Spilman v. City of Parkersburg

• Citation: 14 S.E. 279,35 W.Va. 605
• Parties: SPILMAN v. CITY OF PARKERSBURG et al.
• Decision Date: 19 December 1891
• Court: Supreme Court of West Virginia

14 S.E. 279

35 W.Va. 605

SPILMAN v. CITY OF PARKERSBURG et al.

Supreme Court of Appeals of West Virginia.

December 19, 1891

Submitted September 7, 1891.

Syllabus by the Court.

1. A city, indebted up to the limit fixed by the constitution cannot carry on its operations upon credit, within the meaning of credit in the constitution, in any manner, or for any purpose, but must pay during the current year with funds in hand, or with funds already legally levied.

2. A city thus indebted cannot increase its indebtedness beyond the constitutional limit by contracting for an electric apparatus and plant; and, such indebtedness being forbidden the contract out of which it arises, although executory, is also forbidden. The end aimed at is prohibited, which carries with it the prohibition of the means directly and appropriately designed and adapted for its accomplishment.

3. Any tax-paying resident and voter of such city suing on behalf of himself and of all other tax-payers of such city, has a right to enjoin the creation of any such unconstitutional indebtedness.

Appeal from circuit court, Wood county.

Suit by B. D. Spilman against the city of Parkersburg and others to restrain the creation of a city debt for the erection of an electric light plant. From an order refusing defendants' motion to dissolve the injunction, defendants appeal. Affirmed.

J. B Jackson and J. A. Hutchinson, for appellants.

B. M. Ambler, for appellee.

HOLT J.

Article 10, § 8, Const. W.Va., provides that "no county, city, school district, or municipal corporation shall hereafter be allowed to become indebted in any manner or for any purpose to an amount, including existing indebtedness, in the aggregate exceeding five per centum on the value of the taxable property therein, to be ascertained by the last assessment for state and county taxes previous to the incurring of such indebtedness; nor without at the same time providing for the collection of a direct annual tax, sufficient to pay annually the interest on such debt and the principal thereof within, and not exceeding, thirty-four years: provided, that no such debt shall be contracted under this section unless all questions connected with the same shall have been first submitted to a vote of the people, and have received three-fifths of all the votes cast for and against the same." This suit involves this provision of the state constitution, and is a bill in equity, filed in the circuit court of Wood county on the 9th day of April, 1891, by B. D. Spilman, who sues on behalf of himself and all other citizens, residents, and tax-payers in and of the city of Parkersburg, W.Va., against the city of Parkersburg and others, to restrain and inhibit the creation by the city of a debt for the erection of an electric light plant, alleged to be in violation of the above-mentioned section of the state constitution. The injunction was granted on May 25, 1891, until further order, and thereupon defendants gave notice of motion to be made on June 22, 1891, to dissolve, on which day the judge in vacation heard the motion, but overruled the same, refusing to dissolve the injunction, and from this order defendants below, plaintiffs in error, have obtained this appeal.

The facts are as follows: The total valuation of the taxable property on the 10th day of November, 1890, ascertained by the last assessment in the city for state and county taxes, was $3,818,120,--5 per cent. of which is $190,906. The then existing indebtedness of the city was $190,000. On the 18th day of March, 1891, the Thomson-Houston Electric Company entered into a written contract of that date, whereby the electric company agreed, to erect and install for the city a certain electric plant in accordance with specifications attached and made part of the contract, for which the city agreed to provide a suitable site, boiler, and foundation for engine and dynamos, to pay all taxes on such apparatus and plant, and keep the same in repair, and also agreed to lease from the electric company such plant, furnished for street lighting, for a term of five years from the completion of the plant, and to pay at the end of each three months after its completion--that is to say, quarterly--the sum of $1,625 for the use thereof, except that each succeeding payment was to be $18.75 less than the preceding payment; and at the expiration of the term of five years the city has the right to buy the same at the price of $1,--plainly a contract of purchase in legal effect; in fact so designated twice in a paper made part of the contract. No question connected with this transaction was submitted to the people; no vote was had thereon. In addition, there were in November, 1890, funds receivable from licenses, etc., the sum of $17,444.53.

"AGREEMENT.

"This agreement, made this 18th day of March, 1891, between the Thomson-Houston Electric Company, party of the first part and the city of Parkersburg, W.Va., party of the second part, witnesseth: 1st. The party of the first part agrees to erect and install an electric light plant in accordance with specifications attached, such plant consisting of one 100 H. P. automatic cut-off and compound condensing engine of some well-known and approved make, such engine being guarantied by the makers to have as high an efficiency as is attainable under the conditions of working; two Thomson-Houston standard are dynamos, each having a capacity of fifty (50) lamps of two thousand (2,000) nominal candle-power each; seventy-five (75) double carbon standard arc lamps, with necessary device for suspending over street; together with all other electrical apparatus and line construction to the extent of ten (10) miles single line, according to attached specifications, and necessary to make the plant complete and satisfactory in every detail. 2d. And the party of the second part agrees to provide a suitable site, building, boiler, and foundation for the above-mentioned engine and dynamos. 3d. And the party of the second part further agrees to lease from the party of the first part and operate such of the above-mentioned plant as is furnished by said party of the first part for street lighting, and is described in the attached specifications, for a term of five (5) years from the completion of said plant; and the party of the second part agrees to pay party of the first part at the end of each three months after the completion of said plant,--that is to say, quarterly,--the sum of sixteen hundred and twenty-five dollars ($1,625) for the use of said apparatus and plant described in attached specification, except that each succeeding payment shall be eighteen dollars and seventy-five cents ($18.75) less than the preceding payment. 4th. The party of the second part agrees to pay all taxes on said apparatus and plant furnished by party of the first part as described in the attached specifications, and to keep said apparatus and plant in repair. 5th. At any time during the term of lease above mentioned, and which the party of the second part hereby agrees to enter into, the party of the first part and the party of the second part agree that the party of the second part may purchase said apparatus and plant furnished by party of the first part by paying therefor to the party of the first part the difference between the sum of the amounts which may have been paid under the terms of the above-mentioned lease and twenty-five thousand dollars, to which shall be added the costs of any additions which, by mutual consent, may have been made, together with interest at six per cent. per annum from the completion of said plant to date of purchase. 6th. The party of the first part and the party of the second part agree that any additions and extensions which may be required shall be made to above-mentioned apparatus and plant by mutual agreement and consent. 7th. At the expiration of the term of the above-mentioned lease, and upon the completion and fulfillment of the terms and additions of same, party of the first part agrees that party of the second part may purchase the above-mentioned apparatus and plant as is described in attached specifications, together with any additions or extensions which may have been made in the manner as described above, for a consideration of one dollar, to which shall be added the cost of any such additions or extensions as may have been made payable to party of first part. 8th. But if the party of the second part decides not to purchase as above provided for, then said party of the second part agrees to lease the above-mentioned apparatus and plant, together with any additions or extensions, for a further term of five years, on terms to be agreed upon. The ordinances of the city of Parkersburg under which this contract is made and executed is hereby accepted by the Thomson-Houston Electric Company, and it and the specifications herein referred to are made parts hereof, as if the same were written herein. In witness whereof, the party of the first part has caused these presents to be signed and its seal to be affixed by ___, its ___, and the party of the second part has caused these presents to be signed by G. B. Gibbens, its mayor, and its seal to be affixed and duly attested by L. W. Hughes, its clerk. G. B. GIBBENS, Mayor. [Seal.] Teste: L. W. HUGHES. [Seal.]

"SPECIFICATIONS.

" General Conditions.

"Construction: It is understood that the Thomson-Houston Electric Co. is in no way responsible for any defects in wiring or other parts of the installation, unless the same is done under the direction of its authorized representative, or in any manner approved by it; and it is also understood that the entire installation is to be made in accordance with the requirements of the West Virginia Board of Fire Underwriters.

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