Hotard v. City of New Orleans , 213 La. 843 ( 1948 )

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] Two taxpayers residing in New Orleans brought this suit against the city and certain railroad companies to have the court declare invalid a constitutional amendment, which was proposed by Act No. 385 of 1938 and which became Section 31.3 of Article 14 of the Constitution, authorizing the city, acting through the Public Belt Railroad Commission, to construct, maintain and operate one or more railroad passenger stations in New Orleans and as an incident thereto to eliminate certain grade crossings. The plaintiffs sued also to annul a contract made by the city with the defendant railroad companies under authority of the constitutional amendment, and to prevent by injunction the carrying out of the contract. Several other taxpayers and the Police Jury of Jefferson Parish intervened in the suit taking the side of the plaintiffs. The district judge after hearing the case gave judgment for the defendants rejecting the demands of the plaintiffs and interveners and dismissing the suit. The plaintiffs and some of the interveners have appealed from the decision.

The argument for the appellants resolves itself into two main divisions: (1) an attack upon the validity of the constitutional amendment, and (2) an attack upon certain provisions of the contract itself.

The first complaint concerning the validity of the constitutional amendment is that it really consists of several amendments and therefore should have been so submitted as to enable the electors to vote on each amendment separately, as provided in Section 1 of Article 21 of the Constitution. In support of this complaint the appellants cite and rely upon Graham v. Jones,198 La. 507, 3 So.2d 761.

The constitutional amendment in question is really only one amendment, authorizing the city to establish and maintain one or more railroad passenger stations, and, as an incident thereto, to eliminate certain grade crossings of tracks entering the station or stations. This new section — 31.3 of Article 14 — is necessarily a long section because it embodies all of the details concerning the authority which was conferred upon the city. It covers nearly five pages of the Constitution; but all of its provisions relate to the one purpose of authorizing the city, acting through the Public Belt Railroad Commission, to construct, maintain and operate one or more passenger stations, and, as an incident thereto, to eliminate grade crossings. The provisions of the amendment are so interrelated that it would not have been feasible to submit each one of them to the voters as a separate and independent amendment of the Constitution. If they had been so submitted, and if the voters had voted for some of the propositions and against others, the purpose of the amendment might have been defeated. In fact, a careful reading of the amendment reveals that it would have been practically if not actually impossible for the voters to vote upon the adoption or rejection of each provision separately. All that the Constitution — Section 1 of Article 21 — requires in that respect is that when more than one amendment shall be submitted at the same election they shall be so submitted as to enable the electors to vote on each amendment separately. That provision was complied with literally in this instance, in Act No. 385 of 1938, proposing the amendment, which provided in Section 3 that on the official ballot to be used at the election there should be printed:

"FOR the proposed amendment to the Louisiana Constitution authorizing a union station or stations at New Orleans".

and also

"AGAINST the proposed amendment to the Louisiana Constitution authorizing a union station or stations at New Orleans".

In the same section it was provided that each elector voting on the provision for so amending the Constitution should indicate his vote in the manner provided by the general election laws of the state. In compliance with the statute, the two paragraphs were printed separately on each ballot — thus:

"FOR the proposed amendment to the Louisiana Constitution authorizing a union station or stations at New Orleans.

"AGAINST the proposed amendment to the Louisiana Constitution authorizing a union station or stations at New Orleans".

Opposite each of these paragraphs was the white square, for each voter to indicate his vote, by stamping the ballot in the manner provided by the general election laws of the state.

The decision in Graham v. Jones is not at all appropriate to the complaint made in this case. In the case cited it was found by a majority of the members of the court that the constitutional amendment really consisted of several separate and distinct amendments of several sections of the Constitution. That is not true in this case because all of the provisions of the one amendment in this case relate to the main purpose of establishing and maintaining and operating one or more railroad passenger stations, with all approaches thereto and appurtenances thereof. As we have pointed out it would have been impractical if not impossible to submit the several provisions of this amendment so that the voters could vote intelligently and effectually upon each provision separately.

The second ground of attack upon the validity of the constitutional amendment is that the voters were not properly notified or informed of the contents or provisions of the amendment. All that the Constitution — Section 1 of Article 21 — requires in that respect is that the Secretary of State shall cause the proposed amendment to be published in a newspaper in each parish in which a newspaper is published, twice within not less than 30 days nor more than 60 days preceding the election at which the amendment is to be submitted to the voters. It is admitted that the Secretary of State did cause this amendment to be published in full in one newspaper in every parish in the state, twice within not less than 30 nor more than 60 days preceding the election at which the amendment was voted upon. It appears in some of the briefs for the appellants — and was revealed in their oral arguments — that they have confused the manner of submitting constitutional amendments on the printed ballots with the manner in which notice shall be given by publication in the newspapers. The publication in the newspapers gives the voters full information as to the contents or provisions of a proposed constitutional amendment. All that is required to be printed on the ballot is sufficient information to identify the proposed amendment which the voter is voting for or against. In this case it is not contended that the wording of the submission was not sufficient to identify the amendment which the voters were called upon to vote for or against. There is therefore no merit in the argument that the voters were misled or were not sufficiently informed of the contents or provisions of the proposed amendment. The case of Schultz v. Police Jury of Tangipahoa Parish, 196 La. 359,199 So. 215, cited by the appellants, is not at all appropriate to this case. In the Schultz Case a constitutional amendment, Section 33 of Article 14, authorized the police juries throughout the state to issue bonds to provide funds for the construction and maintenance of industrial plants for the conversion or processing of raw farm or agricultural products, when authorized by a majority vote of the property taxpayers of the parish, or of any police-jury ward. The police jury of the Parish of Tangipahoa adopted a resolution submitting a proposition to the vote of the property taxpayers, intending that the industrial plant should be used only for the conversion or processing of milk; but there was no indication in the resolution as published, as to what kind of farm or agricultural products were to be processed. It was held therefore that the resolution, as published, did not give the taxpayers sufficient information as to the proposition on which they were called upon to vote. There is no comparison between that case and this case.

The appellants' first attack upon the legality of the contract is upon the following portion of Paragraph L of Section 7 of Article II: "The City hereby further agrees that * * * it shall be the policy of the City to budget and appropriate annually out of its general revenues derived from various sources for general municipal purposes * * * the sum of Five Hundred Thousand Dollars * * * per year * * * to be * * * used * * * for the same purpose for which the proceeds of the bonds referred to in this paragraph are to be * * * dedicated * * *." It is contended that this provision of the contract violates Section 24 of Article XIV of the Louisiana Constitution, which forbids the City of New Orleans to anticipate the collection of any of its taxes, or to incur any debt or obligation unless sufficient funds (not otherwise appropriated) to pay such debt are actually in the city treasury at the time when the debt is incurred. The appellees apparently concede that this provision would be illegal if it, in fact, expresses an obligation on the part of the city to make the annual appropriation referred to. The city's position is that the provision is merely a declaration of the city's intention as to the course of action which it will pursue in the future, but which declaration is in no way binding upon the city. We agree with the contention of the appellees, for two reasons. It is a familiar rule of law that if one of two reasonable constructions of a contract provision will render it valid and the other will render it invalid, the first will be adopted or approved by the court. Sporl v. New York Indemnity Co., 176 La. 363, 145 So. 771. Moreover, there is in the record a stipulation by the attorneys representing all parties to the contract to the effect that the construction contended for by the defendants is that which was intended by the parties. In the absence of any showing to the contrary, we assume that the parties to the contract authorized their attorneys to make that stipulation. Hayes v. Cuny, 9 Mart., O.S., 87; Dangerfield's Executrix v. Thurston's Heirs, 8 Mart., N.S., 232. The appellants refer to the use of the word "policy" in the constitutional amendment in what they contend is a different sense from that in which the appellees contend it is used in the contract itself. The meaning of the word in the constitutional amendment does not control its meaning in the contract. "The same words may have different meanings in different parts of the same act, and of course words may be used in a statute in a different sense from that in which they are used in the Constitution." Lamar v. United States,240 U.S. 60, 65, 36 S.Ct. 255, 257, 60 L.Ed. 526. Besides, if the intention of the parties to the contract had been to bind the city absolutely to appropriate the $500,000 annually the obligation would have been expressed more directly and positively than by saying that it would be the policy of the city to make the appropriations.

The appellants attack also that portion of the contract provision stating the policy of the city to appropriate $500,000 annually which provides that the money so appropriated shall be "used * * * for the same purpose for which the proceeds of the bonds [the $12,000,000 bond issue for grade separations] * * * are to be * * * dedicated, as well as for the payment of thecost of the other obligations and undertakings assumed by theCity in this agreement." The appellants argue that the italicized clause indicates that the city intends to spend or is empowered to spend the appropriated money for illegal purposes. There is no reason to assume that the city will not act according to law in that respect.

The appellants attack also certain provisions of the contract which create what they call a "dump fund," which is "to be dedicated and exclusively used for the payment and discharge of the obligations assumed by the City under this agreement." As in the case of the clause discussed in the preceding paragraph, to hold invalid the provisions creating the so-called "dump fund," this court would have to assume that the parties intend to use this fund for an illegal purpose. There is no reason for any such presumption.

The appellants attack the provision in the contract for submission to arbitration disagreements among the parties to the contract. The appellants contend that Article 459 and 460 of the Code of Practice strike this provision with nullity. We can find nothing in the articles cited which would render invalid the provision in question. The appellants seem to think that if the parties intend to empower the arbitrator to act as an amicable compounder they must so state their intention in so many words. There is no such requirement in Article 460 of the Code of Practice. A municipality has the right to submit disputes to arbitration in the absence of any law to the contrary. Dillon on Municipal Corporations, Section 822; McQuillin on Municipal Corporations, Section 2646. The appellants cite no law which would limit the power of the City of New Orleans to agree to submit disputes to arbitration.

The appellants assail the legality of Section 85 of the contract, which reads, in part, as follows: "The City hereby determines, pursuant to the power conferred on it under the first paragraph of Section 31.3 of Article XIV of the Constitution of the State of Louisiana * * * and the parties hereto hereby agree that * * * the acquisition, construction, maintenance and operation of the Union Passenger Terminal shall not be governed or controlled by any otherwise applicable provisions of Louisiana Act 271 of 1908, Sections 58 and 60 of Louisiana Act 159 of 1912, Louisiana Act 144 of 1934, Louisiana Act 127 of 1940, Louisiana Act 171 of 1940, and any and all acts amendatory thereof and shall be conducted and accomplished without reference thereto." The appellants contend that this provision is in contravention of Articles 11 and 12 of the Revised Civil Code. The appellees, on the other hand, rely on the opening words of the constitutional amendment which authorizes the construction of the terminal as authorizing the city to stipulate that the statutes named shall not govern the construction of the terminal. These words read as follows: "* * * the City of New Orleans * * * shall have the power, in any manner it may determine, to acquire, construct, maintain and operate one or more railroad passenger stations * * *." Our opinion is that this general phrase, coupled with the authorization contained in subsection (A) for the city to enter into contracts relating to the construction of the terminal, empowers the city to stipulate for the non-applicability of the statutes referred to. In this connection we must bear in mind that the constitutional amendment authorizes the city "to enter into a contract or contracts, containing such terms, conditions, stipulations and provisions * * * as may be approved by the vote of a majority of all the members of said Commission * * *."

The appellants complain of the contract provisions which apportion the cost of the grade separation program between the city and the railroads. It is provided that the city shall pay 85 per cent of this cost and that the railroads shall pay 15 per cent. The constitutional amendment gives the city the absolute power to contribute to the cost of the grade separations any amount that the Commission Council may determine. The appellants cite the provision of the charter of the city which empowers the city to require any railroad to contribute 65 per cent of the cost of any grade separation. In answer to this argument, it need only be pointed out that this provision empowers the city so to act, but does not command it so to act. Appellants further argue that this provision must be set aside as an unconscionable or iniquitous abuse of discretion or authority on the part of the city. Examination of the authorities cited by both sides on this point leads us to the conclusion that the weight of authority is to the effect that the act of a municipality, although it be duly authorized, can be set aside by the judiciary, but that this will be done only if the act is such a manifest and oppressive abuse of authority that it appears that the municipality has entirely ignored the interest of the people whom it represents. McQuillin on Municipal Corporations, Section 378; Lackey v. Fayetteville, 80 Ark. 108, 96 S.W. 622; Rosenthal v. Goldsboro, 149 N.Car. 128, 62 S.E. 905. The mere fact that the act might have been executed in a manner more advantageous to the public interest is immaterial. City of New Orleans v. Warner,175 U.S. 120, 20 S.Ct. 44, 44 L.Ed. 96; Campbell v. City of New York,244 N.Y. 317, 155 N.E. 628, 50 A.L.R. 1473.

The appellants complain of the contract provision which vests in a committee, the majority of the members of which represent the railroads, certain powers relative to the construction of the terminal. The constitutional amendment specifically provides that the city may "vest in a Committee or other body composed of representatives of any and all interested parties, including but not limited to representatives of any railroad company or railroad companies, * * * such powers as may be specified in such contract or resolution for supervising or controlling the acquisition, construction, maintenance and operation of said passenger station or stations." The action complained of, therefore, has been specifically approved and authorized in advance by the people themselves. The appellants argue vigorously that the city has delegated a part of its police power to this committee. That, if true, is authorized by the constitutional amendment, — the supreme power in the state. The powers delegated are "powers * * * for supervising or controlling the acquisition, construction, maintenance and operation of said passenger station or stations."

The appellants attack also the provisions of the contract (1) which make payable out of the revenues from the terminal the $15,000,000 of bonds which the city undertakes to issue; (2) which exempt the terminal and the railroads' use thereof from taxation; (3) which postpone the obligation of the railroads to pay rent for the use of the terminal until the $15,000,000 bond issue has matured; and (4) which fix the final maturity date for the $15,000,000 bond issue as January 1, 1998. A sufficient answer to these complaints, is that these provisions are all specifically authorized by the constitutional amendment; hence it is beyond the power of the court to question their legality.

The judgment is affirmed.

PONDER, J., dissents and assigns reasons.

FOURNET, J., dissents and assigns written reasons.