The State ex rel. City of Carthage v. Gordon

• Decision Date: 09 March 1909
• Parties: THE STATE ex rel. CITY OF CARTHAGE v. JOHN P. GORDON, State Auditor
• Court: Missouri Supreme Court

116 S.W. 1099

217 Mo. 103

THE STATE ex rel. CITY OF CARTHAGE v. JOHN P. GORDON, State Auditor

Supreme Court of Missouri

March 9, 1909

Peremptory writ awarded.

R. A Hockensmith and Perkins & Blair for relator.

(1) Notice of the election given for fifteen days previous to such election by publication in a newspaper published in the municipality is in compliance with the statute (R. S. 1899 sec. 6351), and is therefore sufficient. Where the statute is complied with, the notice is sufficient. Hamilton v Detroit, 85 N.W. 933; sec. 6351, supra. (2) The rate of interest is left to the discretion of the council by R. S. 1899, sec. 6353, to be fixed at "not exceeding eight per cent per annum," and the notice of election fixing the rate at "not exceeding five per cent per annum" is within the statute and sufficient. The proposed bond issue is at the rate of five per cent per annum and is within the limit of the statute, which is controlling. Hamilton v. Detroit, supra; Cleveland v. Calvert and City of Spartenburg (S. C.), 31 S.E. 872; Daily v. Columbus, 49 Ind. 169; Gibbons v. Mobile, 36 Ala. 410; Bank v. Omaha, 18 N.W. 63; Hillsboro Co. v. Henderson, 33 So. 997. (3) (a) The city council, at the time of the issuance of the bonds, directed that a tax levy sufficient to pay the interest and sinking fund be made, and this complied with the constitutional requirements in that regard. The mandatory provision of the Constitution (art. 10, sec. 12a), with reference to waterworks bonds has been fully complied with by relator. At the time the council by ordinance declared the proposition carried it, by section 3 of the same ordinance, provided for the levy of a tax in pursuance of the constitutional provision. Subsequently the rate of interest was increased to five per cent and there-upon provision was made for a levy sufficient to cover the increased interest. The regular annual appropriation ordinance for 1908, passed August 7, 1908, by section 5 provided a levy to pay semiannual interest, and the amount realized therefrom ($ 13,720.20) is more than sufficient to pay the semiannual interest ($ 5,500) and semiannual portion of the sinking fund ($ 5,500). It would doubtless have been better to have provided at that time a levy sufficient to pay the annual interest and sinking fund, but that this was not then done does not invalidate the bonds, since the proceedings had at most were but the levy of an insufficient amount, and the levy and collection of an amount sufficient to pay the entire interest and sinking fund can be made en masse at any time under authorities cited in the next paragraph hereof. The council did by resolution direct that section 5 of Ordinance 1018 be not enforced, but such a resolution could not, nor did it attempt to, repeal the levy, so that in contemplation of law the levy remains as made, such a resolution being a mere nullity, as has been directly held in this State. Young v. St. Louis, 47 Mo. 492. (b) But even if the council has made an insufficient levy, or had failed to make any levy whatever, the bonds would not be invalidated for that reason, since under our Constitution such levy can be made at any time and if the city fails in its duty in this regard, mandamus will lie and such levy can be directed made at any time en masse for all past due interest and principal. East St. Louis v. Amy & Co., 120 U.S. 600; East St. Louis v. People ex rel., 17 N.E. 449; Marion Co. v. Coler, 67 F. 64; Wade v. Travis Co., 174 U.S. 499; Cleveland v. Calvert and City of Spartenburg, supra. (4) The present indebtedness of the city being but $ 40,534.37, and the assessed valuation prior to the issuance of the bonds being $ 3,430,051, the constitutional limitation of five per cent for general municipal purposes and five per cent additional for waterworks (at ten per cent maximum of indebtedness) is not exceeded by the proposed issue of $ 220,000 waterworks bonds. State ex rel. v. Wilder, 197 Mo. 1; State ex rel. v. Allen, 183 Mo. 283; Metcalf v. Seattle, 25 P. 1010; Rochester v. Quintard (N. Y.), 32 N.E. 760.

Elliott W. Major, Attorney-General, C. G. Revelle, Assistant Attorney-General, and C. F. Mead for respondent.

(1) Did the council act within its constitutional and charter powers in ordaining that not only the statutory but additional and further notice be given in order that the public might be fully advised, and the sense of the voters properly tested? By virtue of the power given such cities by the organic law of the State and by statutory transmission, it had the power to so provide, and thus providing its ordinance became of the same force and effect and of equal dignity with an act of the Legislature. Sec. 7, art. 9, Constitution of Mo.; secs. 5834 5872, R. S. 1899; Sanders v. Railroad, 147 Mo. 426; St. Louis v. Foster, 52 Mo. 516; State v. Kessels, 120 Mo.App. 233; St. Louis v. Bentz, 11 Mo. 62; State v. Cowan, 29 Mo. 330; St. Louis v. Schoenbusch, 95 Mo. 618; Ashville v. Webb, 134 N.C. 75; Bowen v. Mayor, 79 Ga. 714; State ex rel. v. White, 162 Mo. 533; St. Louis v. DeLassus, 205 Mo. 578. (a) A general enactment of the General Assembly granting to cities of a certain class certain powers is the charter of these cities, and whatever is contained therein has the full force of a legislative enactment. State ex rel. v. Telephone Co., 189 Mo. 99; St. Louis v. Foster, 52 Mo. 513; Railroad v. Railroad, 105 Mo. 562; Jackson v. Railroad, 118 Mo. 199. (b) The Legislature has said the council shall have no power to submit a proposition unless it shall give not less than fifteen days' notice by publication. This is a limitation and the Legislature is satisfied to leave the matter to the municipal powers, if the statutory notice is given, but it does not compel the municipal authorities to be satisfied with this notice. State ex rel. v. White, 162 Mo. 533; Luce v. Fensler, 52 N.W. 517; Bowen v. Mayor, 79 Ga. 709; Vance v. Ansill, 45 Ark. 400. The matter of giving additional notice is one of the purely local concern, affecting only the interest of the taxpayers of Carthage, and, in the absence of statutory prohibition, the council had the power to require that more complete and perfect information be given the voters if they "deemed it expedient for the good government and welfare of the city, and its trade and commerce." Water Co. v. Lebanon, 163 Mo. 260; Paving Co. v. French, 158 Mo. 534; Railroad v. Railroad, 105 Mo. 562; Jackson v. Railroad, 118 Mo. 199. (2) Section 5 of the ordinance referred to declares that the notice "shall specify the rate of interest." Instead of this the notice given provided that the interest should be "a rate of interest not exceeding 5 per cent per annum, payable semiannually." A mere statement that the interest to be paid is not to exceed a stated rate is not a compliance with the above requirement, as has been uniformally held in all the adjudications. Athens v. Hemerich, 89 Ga. 674; Thompsonville v. Light Co., 50 S.E. 169; Bowen v. Mayor, 79 Ga. 709; Mercer County v. Railroad, 27 Pa. St. 389; Staven v. Genoa, 23 N.Y. 449; Smith v. Dublin, 113 Ga. 833; State ex rel. v. School District, 15 Mont. 133; Elyria Water Co. v. City, 57 Ohio St. 374; Railroad v. Petersboro, 49 N.H. 281; Railroad v. Wells, 39 Ind. 539; State ex rel. v. Roggen, 22 Neb. 118; State ex rel. v. Woodson, 41 Mo. 230; Railroad v. Apperson, 97 Mo. 300. (3) Neither the ordinance, proclamation nor notice designated the newspaper in which the notice should be printed, nor did the printed notice recite the fact that the ordinance authorizing the election had been theretofore enacted. This, in similar matters, has been held to be fatal. State v. Baldwin, 109 Mo.App. 573. (4) Section 12, article 10, of the Constitution is an absolute prohibition against the incurrence of an indebtedness until provision is made for the collection of an annual tax sufficient for the purposes therein mentioned. Almost two years have now elapsed, and yet no adequate provision for that purpose has been made. This constitutional requirement having been ignored, the bonds should not be registered. State ex rel. v. Allen, 183 Mo. 299; State ex rel. v. Railroad, 149 Mo. 645; Wilkens v. Wainsboro, 116 Ga. 359; State v. Water Works Co., 106 Ga. 732. The conduct of the council and the acquiescence therein by the voters indicates that instead of intending to comply with the provisions of the law, and carry out the bond issue, the whole project had been abandoned some time ago, and the right to issue the bonds thereby forfeited. This suggestion seems of peculiar force when it is considered in connection with relator's delay in exercising its alleged authority to issue the bonds in question. It is clear that the vote must lose its authority if not acted upon within a reasonable time, as it cannot be successfully argued that the voters intended giving their public servants a roving commission authorizing them to act without limitation, to abandon the project one year and revive it the next. The delay, when considered with relator's other conduct, is unreasonable. (5) The assessed valuation, as equalized for the purpose of taxation of the relator, was, at the time mentioned, as follows: For 1906, $ 3,306,934; for 1907, $ 3,430,051. Computing the amount of the indebtedness which may be incurred as five per cent of the taxables, the total amount of the bonds which the city could issue would be $ 171,507.55; the amount of this issue is $ 220,000. The bonds are, therefore, prohibited by section 12 of article 10 of the Constitution of Missouri, unless the power of relator is enlarged by the amendment of 1902, the same being section 12a of article 10. In our opinion, such a construction should not be placed upon said amendment, but said amendment should be construed to restrict the debt for...