State ex rel. Spoone v. Mayor and Aldermen of Town of Morristown

• Decision Date: 07 June 1968
• Citation: 26 McCanless 21,222 Tenn. 21,431 S.W.2d 827
• Parties: , 222 Tenn. 21 STATE of Tennessee ex rel. Frank SPOONE et al., Petitioners-Appellees, v. MAYOR AND ALDERMEN OF the TOWN OF MORRISTOWN, Defendant-Appellant.
• Court: Tennessee Supreme Court

Page 827

431 S.W.2d 827

26 McCanless 21, 222 Tenn. 21

STATE of Tennessee ex rel. Frank SPOONE et al., Petitioners-Appellees, v. MAYOR AND ALDERMEN OF the TOWN OF MORRISTOWN, Defendant-Appellant.

Supreme Court of Tennessee.

June 7, 1968.

William H. Inman, Morristown, Taylor, Inman, Tilson & Line, Morristown, and Mack H. Hall, County Atty., Morristown, of counsel, for appellees.

James K. Miller, City Atty., Morristown, for appellant.

OPINION

DYER, Justice.

Under Authority of T.C.A. § 6--309 the Town of Morristown in Hamblen County enacted Ordinance 1710 annexing an area adjacent to its corporate limits, which area consisted of three hundred eighty-one acres, wherein there are seven hundred nineteen people, two hundred fifteen residences, and nine parcels of commercial property. Under T.C.A. § 6--310 several property owners in the area to be annexed, including Hamblen County, filed their petition attacking the reasonableness of the Ordinance under this statute. The chancellor, without the intervention of a jury, found the ordinance to be unreasonable and issued an order vacating same. The Town of Morristown has appealed.

The first question here for decision is whether Hamblen County is a proper party to this proceeding. T.C.A. § 6--310 authorizes 'any aggrieved owner of property lying within the territory' to question the reasonableness of the ordinance. Within this territory Hamblen County owns the roads and a school building. The question then is whether the word 'owner' as used here would obviously include natural persons and corporations. We see no reason why it should not include a county when the county desires to question the reasonableness of the ordinance under this statute. The action of the chancellor in holding Hamblen County a proper party to this proceeding was not error.

The second question presented is in regard to school bonds issued by Hamblen County some of which are still outstanding. These bonds are paid by a special tax levy on property outside the corporate limits of the Town of Morristown, and the argument is to the effect that reducing the property subject to this levy by this annexation impairs the obligation of the contract between Hamblen County and its bondholders. This is the same issue and argument raised in the recent case of State of Tennessee ex rel. Cope v. Mayor and Aldermen of the Town of Morristown, 218 Tenn. 593, 404 S.W.2d 798 (1966), wherein the Court said:

This issue is one that would concern only the County or School District obligated on the bonds, and the holders of such bonds. It is not a justiciable issue in a suit of the present character; nor are the plaintiffs in error legally entitled to pose the question. 218 Tenn. at 603, 404 S.W.2d at 802.

There is a material difference between the case at bar and the Cope case. In the case at bar Hamblen County is a party to the proceedings, while in the Cope case neither Hamblen County nor any of the bondholders were parties to the proceedings. Even so, we think the statement in the Cope case that 'it is not a justiciable issue in a suit of the present character' is determinative of this issue in the case at bar.

We think the rights of Hamblen County in regard to its liability for the repayment of these bonds is controlled by T.C.A. § 6--318. This Court in Hamilton County v. City of Chattanooga, 203 Tenn. 85, 310 S.W.2d 153 (1958), held a county is within the scope of this statute. This statute requires the Town of Morristown and Hamblen County to attempt to reach an agreement in regard to these school bonds as justice and reason may require under the circumstances. The statute then provides that if no such agreement be reached within sixty days from the operative date of the annexation, the matter shall be submitted to arbitration under our statute.

The case at bar was filed and tried under T.C.A. § 6--310, where the issue is essentially the reasonableness of the ordinance applying the criteria set out in that statute. The effect of the annexation upon the liability of Hamblen County to repay these bonds would not be an issue in the case tried under the criteria set out in T.C.A. § 6--310. This matter could only be an issue upon the ordinance becoming effective and then only if the parties are not able to agree.

It is apparent Hamblen County, upon this ordinance becoming effective, will lose certain property previously subject to being taxed for repayment of these bonds, but it is also true for example the ordinance would relieve Hamblen County of the responsibility for the upkeep of the streets and roads in the area. These factors and many others will have to be considered by the parties in reaching an agreement under T.C.A. § 6--318 and we think the Legislature had such in mind in directing the parties to attempt to reach an agreement as justice and reason may require under the circumstances. Construing all of these Code sections applicable to annexation by ordinance in pari materia we do not think it was the intent of the Legislature by such statutes that issues arising under T.C.A. § 6--318 were to be determined at the time of the reasonableness of the ordinance was at issue under T.C.A. § 6--310.

The chancellor was in error in admitting evidence as to the effect the proposed ordinance would have upon the liability of Hamblen County in regard to these school bonds.

While the chancellor did consider evidence in regard to the school bond issue, it is apparent from his memorandum he found the ordinance unreasonable and invalid under the other evidence in the record. Disregarding the evidence as to the school bonds the question here for decision is whether the chancellor was in error in finding the ordinance unreasonable under the evidence presented.

The statute, T.C.A. § 6--310, states the issue upon which the matter is to be determined in the following language:

* * * the question shall be whether the proposed annexation be or be not unreasonable in consideration of the health, safety and welfare of the citizens and property owners of the territory sought to be annexed and the citizens and property owners of the municipality.

In Morton v. Johnson City, Tennessee, 206 Tenn. 411, 333 S.W.2d 924 (1960), this Court stated the rule of judicial review in these cases in the following language:

'* * * (T)he court does not, in any sense, substitute its discretion or judgment as to the advisability or propriety of the annexation for that of the legislative body of the city, and that it does not review the legislative discretion; its consideration of 'reasonableness' is confined to a determination of whether there exists a sufficient showing of reasonableness to make that question, at the least, a fairly debatable one; if there is such, then the discretion of the legislative body is conclusive.' 206 Tenn. at 417, 333 S.W.2d at 927.

It is argued the fairly debatable rule as set out in Morton, in effect, destroys judicial review since all contested annexation cases will be fairly debatable. The rule does not destroy judicial review, but limits its scope to the court's determining whether the proposed annexation is so palpably unreasonable and unnecessary as to be an arbitrary and oppressive exercise of delegated legislative power. It is stated in 37 Am.Jur., Municipal Corporations, Section 28, that annexation is exclusively a legislative power and great latitude must necessarily be accorded the legislative discretion. The fairly debatable rule does not more than insure this latitude of legislative discretion.

The chancellor adhered to...