Porsh Builders, Inc. v. City of Winston-Salem , 302 N.C. 550 ( 1981 )

COPELAND, Justice.

The sole question presented by this appeal is whether defendants were required under the language of G.S. 160A-514 to accept plaintiff’s bid as the “highest responsible bid,” if defendants decided to accept either bid submitted. For the reasons stated below, we find the Court of Appeals’ majority opinion correct in its interpretation of the statute as allowing defendants to either reject all bids or accept plaintiff’s “highest responsible bid,” and hold that summary judgment entered in favor of defendants was properly reversed.

G.S. 160A-514(c) and (d) govern the sale to private developers of property owned by the Winston-Salem Redevelopment Commission and provide:

“(c) A commission may sell, exchange, or otherwise transfer real property or any interest therein in a redevelopment project area to any redeveloper for residential, recreational, commercial, industrial or other uses or for public use in accordance with the redevelopment plan, subject to such covenants, conditions and restrictions as may be deemed to be in the public interest or to carry out the purposes of this Article; provided that such sale, exchange or other transfer, and any agreement relating thereto, may be made only after, or subject to, the approval of the redevelopment plan by the governing body of the municipality and after public notice and award as specified in subsection (d) below.

(d) Except as hereinafter specified, no sale of any property by the commission or agreement relating thereto shall be effected except after advertisements, bids and award as hereinafter set out. The commission shall, by public notice, by publication once a week for two consecutive weeks in a newspaper having general circulation in the municipality, invite proposals and shall make available all pertinent information to any persons interested in undertaking a purchase of property or the redevelopment of an area or any part thereof. The commission may require such bid bonds as it deems appropriate. After receipt of all bids, the sale shall be made to the highest responsible bidder. All bids may be rejected. All sales shall be subject to the approval of the governing body of the municipality .. . .”

In its conclusions of law supporting entry of summary judgment in favor of defendants, the trial court stated that G.S. 160A-514(c) and (d) confer upon defendants the discretion to consider more than the dollar amount bid in determining which bid, if any, to accept. Specifically, the trial court found defendants authorized to consider “the redevelopment plan of each bidder, the housing needs of the City, the housing policies of the City, the revenue to be derived from each bid,” and other factors relevant to the property in question. We agree with the majority decision of the Court of Appeals that neither subsection of G.S. 160A-514 can be interpreted to give defendants the discretionary powers recited by the trial court.

Municipal corporations are created by legislative enactment and possess only those powers conferred in the express language of a statute and those necessarily implied by law therefrom. Campbell v. First Baptist Church, 298 N.C. 476, 259 S.E. 2d 558 (1979); Matter of Ordinance of Annexation No. 1977-4, 296 N.C. 1,249 S.E. 2d 698 (1978); Koontz v. City of Winston-Salem, 280 N.C. 513, 186 S.E. 2d 897 (1972). The municipality may not exercise any power not granted to it, and possesses no inherent authority to exercise powers either expressly or impliedly prohibited by statute. Greene v. City of Winston-Salem, 287 N.C. 66, 213 S.E. 2d 231 (1975). In addition, it is generally held that statutory delegations of power to municipalities should be strictly construed, resolving any ambiguity against the corporation’s authority to exercise the power. This Court has long held that “[a]ny fair, reasonable doubt concerning the existence of the power is resolved against the corporation.” Shaw v. City of Asheville, 269 N.C. 90, 97, 152 S.E. 2d 139, 144 (1967), quoting from Elizabeth City v. Banks, 150 N.C. 407, 412, 64 S.E. 189, 190 (1909). See also 56 Am. Jur. 2d Municipal Corporations §§ 195, 210 (1971).

Applying the above rules of statutory interpretation to the language of G.S. 160A-514 (c) and (d), we find that the statute cannot be construed to vest the amount of broad discretion in defendants that was contemplated by the trial court. Subsection (d) specifically directs that “[ajfter receipt of all bids, the sale shall be made to the highest responsible bidder.” (Emphasis added.) Defendants contend that by the use of the word “responsible,” the legislature intended to give the governing board of a municipality broad discretion to accept a lower bid if it determines that the lower bid will make a more effective contribution to the redevelopment plan. We disagree. The adjective “responsible” modifies the term “bidder,” not the term “bid.” “Responsible” is defined in Black’s Law Dictionary 1180 (5th ed. 1979) as follows:

“Liable; legally accountable or answerable. Able to pay a sum for which he is or may become liable, or to discharge an obligation which he may be under.”

We hold that the term “responsible” in G.S. 160A-514(d) was intended to give the municipality power to use its discretion only to the extent of determining whether a bidder has the resources and financial ability to complete the project set forth in his proposal for the development of the property. This phrase does not allow the municipality to consider which bid best complies with the redevelopment plan.

Likewise, we reject defendants’ allegation that since subsection (d) of the statutue expressly empowers the governing board of a municipality to reject all bids, it impliedly authorizes the board to reject the highest bid if a lower bid “more nearly” complies with the redevelopment plan. Again, there is no language in the statute to support defendants’ proposed interpretation. The clear meaning of the language of subsection (d) is that although the municipality may reject all bids, if any bid is accepted, it must be the “highest responsible bid.”

Our interpretation is supported by this Court’s recent opinion construing the same statute in Campbell v. First Baptist Church, supra. There Chief Justice Branch, writing for the Court, stated:

“As we read the statute, each subsection confers upon a redevelopment commission the authority to perform certain acts necessary to carry out the redevelopment project, and the use of the word ‘may’ merely denotes that the commission is not required to do each and every act authorized in G.S. 160A-514. However, should a commission elect to exercise the authority conferred upon it by a particular section, then the procedural requirements ‘shall’ be followed.” 298 N.C. at 483, 259 S.E. 2d at 563.

Subsection (c) provides that a municipality may sell property, and if it chooses to exercise this power, the sale must be made according to the procedural requirements set forth in subsection (d). One requirement specified under subsection (d) is that “[ajfter receipt of all bids, the sale shall be made to the highest responsible bidder.” The use of the term “shall” renders the procedural requirement mandatory, if the governing body of the municipality decides to accept any bid.

Defendants further maintain that the authority to use the discretionary powers outlined by the trial court stems from the provision in subsection (d) that “[a]ll sales shall be subject to the approval of the governing body of the municipality.” They argue that the express delegation of authority to approve the sale impliedly gives them the power to determine which bid “more nearly” complies with the redevelopment plan. Were we to accept defendants’ argument, the provision that the sale shall be made to the “highest responsible bidder” would be rendered meaningless. If a sale could only be “approved” by the governing board after the board determined that the sale was being made to the bidder whose plan best satisfied the purposes and specifications of the redevelopment plan, then no more than one “responsible bidder” could exist and there would have been no need for the legislature to specify that the sale shall be made to the highest responsible bidder. We believe the provision vesting authority in the governing board to approve the sale was merely intended to place final authority in the board to determine whether all submitted bids satisfy the zoning requirements of the district and are in general conformity with the redevelopment plan. The clause also allows the board to ultimately decide whether all bids should be rejected. Thus, the approval provision serves as a protective measure to insure that the Redevelopment Commission’s actions under the statute are in conformity with the zoning laws and the redevelopment plan. This interpretation reconciles the approval clause and the requirement that the sale shall be made to the highest responsible bidder, so that each sentence of the statute remains fully effective. It is well established that a statute must be considered as a whole and construed, if possible, so that none of its provisions shall be rendered useless or redundant. It is presumed that the legislature intended each portion to be given full effect and did not intend any provision to be mere surplusage. Jolly v. Wright, 300 N.C. 83, 265 S.E. 2d 135 (1980); Williams v. Williams, 299 N.C. 174, 261 S.E. 2d 849 (1980); State Ex Rel. Commissioner of Insurance v. North Carolina Automobile Rate Administrative Office, 294 N.C. 60, 241 S.E. 2d 324 (1978). Our interpretation of G.S. 160A-514(c) and (d) complies with this rule of construction and comports with the legislature’s intent.

For the foregoing reasons, we affirm the Court of Appeals’ majority holding that under the language of G.S. 160A-514, defendants are required to accept the “highest responsible bid,” if any, where that bid is in compliance with the applicable zoning restrictions and redevelopment plan for the property to be sold. The Court of Appeals’ decision reversing summary judgment in favor of defendants is

Affirmed.

Justice Meyer did not participate in the consideration or decision of this case.