State v. Dade County

• Decision Date: 08 June 1962
• Docket Number: 31558-B,Nos. 31558,31558-,s. 31558
• Citation: 142 So.2d 79
• Parties: The STATE of Florida, Appellant, v. DADE COUNTY, a political subdivision of the State of, florida, Appellee. Carlos EDWARDS et al., Appellants, v. DADE COUNTY et al., Appellees. CITY OF MIAMI, Appellant, v. DADE COUNTY, a political subdivision of the State of Florida, Appellee.
• Court: Florida Supreme Court

Page 79

142 So.2d 79

The STATE of Florida, Appellant, v. DADE COUNTY, a political subdivision of the State of, florida, Appellee.

Carlos EDWARDS et al., Appellants, v. DADE COUNTY et al., Appellees.

CITY OF MIAMI, Appellant, v. DADE COUNTY, a political subdivision of the State of Florida, Appellee.

Nos. 31558, 31558-A, 31558-B.

Supreme Court of Florida.

June 8, 1962.

Richard E. Gerstein and John C. Wynn, Miami, for State of Florida.

Anderson & Nadeau, Miami, for Carlos Edwards et al.

Robert D. Zahner, Coconut Grove and Jack R. Rice, Jr., Miami, for City of Miami.

Darrey A. Davis, Miami, for Dade County.

Scott, McCarthy, Preston & Steel and Paul R. Scott, Miami, for W. D. Pawley.

DREW, Justice.

A petition to validate nine million dollars of transit system revenue bonds sought to be issued by Dade County (hereafter called the County) was consolidated with a suit for declaratory decree filed by Carlos Edwards and others as taxpayers and citizens of Dade County and certain municipalities therein, questioning the validity of an agreement between the County and W. D. Pawley for the purchase by the County of certain transit companies. Final decrees were entered in each suit. In the bond validation proceeding the final decree upheld the power of the County under the Florida Constitution and the Home Rule Charter to establish and develop a unified mass transit system under county ownership; upheld the power of the County to create and establish a Metropolitan Dade County Transit Authority as a governmental unit, agency or instrumentality of the County; found that the transit authority had recommended to the Board of County Commissioners (hereafter called the Board) as the best solution for the development of a unified mass transit system for said County, at a cost commensurate with the value received, the acquisition of the four transit companies owned by W. D. Pawley free and clear of all liens and encumbrances; found and determined that the Board had approved the recommendations of the transit authority; validated and approved the contracts between Pawley and the County for the purchase of said transit systems at the price of $7,705,274; decreed that the Board had the power to adopt and had adopted an ordinance authorizing the issue of $9,000,000 of transit revenue bonds of the County for the purpose of providing funds for the purchase of said system and for constructing a central garage and office building and providing initial working capital; found that in the ordinance authorizing the issuance of said bonds provision was duly and legally made for the execution of a trust agreement to secure the payment thereof; found and determined that rates, fares and charges for the services and facilities furnished would be sufficient at all times to pay the cost of operating and maintaining the transit system and the principal and interest of the revenue bonds and to create and maintain reserves for such purposes. The decree of validation adjudicated that the Board was empowered to operate a public transportation system and to issue revenue bonds in the manner above mentioned and, subject to such limitations as may be provided by law, to exercise all powers and privileges granted to municipalities as well as to exercise all powers not prohibited by the Constitution or the Home Rule Charter of Dade County; decreed that the County was fully authorized to issue said $9,000,000 of transit revenue bonds and that such Board was fully authorized to create the transit authority hereinabove referred to and that the ordinance creating such authority was duly and lawfully adopted; decreed that the agreement of May 17, 1961 for the sale and purchase of the systems between W. D. Pawley and the County was properly entered into and constituted a valid, binding and effective agreement between the parties; decreed that the ordinance authorizing the issuance of said bonds and the delivery of the trust agreement was properly adopted; validated and confirmed all of the terms, conditions, covenants and provisions in said ordinance and trust agreement. It was specifically adjudged and decreed that none of said revenue bonds to be issued would constitute a debt of the County, that the faith and credit of the County was not pledged to the payment thereof, and that the issuance of such revenue bonds would not obligate the County to levy or pledge any taxes whatever. The court further decreed that the issuance of said revenue bonds did not violate the provisions of Section 6, Article 9 of the Florida Constitution, F.S.A.; that the covenants contained in the ordinance authorizing the issuance of said bonds and the trust agreement requiring the County to fix and collect rates, fares and charges sufficient to pay the cost of operating said system as well as the principal and interest on the revenue bonds and to maintain reserves for such purpose was a valid and binding covenant; and that no laws of this state impose any power on the Florida Railroad and Public Utilities Commission with respect to the approval of the fixing and collecting of such charges, rates or fares. The court decreed that the purchase agreements between Pawley and the County were valid and that no laws of this state conferred any jurisdiction on the Florida Railroad and Public Utilities Commission with reference to the transfer of the said transit system to the County. The court further specified that the provisions of said sale and purchase agreement with respect to the manner of acquisition of said systems did not violate the provisions of Section 10 of Article 9 of the Florida Constitution, and that the County was authorized to issue and sell its revenue bonds in exchange for the capital stock of said transit companies in accordance with the terms of said agreements. Finally the court decreed that the ownership and operation of said transit system by the County did not unlawfully impair the rights of the City of Miami, the City of Miami Beach or the City of South Miami under existing franchise agreements with certain of said transit companies or unlawfully deprive said municipalities and the citizens and taxpayers of the revenues under such franchise agreements; that the County will have no obligation to said municipalities under such agreements upon the acquisition of said transportation systems. Based upon such findings and adjudications, the trial court validated and confirmed said bonds in the principal sum of $9,000,000 maturing at the times and in the manner therein prescribed and bearing interest not to exceed the rates therein specified.

A supplemental decree entered February 2, 1962 recited that the decree of validation summarized above determined and decided most of the questions relating to the consolidated proceedings and that it was the purpose of such supplemental decree to determine all remaining questions presented in said cases. In addition, the supplemental decree contained the recitation that, since all of the issues had been fully heard and considered by the court in the consolidated cases, and the court being of the opinion that with the entry of the supplemental decree all of the issues in both cases had been determined, it should include in such decree a provision enjoining any person or party from commencing any further action relating to any and all matters adjudicated in the consolidated causes consistent with the laws of this state. Whereupon, the court found that it had jurisdiction of the parties and the subject matter, that 'there is no franchise tax due the City of Miami, Florida by the defendant Miami Transit Company,' that 'the sale of the capital shares of the defendant companies in Dade County will not create any indebtedness, obligation or liability by Miami Transit Company to the City of Miami for franchise tax,' and that 'upon the acquisition by Dade County of the capital shares of the defendant companies the franchise of said companies terminates.' Thereupon the court decreed that the complaint of Carlos Edwards and others heretofore referred to and the cross-complaint of the City of Miami seeking a recovery of deficiencies in franchise taxes from the Miami Transit Company be dismissed and that all persons and parties affected by said decrees be enjoined and restrained from commencing any action at law or in equity seeking to adjudicate any of the questions of law or fact determined in said causes.

From the two decrees summarized above five separate appeals have been taken by interested parties, one by the State of Florida and four by the City of Miami and the bus operators' union. Assignments of error are filed in all appeals so taken in which there are enumerated a total of fifty-four ¹ alleged errors, and nineteen points are argued by the various parties to these causes. Inasmuch, however, as many assignments of error and several of the points argued are identical or sufficiently related to present substantially the same point, we deem it unnecessary to detail what we consider to be the pertinent points involved or designate the particular party or parties urging them.

We have examined the voluminous records and extensive and ably prepared briefs in these consolidated cases and have carefully considered all nineteen points argued by the respective parties. We shall discuss and dispose of those we deem essential.

The basic and primary point for consideration is whether the County is authorized and empowered under the provisions of the Constitution, Home Rule Charter and general laws to acquire by purchase all of the capital stock of private corporations owning bus transportation systems in the County and to issue revenue bonds payable solely from the earnings of such bus system to pay the cost of acquiring the same and making improvements thereto and in connection therewith to create a transit authority for the purpose of operating such system under policies fixed by the Board of County Commissioners.

'Article VIII,...