State ex rel. County Court of Brooke County v. Kemp

• Decision Date: 13 December 1966
• Docket Number: No. 12623,12623
• Citation: 151 W.Va. 349,151 S.E.2d 680
• Court: West Virginia Supreme Court
• Parties: . Hazel G. KEMP, as Clerk of the County Court of Brooke County, a corporation. Supreme Court of Appeals of West Virginia

Page 680

151 S.E.2d 680

151 W.Va. 349

STATE ex rel. the COUNTY COURT OF BROOKE COUNTY, a corporation, v. Hazel G. KEMP, as Clerk of the County Court of Brooke

County, a corporation.

No. 12623.

Supreme Court of Appeals of West Virginia.

Submitted Nov. 15, 1966.

Decided Dec. 13, 1966.

Syllabus by the Court

Under the provisions of Chapter 13, Article 2C, Code, 1931, as amended, a county court may acquire an existing industrial facility through the issuance of Industrial Development Bonds and lease such facility to its former owner so long as such acquisition and lease promote the public welfare as prescribed by the legislature in Chapter 13, Article 2C, Section 2, Code, 1931, as amended.

Schmidt, Laas, Schrader & Miller, Thomas B. Miller, Wheeling, for relator.

James P. McMullen, Jr., Wellsburg, for respondent.

CAPLAN, President:

In this original proceeding in mandamus the record reveals that the petitioner, the County Court of Brooke County, at a regular meeting on January 20, 1966, entered an order resolving that it would, upon the completion of negotiations, take such action as is necessary for the issuance of Industrial Development Bonds to finance the acquisition of an industrial plant and equipment to be leased to the Wheeling Corrugating Company, a wholly owned subsidiary of Wheeling Steel Corporation. The petitioner alleges that it was advised of the desire of the Wheeling Steel Corporation to construct a spiral culvert plant on land owned by it at Beech Bottom, Brooke County, which would be operated by the Wheeling Corrugating Company. This plant, including the necessary equipment, would be valued in excess of one million dollars and would employ a number of industrial workers. The County Court of Brooke County was also advised, as demonstrated by an affidavit of William L. Doepken, a Vice President of Wheeling Steel Corporation and President of Wheeling Corrugating Company, which affidavit is attached to the petition as an exhibit, that Wheeling Steel Corporation was without sufficient capital funds to construct the plant and obtain the necessary equipment; that by reason of its expenditure in excess of $165,000,000.00 on a capital improvement program, which program caused interruptions in its operating facilities resulting in marked decreases in capital funds and current assets, it was in need of financial assistance to proceed with the establishment of the proposed plant. Mr. Doepken further said that a proposal had been made by the office of the Governor of Ohio to induce the corporation to construct the proposed plant on property owned by it in that state and that the obtaining of financial assistance was crucial to its decision in relation to the location of the plant.

The petitioner, recognizing the economic benefits to be derived by the location of a new industrial plant in Brooke County and the increase in employment that would result, advised Wheeling Steel Corporation that if it would agree to construct and operate the plant in Brooke County it would offer financial assistance through the use of Industrial Development Bonds to the extent of one million dollars.

Upon being advised by the corporation that under those conditions it would locate its plant in Brooke County, the petitioner adopted the resolution of January 20, 1966, referred to above. Thereafter, Wheeling Steel Corporation informed the County Court that arrangements had been made with the Irving Trust Company, a banking corporation of New York City, to purchase all the Industrial Development Bonds, which were to bear interest at 4 7/8 per cent. Furthermore, it was agreed that the subject property would be leased to Wheeling Steel Corporation, the rental from which would pay the principal and interest on such bonds.

It was the desire of both the County Court and Wheeling Steel to construct the industrial plant and put it into operation as soon as possible. Therefore, it was agreed by the parties that Wheeling Steel should undertake to provide interim financing on a temporary basis to cover the cost of construction and equipment to enable the plant to become operational while the necessary documents for the issue and purchase of the bonds were being prepared and approved by the parties.

Pursuant to that agreement, and with the knowledge and counsel of the County Court, Wheeling Steel proceeded with the construction of the plant. On April 30, 1966, the Wheeling Steel Corporation effected a consolidation with its wholly owned subsidiary, Wheeling Corrugating Company, which was to operate the industrial facility, and so advised the County Court of Brooke County. Subsequently, on June 2, 1966, the County Court adopted a resolution wherein it resolved to continue its financing arrangement with Wheeling Steel. The plant was completed and commenced operation in July, 1966, but despite diligent efforts to expedite the preparation of the documents necessary to consummate the industrial bond issue and sale, such procedure was not completed until early in October, 1966.

On October 22, 1966, the County Court of Brooke County unanimously adopted the resolution which (1) authorized the acquisition of the industrial plant and equipment and the leasing thereof to Wheeling Steel Corporation; (2) authorized the issuance of one million dollars of Industrial Development Bonds, Series A, to finance the cost of acquisition; (3) prescribed the form of mortgage and deed of trust to secure the bonds; and (4) authorized the execution of said lease, mortgage and deed of trust for the security, rights and remedies of the holders of said bonds. Pursuant to that resolution the petitioner, by its president, executed a lease of the industrial plant and equipment to Wheeling Steel Corporation. Also executed by the president, on behalf of the courts, was Bond No. 1 of the Brooke County Industrial Development Bonds, Series A. The lease and bond were presented to Hazel G. Kemp, Clerk of the County Court of Brooke County, respondent herein, for the purpose of having the seal of the County Court affixed thereto and attested. The respondent, being advised by counsel that there may be a question as to the validity of this acquisition under the Industrial Development Bond Act, declined to affix the seal of the County Court to the lease and bond.

Upon the respondent's continued refusal to affix the County Court's seal to the lease and bond, the petitioner instituted a mandamus action in this Court seeking a writ commanding the respondent to so act. A rule to show cause...