State ex rel. City of Townsend v. D. A. Davidson, Inc., 12940
| Decision Date | 30 January 1975 |
| Docket Number | No. 12940,12940 |
| Citation | 531 P.2d 370,166 Mont. 104,32 St.Rep. 74 |
| Parties | The STATE of Montana ex rel. the CITY OF TOWNSEND, a Municipal Corporation, Relator, v. D. A. DAVIDSON, INC., a Montana Corporation, Respondent. |
| Court | Montana Supreme Court |
Patrick F. Hooks, argued, Townsend, for relator.
A. William Scribner, argued, Helena, for respondent.
This is an original proceeding for declaratory relief under Title 93, Chapter 89, R.C.M.1947, the Uniform Declaratory Judgments Act.
Relator is a municipality of the state of Montana, duly organized and existing as a municipal corporation under the laws of Montana. Respondent is a Montana corporation which, in the course of its business, purchases for resale bonds issued by special improvement districts within the state of Montana.
On March 5, 1974, by resolution of its city council relator created, within the city, Special Improvement District No. 4 for the purpose of grading streets, replacing existing gravel base course as needed, placing asphaltic surface course, installing storm drainage pipes and inlets as needed, all upon the streets and avenues of the special improvement district. Thereafter, on June 27, 1974, relator awarded a contract for the construction of such improvements. Relator city and the contractor intend to proceed with the construction in accordance with the contract when bonds of the special improvement district are sold and the necessary funds are obtained for the financing of the work.
By notice duly given and advertised according to law, relator requested bids for submission to the city council for the purchase of $264,000, par value, of Special Improvement District No. 4 bonds for the financing of such construction. On September 3, 1974, a bid was submitted by respondent and State Bank of Townsend for the purchase of such bonds at par with an accruing interest rate of 7.75% per annum. No other bid was submitted. The bid was conditioned upon the issuance and filing of an opinion of the attorney general of the state of Montana, to the effect that cities and towns could lawfully issue and sell special improvement district bonds bearing an interest rate in excess of 7% per annum. The bid was accepted by the city council and thereafter a contract was entered into between relator and the bidders, conditioned as aforesaid, providing for the issuance of Special Improvement District No. 4 bonds in the sum of $264,000 bearing interest at the rate of 7.75% per annum, and for the purchase thereof by the bidders at par plus accrued interest to the date of delivery.
Thereafter, on November 27, 1974, the attorney general of the state of Montana issued an opinion stating, in effect, that cities, towns and counties may lawfully issue and sell special improvement district bonds or warrants, bearing an interest rate in excess of 7% per annum if the special assessments paid by the property owners within the district are appropriated for the payment of principal and interest on such bonds or warrants.
Relator was then advised by respondent that, notwithstanding the provisions of their contract and the attorney general's opinion, it would continue to refuse to purchase the bonds for the claimed reason that cities and towns are prohibited by law from issuing or selling special improvement district bonds or warrants bearing an interest rate greater than 7% per annum.
Relator has made diligent effort to secure a purchaser for the bonds at an interest rate of 7% or less but has been unable to do so. By reason thereof, relator is informed and believes that it will be unable to proceed with such construction or to perform its obligations under the construction contract unless respondent performs under the provisions of its contract for the purchase of the bonds.
On information and belief, relator stated in its application for declaratory judgment that for the past several months cities, towns and counties of the state of Montana have been unable to finance needed special improvements in districts created for that purpose because the prevailing bond market will not justify the purchase of special improvement district bonds bearing an interest rate of 7% or less and that the prevailing long term municipal bond interest rates are unlikely to come down in the foreseeable future.
The subject matter of this action is of great and widespread public concern and should be resolved at the earliest possible time. Due consideration of this question in the trial courts and final determination by an appeal to this Court is an inadequate remedy in that delay would ensue before a final decision could be had, making it impossible for cities, towns and counties to proceed with necessary construction of improvements in the forthcoming construction season. There are no disputes of fact and only a...
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...giving effect to each. Crist v. Segna (1981), 191 Mont. 210, 212, 622 P.2d 1028, 1029 (citing State ex rel. City of Townsend v. D.A. Davidson, Inc. (1975), 166 Mont. 104, 531 P.2d 370). Section 27-2-204, MCA, provides the limitations periods for initiating both negligence and intentional to......
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Crist v. Segna
...legislation; and must harmonize statutes relating to the same subject, giving effect to each. State ex rel. City of Townsend v. D. A. Davidson, Inc. (1975), 166 Mont. 104, 531 P.2d 370. Finally, we presume that the legislature, in repealing an old law and adopting a new statute, intended to......
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...of a city's contract to sell Special Improvement District bonds bearing 7 3/4% interest. State ex rel. City of Townsend v. D. A. Davidson, Inc., Corporation, Mont., 531 P.2d 370, 32 St.Rep. 74. If the rule were otherwise, insurance policy questions commonly determined in declaratory judgmen......