State Etc. v. Goodgame , 91 Fla. 871 ( 1926 )

The controlling question to be determined is whether Chapter 11678, Laws of Florida, in abolishing three municipalities and establishing one municipality in lieu of three, has complied with the mandate of the constitution that "when any municipality shall be abolished, provision shall be made for the protection of its creditors." The organic provision that "no law impairing the obligation of contracts shall ever be passed," is a prohibition upon legislative action and relates to the obligation of contracts; while the organic command that "when any municipality shall be abolished, provision shall be made for the protection of its creditors," requires affirmative and positive action by the legislature in making provision for the protection of creditors when a municipality is abolished. It may not be necessary that the required provision for the protection of such creditors, be contained in any specific and express terms, words or language, but there must be positive and affirmative provision duly made, that in fact and in law protects the creditors of a municipality when it is "abolished." Provisions omitted from a statute cannot be supplied by the courts. Ebert v. Poston, 266 U.S. 548,45 Sup. Ct. Rep. 188.

Chapter 11678, Laws of Florida, the Charter Act, provides that three municipalities are "abolished" and a new municipality is "established," covering the territory of the former three with additional territory. The Charter Act validates all assessments and liens, certificates of indebtedness, improvement certificates and collections of the same "heretofore made and obtained" severally by the three prior municipalities, and also validates all contracts, bonds and obligations of the then abolished municipalities severally the amount due to the three to be collected by the newly established City of Panama City and used for the benefit of that portion of said city which formerly constituted severally the three former municipalities; and provides that all property included in such former municipalities respectively, "shall be held responsible for, and be bound for all contracts, judgments, and debts now held against" them respectively, "and no other territory or property included herein and covered by this Act, shall be responsible for such contract, judgments and debts, nor shall any tax ever be levied upon any such other territory or property for the payment of such contracts, judgments and debts."

These provisions tend to negative a purpose to violate the obligation of the contracts of the abolished municipalities; but they are insufficient to constitute an affirmative compliance with the organic command to make provisions for the protection of the creditors of the abolished municipalities. The provision that amounts due to the abolished municipalities severally shall be collected by the new city and "used for the benefit of" the portion of the new city that were parts of the former entities severally, is not an adequate provision for the protection of creditors as required by the constitution. It does not provide for the payment of debts.

Section 4 of the Charter Act vests in the new municipality the "title, rights, ownership of property, uncollected taxes, dues, claims, judgments, decrees, choses in action held and owned by the" three abolished municipalities, but the new city is not expressly required to pay the debts of either of the former municipalities. And Section 197 provides that all the property, rights and choses in action of every kind and character belonging to either of the three abolished municipalities "shall become and be the property, rights, and choses in action of the City of Panama City hereby organized and created."

The Charter Act gives the new city power to levy and collect annually taxes upon the real and personal property in the said city, and provides that it shall levy and collect "such sums as may be necessary to pay interest upon the indebtedness of the city and for the maintenance of its properties and public works, to create a sinking fund for the payment of such indebtedness as may be incurred; and to pay the bonds of the city already issued or any bonds which may be issued in accordance with law; to pay any judgment against the city and such sum as may be commanded to be levied by any mandamus legally issued against the city."

This provision relating to the taxing power should not be construed to extend beyond its plain purpose, particularly when its controlling features appear to relate to prospective obligations. If the provision as to "bonds of the city already issued," or any other provision, be construed to have reference to the then existing bonds and also to other indebtedness of the three abolished municipalities, such provisions must be construed with the provisions making prior indebtedness obligations upon only the property that was in the prior municipalities severally. Thus the tax levy, provisions are not entirely free from equivocation thereby producing uncertainty and doubt.

The Charter Act does not appear to specifically authorize the new municipality to sue and be sued, though there are references to suits against it; and the provision of the Revised General Statutes of 1920, on that subject seems to confine the authority therein conferred, to municipalities incorporated under the general law. See Sec. 1832, Rev. Gen. Stats. 1920.

Whatever may be the general rules of law relative to the implied liability of a municipality for the debts of its abolished predecessor (1 Dillon on Munic. Corp. (5th ed.) 336), in Florida the constitution expressly commands that "when any municipality shall be abolished, provision shall be made for the protection of its creditors;" and this organic mandate obviously requires affirmative, positive and unequivocal provisions to be duly enacted for the protection of the creditors of each and every municipality when it is abolished. The provision of the constitution here considered was not in existence and was not material to the decision in Broughton v. City of Pensacola, 93 U.S. 266, which case, like Mobile v. Watson, 116 U.S. 289, 6 Sup. St. Rep. 398, is not entirely analogous to this one.

There is ambiguity as to the taxing power of the new municipality "to pay bonds of the city already issued" or "to pay any judgment against the city," and it is not apparently made the duty of the new municipality to duly levy and collect taxes and to pay the debts of the former three; nor is the new municipality specifically authorized to be sued to enforce the indebtedness of the several former municipalities to be paid from the property in the territory that was covered by those former municipal entities severally, though there is reference to a mandamus to compel a tax levy.

The Revised General Statutes of 1920, do not supply the provisions required by the constitution for the protection of the creditors of municipalities that are abolished by special legislative enactments. If any of the provisions of Sections 1920, 1922 or other sections of the Revised General Statutes would seem to be applicable, such provisions are inconsistent with the special Charter Act, Chapter 11678, Laws of Florida, and under Section 24, Article III of the Constitution, the special law "shall be applicable," which special law does not comply with the organic command that when any municipality shall be abolished, provision shall be made for the protection of its creditors.

STRUM, J., concurs.