Federal Construction Co. v. Ensign

Petitioner, to whom the board of trustees of the city of Dinuba awarded a contract for the performance of certain public work, brings this proceeding in mandamus to compel respondent, as the city superintendent of streets, to execute the contract.

The city of Dinuba, a municipal corporation of the sixth .class, is provided with a complete sewer system. It owns a parcel of land outside of and distant about two miles from its corporate limits, on which it has constructed a sewage disposal plant, consisting of a septic tank and its appurtenances, constructed some years ago for the disposal of the city sewage. That part of the municipal sewer system which lies within the corporate limits of the city is connected with the septic tank by a main sewer line, owned and maintained by the city, and extended to the outside parcel of land on which the septic tank is situated.

So greatly has the population of the municipality increased since the construction of the present septic tank, that the existing sewage disposal plant, of which the tank is the principal constituent, is now wholly inadequate—so much so that the sewage from the city overflows the septic tank and the effluent therefrom flows into and contaminates the water in certain irrigating ditches which are being used to irrigate near-by farms, orchards, and vineyards, thus creating a nuisance which menaces the health of the surrounding community. So serious is the situation that the farmers and others whose irrigating systems are now being polluted by the effluent from the city’s present insufficient sewage disposal plant threaten to and will enjoin the city from using the existing inadequate septic tank unless new and adequate tanks be immediately constructed by the city. Should the city be thus restrained it will be practically impossible for any of its inhabitants to make use of any part of the city’s sewer system. To meet so grave a situation the city board of trustees proposes to construct on the parcel of land two miles distant from the city limits— the land on which is now located the present inadequate septic tank—a complete sewage disposal plant, consisting of reinforced hydraulic concrete settling tanks, with outlets, connecting sewers, conduits, and appurtenances. In other words, the proposed work is, as stated in petitioner’s brief, “the reconstruction of the present sewage disposal

The proceedings thus inaugurated by the city trustees progressed through the various legal stages provided by the Improvement Act of 1911 to and including the award of the contract to petitioner as the successful bidder. Respondent, upon whom, as the superintendent of streets, the statute imposes the duty of entering into a formal written contract with every successful bidder, refuses to enter into any contract with petitioner, placing his refusal on the ground that the Improvement Act of 1911 does not contemplate work of the character here proposed. Hence this mandamus proceeding.

Respondent’s first point is that work to he done on property lying outside of a municipality’s corporate limits, even though such outside property be owned by the city, is within neither the letter nor the spirit of the act.

Section 2 of the Improvement Act of 1911 (omitting parts not essential to the question in controversy) reads: “Whenever the public interest or convenience may require, the city council is hereby authorized and empowered to order the whole or any portion or portions, either in length or width of any one or more of the streets, avenues, lanes, alleys, courts, places or public ways of any such city graded or regraded to the official grade, . . . and to order the construction or reconstruction therein of sidewalks

As will, be noticed, the act declares that the legislative body of any city is authorized to order “the whole or any portion ... of any one or more streets . . . graded . . . and to order the construction or reconstruction therein [i. e., in such streets] of sewers . . . with outlets, . . . flush tanks, septic tanks, connecting sewers . . . and other appurtenances. ” The act does not say that the “outlets, flush tanks, connecting sewers . . . and other appurtenances” which may be constructed or reconstructed with the sewers shall be constructed or reconstructed in the streets, nor even' that they shall be constructed within the city’s corporate limits. On the contrary, the legislature, in seeming recognition of the fact that every municipality may be confronted with its own peculiar engineering problems respecting the disposal of its sewage, has wisely refrained from saying that the outlets, flush tanks, etc., which are authorized to be constructed “with” the sewers shall be constructed in any particular place or locality. Indeed, the legislature, recognizing, apparently, that it often is necessary to leave to the local authorities a wide latitude of discretion respecting the place or places where the outlets, flush tanks, etc., and even the sewers themselves, may be constructed, has specifically declared in this same section of the act that the city authorities shall have the power to order the construction or reconstruction of sewers, with necessary outlets, flush tanks, etc., “in, over or through property or rights of way owmed by such city,” wdthout in anywise attempting to place any restriction upon the place

[1] It is a matter of common knowledge that, though the sewers are usually laid in streets, the outlets, flush tanks, septic tanks, and other similar appurtenances which take care of the sewage flowing through and from sewers are seldom, if ever, constructed in the streets. Indeed, we cannot imagine a case where scientific engineering would sanction the construction of a settling tank or a septic tank in a street of such a municipality as the city of Dinuba, for the purpose of taking care of the sewage flowing from the city’s entire sewer system. The construction of such outlets, flush tanks, septic tanks, etc., on lands lying outside of the city limits is not at all uncommon in this state. And when the act declares that city councils may construct sewers in streets, or in, over, or through property or rights of way owned by the city, ivith outlets, flush tanks, septic tanks, and other appurtenances, it undoubtedly contemplates the possible, if not probable, construction of such adjuncts to the city’s sewer system as flush tanks, etc., upon any convenient and appropriate parcel of land or right of way owned by the city, even though such land or right of way be located without the city’s corporate limits.

[2] Counsel for defendant says that the Improvement Act of 1911 is essentially a “street improvement act,” and that, therefore, no improvement may be made of property situated outside the city’s corporate limits. The object and true scope of such work as that under consideration here is not the improvement of the land upon which the proposed settling tanks, etc., are to be constructed. The proposed improvement is for the benefit of the inhabitants of the city and their lots and lands. Existing conditions are such that it is absolutely necessary that the present sewer system shall have a larger and a more adequate sewage disposal plant. To make the present sewer system of any real benefit to the lot owners and other inhabitants of the city of Dinuba, a larger sewage disposal plant must be constructed. No natural outlet for the city’s sewage can be found within the city’s corporate limits. Nor does it appear that the municipality owns any property within its corporate limits that is suitable for the erection thereon of an adequate sewage disposal plant; and if the city does

Respondent cites us to Thompson v. Hance, 174 Cal. 572 [ 163 Pac. 1021 ], a case arising under the Vrooman Act (Stats. 1885, p. 147) and involving a city’s power under that statute to construct tunnels for the use of pedestrians

[3] By subdivision 10 of section 20 of the act under consideration it is provided that the assessment diagram

For the foregoing reasons, we are of the" opinion that respondent has shown no basis for his contention that the Improvement Act of 1911 does not embrace such work as is contemplated by these improvement proceedings.

This brings us to a consideration of respondent’s second point, which is that, by reason of certain constitutional limitations upon the power to levy special assessments to pay for local improvements, the reconstruction and enlargement of a sewage disposal plant, intended to take care of all the sewage flowing through and from a city’s entire system of sewers, cannot be made the subject of a local improvement, to be paid for by special assessments on all "the privately owned lots and parcels of land situated within the municipality.

It is not claimed that special assessments may not be levied to pay the cost of reconstruction work as such. Nor could such claim be maintained if made. The legislature, in the act under consideration, has expressly authorized the construction or reconstruction of sewers, septic tanks, etc. That the legislature possesses the power to authorize reconstruction work is no longer a debatable question in most of the jurisdictions of this country. Power to make local improvements is a continuing one which may be exercised

[4] Special benefits to the property to be assessed, that is, benefits received by it in addition to those received by the public at large, is the equitable and just foundation upon which local assessments rest; and under our system of government no assessment can be made upon any land on any principle other than that of special benefits actually or presumptively received. [5] The elements which an improvement must possess in order to 'justify a local assessment based on the theory of benefits are certainly two in number, and possibly three. The first is that the improvement must be a public one; that is, it must be one which confers a general benefit upon the public at large, and which, therefore, the public, acting through its government, may construct without the consent of the particular individuals affected. An improvement which lacks this element is essentially a private improvement; and no matter how useful or advantageous it may be to the owners of private property, the public cannot compel its construction, nor can it pay for it by funds raised by the exercise of the sovereign power of taxation. (Spring Street Co. v. City of Los Angeles, 170 Cal. 30 [L. R. A. 1918E, 197, 148 Pac. 217 ]; 1 Page and Jones on Taxation by Assessment, sec. 283.) The second element essential to a valid local assessment is that the improvement must confer an especial and local benefit upon the property which is to

Whether all of the privately owned lots in the city of Dinuba will be specially benefited by the proposed improvement, and whether it is a “local improvement,” as that term is generally understood when considered in connection with special assessments, are questions which, it must be confessed, are of serious concern; for, so far as we are advised, the appellate courts of this state never have had occasion to deal with an improvement of the nature of that which confronts us here. However, the guiding principles are few and well established, and we are convinced that their proper application to the facts of this case must lead to a decision favorable to the exercise of the power to

As we view the problem, it presents two aspects: (1) Is the nature of the work such that we can see that it is possible for it to especially benefit all the privately owned lots and parcels of land within the confines of the city, in addition to any general benefit which may result to the public? (2) Does the fact that the assessment district embraces all of the privately owned real property within the city necessarily deprive the enterprise of the character of a “local improvement ’ ’ ?

Addressing ourselves now to the first question: We think it clear that not only will the lot owners be specially benefited by the proposed improvement, but that the benefits to be derived by' them as lot owners will exceed any that the general public will receive—much more so, in fact, than in the ease of the improvement of a public street or other highway. Where a street is paved or otherwise improved, the beneficial use thereof may be enjoyed, not only by the owners of lands within the city, but by the nonowners of real property in the city and likewise hy the citizenry of the state generally. It is evident, therefore, that where a street or other highway is paved or otherwise improved, the benefits accruing to the lot owners are much less, in proportion to the advantages accruing to the general public, than is the ease here. Practically all of the benefits to be derived from the enlargement of a city’s sewage disposal plant will redound to the lot owners of the city, as lot owners, and little, if any, will be received by the general public. With but few exceptions it is the inhabitants of a municipality who enjoy the benefits which are derivable from a city sewer system designed to carry off the sewage from the various residences, factories, buildings, and other structures within the municipality. Practically every inhabitant of a city either is the owner of the land on which he resides or on which he pursues his vocation, or he is the tenant of the owner, or is the agent or servant of such owner or of such tenant. And since it is the inhabitants who make by far the greater use of a city’s sewer system, it is to them, as lot owners or as tenants, or as the servants or agents of such lot owners or tenants, that the advantages of actual use will redound. But this

[6] There is no fairer test of special benefit received than that which determines the existence and amount of such benefit by the effect of the improvement upon the market value of the property to be assessed. (2 Page and Jones on Taxation by Assessment, sec. 653. See, also, Doyle v. Austin, 47 Cal. 359 .) If, then, the farmers whose lands are now being polluted by the effluent from the present sewer system shall carry out their threat' to enjoin the use of that system on the ground that its present use constitutes a nuisance, thus making it impossible for the inhabitants of the municipality to make any substantial use of any of the sewers within the city’s confines, the result will be that the whole existing sewer system will become useless. Should such a calamity befall the inhabitants of the city of Dinuba, the market value of all the real properties within the city necessarily would be considerably reduced. On the other hand, should the city’s sewage disposal plant be reconstructed and enlarged in the manner contemplated by the proposed improvement, the market

In view of these considerations, it is manifest that the nature of the work is such that we cannot say that it is impossible to confer any special or peculiar benefit on the lots to be assessed. On the contrary, it is obvious that each and every lot within the confines of the municipality will enjoy a special benefit not shared by the general public. This being so, the courts, in the absence of glaring injustice, or of fraud or mistake on the part of the city trustees, will not inquire into the quantum of special benefit which will accrue to the lot owners.

[7] The established rule in this state is that if, from the nature of the improvement, it can be seen that the lots to be assessed are susceptible of some substantial benefit from it, the question of the extent of the benefit received is one which, in the absence of fraud, gross injustice, or demonstrable mistake, rests peculiarly in the determination of the assessing authorities, and their action will not be interfered with by the courts. The right to make assessments of this character is referable, in a general way, to the sovereign power of taxation. But it would be inconsistent with the proper exercise of that power, and would tend to a manifest embarrassment of the public in the prosecution of these public improvements, if, on each assessment, the lot owner were entitled to have the question judicially determined whether or not he would be benefited by the proposed improvement in an amount commensurate with the assessment on his lot. This doctrine is forcefully stated by the Oregon supreme court as follows: “It is asserted with substantial unanimity and great clearness by the courts in this country, as well as by text-writers of erudition and learning, that, unless the nature of the case precludes it, the power to determine the confines of a taxing district for any particular burden is purely one of legislative discretion, and that the question

[8] It only remains to consider whether the fact that all the lands within the city will be benefited deprives the enterprise of the character of a “local improvement,” so that the work may not be paid for by special assessment. By establishing an assessment district coextensive with the city, the city’s board of trustees must be deemed to have proceeded upon the theory that practically all of the privately owned lands within the municipality will be specially

Though it may be difficult to lay down a test which shall have an unvarying application to every state of facts, it seems clear that there can be no sound reason why the magnitude of the project or the extensiveness of the area to be assessed should have any decisive bearing on the question, provided the included area will derive a special benefit apart from that enjoyed by the public as a whole. In other words, the size of the assessment district presents only a question of degree in the enjoyment of the special benefits, and is not necessarily decisive that the benefit is general in its results. (Bennett v. Johnson, supra.) In

Aside from such general inhibitory provisions as, for example, are to be found in the Bill of Bights, the California constitution contains no direct and express limitation upon the power to levy special assessments for local improvements. The legislative will in this state is, therefore, supreme, so far as any direct constitutional limitation is concerned. In this respect our constitution differs from that of Illinois. In the Illinois constitution of 1870 it is expressly declared that the legislature may vest the corporate authorities of cities, towns, and villages with power “to make local improvements by special assessment” (article IX, sec. 9). This provision of the Illinois constitution has been held by the courts of that state not only to be a grant of the power to .authorize special assessments as therein set forth, but also to be an inhibition prohibiting the legislature from conferring the power in any way other than as therein set forth. [9] In California the only limitations upon the power, or, more accurately speaking, the rules which the municipal authorities must observe, are that the improvement shall be a public one, that it shall confer an especial benefit upon the property to be assessed, and that the apportionment of the assessments shall be made upon some basis that is uniform and free from unjust discrimination.

A definition of a “local improvement” which seems to have commended itself to the courts of many jurisdictions, and which meets with our unqualified approval, is that given by the Arkansas supreme court in Crane v. City of Siloam Springs, supra: “If we look for the technical or legal meaning of the phrase ‘local improvement’ we find it to be a public improvement, wdiich, although it may incidentally benefit the public at large, is made primarily

Although not giving direct consideration to this question, one of the district courts of appeal of this state (division one, first appellate district), as well as the United States circuit court of appeals, has indirectly passed upon it by holding that the legislative body of a municipality may create an assessment district coextensive with the boundaries of the city and assess all of the privately owned real property situated therein. (Kane v. Wedell, supra; McGarry v. Ellis, supra, and Minnesota etc. Improvement Co. v. Billings, supra.) Sir^ee such an assessment district may be upheld only upon the theory that all of the privately owned lands within the city are especially benefited by the improvement, the cases last cited become authority for the proposition that an improvement is none the less a “local improvement,” and the benefits accruing therefrom are none the less “special,” merely because the improvement benefits all the lands within the confines of the municipality.

Our views upon this branch of the case may be summarized thus: It is demonstrable that the proposed improvement will tend to increase, or at least to stabilize, the market values of all the real properties within the city, thus conferring a financial benefit upon every lot owner, so that the lot owners of the city, as lot owners, will he benefited by the improvement. Such benefits are “special,” since the benefits which land owners receive from a public improvement by virtue of their ownership of real properties may be regarded as special, even though the improvement be constructed in part for the benefit of a greater number of persons, all of whom, including the lot owners, are in fact benefited thereby. (2 Page and Jones on Taxation by Assessment, p. 1118.) Since the receipt of special benefits, actual or presumptive, by the property to be assessed is the sole underlying principle of,

This disposes of the questions raised in opposition to the issuance of the writ.

It is ordered that respondent, H. W. Ensign, as superintendent of streets of the city of Dinuba, forthwith execute with the Federal Construction Company the contract referred to in the petition herein, that he approve the bonds referred to in the petition, and that he fix a time for the commencement and completion of the work to be done under that contract; also, that petitioner recover its costs.

Works, J., and Craig, J., concurred.

A petition to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on November 23, 1922.

All the Justices present concurred.