Tocci v. City of Three Forks
| Citation | 700 P.2d 171,216 Mont. 159 |
| Decision Date | 23 May 1985 |
| Docket Number | No. 84-501,84-501 |
| Parties | Raymond P. TOCCI, Betti J. Tocci, Victor Surdahl and Eloise Surdahl, Plaintiffs and Appellants, v. The CITY OF THREE FORKS, a municipal corporation, Defendant and Respondent. |
| Court | United States State Supreme Court of Montana |
Morrow, Sedivy & Bennett; Lyman H. Bennett, III, Bozeman, for plaintiffs and appellants.
Landoe, Brown Law Office, Bozeman, for defendant and respondent.
Landowners appeal a judgment of the Gallatin County District Court upholding special improvement district assessments by the City of Three Forks. The assessments were made to recapture engineering and legal expenses in creating a SID for improvements which were never completed by the City. The project was completed privately after the municipal bond failed to sell. Finding neither a statutory basis for the assessment nor a benefit to the property involved, we reverse the judgment of the District Court.
Raymond Tocci on behalf of himself and other landowners petitioned the City of Three Forks in 1977 for the creation of several special improvement districts. Acting on these requests the City Council created four SIDs in 1978. The purpose of the SIDs was to provide water and sewer services for parcels that Tocci wished to develop.
The City proceeded to contract with the engineering firm of Thomas, Dean & Hoskins to design a water and sewer system and estimate its cost for purposes of letting a construction bid and drawing up a municipal bond. This firm acted as the city engineer of Three Forks. The City undertook this work under the assumption that the SIDs would result in a bond sale and improvements.
The costs of designing and planning the project totalled $7,831.19. This amount represents engineering services, publication, title search and legal services associated with creating the four SIDs. The low bid for construction of the project was approximately $50,000. The City was unsuccessful in its attempts to sell a bond for the SIDs.
Subsequent to the unsuccessful sale the developer retained his own engineering firm to design the project and at his own cost improved the property with water and sewer facilities.
The question then arose as to which party would pay the creation costs of the abandoned SIDs. The City's engineering firm of Thomas, Dean & Hoskins filed suit against the City of Three Forks for $5,211.89 representing its consulting fee. The parties negotiated a settlement whereby the City paid $4,000 to the engineering firm.
In October 1982 the City Council voted to assess Tocci and the other property owners the costs of creating the SIDs. Following this assessment, which Tocci objected to, the plaintiffs in the present lawsuit under protest paid assessments of $7,121.94 in 1983. Shortly thereafter, Tocci and Surdahl filed the present lawsuit to recover their tax payments.
Facts reflecting our discussion above were stipulated and a nonjury trial was held June 27, 1984. The trial court concluded as a matter of law that the defendant City was properly authorized to incur the creation costs of the SIDs and to assess the same against the plaintiffs.
In a memorandum attached to the court's order of August 15, 1984, the court noted that it was the developer that started the SID process by petitioning the City for the improvements. The court stated that the developer was aware that the bond might not sell and that this party should assume the risk of nonsale. Furthermore, the court found the property owners could have used the engineering (sewer and water) plans the City had contracted for, rather than those of the independent engineering firm with which Tocci had contracted:
The property owners appeal and raise this issue:
May a city levy SID assessments against property for creation costs of anticipated improvements when those improvements are not constructed on the property by the city?
The starting and ending point for our discussion on this issue will be the plain language of the statutes that authorize assessments for special improvement districts. Section 7-12-4201, MCA, states that: "All costs and expenses incurred in the construction of any improvements specified in part 41 in any improvement district shall be paid for by special improvement district bonds or warrants ..." The appellants have emphasized the mandatory language of this provision in their briefs before this Court. It is obvious that the City of Three Forks did not comply with the letter of this law when they compelled the developers to pay for certain creation costs of improvements rather than completing a bond sale.
The costs at issue here are clearly anticipated by the language of Sec. 7-12-4201, MCA. That statute makes reference to costs specified in part 41 of title 7, chapter 12, MCA. Incidental expenses are defined in part 41 to be:
"... the compensation of the city engineer for work done by him, the cost of printing and advertising as provided in this part and part 42, the compensation of persons appointed by the city engineer to take charge of and superintend any of the work mentioned in this part, or the expenses of making the assessment for any work authorized by this part." Section 71-2-4101(7), MCA.
We note that the contracted firm of Thomas, Dean & Hoskins was acting as the city engineer of Three Forks at the time of this project. The incidental, creation, or start-up costs are considered part of "the cost and expenses of making the improvements within such special improvement district" by the language of Sec. 7-12-4169(1), MCA. Thus, the statutory scheme of part 41 and part 42 of chapter 12 clearly states that creation costs of an SID, incurred by the city engineer and the city generally, shall be payable by SID bonds.
The statutory language being plain and unambiguous, we refrain from reading into the language a second mode of payment for expenses other than a SID bond. It is true that the contingency presented by the facts before us is not addressed by statute. Respondent City would have us...
To continue reading
Request your trial