State, Ex Rel. v. Broward County Port Authority

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 44 [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 45 [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 46 On June 14, 1932, an amended alternative writ of mandamus was filed herein containing a command that the respondents, as and constituting the Broward County Port Authority, forthwith, and without undue delay, pay over to the relator the sum of $1261.00 alleged to be held in respondents' custody and as such to be applicable and available to be paid over to relator upon certain indebtedness held by him in the form of City of Hollywood bonds which it is alleged the Broward County Port Authority had lawfully assumed and agreed to pay pursuant to competent statutory authority so to do. The writ, as amended, sets up a total alleged indebtedness claimed by relator amounting to $23,220.00. To apply on this claim, the writ asserts that there is on hand and available for payment in part satisfaction thereof, the sum of $1,261.00 in moneys raised and collected from taxation by said Broward County Port District to be applied to the district indebtedness, of which relator's claim is asserted to be a part.

The case is now before us for consideration upon respondents' demurrer to the amended writ of mandamus, as *Page 47 well as upon relator's motion for a peremptory writ notwithstanding a special return filed by respondents setting up certain special defenses. In addition to the foregoing, there was received and permitted to be tentatively filed in this proceeding, a petition of the City of Hollywood praying that it be made a party respondent. Said petition was accompanied by an answer prepared in its behalf. The City of Hollywood's answer was likewise ordered to be received and filed for consideration as a part of the pleadings herein, subject to its being stricken out later should it be found on final hearing to be inapplicable, or such an intervention as ought not to be allowed to stand as part of the record in the present case.

It is accordingly disclosed by the record that in 1926 the City of Hollywood, purporting to act under its charter (Chapter 11510, Special Acts of 1925), issued bonds in the sum of $2,000,000.00 of which relator's bonds are a part.

The bonds so issued recited that they were issued for unspecified municipal purposes of the City of Hollywood, Florida, under and pursuant to and in strict compliance with the Constitution and statutes of the State of Florida and under and pursuant to proceedings duly adopted and taken by the City Commission of the City of Hollywood, Florida, all as required by law. It is further recited that the bonds were regularly and duly validated by decree of the Circuit Court of the Fifteenth Judicial Circuit of Florida on November 5, 1926. Recited also in such bonds, is the 1925 Charter Act of the City of Hollywood (Chapter 11519, supra) as the authority for their issue. Due execution of the bonds under the hand of the Mayor, attested by the signatures of the City Treasurer and of the City Auditor, under the city's seal, is made to appear by a copy of one of the bonds under consideration which is attached as an *Page 48 exhibit and made a part of the amended alternative writ.

In 1927, by Chapter 12562, Special Acts of 1927, a Port District in Broward County was created. Acting under authority of this Act the Port Authority as part of the plan of its creation, took over a certain pending harbor project from the City of Hollywood and the City of Fort Lauderdale, which municipalities had together been projecting the same on their own credit and responsibility. Incident to this transaction, the Port Authority acquired from the two municipalities the balance of the proceeds of their bonds to the extent that such proceeds had not been expended on said harbor project, and agreed to repay the City of Hollywood and the City of Fort Lauderdale not only what they had expended, but also to pay the cities the amounts of the bond interest and maturities as they should become due.

In 1929, by Chapter 13940, Special Acts of that year, the Port District was authorized by resolution to assume payment of the municipal bonds in question and to become primarily liable thereon. Under authority of the 1929 Act an assumption agreement was entered into, and by a subsequent legislative Act (Chapter 15107, Special Acts of 1931), the Act creating the original Port District, set up in 1927, was repealed and a new District of like character created to take its place.

Section 5 of said Chapter 15107, Special Acts of 1931, specifically undertook to validate the prior assumption and enacted that the bonds of the cities of Hollywood and of Fort Lauderdale so assumed, should be the valid and binding obligation of the Port District created by the Act of 1931.

So the real question presented by the pleadings considered as a whole, is whether or not Chapter 15107, Special Acts of 1931, if a valid Act is sufficient to sustain and render enforceable against the Broward County Port District created *Page 49 in 1931, the assumed bonds of the municipality, of which relator shows himself to be a holder.

The City of Hollywood was recognized under Chapter 12877, Special Acts, 1927, which abolished the old municipality and established a new municipality to be known as the City of Hollywood. The new municipality succeeded to all the property and property rights of the abolished corporation and became bound for its obligations, contracts and undertakings.

The Broward County Port District, as originally created, was organized under Chapter 12652, Special Acts, 1927. As laid out, it included both the cities of Hollywood and Fort Lauderdale, together with outside territory twelve to fifteen miles wide, extending westerly to the western county line of Broward County. The purpose of the creation of the new Port District appears to have been to establish in a described territory deemed to be benefited thereby, a new special taxing district, to be governed by a special Port Authority, which could and would take over, manage and operate for the general utility and benefit of the enlarged territory comprised in the Port District, the special Port improvements theretofore being projected solely as municipal works of the Cities of Hollywood and Fort Lauderdale, and in consideration thereof, to take over and assume, and agree to pay, the municipal debts that the cities of Fort Lauderdale and Hollywood had incurred up to that time in executing and bringing about the harbor improvements which the Act contemplated would be transferred in their entirety to, and become the assets of, the Broward County Port District. The enactment of Chapter 15107, Special Acts, 1931, merely validated and carried forward under a new organization, the original district established in 1927, *Page 50 accompanied by an express validation of all the acts and proceedings previously had by the pre-existing district.

It therefore appears from the record that by a series of Acts of the Legislature relating to the cities of Hollywood and Fort Lauderdale, and creating a special taxing district designated as the Broward County Port District, certain harbor improvements have been actually constructed in part, if not wholly, by the proceeds of the bonds of the City of Hollywood, which the respondent Broward County Port District was authorized in terms to assume, and did assume, as the consideration for the transfer to the district, of the valuable asset represented by the improvement thus constructed, and that the Broward County Port District has, through its governing authority, specifically accepted, and now holds, uses and enjoys the exact asset which was constructed by means of the proceeds of the bonds of the City of Hollywood whose assumption by it under legislative authority, it now undertakes to repudiate while retaining and continuing to enjoy the benefits constituting the consideration for its assumption of the attendant liabilities.

Assuming, without deciding, that the Act of 1927 (Chapter 12562) creating the Broward County Port District was initially defective or invalid as to any purported unlimited power of taxation therein or thereby attempted to be authorized, as respondents contend, the legal existence of the district itself was not thereby destroyed, nor was its authority under the statute to contract for, and to operate, for the benefit of the territory involved, improvements in the form of harbor facilities already partly completed and in course of construction, thereby made ineffectual. And even if ineffectual in the first instance, the act of the District Authority was in unequivocal terms subsequently validated and made legal by the express provisions of Chapter 15107, Acts *Page 51 of 1931, which specifically confirmed the whole of the transactions of the 1927 Governing Authority, with reference to the taking over of assets and the assumption of certain indebtedness in consideration thereof.

The Broward County Port District referred to in Chapter 12562, Acts of 1927, Chapter 13940, Acts of 1929, and as reorganized by Chapter 15107, Acts of 1931, was and is clearly a taxing district of a general and permanent nature designed to accomplish the general and permanent purpose of acquiring and holding lands, property, property rights, liens, leases, easements, etc., necessary for the purposes of the district which are in general to lay out, acquire, maintain, conduct and operate sea walls, piers, wharves, docks and general terminal facilities whose construction, maintenance and operation by the District at District expense, the Legislature deemed to be for the special benefit of the territory which the Port District was made to include. Such a special taxing district may be established by the Legislature for particular purposes, and if created directly by the Legislature, must be recognized and can only be judicially set aside upon a showing of gross abuse of the legislative power in the enactment of its act of creation. See Jinkins v. Entzminger, 102 Fla. 167, 135 Sou. Rep. 785, and cases cited.

The consideration for the enactment of the assumption provisions of Section 5 of Chapter 15107, Special Acts of 1931, was the transfer to the new Broward County Port District of the title, rights, ownership of property, taxes due, claims, judgments, decrees and choses in action theretofore held, possessed and enjoyed by the old Broward County Port District under the Acts of 1927 and 1929. None of such benefits so transferred to the new Broward County Port District have been renounced by the respondents *Page 52 or by their predecessors in office. On the contrary, respondents purport to hold their offices and to exercise their powers as the governing authority of the new district on the legal predicate that such district is a valid one for the purposes of its creation.

A subsequent purchaser who expressly assumes the payment of a prior existing mortgage as part of the purchase price of a piece of property that he buys, is estopped to defend against the foreclosure of the assumed mortgage upon any ground, since the assumed mortgage, whether valid or invalid, was a part of the consideration for the acquisition of property which the law will not permit the acquirer to hold without estopping him to question the liability which was assumed in order to obtain the benefit of it. Kew West Wharf Coal Co v. Porter, 63 Fla. 448,58 Sou. Rep. 599, Ann. Cas. 1914A 173n.

The same principle of estoppel will apply with equal force to a special taxing district which, while still holding, using and enjoying valuable public works transferred to, held and utilized by it for the special benefit of its inhabitants and property owners, undertakes to defend against the collection of moneys due on bonds issued to raise funds to accomplish such improvements, which bonds it has been authorized to assume, and has assumed and agreed to pay as a district debt, in consideration of the transfer to and acceptance by it of the public works, for which the proceeds of the assumed bond issue were expended to make possible.

Whether or not individual land owners having properties situate within, and subject to, the tax burdens of the Broward County Port District, have a justiciable cause of complaint against the exercise of the district's taxing power with respect to their individual properties, because of a palpable abuse of the legislative power in the inclusion of their lands *Page 53 within the boundaries of the district, is a question not capable of being tried in a mandamus proceeding of this kind, therefore the special defenses sought to be interposed herein on their behalf by the respondent district officials, must be stricken, without prejudice to the individual rights of any of such taxpayers to pursue appropriate proceedings to have any complaint made by them duly adjudicated.

It follows that the motion to quash, and the demurrer to, the alternative writ of mandamus, as amended, must be overruled; that the intervening answer of the City of Hollywood allowed to be interposed by it as the primary obligor on the assumed bonds must be held good; that the answer and return of the respondent officials of the Broward County Port District must be held insufficient; and that the motion of relator for the issuance of a peremptory writ of mandamus herein must be granted.

Let an appropriate judgment be entered.

DAVIS, C. J., and WHITFIELD, ELLIS, TERRELL and BUFORD, J. J., concur.

BROWN, J., not participating because of illness.