Gardner v. Board of County Commissioners

RODOWSKY, Judge. Respondents, the County Commissioners of St. Mary’s County (the County), after having been petitioned to do so, ⁶⁶ created a special tax district in order to build public roads in a large residential subdivision that was partially developed. On the merits the principal issue is whether the ordinance creating the special tax district was initiated by the requisite number of petition signatures. Procedurally, the principal issues are whether this litigation may properly proceed until the Attorney General of Maryland has been notified and until the owners of all of the lots in the tax district have been joined as co-defendants with the County.

Longview Beach is a platted subdivision of 870 lots lying between Maryland Route 238 and the Wicomico River. 1 At least some of the roads shown on the plat have been laid out and graded, but none is surfaced to current County standards. Prior to July 21, 1987, the owners of 236 lots in Longview Beach petitioned the County to improve certain of the private roads in Longview Beach and to incorporate those roads, so improved, into the County roads system. This petition was presented pursuant to a public local law authorizing the County to construct “on or along private roads after the approval of a petition of a majority of the property owners whose property will benefit from the proposed construction or improvement, requesting that the roads be taken into the county roads system.” St. Mary’s County Code (1978, 1989 Cum.Supp.), § 109-2.C.(1). 2 ⁶⁷ On July 21, 1987, the County adopted Ordinance No. 87-10, the Longview Beach Special Taxing District Ordinance (the Ordinance). The tax district initially consists of 466 of the 870 lots in Longview Beach.

The Ordinance specifically refers to block and lot designations, as shown on the recorded plat, in order to create a tax district consisting of “all improved lots and all lots fronting on one of the roads to be reconstructed.” In other words, the district initially consists of unimproved lots abutting a proposed County road, improved lots abutting a proposed County road, and improved lots abutting a private road, but unimproved lots abutting a private road will not be assessed initially. The Ordinance further provides that “[i]f improvements are constructed on lots that are not currently included in the taxing district ... such lots shall, in the assess ⁶⁸ ment year following such construction or subdivision, be included in the taxing district at the appropriate rate.” The total costs of the proposed County roads in Longview Beach are to be paid by benefit assessments levied against the lots comprising the tax district from time to time. 3 The criteria for determining the initial lots to be assessed create sections of the tax district which are wholly surrounded by lots which are not part of the tax district. Those criteria also produce an initial tax district of 466 lots. Inasmuch as the petition under § 109-2.C of the County Code was signed by the owners of 236 lots, the petition was signed by a majority of the owners of the lots in the tax district, as defined in the Ordinance.

One issue on the merits of this case is whether the § 109-2. C requirement for “a petition of the majority of the property owners whose property will benefit from the proposed construction” has been satisfied. ⁶⁹ This litigation began when Viola M. Gardner and others, the Petitioners, filed in the Circuit Court for St. Mary’s County an order for appeal, followed by a petition for appeal, under Maryland Rules of Procedure, Ch. 1100, Subtitle B, “Administrative Agencies — Appeal From.” The circuit court granted the County’s motion to dismiss, but allowed Petitioners leave to amend. In their amended complaint Petitioners alleged that they are “property owners and taxpayers in Longview Beach whose properties will be subject to a special taxing district tax.” They sought a judgment declaring the Ordinance to be void and enjoining the County from implementing it. They alleged that fewer than half of the lot owners in Longview Beach petitioned for creation of the tax district.

The amended complaint also alleged that the County’s action violated Art. XV of the Maryland Declaration of Rights and the fifth and fourteenth amendments to the United States Constitution. At no time during the course of this litigation have the Petitioners sent notice of their suit to the Attorney General of Maryland, despite the County’s having raised by answer Md.Code (1974, 1989 Repl.Vol.), § 3-405(c) of the Courts and Judicial Proceedings Article (CJ). 4 The County’s answer also asserted that “at least 466 property owners are to ⁷⁰ be in this taxing district and would be possibly affected by the outcome of this case and, therefore, should be included as necessary parties in this case.” The circuit court essentially severed for separate trial, on stipulated facts, the issue involving the number of signatures on the petition. That court concluded that the owners of a majority of the benefited lots had not signed so that the Ordinance was void. The County appealed to the Court of Special Appeals which vacated the judgment of the circuit court and remanded for further proceedings, to be conducted after notice to the Attorney General in accordance with the requirements of CJ § 3-405(c).

Board of County Comm’rs of St. Mary’s County v. Gardner, 79 Md.App. 417 , 557 A.2d 260 (1989). The appellate court concluded that § 3-405(c) must be followed even though the trial court had not predicated its judgment on constitutional grounds. The Court of Special Appeals, however, expressly disclaimed “ruling that notice to the Attorney General is jurisdictional.” Id. at 419, 557 A.2d at 261 . The intermediate appellate court also held that the owners of lots assessed under the Ordinance were directly impacted by any ruling on its validity.

Relying on CJ § 3-405(a) and Maryland Rule 2-211, the court held that “[ijnclusion of persons owning property within the scope of the [Ordinance is, therefore, mandatory.” Id. at 421, 557 A.2d at 262 . 5 The court did not reach the merits. ⁷¹ We issued the writ of certiorari at the request of the Petitioners. That petition included the following questions: “1. Whether the failure to notify the Attorney General in a declaratory judgment action, pursuant to ... Section 3-405(e), is harmless error when the Circuit Court enters the declaratory judgment based on non-constitutional grounds. “3.

Whether the Plaintiffs, in a taxpayer’s suit seeking a decree enjoining the implementation of an ordinance illegally creating a special taxing district, are required to join all other property owners located in the special taxing district pursuant to Maryland Rule 2-211 (1989). “5. Whether the ordinance creating a special taxing district is illegal or ultra vires since a class of property owners who will be taxed in the future if they improve their property were not permitted to vote on, nor counted toward, the proposed taxing district.” The Attorney General also obtained leave to file a brief as amicus curiae, in order to address only the issue involving CJ § 3-405(c). I As a threshold matter the County submits that the circuit court had no jurisdiction. We consider this contention, despite the absence of a cross petition for certiorari, because lack of jurisdiction over the subject matter may be raised at any time.

Md.Rule 2-324. Petitioners’ first pleading invoked the B Rules which confer no substantive right to judicial review of legislative enactments. The County seems to say that the misconcep ⁷² tion by Petitioners of their remedy rendered the circuit court powerless to act in any aspect of the case. Courts have jurisdiction, as in the case here, to rule that an initial claim for relief does not state a claim upon which relief can be granted.

Maryland Rule 2-341 permits amendments which “shall be freely allowed when justice so permits.” An amendment may seek to “change the nature of the action.” Md.Rule 2-341(c)(l). II We now turn to the effect of Petitioners’ violation of CJ § 3-405(c). By the clear terms of that statute the Petitioners should have given notice to the Attorney General when they filed their suit alleging, inter alia, the unconstitutionally of the Ordinance. The purpose of § 3-405(c) is to give the Attorney General “the opportunity to decide whether to intervene on behalf of the State or any State agency affected.” Pressman v. State Tax Comm’n, 204 Md. 78, 86 , 102 A.2d 821, 826 (1954).

CJ § 3-405(c) is § 11 of the Uniform Declaratory Judgment Act, 12 U.L.A. 516 (1975). One court has said: “The purpose of this provision is to enhance the quality of constitutional litigation by notifying the Attorney General of the pending action____ While it is not contemplated that the Attorney General will actually appear in every case in which he is served, still, from a copy of the proceedings, he can identify the parties and issues and decide whether the State, with the forces it can muster, should step in and support the enactment. If, in a particular case, the Attorney General decides to appear in court, as this statute permits, his presentation of evidence and argument may provide the court with that additional crucial matter which will demonstrate that an enactment is constitutional. Having this important goal as its basis, this statutory notice provision deserves to be vigilantly enforced.” ⁷³ Sendak, Attorney General v. Debro, 264 Ind. 323, 327 , 343 N.E.2d 779, 781-82 (1976).

A The Attorney General submits that Petitioners’ failure to give notice deprives the circuit court of jurisdiction to enter a declaratory judgment. There are decisions which speak of a lack of jurisdiction to proceed, absent the notice. See Smith v. City of Florence, 288 Ala. 61 , 256 So.2d 893 (1971); Sullivan v. Murphy, 279 Ala. 202 , 183 So.2d 798 (1966); Plantation Pipeline Co. v. City of Bremen, 225 Ga. 607 , 170 S.E.2d 398 (1969); Williams v. Kaylor, 218 Ga. 576 , 129 S.E.2d 791 (1963); Hydraulic Press Brick Co. v. City of Independence, 38 Ohio App.2d 37 , 311 N.E.2d 873 (1974); McCabe v. City of Milwaukee, 53 Wis.2d 34 , 191 N.W.2d 926 (1971); Tobin v. Pursel, 539 P.2d 361 (Wyo. 1975). The Supreme Judicial Court of Massachusetts has taken the view that notice to the Attorney General and an opportunity for that official to be heard “are conditions precedent to the entry of a declaratory decree.” Court St. Parking Co. v. City of Boston, 336 Mass. 224, 226 , 143 N.E.2d 683, 685 , appeal dismissed, 355 U.S. 272 , 78 S.Ct. 331 , 2 L.Ed.2d 257 (1957). “But the lack of power to enter such a decree of course does not impair the general equitable jurisdiction of the Superior Court which was invoked by the bills of complaint to prevent irreparable injury by enjoining invalid action.” Id.

In Court St. Parking, the lower court entered a declaratory decree, without notice to the Attorney General. It upheld the constitutionality of a condemnation statute. The Supreme Judicial Court, in an appeal at which the Attorney General appeared, agreed that the statute was constitutional. For that reason the court considered it unnecessary to determine whether the notice requirement was fulfilled by the Attorney General’s appearance at the appellate level.

The court reversed the declaratory decree and entered a mandate dismissing the complaints on the merits, saying that “[t]he same end of a determination of ⁷⁴ the validity of the statutes is now served[.]” 336 Mass, at 232, 143 N.E.2d at 689 . In Lumberton Mun. Util. Dist. v. Cease, 596 S.W.2d 601 (Tex.Civ.App.1980), the trial court had temporarily enjoined a tax district from levying or collecting any taxes.

The complaint had raised both constitutional and nonconstitutional grounds, but the complainants had not notified the Attorney General. The injunction was predicated on non-constitutional grounds. On appeal the court held that “[t]he failure to give notice to the Attorney General did not deprive the trial court of jurisdiction to grant relief on other legal \i.e., nonconstitutional] grounds.” Id. at 604 . We need not fathom how other courts have used “jurisdiction” in their opinions on the issue before us because, under Maryland law, failure to give notice is not jurisdictional in the fundamental sense.

In Givner v. Cohen, 208 Md. 23 , 116 A.2d 357 (1955), the dismissal of a bill for declaratory judgment was affirmed. Among many reasons supporting the result this Court pointed out that “[a] bill for a declaratory decree or judgment cannot be maintained, at least against a demurrer, without compliance with” the notice requirement. 208 Md. at 31 , 116 A.2d at 360 . The principal reason for dismissal, however, was that the issue of the constitutionality of warrantless searches by officers of the Baltimore City Health Department was not presented in a sufficiently concrete fashion to be justiciable. We so interpreted Givner in Hatt v. Anderson, 297 Md. 42, 46 , 464 A.2d 1076, 1078-79 (1983).

If failure to give notice deprives a circuit court of jurisdiction over the subject matter, it would have been unnecessary in Givner to say any more than that to support dismissal. In other cases this Court and the Court of Special Appeals have noted a violation of CJ § 3-405(e) without dismissing for want of subject matter jurisdiction or, indeed, without imposing any sanction whatsoever. See Harden v. Mass Transit Admin., 277 Md. 399 , 404 n. 3, 354 A.2d 817 , 819-20 n. 3 (1977); Board of County Comm’rs of Calvert County v. East Prince Frederick Corp., 80 Md.App. 78 , 80 ⁷⁵ n. 1, 559 A.2d 822 n. 1 , cert, granted, 317 Md. 609 , 565 A.2d 1033 (1989); Bama, Inc. v. Anne Arundel County, 53 Md.App. 14 , 26 n. 4, 451 A.2d 1261 , 1268 n. 4 (1982), cert, denied, 295 Md. 529 (1983). Thus, the circuit court was not deprived of jurisdiction over the subject matter.

B The true issue concerning Petitioners’ violation of CJ § 3-405(c) is whether a sanction should be imposed or a remedy fashioned and, if so, what it should be. Any sanction or remedy should be designed to achieve the purpose of the statutory requirement. If, without notice to the Attorney General, a trial court proceeds to judgment and invalidates an enactment on constitutional grounds, an appropriate remedy, if requested, may well be to vacate the judgment and remand for further proceedings after notice to the Attorney General. See Sendak v. Debro, supra; Lazo v. Board of County Comm’rs of Bernalillo, 102 N.M. 35 , 690 P.2d 1029 (1984).

If, under the same assumption, and after remand, an Attorney General were to choose not to be heard on the rehearing, the trial court may reenter its prior judgment. See Lakewood Pawnbrokers, Inc. v. City of Lakewood, 182 Colo. 315 , 512 P.2d 1241 (1973). In the instant case the circuit court declared the Ordinance to be invalid on nonconstitutional grounds. The Attorney General’s motion and amicus brief in this Court evidence that the Attorney General now has notice, but the Attorney General indicates no interest in arguing to us that the circuit court’s judgment on the merits was erroneous.

Indeed, the Attorney General agrees that “[t]he circuit court held the [Ordinance invalid on nonconstitutional grounds.” Brief of State of Maryland as Amicus Curiae in Support of Appellee, at 3. In Part IV, infra, we shall hold that the circuit court ruled correctly on the merits. Under all of these circumstances the purpose of CJ § 3-405(c) has ⁷⁶ been substantially served. There is no need further to remedy Petitioners’ failure to give notice.

C The County, disagreeing with the Attorney General’s interpretation of CJ § 3-405(c), submits that Petitioners’ allegation that the Ordinance violates St. Mary’s County Code § 109-2.C is an allegation that the Ordinance is “unconstitutional” within the meaning of CJ § 3-405(e). The argument is that the term “unconstitutional” embraces any organic law, the violation of which by a dependent law renders the latter invalid. We disagree. That has not been the interpretation in practice when an ordinance of a charter county is alleged to be invalid for violation of the county charter or of the Express Powers Act (even when those allegations were coupled with claimed violations of Maryland Const., Art. XI-A).

See, e.g., Montgomery Citizens League v. Greenhalgh, 253 Md. 151 , 252 A.2d 242 (1969); Scull v. Montgomery Citizens League, 249 Md. 271 , 239 A.2d 92 (1967). ' III Petitioners also seek reversal of the requirement laid down by the Court of Special Appeals that Petitioners join the owners of the other lots in Longview Beach tax district in order for the case to proceed. The issue is one of compulsory joinder and is primarily controlled by Md.Rule 2-211(a), see n. 5, supra. The Declaratory Judgment Act, CJ § 3-405(a), see n. 4, supra, also contains a compulsory joinder provision. “Generally there is no difference in the rule as to necessary parties between a declaratory judgment proceeding and any other proceeding in personam.” Maryland Naturopathic Ass’n v. Kloman, 191 Md. 626, 631 , 62 A.2d 538, 540 (1948) (emphasis in original omitted); Staley v. Safe Deposit & Trust Co., 189 Md. 447, 456 , 56 A.2d 144, 148 (1947). We shall therefore analyze whether the other owners in the tax district must be made parties, ⁷⁷ either individually or as members of a class, in terms of Md.Rule 2-211(a).

The Court of Special Appeals rested its holding on both aspects of Md.Rule 2-211(a)(2) when it said: “Disposition of the action, in the absence of [other lot owners in the district], will impede or impair their ability to protect a claimed interest. Further, public officials charged with implementing the [Ordinance may incur multiple or inconsistent obligations absent joinder of necessary parties in this suit. Inclusion of persons owning property within the scope of the [Ordinance is, therefore, mandatory.” 79 Md.App. at 421 , 557 A.2d at 262 . Petitioners submit that this is a taxpayers’ action against public officials and that, in that type of action, joinder of other property owners has not been required.

The County says that the instant action is not a taxpayers’ suit at all. A In their complaint Petitioners describe themselves as “property owners and taxpayers in Longview Beach whose properties will be subject to a special taxing district tax.” The complaint does not go on to say that Petitioners bring the action for the benefit of all other taxpayers in the tax district. The County argues, without citation of authority, that the omission is fatal. One aspect of the concept of a taxpayer’s suit concerns the standing of the plaintiff to sue. “Under Maryland law, the doctrine of taxpayer’s standing is not as narrowly limited as it is under the law of some jurisdictions. ‘In Maryland, taxpayers have standing to bring suit to challenge the constitutionality of a statute when the statute as applied increases their taxes.’ ” State v. Burning Tree Club, 315 Md. 254, 291 , 554 A.2d 366, 385 , cert, denied, — U.S. -, 110 S.Ct. 66 , 107 L.Ed.2d 33 (1989) (footnote omitted) (quoting Murray v. ⁷⁸ Comptroller, 241 Md. 383, 391 , 216 A.2d 897, 901 , cert. denied, 385 U.S. 816 , 87 S.Ct. 36 , 17 L.Ed.2d 55 (1966)).

And see James v. Anderson, 281 Md. 137 , 377 A.2d 865 ' (1977); Citizens Planning & Hous. Ass’n v. County Executive of Baltimore County, 273 Md. 333 , 329 A.2d 681 (1974). In Montgomery County v. Board of Supervisors of Elections for Montgomery County, 311 Md. 512 , 516 n. 3, 536 A.2d 641 , 643 n. 3 (1988), we held that a challenge to charter amendments, based on conflict with public general law, could be asserted by a single taxpayer. The ability of the, plaintiff to proceed in these cases has not, turned on whether the plaintiff alleged that the suit was brought for the benefit of other taxpayers similarly situated.

B The Court of Special Appeals concluded that Petitioners’ attack on the Ordinance subjected the County “to a substantial risk of incurring multiple or inconsistent obligations by reason of the ...' claimed interest” of the nonjoined lot owners.' Md. Rule 2-211(a)(2). Perhaps the most forceful illustration of the lack of any substantial risk to the County of incurring multiple or inconsistent obligations is found in the “test” cases. In those permissibly collusive actions a governmental body or private party seeks oút a taxpayer to' bring an action in order to obtain an adjudication concerning the validity of some public action, and the