Smith v. Wilson

• Decision Date: 03 July 1926
• Docket Number: No. 272.,272.
• Citation: 13 F.2d 1007
• Parties: SMITH et al. v. WILSON et al.
• Court: U.S. District Court — Southern District of Texas

13 F.2d 1007 (1926)

SMITH et al. v. WILSON et al.

No. 272.

District Court, S. D. Texas, at Houston.

July 3, 1926.

R. E. Seagler and J. A. McNair, both of Houston, Tex., and A. D. Lipscomb, of Beaumont, Tex., for plaintiffs.

A. R. Rucks, of Angleton, Tex., C. D. Jessup, of Austin, Tex., Louis J. Wilson, of Angleton, Tex., and Bryan, Colgin, Suhr & Bering, of Houston, Tex., for defendants.

Before HUTCHESON and SHEPPARD, District Judges, and FOSTER, Circuit Judge.

HUTCHESON, District Judge.

This is a suit brought by the plaintiffs under section 1243, U. S. Compiled Statutes of 1925, section 266, Judicial Code, as amended in 1925, against the commissioners of the Brazos river harbor navigation district of Brazoria county, Tex., and against the county judge and county commissioners and the tax officers of Brazoria county, Tex., to enjoin the defendants from proceeding in the execution of the plan of assessment, the issuance and sale of bonds, and the levy and collection of taxes on an ad valorem basis upon plaintiffs' property; plaintiffs claiming that the navigation district has been attempted to be formed in violation of the Constitution and statutes of the state of Texas, and, further, that whether so or not, as to plaintiffs' property the burdens sought to be imposed in pursuance of its formation constitute a denial to plaintiffs of the equal protection and due process guaranties of the Fourteenth Amendment to the Constitution of the United States.

While a vast amount of testimony was taken in this case, most of it is cumulative and immaterial, and the facts upon which the decision of the matter turns may be stated with the utmost brevity. These are:

That under section 59, art. 16, of the Texas Constitution, and chapter 5 of the Acts of the Thirty-Ninth Legislature (Vernon's Ann. Civ. St. 1925, art. 8263) passed to make its mandates effective, the creation of the Brazos river harbor navigation district was petitioned for, and the boundaries of the district, as finally established, were set out and defined (see map introduced by plaintiffs and attached to this opinion), and after due notice, as provided in the statutes, after a long and patient hearing of the petition and the protests of the property owners, including plaintiffs, the commissioners' court finding that the proposed improvement was feasible and practicable, that it would be a public benefit and a public utility, and that the boundaries of the proposed district as set out in the petition should be approved, the petition was granted, the result announced by the county judge in open court, and on the same day two orders, one calling the election, the other fixing the amount of the bonds, etc., were presented to the county judge, in the presence of three of the commissioners, and were without discussion signed by the county judge and spread upon the minutes.

Thereafter, the election coming on, practically the entire voting strength of the district went to the polls. Out of a population of less than 15,000, a vote of 3,200 was cast; the district winning by a very large majority. The returns of the election were regularly canvassed, the result regularly declared by the commissioners' court, and an order was entered appointing navigation and canal commissioners, and reciting that the district had been legally and properly created. Thereafter the commissioners' court entered its orders authorizing the issuance of a million dollars in bonds, and the levy of taxes in payment therefor, which orders were signed by the county judge and the four commissioners.

Immediately after the making of these orders, plaintiffs caused this suit to be brought to prevent the district from functioning. No bonds have been sold, no taxes collected, and the Attorney General has expressly declined, because of this litigation, to approve the bonds.

Both the evidence taken before the commissioners' court and that taken on this trial establish that while there would be a direct, immediate and large benefit to the Freeport Sulphur Company, a corporation owning wharves, a sulphur plant, and large properties in and around Freeport where the navigation district is, and to other property in that vicinity, the property of plaintiffs, lying many miles back of Freeport, will not be directly or immediately benefited, but the benefit will arise indirectly from the growth of the community generally, due to the establishment and maintenance of a successful port.

In support of the finding of the commissioners that the project was practicable, a public benefit, and a public utility, the evidence discloses that the project has been approved by the United States Engineer, and that an appropriation of $500,000 has been made by Congress to be used with and supplementing the funds provided by the district, and the evidence establishes affirmatively that the creation of an excellent port will result from the improvement, which, while benefiting those owning property immediately adjacent to it, will also operate as a benefit, to some extent, throughout the entire district.

The evidence also shows that the hearing before the commissioners' court was fairly and justly conducted; the judgment of the court was found and entered, not arbitrarily, but justly and fairly, and in accordance with the statutes and the Constitution of the state, and that there was ample warrant for the judgment of the commissioners' court that the boundaries as proposed were just and reasonable, and that the district as bounded would be a public benefit and a public utility. There is no evidence from which it could be found that the property of the plaintiffs was arbitrarily and capriciously included in the district, and that the inclusion operates unconscionably, or in a confiscatory way, unless it is an act of confiscation to include property within the district without making provision at some time, for a hearing on the apportionment of taxes to benefits other than the hearing which is accorded by law to all property owners in connection with ad valorem assessments.

Section 59, art. 16, of the state Constitution, is the expression of the public policy of this state for the conservation and development of all its natural resources, including the navigation of its many inland waters, and the utilization of its long and favorable coast line. It declares:

"There may be created within the state of Texas, or the State may be divided into, such number of conservation and reclamation districts as may be determined to be essential to the accomplishment of the purposes of this amendment to the Constitution, which districts shall be governmental agencies and bodies politic and corporate with such powers of government and with the authority to exercise such rights, privileges and functions concerning the subject-matter of this amendment as may be conferred by law."

The Legislature is authorized and directed to make provision for the creation of the districts and the levy and collection of the taxes.

To effectuate this constitutional mandate, the Thirty-Ninth Legislature enacted the law under which the navigation district was formed. This act, chapter 5 of the Acts of the Thirty-Ninth Legislature, also found in R. S. 1925, fully and in detail sets out the procedure under which this district was organized, provides for a hearing before and judgment by the commissioners' court on petition, which hearing should be had after notice, at which hearing those for and against the district had the right to contest or to contend for its creation, and offer testimony in favor of or against the district, to show that the proposed improvement or improvements would or would not be of any public benefit, and would or would not be feasible or practicable, and as to any other matters pertaining to the district.

It provides that the county commissioners' court shall have exclusive jurisdiction of the hearing, and shall determine all contests and objections, and all matters pertaining to the creation of the district, and all judgments or decisions rendered by the court shall be final, and it expressly authorizes that court to adopt, reject, or change, as it deemed best, the proposed boundaries.

It provides minutely and in detail for the holding of an election, for canvassing and declaring the result of it, the issuance of bonds, and the levy of ad valorem taxes to pay therefor, and specifically authorizes the district to co-operate with the government of the United States in the matter of any proposed development.

The contentions of plaintiffs on their pleadings and proof, briefly summarized, are:

(1) That the creation of the district is not in fact a public, but a private, enterprise, since though ordered by the commissioners' court of Brazoria county, that court did not use its discretion, but merely registered the will of certain alleged selfish promoters, especially the Freeport Sulphur Company, a large property owner and shipper at Freeport. Therefore the issuance of bonds therein, and the levy and assessment of taxes to pay the same, constitute a lending of public credit to a private enterprise, in violation of article 3, § 52, of the state Constitution, which prohibits the lending of public credit to any individual, and of article 8, § 3, of the State Constitution, providing that taxes shall be levied and collected for public purposes only.

(2) That if the district could have been validly created, it was not so created, because, as they claim, the commissioners' court did not make any order fixing the date of the election, and fixing the amount of bonds to be voted on, but the order therefor was signed by the county judge without the action of the commissioners' court thereon.

(3) That in any event, the inclusion of plaintiffs' property within the district is so arbitrary and unreasonable under the facts as to bring this case within the principle of Norwood v. Baker, 172 U. S. 269, 19 S. Ct. 187, 43 L. Ed. 443.

(4) That the...