State ex rel. Haberkorn v. DeKalb Circuit Court

• Decision Date: 22 October 1968
• Docket Number: 768S111,Nos. 668S91,s. 668S91
• Citation: 251 Ind. 283,241 N.E.2d 62
• Parties: STATE of Indiana on the relation of Theodore E. HABERKORN, Jr., et al., Relators, v. DeKALB CIRCUIT COURT, Judge Ray Ade as Special Judge of the DeKalb Circuit Court, Respondent. Theodore E. HABERKORN, Jr., Jack Hollabaugh, and Victor Timmerman, Appellants, v. Delbert WASHLER et al., as Members of the Board of Trustees of the DeKalb County Eastern Community School District, Appellees.
• Court: Indiana Supreme Court

Page 62

241 N.E.2d 62

251 Ind. 283

STATE of Indiana on the relation of Theodore E. HABERKORN, Jr., et al., Relators, v. DeKALB CIRCUIT COURT, Judge Ray Ade as Special Judge of the

DeKalb Circuit Court, Respondent.

Theodore E. HABERKORN, Jr., Jack Hollabaugh, and Victor

Timmerman, Appellants, v. Delbert WASHLER et al., as Members of the Board of Trustees

of the DeKalb County Eastern Community School

District, Appellees.

Nos. 668S91, 768S111.

Supreme Court of Indiana.

Oct. 22, 1968.

Rehearing Denied Dec. 30, 1968.

H. Charles Winans, Garrett, for respondent.

Nelson G. Grills, Indianapolis, for relators.

Rose, Buchanan, McKinney & Evans, Indianapolis, for amici curiae.

ORIGINAL ACTION

PER CURIAM.

Respondent is the regular judge in a suit entitled Theodore E. Haberkorn, Jr., Jack Hollabaugh, and Victor Timmerman v. Delbert Washler et al, as the Board of School Trustees of the DeKalb County Eastern Community School District. The action was commenced when the relators, plaintiffs below, filed a complaint for an injunction against the defendant school board seeking to restrain the said school board from the construction of a new junior and senior high school in the school district at a site which was not satisfactory to the plaintiffs. The suit technically seeks to enjoin the School Board from proceeding with carrying out the terms of a lease agreement executed between the school board and a building corporation which was created for the purpose of selling bonds to finance construction of the school. Judge Ray Ade, respondent and defendant below, became the special judge by appointment of this Supreme Court.

The main issue before this court in this appeal is whether or not the relators, on the basis of the pleadings and the evidence of the hearing, can establish facts which would entitle them to a temporary injunction. There is submitted with the writ of prohibition the record of the hearing in the lower court which has been numbered and indexed. The relators have urged that a state of fact exists which makes the transaction a proper subject for investigation in the court of equity indicating the limitations of the availability of the ground for the school use at the site; the failure to comply with the rules of the General Commission on Education and the failure to obtain the approval of the State Board of Accounts.

The trial court below found that the suit filed by the plaintiff was a 'Public Lawsuit' within the meaning of Chapter 357 of the Acts of 1967; that the defendant School Board had taken the proper steps for the approval of a site to construct the proposed school, which site had been approved by various agencies and boards of the State of Indiana, including the State Department of Public Instruction of the State of Indiana; that the relators, plaintiffs below, did not and can not establish facts which would entitle them to a temporary injunction; that the relators herein, plaintiffs below, should be required to post a bond in the amount of $160,000 to cover the damages and costs which may accrue to the defendant by reason of the lawsuit.

Relators have filed an amended petition for a writ of prohibition which repeats the allegation in their original petition which, among other things, alleged that the order to post a bond is contrary to the evidence in that any delay was not the fault of the plaintiffs below, but was the fault of the defendant below failing to answer the complaint.

In its amended petition, it is further alleged that the order of the court below to post a bond is unconstitutional under the terms of the Federal Constitution and the Constitution of the State of Indiana for two reasons:

(a) The requirement of Section 5 of Chapter 357 requiring the posting of a bond to cover all damages and costs which may accrue to the defendants by reason of the pendency of the public lawsuit in the event the defendant prevails is an unreasonable limitation upon the plaintiffs denying them justice freely under Article 1, Section 12 of the Indiana Constitution, and due process of law under the 14th Amendment to the United States Constitution.

(b) The provisions for appeal of the order to post bond of Section 5 of Chapter 357 of the Acts of 1967 denies the plaintiffs due process of law under Section 12 of Article 1 of the Indiana Constitution and the 14th Amendment to the United States Constitution.

The provisions of Section 5 of the 'Public Lawsuit Act' Acts of 1967, ch. 357, sec. 5 as found in Burns § 3--3305 et seq. reads as follows:

'At any time prior to the final hearing in a public lawsuit, the defendant may petition for an order of the court that the cause be dismissed unless the plaintiff shall post a bond with surety to be approved by the court payable to defendant for the payment of all damages and costs which may accrue by reason of the filing of the lawsuit in the event the defendant prevails. A hearing shall be had on such petition in the same manner as the hearing on temporary injunctions under Acts 1881 (Spec.Sess.) c. 38. If at the hearing the court determines that the plaintiff can not establish facts which would entitle him to a temporary injunctions, the court shall set the amount of bond to be filed by the plaintiff in an amount found by the judge to cover all damage and costs which may accrue to the defendants by reason of the pendency of the public lawsuit in the event the defendant prevails. In the event such a bond is not filed by the plaintiff with sureties approved by the court within ten (10) days after such order is entered the suit shall be dismissed. Either plaintiff or defendant may appeal such order to the Indiana Supreme Court within such ten (10) day period by notice of appeal and a statement of error in the same manner as is provided in a petition for mandate or prohibition. The Supreme Court may stay the lower court order pending its own decision, may set a bond to be filed by the plaintiff in connection therewith, may modify the order of the lower court, or may enter its order as a final order in a case. In the event no bond is filed as provided in this section the public lawsuit shall be dismissed and no court shall have further jurisdiction of the public lawsuit or any other public lawsuit involving any issue which was or could have been raised therein.'

Chapter 357, Acts 1967, Burns § 3--3301 et seq. was adopted as a protection to the public against a flood of harassing litigation which was obstructing and delaying public improvements at prohibitive costs. Since World War II the scope and responsibility of our municipal governments have drastically expanded with greater population, movement of people from farms to the city, and increased educational demands. This has required building of substantial facilities, such as sewers, water lines and parks, the creation of new municipal bodies such as redevelopment commissions, metropolitan area bodies and substantial boundary revisions as in the case of schools. With the changes have come additional legislation as, for example, the new Sewer Revenue Act, the Conservatory District Act, the Public Housing Acts, the School Building Corporation Acts, the School Reorganization and Consolidation Acts.

The courts have properly permitted any citizen or taxpayer to file some suit to keep a public official within his statutory duties. See State of Indiana on the Relation of the Board of Sanitary Commissioners of the City of Terre Haute, Indiana, etc. v. Superior Court of Vigo County, etc. (1966), 9 Ind.Dec. 233, 220 N.E.2d 336. In this case this court held that the law permits persons claiming to be aggrieved to come into the trial court and ask for injunction or other equitable remedies against administrative action where no statutory or administrative procedure provides for a final judicial review or appeal. The court likewise stated that this court cannot arbitrarily bar the filing of lawsuits or the continuation of the same because the party being sued thinks the lawsuit is unfair, a hardship, or without merit. Those are issues that have to be tried in the trial court, including the issue of harassment. The court cannot arbitrarily take from a taxpayer the long established right to question the action of public officials in borrowing funds and spending such public funds.

There has been no effective legislation which could give the majority of the citizens a correlative remedy, so that necessary public projects, where legally proper, may be carried out as planned with protection against harassing lawsuits.

It is true under the state law prior to adoption of Chapter 357, a determined plaintiff could keep a suit in being from two to six years; and in many cases the mere filing of the action delayed beyond saving the intricate planning of the project regardless of the merits of the action.

If litigation is filed and a legal opinion cannot be given, bonds will remain unsold or undelivered. If this persists for any project for more than six months to a year, construction contractors in inflationary times cannot stand by their bids, and the project as planned and the litigation opposing it become moot. In the meantime taxpayers, in those cases where the endeavor is legally correct, have suffered substantially by increased construction costs.

The relators have raised only the constitutional question as to Sec. 5 of Chapter 357, supra, set forth hereinbefore with which this opinion deals, and which provides for three things: first, that the plaintiff may be required to post a bond covering defendant's damages in the event, after hearing in the same manner as a hearing on the temporary injunction, plaintiff cannot show any grounds on which he can obtain a temporary injunction. The existence of most public lawsuits operates as a temporary injunction. This provision is applicable, however, only when the plaintiff is unable to establish the prima facie case necessary for the granting of a temporary injunction. This is...