Portland General Electric Co. v. City of Estacada

ROSSMAN, J.,

SPECIALLY CONCURRING.

I concur in the majority opinion, but add the following as additional explanation for my views.

The city’s belated attack upon the sufficiency of the complaint as the statement of a cause of suit has provoked the only disparity of views which this court entertains about the case. The complaint was not challenged by motion or demurrer in the circuit court. In that court no contention was made, through objection to the evidence or in any other way, that the complaint did not state a cause of suit. No one there voiced a *171claim that the state was a necessary party, or that the plaintiff had mistaken its remedy.

When the contentions now under consideration are reduced to their essence, they are: (1) Only the state can maintain a proceeding which challenges the validity of the annexation of territory to a city; and (2) quo warranto is the exclusive remedy in instances of this kind. In behalf of the suggestion that quo warranto is the exclusive remedy, the city argues that (a) the action taken by the voters on February 10, 1950, created a de facto annexation of territory, including the plaintiff’s property, to the city of Estacada; and (b) this is a collateral attack upon the annexation proceedings. The city argues that a collateral attack cannot succeed and must be dismissed.

Let us now determine whether or not the complaint states a cause of suit. For that purpose an assumption will be made that the city has now filed a demurrer to the complaint and that it states as its bases the contentions mentioned above. In considering those matters, attention will, of course, be given to the inquiries as to (1) whether or not this is a collateral attack, and (2) whether or not injunction is the proper remedy. I will confine myself to the averments of the complaint and will not borrow from the evidence.

The complaint describes the plaintiff’s property in terms of metes and bounds. The description begins as follows: “Beginning at the southwest corner of the Franklin Pierce D.L.C. No. 38 in T. 3 S., B. 4 E. of W.M., thence north on claim line to * * *." The terms in which the description is cast warrant a belief that the property has not been subdivided into lots and blocks. Since the description does not mention or allude to any line which forms a part of the city’s boundary, apparently the plaintiff’s property lies be*172yond the city limits and does not touch thereon. The following are other pertinent parts of the complaint:

“As to the hereinabove described real property owned by plaintiff, said attempted annexation and said purported new charter were and are void and of no effect in that:
“A. They were and are for the sole purpose of subjecting plaintiff’s said property to taxation by defendant city.
“ B. They were and are unreasonable extensions of defendant city’s territorial limits.
‘ ‘ C. They burden plaintiff’s said property with taxation by defendant city without benefit to plaintiff from defendant city and, therefore, constitute the taking of private property without just compensation, and without due process of law in violation of the Constitution of the United States and of the State of Oregon.
“D. Said real property owned by plaintiff was and it now is wholly unpopulated. ’ ’

When a pleading is tested by a demurrer which has been timely filed, its averments are construed most strongly against the pleader (Christopher v. McGuire, 179 Or. 116, 169 P2d 879), but a different rule is employed when the demurrer is withheld until after a decree or judgment has been entered. Tardiness in attacking the pleading of one’s opponent calls to the aid of the attacked pleading the doctrine of waiver, with the result that formal, technical and unsubstantial defects are deemed waived. When met with a postponed attack, a pleading is given a liberal construction and all reasonable intendments come to its avail: Feehely v. Rogers, 159 Or 361, 80 P2d 717, and Cooper v. Hillsboro Garden Tracts, 78 Or 74, 152 P. 488, Ann Cas 1917E 840.

For the reasons just given, we must assume that the city admits that the annexation was made “for *173the sole purpose of subjecting plaintiff’s said property to taxation by defendant city,” and that the annexation burdens “plaintiff’s said property with taxation by defendant city without benefit to plaintiff from said defendant city.” In other words, this is a case in which the appellant city admits for the purposes of the demurrer that it annexed the plaintiff’s property for the sole purpose of taxing it, and that the plaintiff will derive no benefits either from the annexation or from the tax which it will be compelled to pay.

It seems too clear to require the citation of authority that property can never be annexed for the sole purpose of taxing it, and that no tax is valid if the person who is required to pay it can never derive any benefit from the money taken from him.

Before going to the authorities, it is pertinent to take notice of the fact that annexation of territory to a city must be made for the good, not only of the city, but also of the land annexed. Each must be complementary to the other. The purpose of annexation must be, not only to create a unit as a matter of law, but also as a matter of fact. The annexed land with its homes, streets or other features must be capable of amalgamation into the city. The old boundaries and the annexed area must create a homogeneous whole. A city is a community; it is not a body of people upon the one hand and an area of land upon the other upon which no one lives and of which nothing is expected except the payment of taxes. In other words, the area annexed must not be a mere captive held for ransom or bounty purposes only. The opinion of Mr. Justice Latourette contains an excerpt from Vestal v. City of Little Rock, 54 Ark 321, 15 SW 891, 16 SW 291, 11 LRA 778, which delineates the characteristics which land must possess to be suitable for annexation. The following, taken *174from Jones v. City of Clayton (Mo App), 7 SW2d 1022, states the same features in a somewhat amplified manner:

“* * * However, the appellate courts in the disposition of cases of this character, have made some general observations which are highly pertinent to the matter at hand, to the effect that existing boundaries may properly be extended so as to take in contiguous lands: (1) When they are platted, and held for sale as town lots; (2) whether platted or not, if they are subject to be brought on the market, and sold as town property when they reach a value corresponding with the views of the owners; (3) when they furnish the abode for a densely settled community, or represent the actual growth of the municipality beyond its legal limits; (4) when they are needed for any proper town purposes, as for the extension of streets, sewer, gas, or water systems, or to supply places for the abode or business of its residents, or for the extension of needed police regulation; and (5) when their value is enhanced by reason of their adaptability for prospective town uses. This rule, however, has its converse, so that when it appears from the evidence that the contiguous lands are used chiefly for the purposes of agriculture or horticulture, and are valuable on account of such use, or when they are largely vacant, and do not derive any special value from their adaptability to city purposes, their incorporation within municipal limits will be regarded as unreasonable. State ex inf. v. Kansas City, 233 Mo. 162, 134 S. W. 1007; Stoltman v. City of Clayton, supra; Prairie Pipe Line Co. v. Village of Moscow Mills (Mo. App.), 300 S. W. 298; Winter v. City of Kirkwood (Mo. App.), 296 S. W. 232.”

By reverting to the excerpt of the complaint which is copied in a previous paragraph of this opinion, it will be seen that the plaintiff’s property possesses none of the needed attributes; in fact, as the defendant’s demurrer admits, “said real property owned by *175plaintiff was and it now is wholly unpopulated.” It is unplatted property.

We have seen that the sole purpose of the annexation, as admitted by the demurrer, is to tax the property. Let us now go directly to that feature of the case. Annexations for tax purposes have frequently been condemned. The courts hold them void and subject to collateral attack. Very practical reasons support the holding; one is: when an owner of property is required to pay annually a tax without receiving any benefit whatever from the tax, not only is he deprived of his money in invitum, but his property is diminished in value. Thus he incurs a double loss and no gain.

The authorities speak in no uncertain terms against the course taken by the city. McQuillin, Municipal Corporations, 3d ed, § 7.21, says:

“* * * It is improper to annex to a city unneeded and unbenefited rural lands solely or principally for the purpose of deriving revenue therefrom by way of taxation, and it has been held that it is unconstitutional to do so. Those lands occupied by the proprietor exclusively in his business as a florist and farmer, to which no streets or other town improvements extend, and which the line of city settlements has not reached, and which is not laid off for city use, and would not be enhanced in value by annexation, but would be subjected thereby to taxation is not properly included in territory annexed to the city.”

Possibly the most glaring case in which the city lines were extended for tax purposes only is McCarroll v. Arnold, 199 Ark 1125, 137 SW2d 921. In that case, the plaintiffs were operators of gasoline filling stations in a place entitled Omaha, which purported to be an incorporated town. In 1935 Arkansas enacted a statute which provided that gasoline dealers in any town or city, the corporate limits of which extended to within *176two miles of the state line, could sell gasoline at the rate of tax prescribed by law in the adjoining state. When that act was passed, Omaha was an unincorporated village which lay 3% miles south of the Missouri-Arkansas state line. Shortly after passage of the act, the village underwent the form of becoming incorporated into the town of Omaha with a territorial boundary a quarter of a mile wide and four miles long, terminating at the Missouri state line. At that time aii Arkansas statute imposed a tax of 6y2 cents per gallon upon all gasoline sold by service stations except, as already indicated, stations that were in towns within two miles of the state line. The plaintiffs, that is, the Omaha service station operators, brought the suit under review for the purpose of enjoining the defendant commissioner of revenue from collecting from them the state tax of 6% cents per gallon. They, of course, depended upon the charter which had been granted to Omaha, and the fact that it lay within two miles of the Missouri-Arkansas line. The defendant admitted the circumstances which we have mentioned and, in explanation of his demand for payment of the tax, alleged that most of the land included in the incorporation order was unfit for town purposes and was not, in fact, needed for such purposes. He alleged that the sole reason for incorporating Omaha was to evade the provisions of the gasoline tax laws. At the trial, testimony offered by the defendant in support of his allegation was excluded. This testimony included facts tending to show that the strip of land, a quarter of a mile wide and four miles long, included agricultural, timber and bluff land impossible of traversal by wagon or automobile. The decision said:

“Appellees insisted on the trial below, and contend here, that appellant cannot make a collateral attack on the order of the Boone county court in*177corporating the town of Omaha and that the trial conrt was correct in so holding.
“On the contrary, appellant urges here that under the evidence offered by him before the chancellor he was entitled to attack collaterally the incorporation of the town of Omaha for the reason that said incorporation order is void ab initio; # * #

The court held that the defendant was “correct in both of these contentions.” It then said:

“* * “ The question, therefore, presented here is whether an unincorporated town can incorporate a strip of land four miles long and a quarter of a mile wide, running to the borderline of an adjoining state, which strip of land includes therein territory unsuited for municipal purposes, agricultural land not needed or adapted for city uses, to which no streets or other municipal improvements extend, which is uninhabited except for a few isolated farm houses, and thus avoid payment of the state tax on gasoline on the theory that the order of incorporation though void abinitio is not subject to collateral attack?”

The court reversed the decree of the lower court and remanded the case for disposition in accordance “with the principles of equity as outlined in this opinion.” Those principles were stated by the court by quoting as follows from Waldrop, Collector v. Kansas City Southern R. Co., 131 Ark 453, 199 SW 369:

“The order of the court organizing the proposed territory into an incorporated town was null and void, for the reason that the land was not of such character as could form an incorporated town. The record shows that the territory attempted to be formed into the town of Ogden ran parallel with the railroad track on both sides of it, and was 7 miles in length and about 5 miles in width. The railroad station of Ogden was situated on 80 acres of the *178land and there were a few residences on these 80 acres. Most of the rest of the lands within the limits of the proposed town were timber lands, and the remainder were agricultural lands. There were four lakes upon the lands within the limits of the proposed town. It was manifest that the owners of the lands could not derive any benefits whatever from the lands being placed within the limits of an incorporated town. * * *
“The attempted organization of the proposed territory into an incorporated town was palpably wrong, and was an arbitrary and unreasonable exercise of power. Under the circumstances as they appear from the record, it is evident that the property of the railroad company is subject to the local burden of taxation solely for the benefit of others, and we think this is a case of taking private property for public use under the form of taxation without giving any protection or other compensation therefor. The attempted organization of the town of Ogden was therefore within the prohibition of our Constitution and was absolutely void. Vestal v. Little Rock, 54 Ark. 321, 329, 15 S. W. 891, 16 S. W. 291, 11 L.R.A. 778; City of Covington v. Southgate, 15 B. Monroe (Ky.) 491, and Morford v. Unger, 8 Iowa 82.”

That is a clear holding that something more than a charter, a few people and wild land are required to make a valid municipality. It is also a clear holding that when an essential element to valid incorporation is lacking, no municipality is created and, therefore, a collateral attack will be entertained. In short, no rights can arise out of an unlawful act, and such an act cannot be set up as a shield by anyone in any kind of case.

Witham v. City of Lincoln, 125 Neb 366, 250 NW 247, was a suit in equity by the owner of a tract of land which had been annexed by the city of Lincoln seeking to have the annexation declared unlawful. The court described the property annexed as “a narrow strip of *179plaintiff’s land, reaching out like a finger, along the exact location of an 8-inch water-main required to be constructed to the Veterans’ Hospital.” According to the decision, the city insisted that the annexation was “of tremendous importance to the City of Lincoln, and that an adverse decision will in a measure hamper the continued growth and prosperity of this fine city.” The city argued: “That plaintiff cannot collaterally and indirectly attack the validity of ordinance No. 3661, annexing the said property, but that only the state of Nebraska can question the same, and that plaintiff has an adequate remedy at law; * * The attacked annexation was made pursuant to a provision of the city’s Home Eule Charter. In affirming the decree in favor of the plaintiff, the court declared:

“The trial judge made a personal inspection of the premises, and in his decree held that the plaintiff’s real estate had been used for many years as farm land, and for no other purpose; that no part of the land had ever been platted into lots or blocks, and that it is in no wise urban property, but is solely agricultural land, which will not at the present time be benefited by being annexed to the city; that the object of the defendant city in passing said ordinance and annexing said lands, or attempting to do so, was to raise revenue, * *

The decision quoted from Bradshaw v. City of Omaha, 1 Neb 16, in which the court, in reaching a similar result, declared:

“Can a legislature authorize a city to tax for its support, lands not reasonably to be considered city property?”

The decision [Witham v. City of Lincoln] said:

“This court has held that a municipality cannot annex property for revenue purposes, as appears to have been done in the case at bar. Joerger v. *180Bethany Heights, 97 Neb. 675; Village of Osmond v. Smathers, 62 Neb. 509. * * *
“ * * * We are constrained to hold that the city exceeded its power when it annexed a narrow strip of plaintiff’s land, reaching out like a finger, along the exact location of an 8-ineh water-main required to be constructed to the Veterans’ Hospital, and that such annexation of such farm land was wrongful and without authority, and that said land shall be considered as outside of the boundaries of the city, and that the taxes levied for the construction of such water-main are declared invalid, and the decree of the district court is affirmed. ’ ’

In Hustead v. Village of Phillips, 131 Neb 303, 267 NW 919, the court said:

“Further, a municipality may not annex, or retain within its boundaries, strictly farm land for revenue purposes only.”

State v. City of Avon Park, 108 Fla 641, 149 So 409, was a quo warranto proceeding instituted by the owners of unoccupied and unimproved lands, who sought an adjudication against the inclusion of their properties in the city. The following is from the decision:

“# * * Certainly, when the present Constitution was adopted, permitting special legislation for the incorporation of municipalities, it was not the intent of the organic or statutory law of the state, or the practice thereunder, that there should be included in a municipality relatively large areas of wild or unoccupied lands wholly unsuited for and not desirable or needed for municipal purposes, with no reasonable hope of municipal expansion to cover any considerable portion of the unoccupied or unimproved land included in or added to the municipality. The inclusion of large areas of rural lands in a municipality solely or largely for the purpose of municipal taxation, when such areas cannot reasonably receive any substantial benefit whatever from the municipality, and the rural *181lands so included are not actually or potentially useful to the municipality except for taxation, is not within the intent of the legislative power stated in section 8, article 8 of the Constitution. Such an inclusion of large areas of lands not actually or potentially useful for municipal purposes except for taxation without any corresponding benefit, whether the incorporation is by special or local laws under section 8, article 8, or under general laws for the incorporation of municipalities, enacted pursuant to section 24 of article 3 of the Constitution, is an exercise of governmental authority not contemplated or permitted by the Constitution, and is a violation of the organic rights of the owners of such property to protection from the taking of their property by taxation without any compensation whatever to the owners who, or whose property so included, can receive no benefit governmental or otherwise from the municipality in return for such taxation. See State ex rel. v. Eidson, 76 Tex. 302, 13 S. W. 263, 7 L. R. A. 733; 43 C. J. 115. In this case the population is very small and the area of wild land incorporated in the town is relatively great.”

The court denied relief solely because “an ouster as to such lands alone is not on this record a proper function of a quo warranto judgment.”

Paducah-Illinois R. Co. v. Graham, 46 Fed 2d 806, was a suit by a taxpayer against the sheriff and the board of education of a school district in which the plaintiff sought an injunction restraining the collection of a tax. It appeared that in the consolidation of some Kentucky school districts the boundaries were so extended as to include the adjacent bed of the Ohio river to the low-water mark on the opposite, that is, the Illinois, shore. Obviously, no children lived upon the submerged river bottom. In expressing its holding *182that the plaintiff was entitled to an injunction, the decision said:

“ * * * If the inclusion of the plaintiff’s railroad bridge in the taxing district is so unnatural and so unreasonable as clearly to show that the sole purpose of the inclusion was to add to the taxable value of the property in the district, such inclusion would amount to spoliation and the taking of plaintiff’s property without due process of law. The primary idea in the consolidation of school districts is to furnish a more efficient system of common schools to the people in the district. There could be no valid purpose in creating a consolidated district where there were no pupils to be served. At the time this district was created, of course, no person lived within that part of the boundary covered by the Ohio river when at ordinary low-water mark, and unless the river changes its course there never will be any school children within that particular territory. So, in placing that particular territory within the district, there could have been no purpose to serve any of the school patrons. * * * The result either way, as a practical matter, simply brings the bridge into the district for taxation purposes. Such inevitably is the sole result of including the river within the district, and legislative bodies, as well as individuals, must be presumed to have intended the necessary and inevitable result of their action.
"* * * * *
“As heretofore indicated, however, I am satisfied from this record that the sole purpose of the board in including in the district any part of the river north of low-water mark on the Kentucky side was to subject plaintiff’s bridge to taxation, and that such taxation will be the only end attained by such inclusion, if allowed to stand. Such being the case, it necessarily follows that this action of the board was arbitrary and unreasonable, and violates plaintiff’s federal constitutional rights.”

*183City of Russell v. Ironton-Russell Bridge Co., 249 Ky 307, 60 SW2d 628, is another instance in which a municipal body sought to extend its boundaries and by that means tax a bridge. The latter spanned the Ohio river from Russell on the Kentucky side to Iron-ton on the Ohio side. A part of the bridge was in Russell, and the latter collected an annual city tax of $984 from that portion. By extending the municipal limits further into the stream, the city sought to bring within its jurisdiction more of the bridge for tax levying purposes. In ruling against the city, the court said:

“ * * * For obvious reasons there can never be in the territory proposed to be annexed any house erected, no street, sidewalk, or sewer can ever be constructed, no child will ever live in this district that can enjoy the school facilities of the city, and all the city can offer the Bridge Co. in return for the tax burden it may impose upon it will be the following advantages which the city claims the Bridge Co. will get:”

At that point the court considered the city’s contention that it gave to the bridge fire and police protection. It held that the amount of such services which the bridge received was negligible. It concluded:

“How can property in a proposed addition be injured by including it within a city is a pertinent question, and the answer is that if the property in the proposed addition is not adapted and gives no promise of desirability for use as sites for residences, factories, mercantile buildings, warehouses, or other city uses, and certainly this is not so now, and can never be so, then its inclusion within the city and its subjection to the power of the city, to impose upon it city taxes would be an injury to it, and as common sense would tell us, that its subjection to such taxes would reduce the market value of property so included, then certainly such inclusion *184would be a material injury to it. All of these things exist here, hence we hold that in view of the inconsiderable, if any advantages that could result to the city by the inclusion of this property in it, and the glaringly inadequate, if any, compensating advantages that could result to this property by the inclusion of it, that its inclusion and the subjection of it to city taxation would be a material injury to it, and hence the right of the city to make this proposed extension of its boundaries is denied.”

In Barbe v. City of Lake Charles, 216 La 871, 45 So2d 62, the court, in reaching its conclusion, said:

“* * * With reference to annexation, what is reasonable or unreasonable depends largely upon the particular facts in any given situation, such as that the property is needed for the future growth of the city and for police, fire or sanitary protection. It should never be permitted when made solely for the purpose of taxation or increasing the revenues of the city by this means.”
Forbes v. Meridian, 86 Miss 243, 38 So 676, declared:
“* * * Municipalities are not devised for the purpose solely, nor chiefly, of raising revenue. The power of extending corporate limits is granted not to be resorted to for the purpose alone of increasing the income of the municipality, but in order that the benefits incident to civic government may be extended to those resident in the territory adjacent to the municipality and included in the extension; •S *íS* if J J

The following is taken from one of the headnotes in State ex rel. Bibb v. City of Reno, 64 Nev 127, 178 P2d 366 (quo warranto):

“Complaint alleging annexation by city of Reno of agricultural land to the financial loss of the owners and over owners’ protest and that the city only, needed to annex the lands for tax revenue, *185stated cause of action to prohibit the annexation as being arbitrary and in violation of due process.”

The following is copied from the words of the court:

“* * * Thus, in State ex rel. Walker v. Gladewater, Tex. Civ.App., 139 S.W.2d 283, 286, the court held:
“ ‘To subject the properties of a people to the burden of a municipal government which will share none of its benefits is unjust, State v. Eidson, supra [76 Tex. 302, 13 S.W. 263, 7 L.R.A. 733], and would result in the imposition of unnecessary burdens and the infliction of great injuries. * * * And as stated in State v. Masterson, [Tex.Civ.App.], 228 S.W. [623], 631, “to permit the incorporation (of relators’ lands) in this case to stand, as was attempted, would be for us to sanction that which is clearly a legal fraud. ’ ’ Such attempted act was arbitrary, unreasonable, and violative of the inhibitions of both. State and Federal Constitutions, * * * that “a person shall not be deprived of his * * * property without due process of law. ’ ’ ’
“A recent case is Nolting v. City of Overland, Mo.Sup., 192 S.W.2d 863. The court held that farm land not platted or offered for sale as town lots and not needed for municipal purposes, could not be annexed. The court cited a number of cases. The cases all hold that on fact very similar to the annexation attempted by Reno, annexation is denied.
“In City of Pine Bluff v. Mead, 177 Ark. 800, 7 S.W.2d 988, the court denied annexation and used language which applies to the Reno situation as follows:
“ ‘There is much vacant property in the present city limits; that much of that attempted to be taken in Is unplatted and vacant.’
“Likewise, the language used by the Indiana court in North Judson v. Chicago & E. R. Co., 72 Ind.App. 550, 126 N.E. 323, 326, is appropriate. *186Annexation of farm lands was denied. The court said:
aem * * with the surplus of lots, tracts, and farm lands within the present boundaries of the town, the territory which it is proposed to annex is not necessary.’ ”

Missouri Zinc Fields Co. v. Webb City (Mo App), 242 SW 1008, was a suit in equity to enjoin the defendant city from assessing and levying municipal taxes on three 40-acre tracts of land which belonged to the plaintiff and which a vote of the people had attempted to annex to the city. The tracts were used for mining lead and zinc. Previous attempts by the city to annex the tracts had been held by the lower Missouri courts unreasonable and, therefore, invalid. The decision said:

“* * * There is no showing that the procedures concerning elections, passing of ordinances, etc., were not at all times in accordance with the layr relative to such matters, and it is apparent that the decisions of the trial court from time to time were based solely on the ground that plaintiff’s land was unfit for city purposes, and ordinances taking it within the city limits were held to be unreasonable.”

In holding the annexation unlawful, the decision ruled:

“To our minds the evidence fails to show that there is any reasonable ground to include plaintiff’s land within the city limits other than to collect city revenue, and further fails to show that any material advantage, other than the collection of taxes, would accrue to either the city or the plaintiff by including such land in the corporate limits of said city.”

The court remanded the cause to the trial court “with directions to render a judgment restraining and enjoin*187ing the defendant from levying or assessing municipal taxes against the said lands.”

Morford v. Unger, 8 Iowa 82, was an action of replevin to recover possession of some personal property which the defendant, as marshal of the city of Muscatine, had seized under a warrant affixed to the city’s tax list. An act of the legislature which expanded the limits of Muscatine had brought the plaintiff’s farm into the expanded city boundaries. After the annexation, the plaintiff’s land was taxed by the city $1.00 per acre. He refused to pay the tax and, after his property had been destrained, the action under review was brought. In reversing a judgment which had been entered for the defendant, the decision said:

“The question to be considered in this case is, whether the act of the legislature of Iowa, approved July 14, 1856, entitled ‘An act to amend the act to incorporate the city of Muscatine’ is constitutional.”

Addressing itself specifically to the city taxes which had been levied upon the plaintiff’s farm land, and from which the court found he could derive no possible benefit, the decision said:

“If there be such a flagrant and palpable de- . parture from equity, in the burden imposed; if it be imposed for the benefit of others, or for purposes in which those objecting have no interest, and are, therefore, not bound to contribute, it is no matter in what form the power is exercised — whether in the unequal levy of the tax, or in the regulation of the boundaries of the local government, which results in subjecting the party unjustly to local taxes, it must be regarded as coming within the prohibition of the constitution designed to protect private rights against aggression, however made, and *188whether under the color of recognized power or not.
'* * * * *
“The extension of the limits of a city or town, so as to include its actual enlargement, as manifested by houses and population, is to be deemed a legitimate exercise of legislative power. An indefinite or unreasonable extension, so as to embrace lands and farms at a distance from the local government, does not rest upon the same authority. And although it may be a delicate, as well as a difficult, duty for the judiciary to interpose, we have no doubt but strictly there are limits beyond which the legislative discretion cannot go. It is not every case of injustice or oppression which may be reached; and it is not every case which will authorize a judicial tribunal to inquire into the minute operation of laws imposing taxes, or defining the boundaries of local jurisdictions. The extension of the limits of the local authority, may in some cases be greater than is necessary to include the adjacent population, or territory laid out into city lots, without a case being presented, in which the courts would be called upon to apply a nice or exact scrutiny as to its practical operation. It must be a case of flagrant injustice and palpable wrong, amounting to the taking of private property, without such compensation in return as the taxpayer is at liberty to consider a fair equivalent for the tax.
"* * * * *
“* * * His land is situated too far from the city of Muscatine, to be deemed, in any just sense, a part of it. He does not desire to lay it off into city lots, but desires to use it as farming land. It is idle to say that the protection afforded by the city authority, or the privilege of voting at the city elections, furnishes a just equivalent for the burdens imposed upon him in the shape of taxes, by the city; and the attempt to extend its jurisdiction over *189him and his property, must be regarded as an attempt to take private property for public use, and within the prohibitory clause of the constitution.”

The annexation was deemed invalid.

The following is taken from Deiman v. The City of Fort Madison, 30 Iowa 542:

“In the case before us the plaintiffs’ lands are used exclusively for agricultural purposes; they have not been benefited by the current expenditures of the city; no money has ever been expended by the city for improvements on any of said lands; no street or alley has ever been opened or worked except Fifth street, which unites with and is the ‘Fort Madison and Franklin road’ on the south of these lands; * * * the lands are not needed for buildings, streets or any other city purposes; some of the out-lots of the city proper are uninclosed, and others are used exclusively for agricultural purposes, showing that not ali of the territory within the city proper is needed for any city purpose, and that the lands of plaintiffs are sought to be brought within the jurisdiction of the city solely for the purpose of increasing its revenue, thereby taxing these lands for the benefit of others owning property in the city. The lands of the plaintiffs have not been enhanced in value since they have been within the corporate limits.”

The court, through resort to one of its earlier decisions, said:

“ ‘* * * while the enlargement of the boundaries of a municipal corporation, whereby the property of individuals is brought within the corporate limits, without their consent, and thereby subjected to municipal taxation, may not be an infringement of the constitution by taking private property for public use, it may so operate when such extension is unreasonable, and embraces lands and territory not needed for buildings and population, but which is taxed for the benefit of the territory which is *190thus needed and occupied/ and that ‘the court will interfere to restrain municipal taxation, where practicable, in eases in which it is shown that the proprietor of the property taxed cannot be benefited in a municipal point of view.’ ”

Going on, the court ruled:

“* * * Upon the principles settled in the cases referred to, we are clear that the appellees’ lands are not liable to the burden of municipal taxation, and the decree of the district court is therefore affirmed.”

The decision affirmed the decree of the trial court, which awarded the plaintiff an injunction.

Territory of Utah v. Daniels (Utah), 5 LRA 444, arose out of a judgment which found the defendant guilty of violating a statute which required a listing of one’s property with the county assessor. The legislature had extended the boundaries of Moroni City to such an extent that it included some farm property owned by the defendant. In reversing the judgment of guilty, the decision held:

“* * * If the taxpayer and his property are so situated with respect to the government that it is palpable and clear that the use to which taxes collected are applied will not benefit him, then there is not compensation to support the tax.
“* * * Inasmuch as it appears from the record in the case that the defendant resides and that his lands are situated outside of Moroni City, as indicated by public or private improvements, and beyond such contiguous or adjacent district as will be benefited by its municipal expenditure, the court holds that the Territorial Legislature had no power to subject his property to the burden of taxation for the corporate purposes of the city.”

*191The facts in Town of Parkland v. Gains, 88 Ky 562, 11 SW 649, are sufficiently indicated in the following excerpt taken from the decision:

"* * * There is no city population near the land of the appellee Gains, nor necessity for taxing him to build these streets, or any reason for extending the municipal government over his land, except to tax him. He cannot and does not have the. advantages or benefits that the citizens of the town proper enjoy from their local government, and the attempt to exercise the taxing power in this case, if carried out, would be taxing his private property for public use without first making constitutional compensation.”

In explanation of that'holding, the court added:

“* * * The ordinance was approved by a majority vote, and, as the property within the entire territory was by an express provision of the act made liable for the payment of these bonds, Gains, who owned the agricultural land included in the last addition of territory to the town, insisting that his land could not be taxed for municipal purposes, obtained an injunction against the collection of the tax, and Brown, the other appellee, obtained his injunction on the ground that, as all the agricultural land was exempt from taxation for the purposes contemplated, the actual town of Parkland should not be compelled to bear the whole burden, as such could not have been the legislative intent.”

In all of the foregoing cases the annexation was held unlawful. In all of the cases, with the exception of McCarroll v. Arnold, supra, the sole purpose of the attempted annexation was to enable the annexing city to gain tax revenue from the annexed property. In the McCarroll case, the purpose was to escape a tax.

Annexation for tax purposes is by no means the only unlawful kind of annexation which has been de*192creed as void by the courts. A city, as we have seen, is a community of people and, therefore, annexations which do not serve in any way that fundamental purpose are not sustained by the courts.

Jones v. City of Clayton, supra, is one of many instances which can be cited in which a city, in extending its boundary lines, embraced land devoted solely to agricultural purposes. The attempted annexation met with the condemnation of the court. See, also, Jones v. City of Ferguson (Mo), 164 SW2d 112.

In Clark v. Holt, 218 Ark 504, 237 SW2d 483, a municipality, by resort to a strip of land 50 feet wide and 3060 feet long, sought to reach out and annex to itself a community which lay at the other end of the strip. The court said:

“For all practical purposes, a half-mile gap will divide the old town from the proposed addition and the essential contiguity is lacking. ’ ’

It found lacking the “oneness” essential to a community.

City of Sugar Creek, Mo. v. Standard Oil Co., 163 Fed 2d 320, was an action by the Standard Oil Company against the city to have declared invalid and to enjoin an annexation of lands made by the city, including an industrial site acquired by the Oil Company in 1944. The city of Sugar Creek was incorporated in 1920. Its population since that time had been virtually static. The municipal area was 534 acres, including 200 acres upon which stood the refinery of the Oil Company. Of the 334 remaining acres only 36 per cent was ever used. In 1944 the Oil Company purchased 90 acres outside the city limits and announced a purpose of building upon it an additional plant at a cost of several million dollars. When the aldermen became *193apprised of the Oil Company’s purpose, they speedily adopted an ordinance expanding the city limits so as to include the newly purchased site. In their haste, the aldermen unwittingly included in the annexed area far more land than they had intended, and thus added to the city some railroad right of way, a water plant and other properties. The court determined the validity of the challenged annexation exclusively upon the basis as to whether or not the city’s action was reasonable. It declared:

“* * * The courts, however, will not undertake to substitute their judgment for that of the city council and the electorate, and they will therefore not declare an annexation invalid unless the evidence is convincing that reasonable men would have to agree, from the nature, scope, object, need and results of the annexation, that the action was unreasonable and ought not to have been taken.”

After considering every reason that was suggested in justification of the attempted annexation, the court agreed with the trial judge that the annexation was invalid. It could conceive of xio valid reason for the annexation, and affirmed the injunction which had been issued.

The above will suffice as a review of the authorities. Of all of the above cases, only State ex rel. Bibb v. City of Reno and State v. Avon Park were based upon actions of quo warranto. Those decisions were included in the above review because they, like the other decisions, held that annexation for the sole purpose of taxation is unlawful. That is the phase of the case of immediate interest.

No decisions which employ principles contrary to those which controlled the outcome of the above cases have come to my attention. The above decisions hold *194that no property is subject to annexation by a nearby city unless the property possesses attributes or features which will enable it to become a homogeneous part of the city upon annexation. The city must present a need for more territory, and the property to be annexed must be suitable to the city’s needs. If it is a farm when annexed and will remain a farm for an indefinite period after annexation, the proceedings which attempted to annex it to the city will be condemned as illegal. If the property is a riverbed where, of course, no child lives, its annexation by a school district clearly is void, even though the annexation will afford the school district opportunity to tax a valuable bridge which has its footings in the riverbed. The same is true when a similar attempt is made by a city which renders no service of any consequence to the bridge. In short, unity by fiat of the law does not suffice. There must be unity of interest and of service so that amalgamation between the city and the annexed area will occur as a matter of fact. The decisions, as well as common sense, render it clear that annexation for the sole purpose of taxation is unlawful.

As we have seen, the city concedes, for the purpose of determining the sufficiency of the complaint, that the sole object of the annexation was taxation. It admits that the plaintiff’s land was wholly unpopulated. The complaint affords good reason for believing that the land is unplatted and non-contiguous to the city. No further analysis is required to show that under the authorities which have been reviewed, the attempted annexation was void.

Some of the decisions which are reviewed in the preceding paragraphs base their holdings of invalidity upon construction of the local annexation statute. Others hold that when the state delegates to the city *195the power which belongs to the state to annex land, an implied condition of the delegation of the power is that it shall be exercised in a reasonable manner. Those decisions condemn annexations, such as the instant one, on the ground that it is arbitrary, unjust and unreasonable. Still others hold that an annexation which cannot possibly be of any benefit to the annexed land, and which was made solely for taxation purposes, is tantamount to a taking of the property without compensation.

In this specially concurring opinion there exists no need to make a selection among those theories. All three possess merit. I prefer the last two. I am satisfied that when Article XI, § 2, Oregon Constitution, conferred upon the local residents power to adopt and amend the charters of cities and towns, it was intended that no arbitrary action would be taken. A delegation of the state’s power to the local residents to make annexations contemplates that something more is essential than (1) a greedy city, (2) a nearby valuable tract of land, and (3) a majority vote. I am, likewise, satisfied that annexation for the sole purpose of taxation is violative of Article I, § 18, and Article XI, § 3, Oregon Constitution.

An imperfect compliance with a statute which authorizes the organization of a corporation — municipal or otherwise — may result in the formation of a de facto, as distinguished from a de jure, corporation. But no rights are won when an act is performed in contravention to law. An unlawful act confers no rights and affords no one a defense. When local residents annex the property of another to their city for the unlawful — and sole — purpose of taxing it, their action is illegal. Every court, upon encountering it, *196regardless of the form of the action, must hold it void. It cannot create a de facto corporation.

In declaring that annexation must bring some good to the annexed land, I have no thought that the annexation must confer upon the land a benefit which can be readily segregated and identified. The benefit may consist of the fact that the annexed land will receive the general services of the city. But in the instant case, the demurrer admits that no benefit, even of the kind just suggested, will be received by the annexed area.

The challenged annexation was not only unlawful, but also ultra vires to the powers of the city. I conclude that (1) the complaint states a good cause of suit; (2) the plaintiff was the proper party-plaintiff; (3) the state was not a necessary party; and (4) injunction was the right remedy.

Although I believe that a suit for an injunction was the right remedy, I agree with Justices Latourette and Tooze that a suit for a declaratory judgment would also have been proper.

The above disposes of the belated demurrer. It also develops sufficiently the principles of law which govern the controversy. The evidence which was presented in support of the complaint warranted the relief that was given. It showed sufficiently that the annexation was made for tax purposes.

An assertion has been made, but not by any party to the case, that laches precludes the grant of relief to the plaintiff and that it would have precluded relief even if an action of quo warranto had been filed. Weatherly v. Hochfeld, 133 Or 136, 286 P 588, holds that laches must be pleaded. Its exact words are: “Laches is not available as a defense for the reason, among others, that it was not pleaded.” The answer *197in the case before us says not one word about laches ; in fact, it consists of nothing but admissions and denials; it contains no affirmative defense. Further, appellant’s brief presents nothing concerning laches. The following, taken from the brief’s Subject Index, gives a composite view of every contention upon which the city depends:

“Page
“Statement of Case 1
“First Proposition of Law — The complaint does not state facts sufficient to constitute a cause of suit. 4
Point No. I — A private party may not attack the fixing or extension of municipal limits or bounds. 4
Point No. II — The grounds for relief set forth in plaintiff’s complaint are not for judicial determination. 11
Point No. Ill — Courts may not inquire into the motives of legislative bodies. 26
Point No. IV — Courts may not inquire into the wisdom and justice of legislation. 30
‘ ‘ Second Proposition of Law — The reasonable or unreasonable extension of city boundaries under the Oregon annexation statute . is not a subject of judicial inquiry. 35
Point No. I — The basic principles of Home Buie in Oregon prevent a court from setting aside all or any portion of a municipal annexation upon any ground other than failure to comply with the provisions of the annexation statute. 36
Point No. II — The Oregon legislature has legislated fully and clearly on the subject of annexation and therefore it is not for the courts to insert a rule of reason into the statute. 41
*198í i Third Proposition of Law — The Federal constitution is not violated in any way by a change in municipal boundaries nor is there a violation of due process through an increase in taxation resulting from a change in city boundaries. 48
“Fourth Proposition of Law — The court has no jurisdiction to set aside or declare void an annexation proceeding as to part only of the area annexed. 56
“Fifth Proposition — The inclusion of Respondent’s property in the annexed area was not unreasonable. 58
“Conclusion. 63”

Thus, laches was not pleaded and is not included among the defenses upon which the city depends. But the point is seized upon that the city has rendered itself indebted for approximately $4,000 upon work which was done after the municipal annexing election. The record does not disclose the amount of the city’s annual budget. However, since the plaintiff’s property constitutes about two thirds of the appraised value of the city [original and annexed lands], presumably the plaintiff, if the annexation is declared lawful, will have to pay from this time on about two thirds of every year’s city tax. Thus because the city annexed, for taxation purposes only, the plaintiff’s property and hurriedly let a contract for $4,000, the plaintiff will forever have to pay two thirds of the taxes assessed by the municipality. Ño part of the $4,000 was spent upon the plaintiff’s land.

According to the record, the annexation election was held February 10, 1950, and on May 18, 1950, the city amended its charter in an apparent effort to conform the latter to the results of the election. This *199suit was filed May 4,1950. Thereafter, the city waited for more than a month before it filed its answer consisting of nothing but admissions and denials. Surely, if a prompt decision of the contested annexation was material to the city, it would not have postponed the filing of its answer for more than a month. The cause was not tried until September 19, 1950. The decree was entered promptly — October 12, 1950. But the city waited until December 8, 1950, before it gave notice of appeal. Its brief was not filed in this court until March 28, 1951. In recounting those facts, I have no purpose whatever of censoring the able attorneys who represent the city, and mention them only for the purpose of indicating that the city has never manifested any indication whatever that a prompt decision of the rights of the parties was vital to it.

Prom the foregoing, it must be apparent that even if the answer permitted us to consider laches, we would not hold that the plaintiff was guilty of undue delay in protecting or asserting its rights. The truth of the matter is, the record does not indicate that the plaintiff ever received intimation that the city had let a contract for any work in the annexed area. I repeat, none of that work was performed upon the plaintiff’s property. I believe that the plaintiff acted with due diligence in asserting its rights.

As I have said, the evidence warrants the relief that was given. I concur in the opinions written by Justices Latourette and Tooze. However, wherever their reasons and mine are not in harmony, I prefer the ones set out above. I concur expressly in the part of Justice Latourette’s opinion which delineates the relief that should be awarded by the decree.