State ex rel. Hurd v. Blomstrom

Citation37 N.W.2d 247,72 S.D. 526
Decision Date23 April 1949
Docket Number9018
PartiesSTATE OF SOUTH DAKOTA, ex rel THOMAS C. HURD, Respondent, v. LLOYD E. BLOMSTROM, Mayor of the City of Winner, A. H. Kourt, F. M. Hall, C. J. Grossenberg, Frank Wurnig, E. K. King, and Reinhold Woidneck, Alderman of the City of Winner, SD, Appellants.
CourtSupreme Court of South Dakota

Appeal from Circuit Court, Tripp County, SD

Hon. J. R. Cash, Judge

#9018—Affirmed

Clarence E. Talbott, Winner, SD

Davenport, Evans & Hurwitz, Sioux Falls, SD

Attorneys for Appellants.

D. G. Grieves, Winner, SD

Attorney for Respondent.

Dorsey, Colman, Barker, Scott & Barber, Minneapolis, MN

Attorneys for amici curiae.

Opinion Filed Apr 23, 1949; Rehearing Denied May 18, 1949

SICKEL, Judge.

This is a mandamus proceeding. Relator is a resident, elector and taxpayer of the City of Winner. Defendants are the Mayor and Board of Aldermen of the City of Winner. On March 15th, 1948, there was filed in the office of the city auditor a petition for the enactment and submission to the voters of a proposed ordinance granting to the Rosebud Electric Association, a corporation, the right to continue to occupy the streets, alleys and public places in the city for the operation of a public utility for the production, transmission, distribution and sale of electricity. The petition was presented to the city council on April 19th, 1948, and was denied. Thereafter the circuit court issued its alternative writ of mandamus, ordering the city council to grant the petition or show cause for not doing so. Defendants answered, admitting their failure to grant the petition, stating their reasons for such failure, and asking that the proceeding be dismissed on its merits. The case was tried on May 13th, 1948, and the peremptory writ of mandamus was issued commanding that defendants enact the proposed ordinance and submit it to the voters of the city. Defendants appealed from the judgment.

The record in this case shows that on April 14th, 1947, the council adopted an ordinance designated as Number 224. This ordinance provided for the construction, acquisition and operation of a municipal light, heat and power system and the issuance of revenue bonds to defray the cost thereof. It was submitted to the voters of the municipality, and was approved by more than sixty percent of the electors voting thereon. Thereafter it was published and became effective. Then the council adopted another ordinance designated as Number 229. This ordinance fixed the form of the bonds, provided details for the operation and maintenance of the system, the administration of the income and revenues, and provided:

Section 6. For the additional security of the bonds herein authorized the city hereby covenants and agrees to and with the holders thereof from time to time as follows: (b) It ... will not establish or authorize any other plant or system for supplying like services in competition therewith and will not grant or renew any franchise or license to a competing light and power system or company, ... .”

The above ordinance was not submitted to the voters of the municipality.

Appellants contend that the provision of ordinance Number 229, quoted above, is a valid contractual obligation of the city with the bondholders; that the grant of a franchise to the Rosebud Electric Association as proposed by the initiated ordinance would impair the obligation of that contract, and would be void; that therefore the petitioner was not entitled to the peremptory writ of mandamus. Respondent contends that the city lacked the power to contract by ordinance with the bondholders for the exclusion of a competitive system and even if such power existed, it could not become effective until the ordinance containing the agreement had been submitted to and approved by the voters of the municipality.

Appellants rely upon SDC 45.2416 which states that the city may “provide by such ordinance ... for the security of bondholders as the governing body may deem necessary.” This presents the question of whether the phrase “such ordinance” refers to the ordinance required by SDC 45.2402. In their argument appellants contend that “such” should be construed as meaning “an”. “An” is the indefinite article meaning “any”. “Such” is an adjective meaning the one previously indicated, characterized or specified. Webster’s International Dictionary, Second Edition. The ordinance previously indicated is found in SDC 45.2402. The effect of SDC 45.2416 is to authorize the city to include a provision for security of bondholders in the bond ordinance referred to in and required by SDC 45.2402. That statute expressly provides that: “no such bonds shall be issued until authorized by an ordinance duly adopted ... nor until such ordinance has been submitted to the voters of such municipality ... and sixty per cent of the electors voting thereon have voted in favor of such ordinance ...”. This statute prohibits the council from making commitments or. behalf of the city, to the bondholders, without a vote of the electors of the city.

SDC 45.2402 also provides: “... no such money shall be borrowed and no such bonds shall be issued until authorized by an ordinance duly adopted, specifying the proposed undertaking. ...”. The council, on behalf of the city, has agreed by ordinance that the city shall grant no franchise to a competitive utility. The agreement is an “undertaking” as that term is used in SDC 45.2402 and required the approval of the voters of the city. Since no such approval has been obtained the undertaking by the council is ultra vires. Whether the council can by ordinance, even with the approval of the electors, bind the city to grant no franchise to a competitive utility, thereby vesting in the city an exclusive right, we need not decide.

Chapter 45.24 does not require that all matters pertaining to the contract and the bond issue shall be included in a single ordinance, and conceivably the council could pass a supplemental ordinance, but the statute does require that any ordinance affecting the obligations of the city and the rights of the bondholders, as distinguished from measures which are purely...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT