St. Louis Housing Authority v. City of St. Louis

• Decision Date: 19 April 1951
• Docket Number: No. 42516,42516
• Parties: ST. LOUIS HOUSING AUTHORITY et al. v. CITY OF ST. LOUIS.
• Court: Missouri Supreme Court

Page 289

239 S.W.2d 289

361 Mo. 1170

ST. LOUIS HOUSING AUTHORITY et al. v. CITY OF ST. LOUIS.

No. 42516.

Supreme Court of Missouri, en Banc.

April 19, 1951.

Paul J. Kaveney, St. Louis, for plaintiff-appellant.

John B. Gage, James A. Moore, Kansas City (Gage, Hillix & Phelps, Kansas City, of counsel), for intervenor-respondent.

James E. Crowe, City Counselor, John P. McCammon, Associate City Counselor, St. Louis, for defendant-respondent City of St. Louis.

CONKLING, Judge.

This action by St. Louis Housing Authority, a chartered municipal corporation organized under our state 'Housing Authorities Law', R.S.Mo.1949, Secs. 99.010 to 99.230, originally approved May 15, 1939, Laws Mo.1939, p. 488 (hereinafter called plaintiff) against the City of St. Louis, Missouri, a municipal corporation (hereinafter called defendant), is one under the Declaratory Judgment Act. Plaintiff seeks a judgment declaring that (1) plaintiff and defendant have constitutional and statutory authority to execute a certain contract called to 'Cooperation Agreement', and (2) that said 'Cooperation Agreement' is valid and legally commits plaintiff and defendant to the terms and conditions thereof. The validity and effect of that Cooperation Agreement is in issue here. A justiciable controversy is presented.

After defendant had filed its answer, Housing Authority of Kansas City (hereinafter called Intervenor) and also organized under our 'Housing Authorities Law', supra, was given leave to intervene and filed in this cause in the circuit court its interplea and answer in which it prayed the same declarations sought by plaintiff.

After the judgment was entered below, plaintiff filed its motion for new trial contending that the judgment below is insufficient; does not remove the uncertainty and doubt as to plaintiff's rights; does not adequately determine the authority of plaintiff and defendant to execute the 'Cooperation Agreement', nor the effect thereof; does not completely adjudicate their rights, and does not give that degree of relief contemplated by our Declaratory Judgment Act. Plaintiff and Intervenor here take those contentions upon plaintiff's appeal. After an examination of the transcript, exhibits, briefs and the authorities cited we have concluded that under the instant circumstances the judgment entered below is deficient. Smith v. Pettis County, 345 Mo. 839, 136 S.W.2d 282, 285; City of Joplin v. Jasper County, 349 Mo. 441, 161 S.W.2d 411, 414; Hyde, Declaratory Judgments, 26 Washington University Law Quar. 489. We must therefore proceed to consider the merits of the issues, determine and declare the rights of the parties, dispose of this appeal and 'give such judgment as such (trial) court ought to have given'. R.S.Mo.1949, Secs. 512.160 and 527.010 to 527.140.

The facts are not in dispute. From the record before us we find these facts: On September 2, 1949, plaintiff applied to Public Housing Administration (hereinafter called PHA), a federally owned corporation, and an agency of the Frderal government, for a preliminary loan, under the United States Housing Act, as amended, U.S.C.A., Title 42, Chapter 8, Sections 1401-1433 (hereinafter called the 'Federal Act'), to make preliminary surveys, etc., for low-rent and slum-clearance housing projects in St. Louis, to include 5800 new dwelling units. PHA is empowered under the Federal Act to extend financial aid to state or local public housing authorities to aid in the development and operation of low-rent housing and slum-clearance projects. The above application of plaintiff was approved by defendant by Ordinance No. 45,080 of the Board of Aldermen of St. Louis, wherein defendant declared the need in the defendant city for such low-rent public housing for low-income families, and that such need is not being met by private enterprise. That ordinance is before us.

The above preliminary loan was approved. Pursuant thereto plaintiff executed a preliminary Loan Contract with PHA for the above purposes and the latter advanced plaintiff $86,000 for which plaintiff executed a note. A copy of the preliminary Loan Contract and note are before us.

On March 14, 1950, plaintiff and defendant executed the instant Cooperation Agreement, the validity of which is in issue here. That agreement had been authorized by a resolution, passed by plaintiff, and by an Ordinance No. 45,182, enacted by the St. Louis Board of Aldermen on January 9, 1950. The Cooperation Agreement, resolution and ordinance are before us. Plaintiff intends to and will execute a 'Proposed Contract' with PHA in which the latter will agree to lend plaintiff $69,600,000, that sum being 90% of the cost of the acquisition and construction of the proposed 5800 units of low-rent housing. Under that proposed contract PHA will make to plaintiff annual contributions for not to exceed 40 years at not to exceed the federal going rate of interest applied to the total cost of the project. The federal going rate is defined in the Federal Act. The loans of federal money to plaintiff for these purposes will be on a wholly self-liquidating basis to cover capital costs and will be secured by a pledge of revenues derived from operating the housing project and by a pledge of annual contributions made for such project by the Federal Government. The contributions are to enable plaintiff to construct, maintain and operate the project on a low-rent basis.

Under the Proposed Contract, the loans advanced to plaintiff by PHY will be also secured by bonds, which shall be payable out of plaintiff's funds, property and income. Plaintiff may sell such bonds with the approval of PHA but such bonds of plaintiff, under R.S.Mo.1949, Sec. 99.140, will be secured exclusively by the property, income and revenues of plaintiff. Under that statute the bonds 'shall not be a debt of the city (defendant), the county, the state * * * and neither the city or the county, nor the state * * * shall be liable thereon, nor in any event shall such bonds or obligations be payable out of any funds or properties other than those of said authority.' See Bader Realty & Investment Co. v. St. Louis Housing Authority, 358 Mo. 747, 217 S.W.2d 489, 494. Plaintiff has heretofore constructed and is now operating 1357 such low-cost housing units. It is now constructing 704 such additional units. Those are in addition to the 5800 units now proposed to be constructed.

We also find that: The Intervenor has followed in respect to the planning for proposed low-rent and slum-clearance housing projects in the City of Kansas City, Missouri, the same course of action as has the plaintiff and has entered into preliminary arrangements and agreements with PHA. Pursuant thereto the latter will agree to lend to the Intervenor as a Housing Authority large sums of money to be used in connection with the acquisition and construction of proposed low-rent housing and slum-clearance projects to be located in Kansas City, Missouri. Such indebtedness is to be repaid upon approximately the same basis as above set out (as to plaintiff) and Intervenor has entered into a 'Cooperation Agreement' with the City of Kansas City, Missouri, similar in context and legal aspect to the 'Cooperation Agreement' of plaintiff with the City of St. Louis.

The 'Cooperation Agreement' instantly at issue is too long a document to be here set out or even fully digested. It has been carefully examined. Briefly, it provides for cooperation between plaintiff and defendant in the construction and operation by plaintiff of the 5800 low-rent dwelling units; recites plaintiff's freedom from ad valorem taxes on those properties 'so long as * * * such project is used for low-rent housing purposes', See Bader Realty & Investment Co. v. St. Louis Housing Authority, supra; provides 'Payments in Lieu of Taxes' from plaintiff to defendant of a percentage of the aggregate 'Shelter Rent', and the manner in which defendant shall distribute same among the 'Taxing Bodies' of the city; provides for elimination of a certain number of now existing 'unsanitary dwelling units' or slums within the defendant city; provides defendant shall furnish public services such as fire, police and health protection, street repairs, storm and sanitary sewers, water systems, garbage disposal, street lighting, etc. It is also provided that defendant shall vacate certain public ways, if necessary in the development of the project, and will accept dedication of new streets, roads, alleys and sidewalks after plaintiff has graded, paved and completed the same to defendant's specifications. Such is the general tenor and effect of the Cooperation Agreement. Our attention has been called to no provision of the Cooperation Agreement, and close scrutiny of that contract reveals no provision therein, which is not 'within the scope of the powers' of either plaintiff or defendant, as limited by the Housing Authorities Law, by R.S.Mo.1949, Sec. 70,220, or by the general law governing their powers to contract.

Under Section 16 of Article VI of our Constitution it is authorized that: 'Any municipality or political subdivision of this state may contract and cooperate with other municipalities or political subdivisions thereof, or with other states or their municipalities or political subdivisions, or with the United States, for the planning, development, construction, acquisition of operation of any public improvement of facility, or for a common service, in the manner provided by law.' (Emphasis ours.) Section 21 of that Article of our Constitution authorizes the enactment of laws and ordinances for the 'clearance, replanning, reconstruction, redevelopment and rehabilitation of blighted, substandard or insanitary areas', etc.

Subsection (f) of Section 8 of the original Housing Authorities Law, Laws Mo. 1939, p. 494, which is now subsection 6 of Section 99.080 R.S.Mo.1949, authorizes the authority 'to cooperate with the city * * * in action taken in connection with...