State Ex Rel. Babson v. City of Sebring

• Decision Date: 05 June 1934
• Citation: 115 Fla. 176,155 So. 669
• Parties: STATE ex rel. BABSON v. CITY OF SEBRING et al.
• Court: Florida Supreme Court

155 So. 669

115 Fla. 176

STATE ex rel. BABSON v. CITY OF SEBRING et al.

Florida Supreme Court

June 5, 1934

En Banc.

Mandamus by the State, on the relation of Roger W. Babson, against the City of Sebring, a municipal corporation, and others.

Motion to quash sustained.

COUNSEL

M. R. McDonald, of Sebring, for relator.

W. H Nollman and Fairfax T. Haskins, both of Sebring, E. Noble Calhoun, of St. Augustine, John W. Watson, Jr., and Abe Aronovitz, both of Miami, Gordon C. Huie, of Haines City Fleming & Snow, of Cocoa, J. M. Austin, of Leesburg, M. H Jones, of Clearwater, Ernest P. Roberts, of Miami, James T. Bocelle, of Vero Beach, Fred M. Harris (of Bartow, Carver & Langston), of Lakeland, Nat J. Patterson, of Ft. Meade, William M. Madison, Austin Miller, Gov. Hutchinson, and Emmet Safay, all of Jacksonville, Giles & Gurney, of Orlando, W. F. Way, of St. Petersburg, Archie Clement, of Tarpon Springs, Leitner & Leitner, of Arcadia, and G. R. Nottingham, of Ft. Pierce, for respondents.

OPINION

WHITFIELD Presiding Justice.

Formerly the respondent municipality was established as the town of Sebring. Under chapter 14371 (Sp. Acts 1929) it is now designated city of Sebring.

The relator seeks by mandamus to require the payment of $500 from the municipal utility light and water funds of the city, upon the bonds of the municipality held by the relator; the defense, in effect, being that, under the statutes authorizing the bonds to be issued and under the statutes of the state as they now exist, the bonds are to be paid only from the proceeds of tax levies, in the absence of other controlling provisions of law.

There is in the record no sample copy of the bonds here involved, but the alternative writ alleges, in substance, that the town of Sebring in October, 1924, and in September, 1925, executed, sold, and delivered stated numbers of $1,000 bonds, 'each of which * * * was therein designated 'Light and Water Bonds,' * * * and in and by each of said bonds said municipality, among other things, pledged itself as follows:

'For the prompt payment hereof, both municipal and interest as the same become due and payable, the full faith, credit and resources of the City of Sebring are hereby irrevocably pledged.

'This bond is one of a series of like date, tenor and amount, and is issued pursuant to the charter of said City, being Chapter 7242 of the Laws of Florida of 1915 and pursuant to a majority vote of the qualified electors of said City, who are freeholders therein voting at an election duly and regularly called and held for that purpose on the 29th day of July, 1924, and pursuant to ordinances of said City duly adopted for the purpose of improving and extending the Electric Light and Water System in the said City of Sebring.

'That all acts, conditions and things required to be done precedent to and in the issuance of this bond by the laws and Constitution of this State and the ordinances of said City have been done and have happened in due time, form and manner, and that the total indebtedness of said City including said bonds, did not exceed any constitutional or statutory limitation.'

The alternative writ alleges:

'That each and all of said bond issues, above described, said 'Light and Water Bonds', were issued for the sole purpose of raising funds to apply on, extend and improve the electric light and water system belonging to said municipality; that said municipality owned and operated its electric light and water system, and as a corporate function, before and at the time of issuing each and all of said issues of bonds and also still owns and operates the same for profit, selling electrical current and water to various persons, firms and corporations within and without the corporate limits of this City, and therefore, Relator alleges that said electric light and water system so belonging to and operated by said municipality at the time of said bond issues and also at this time, constituted some of the 'credit and resources' of said municipality and of which proceeds or funds derived from the sale of electrical current and water were pledged towards the payment of the principal and interest of each and all of said Light and Water Bonds as the same severally becomes due and payable, and in addition to a right of said Relator to a tax levy for his special benefit.'

By motion to quash the alternative writ, the respondents, in effect, challenge the legal correctness of the contentions of the relator. It is contended that the provisions contained in the bonds, that 'the full faith, credit and resources of the City of Sebring are hereby irrevocably pledged' for the prompt payment of the principal and interest of the bonds as they become due and payable, and that the allegation that the bonds 'were issued for the sole purpose of raising funds to apply on, extend and improve the electric light and water system belonging to said municipality,' considered with the statutory powers of the municipality, give to relator a right to require the payment on the bonds and coupons he holds of the sum of $500 from funds held by the municipality derived from the sale of electrical current and water belonging to the municipality.

In ascertaining the obligation of municipal bonds, the statutes authorizing their issue must be considered and given due effect, even if in doing so the terms of the bonds are restrained or modified, since the authorizing statutes control the obligations of the bonds if the terms of the bonds are not in accord with the intendments of the governing statutes. State ex rel. v. Crandon (Fla.) 155 So. 667, decided May 29, 1934.

At the time the bonds were issued the statutory charter of the municipality contained the following:

'The Town Council shall have * * * special power to borrow money by bonding the town for any of the following purposes:

'1st. To improve the streets and sidewalks.

'2nd. To establish waterworks and fire protection.

'3rd. To establish a gas or electric light system.

'4th. To establish a sewerage system.

'5th. To purchase or erect a Town Market building.

'6th. To purchase or erect a Town School.

'7th. To establish a street railway system.

'8th. To provide a park or parks and improve the same.

'9th. To purchase or erect a Town Hall.' Section 4, p. 1245, Special Acts 1915 (chapter 7242, art. 7). See, also, section 5, art. 7, c. 11158, Sp. Acts 1925.

'A special tax may be levied sufficient to create a sinking fund for the purpose of paying the town's bonded indebtedness and interest thereon. Section 2, c. 7704, Sp. Acts 1917. See section 1, art. 8, c. 11158, Sp. Acts 1925.

When the municipality has a bonded indebtedness, the above-quoted authority to levy a sufficient tax to pay the bonded indebtedness may be regarded as mandatory and not merely permissive. See Little River Bank & Trust Co. v. Johnson, as Mayor, et al., 105 Fla. 212, 141 So. 141.

It is clear that the following provision of each bond as alleged in the alternative writ, that 'this bond is one of a series * * * issued pursuant to * * * Chapter 7242 of the Laws of Florida of 1915 * * * for the purpose of improving and extending the electric light and water system' of said municipality, and the designation 'Light and Water Bonds' upon each bond as alleged, do not constitute a lien upon any property owned by the municipality whether in its governmental or...