Thomasson v. Smith , 249 N.C. 84 ( 1958 )

105 S.E.2d 416 (1958) 249 N.C. 84

John A. THOMASSON, on behalf of himself and other property owners and taxpayers in the City of Charlotte, N. C.,
v.
James S. SMITH, Claude L. Albea, Herbert H. Baxter, Herman A. Brown, Steve W. Dellinger, Martha W. Evans, Ernest C. Foard, W. Everett Wilkinson, and The City of Charlotte, N. C.

No. 246.

Supreme Court of North Carolina.

October 29, 1958.

Taliaferro, Grier, Parker & Poe, Sydnor Thompson, Charlotte, for plaintiff.

John D. Shaw, Charlotte, for defendants.

DENNY, Justice.

The plaintiff contends that the City of Charlotte is without authority to issue bonds and to levy and collect taxes from the citizens of the city for the purpose of extending water and sewer facilities and its fire alarm system to an area which is, at present, not within the city limits and will not become a part of the city until 1 January 1960. The plaintiff further contends that such expenditures would be in violation of both the Constitution of the United States and the Constitution of North Carolina, in that it would constitute the taking of property of the citizens of Charlotte without due process of law, and that such expenditures would not be for a public purpose.

It would seem, therefore, that the question posed for determination is simply this: May a municipal corporation, with legislative sanction, issue bonds and levy taxes to meet the required payment of principal and interest thereon, and use the proceeds therefrom to finance the extension of water and sewer facilities and a fire alarm system into an area which is to be annexed to the municipality at a fixed future date, after the residents of the area to be annexed have approved the annexation and the citizens of the municipality have approved both the annexation and the issuance of the bonds?

We shall not undertake a seriatim discussion of all the appellant's exceptions. We shall, however, discuss the questions raised which are, in our opinion, essential to the proper disposition of the appeal.

The briefs filed in connection with this appeal cite no case from this or any other state involving a factual situation similar to that presented on this record. Neither have we been able to find such a case. Even so, the general law authorizes a municipality in this State to establish and maintain a sewer system. G.S. § 160-239. A municipality is likewise authorized to maintain a waterworks system and to furnish water "to any person, firm or corporation desiring the same outside the corporate limits where the services can be made available by the municipality * * *." G.S. § 160-255 (1957 Cum.Supp.).

G.S. § 160-238 provides: "The governing body may provide, install, and maintain water mains, pipes, hydrants, and buildings and equipment, either inside or outside of the city limits, for protection against fire of property outside of the city limits, and within such area as the governing body may determine, not exceeding a boundary of two miles from the city limits, under such terms and conditions as the governing body may prescribe. * * *"

Furthermore, the charter of the City of Charlotte, as adopted in Chapter 366, Section 32, Subsection (25), Public-Local Laws of 1939, authorizes the city, "To establish systems of sewerage and works for sewage disposal, and to extend and build the same beyond the corporate limits when deemed necessary, to permit owners of residences or industrial plants outside the limits of the City of Charlotte to connect to the sewerage system of said City of Charlotte and to remove said sewage through its system as is now done for residents of said city, and to make such reasonable charges for such service as may be set by the city council; * * *." According to the testimony in the court below, approximately thirty-five per cent of the residents in the area to be annexed are presently served by the extension of the sewerage system of the City of Charlotte, and two-thirds of the homes in the area are supplied with city water through local water supply systems.

Moreover, we interpret Section 6 of Chapter 802 of the Session Laws of 1957, amending the charter of the City of Charlotte, to give the city the authority to extend its water and sewer lines into the area to be annexed, and to do so prior to 1 January 1960. This Section authorizes the City of Charlotte, in the event the election shall carry, to annex the involved area, "to plan for extending and to extend, municipal public works into the territory coming (not which has been annexed) into the city limits by virtue of said election."

Section 6 also extends from the date of the ratification of the Act, being 23 May 1957, the law governing condemnation of property within the present city limits of the City of Charlotte to the additional area.

This entire Section was wholly unnecessary if it was not the legislative intent that the City of Charlotte should proceed immediately to provide these facilities within the area which is to become a part of the City of Charlotte on 1 January 1960. After an area is annexed to a municipality, it becomes a part of it and subject to all the debts, laws, ordinances and resolutions in effect on the date of the annexation. This is expressly so provided by statute. G.S. § 160-449.

We think it reasonable to assume that the purpose in fixing 1 January 1960 as the date on which the area to be annexed should become effective, was to give the City of Charlotte a reasonable time to install these facilities so that they would be available to the residents of the area to be annexed at the time the annexation would become effective or as soon thereafter as practicable.

In light of the facts in this case, we are not impressed by the argument that the tax levy complained of constitutes a taking of the property of the citizens of the City of Charlotte without due process of law, in violation of both the Constitution of the United States and the Constitution of North Carolina. The expenditure of funds for the construction of water and sewerage facilities by a municipality, outside its corporate limits, if done pursuant to legislative authority, is for a public purpose and is not violative of the Fourteenth Amendment to the Constitution of the United States or of Article I, Section 17, of the Constitution of North Carolina. Ramsey v. Commissioners, 246 N.C. 647, 100 S.E.2d 55; City of Charlotte v. Heath, 226 N.C. 750, 40 S.E.2d 600, 169 A.L.R. 569; Holmes v. City of Fayetteville, 197 N.C. 740, 150 S.E. 624, 628.

It is said in the last cited case, "If the defendant should attempt to pledge the faith of the city or to contract a debt or levy a tax for an enterprise conducted within the designated territory, the taxpayer would have ample remedy." Plaintiff contends that the foregoing statement should be construed as prohibiting the City of Charlotte from issuing the bonds involved in this action and from levying any tax in connection therewith. However, the plaintiff seems to have overlooked the fact that in addition to the legislative authority granted to the defendants, the qualified voters of the City of Charlotte have approved what the city is attempting to do.

In the case of Town of Dunn v. Tew, 219 N.C. 286, 13 S.E.2d 536, the lands of the defendants were being sold for nonpayment of municipal taxes. The property was located in an area that had been annexed by the plaintiff city and the defendants contended that their property was not subject to the full rate of tax levied, for that a part of the taxes would go toward payment of debts that were existing prior to the time of the annexation and from which the defendants derived no benefit. The holding of the Court is succinctly stated in the third headnote of the opinion as follows: "Where the corporate limits of a municipality have been extended by legislative act * * * the municipality has jurisdiction over the territory annexed and may levy and collect taxes on the property embraced therein, notwithstanding that the taxes so collected may be used to pay municipal indebtedness incurred prior to the time of the annexation * * *."

Certainly the citizens in the area to be annexed by the City of Charlotte will, beginning with the year 1960, be taxed to pay for indebtedness of the City of Charlotte, no part of which was expended for their benefit. G.S. § 160-449.

The General Assembly has expressly authorized the extension of these facilities in the event the election carried and the qualified voters of the City of Charlotte, with full knowledge that the area involved would not be subject to the levy and collection of taxes until on and after 1 January 1960, approved the bond issue to finance the extension of the public utilities of the City of Charlotte into the area of approximately thirty square miles, which area will by the expiration of time, without any further legal steps being taken by anyone, become a part of the City of Charlotte on the date fixed in its charter, to wit, 1 January 1960. Doubtless the provision for the extension of these water and sewer facilities prior to the effective date of the annexation, may have had a material bearing on the result of the voting in this additional area, which is about equal to the area contained within the present corporate limits of the City of Charlotte.

In the case of Briggs v. City of Raleigh, 195 N.C. 223, 141 S.E. 597, 600, the plaintiff undertook to restrain the City of Raleigh from issuing bonds which had been approved by the voters of the city. The proceeds from the sale of the bonds were to be used for the purpose of erecting buildings, etc., on land donated by the State to be used for a State Fair to be operated within five miles of the City of Raleigh. This Court held the expenditures to be for a public municipal purpose and that it was within the power of the city to issue said bonds. Stacy, C. J., in speaking for the Court, said: "Where the question is doubtful, as it is here, and the Legislature has decided it one way and the people to be taxed have approved that decision, it is the general rule of construction that the will of the lawmakers, thus expressed and approved, should be allowed to prevail over any mere doubt of the courts."

In the instant case, upon the findings of fact made by the court below, and which are supported by competent evidence, the court held that the plaintiff has not sustained his burden in showing that the legislative action upon which the defendants are relying is unconstitutional. The court further concluded as a matter of law that the issuing of bonds to extend the water and sewer systems as contemplated by the City of Charlotte, is not in violation of the Fourteenth Amendment to the Constitution of the United States, or of Section 17 of Article I or Section 3 of Article V of the Constitution of North Carolina. The court however, held that the City of Charlotte should be restrained from extending the fire alarm system beyond two miles from the present city limits, as provided in G.S. § 160-238. Judgment was accordingly entered.

The judgment of the court below is

Affirmed.

PARKER, J., not sitting.