding bonds of any township, city, village or school district, the payment of all or a portion of which has been assumed through the annexation of additional territory to said city, all such bonds are hereby ratified, validated and confirmed as binding obligations of said city.All said outstanding bonds of the city, and all said outstanding annexed district bonds, or the portion so assumed by such city, may be refunded from time to time under the provisions of the general laws by the issuance of refunding bonds of said city, and no irregularity or other infirmity in or absence of the proceedings authorizing such outstanding bonds shall ever be set up as a defense to the payment of said refunding bonds or the interest thereon.The legislative or governing body of said city and of the existing unannexed township, village, city or school district, may enter into any contract relative to the payment of the balance of said bonds and interest as shall not be prejudicial to the rights of the bondholders.Any bonds so assumed on any territory not so annexed shall not be construed to be included in the bond limitation of the city assuming same in cases where the school district, township, village or city primarily liable on said bonds shall agree to reimburse the obligating city.’

The Governor called the session ‘for the consideration of such matters as may be submitted by special message.’

Upon the Legislature convening, the Governor delivered a message beginning: ‘You have been called in Special Session to reconsider several important matters which have been before you in your General Session, or in your Special Session, or in both of these sessions.In addition, legislation has been requested on some matters which either have not been before you heretofore, or which are indicated as a result of the administration of laws previously passed by you.’

Petitioners contend this language submitted all subjects considered at the general session.But by its own words it was confined to ‘several important matters,’ which needed further designation before they could have been deemed to be submitted to the Legislature.

The message further stated:

‘Upon the recommendation of legislative council, I am also submitting to you for consideration and action, the following bills:

‘4.A bill providing for the validation of bonds issued by a municipality under sufficient popular vote regardless of technical requirements.’

Apparently the bill so referred to by the Governor was one introduced to validate certain bonds issued by cities to acquire light and power plants and which was enacted as ActNo. 6(Pub. Acts 1934[Ex. Sess.]).

The primary problem is to determine...