James v. Anderson

Eldridge, J., delivered the opinion of the Court. We are here faced with several issues concerning the proposed expenditure of monies for the construction of courthouse facilities in Harford County. In 1970, the Harford County Commissioners appointed a citizens’ committee to review the need for additional court facilities in the county. The committee recommended the construction of an addition to and the renovation of the existing Harford County courthouse.

This recommendation was adopted by the County Commissioners. Subsequently, the General Assembly of Maryland adopted ¹³⁹ Ch. 316 of the Acts of 1972 which authorized “the County Commissioners of Harford County to borrow ... an amount not exceeding a total of Five Million Dollars ... to finance the cost of site and improvements acquisition, construction, improvement or extension of the court house in said County.” Following the enactment of Ch. 316, the Harford County Commissioners engaged an architectural firm to design the courthouse renovation and addition, and also purchased, at a cost in excess of $325,000, the land to the rear of the existing courthouse for the addition to the courthouse. In November 1972, the voters of Harford County adopted a “charter” form of government and the Harford County Charter. Under this charter, the executive power in Harford County became vested in a County Executive, with the County Council being the County’s legislative body.

In January 1973, representatives of the County Executive and County Council were advised of the background and status of the courthouse project. Subsequently, the County Executive submitted a budget to the County Council which provided for the courthouse project. The County Council adopted the budget, appropriated the funds for the courthouse project, and, later, authorized the sale of $5,000,000 in bonds, the proceeds to be used for the courthouse project. Late in 1974, subsequent to the sale of the bonds, the courthouse project was advertised for bids.

The County Executive rejected all bids received because they were in excess of the remaining bond proceeds. The County Executive, however, requested and received an extension from the bidders, and then requested additional bonding authority from the County Council. The County Council responded with Resolution No. 1-75, in which it declared that the council “will authorize necessary funding in future bond issues for the completion of the Court House complex when requested by the County Executive after his awarding of the contract.” On the next day, the County Executive again rejected all bids and issued a press release stating that he was ¹⁴⁰ abandoning the project because of the severe fiscal problems which Harford County might be facing in the coming months. Several months later, the County Executive proposed to the County Council the formation of a Courthouse Project Review Board to study the then existing situation pertaining to the building of additional court-related facilities.

This board was subsequently formed, a member of the County Council serving on the board as its representative. On recommendation of the board, an advertisement was placed, soliciting the services of architects. Some 20 responses were received, and the Courthouse Project Review Board reduced the number of architects to be considered to four. In December 1975, the County Executive executed an agreement on behalf of Harford County with one of these four firms, Tatar, Lininger, Clark & Wood, Inc.; part of this agreement concerned a feasibility study of the various available courthouse sites.

Following the recommendation of this feasibility study, on July 7, 1976, the County Executive announced that he had authorized the firm of Tatar, Lininger, Clark & Wood, Inc., to proceed with the design of a new courthouse, to be constructed on a different site than the then existing courthouse. On September 8, 1976, the plaintiff, William S. James, instituted an action in the Circuit Court for Harford County for a declaratory judgment, naming the County Executive as defendant and asking the court to declare, inter alia, that the Harford County Charter and the Capital Improvements Program and Budget as adopted by the Harford County Council preclude the County Executive from using the bond proceeds for the construction of the new courthouse on a new site. The architectural firm of Tatar, Lininger, Clark & Wood, Inc., was later allowed to intervene as a defendant. Both defendants filed motions for summary judgment, arguing: (1) that William James had no standing to bring this action; (2) that the action was barred by laches; and (3) that the laws authorizing the bond issue empowered the County Executive to spend the proceeds from the bond sale in the manner described above. ¹⁴¹ The circuit court granted the defendants’ motions for summary judgment, holding that the plaintiff had standing and that his claim was not barred by laches, but that the County Executive was authorized by law to proceed with the new courthouse.

The plaintiff then took an appeal to the Court of Special Appeals. Before any proceedings in that court, we granted the plaintiff’s petition for a writ of certiorari. (H Initially, the defendants renew their contention that the plaintiff has no standing to maintain this action. The plaintiff brought this action “in his own behalf and on behalf of the taxpayers of Harford County,” and he alleged that he was a taxpayer of the State and of Harford County.

The defendants argue that the expenditure planned by the County Executive would in fact be less than the expenditure required to renovate the old courthouse, and that, as such, the plaintiff had not alleged any special damages or pecuniary loss which would entitle him, as a taxpayer, to maintain the action. The plaintiff in his bill of complaint did, however, claim that it would be more efficient for the courts and their supporting agencies to operate in close proximity, as is called for in the renovation project. This appears to us to be in principle indistinguishable from the allegations made in Citizens Planning & Housing Ass’n v. Co. Executive of Baltimore Co., 273 Md. 333 , 329 A. 2d 681 (1974). In that case, several individuals, alleging that they were taxpayers of Baltimore County, brought an action to prevent the County Executive of Baltimore County from reorganizing the Baltimore County Office of Zoning and Planning.

It was alleged that under the Baltimore County Charter, only the County Council had power to reorganize that office, and that, therefore, the action of the County Executive was ultra vires. To show their special damages as taxpayers, plaintiffs alleged that the change proposed by the County Executive would cause the Office of Zoning and Planning to operate ¹⁴² less efficiently, consequently impairing the property base of the county and causing an increase in taxes. In holding that the plaintiffs in Citizens Planning had standing to maintain the action, this Court, speaking through Judge Levine, stated ( 273 Md. at 344 ): “The courts below attached considerable significance to what they regard as conclusory language in the bill of complaint. Concededly, the allegations might have been particularized in greater detail, but this shortcoming may have been unavoidable in the unique circumstances of this case.

The extent to which a taxpayer is capable of detailing the damage anticipated from an illegal and ultra vires act, such as is alleged here, may be rather limited at the time the suit is initially filed. . . . [Ajppellants are not required to allege. . facts which necessarily lead to the conclusion that taxes will be increased.’ . . . The test is whether appellants reasonably may sustain a pecuniary loss or a tax increase; . . . [or] whether there has been a showing of potential pecuniary damage.” The position of the plaintiff in the instant case is, in substance, identical. The plaintiff challenges, as ultra vires, the actions of a County Executive, and points to a claimed decrease in efficiency which would result from the alleged ultra vires acts. As in Citizens Planning & Housing Ass’n v. Co. Executive of Baltimore Co., supra, this is sufficient for a taxpayer of the county involved to maintain a suit. 1 (2) Next, the defendants argue that the plaintiff’s action is barred by laches.

The contract with the architectural firm ¹⁴³ Tatar, Lininger, Clark & Wood, Inc., was signed by the County Executive on December 8, 1975, and the instant action was not instituted until September 8, 1976, some nine months later. It is asserted that, in the interval, substantial sums were expended in architect’s fees in reliance upon the contract. This delay in bringing suit, defendants allege, is unconscionable. While it is true that the contract with Tatar, Lininger, Clark & Wood, Inc., was awarded December 8, 1975, the terms of that contract required the architects to conduct a feasibility study of the various available courthouse sites.

One of the sites they were required to consider was the present site of the Harford County courthouse. Thus, until some recommendation from the architects was forthcoming, it was not possible to know whether the plan for renovation and enlargement of the present courthouse was to be continued. It is undisputed that it was on July 7, 1976, that the County Executive announced he had abandoned the renovation project and authorized the Tatar firm to proceed with the design of a new courthouse, to be constructed on a different site than the then existing courthouse. Thus, the plaintiff’s action was instituted approximately two months after the announcement that the renovation project was to be abandoned.

In light of these circumstances, we believe that the chancellor was fully justified in concluding that there was no unconscionable delay in bringing the action. (31 The principal issue in this case is whether the County Executive of Harford County is empowered to spend funds in the manner described here. The plaintiff relies on language incorporated into the Annual Budget and Appropriations Ordinance enacted by the Harford County Council, which, he maintains, limits the expenditure of the bond proceeds to an addition to the present courthouse facilities. The defendants, on the other hand, rely on language in bond authorization legislation which, they maintain, contemplates the expenditure of the bond ¹⁴⁴ proceeds for the construction and design of a new courthouse on a different site.

The resolution of this issue necessarily entails a review of the budget and spending provisions of the Harford County Charter. The Harford County Charter provides for a type of executive budget system. Under that system, the County Executive has the prime responsibility for the preparation of the annual budget. Sections 504 and 505 of the Harford County Charter provide that all county agencies which receive or disburse funds shall, at specified times, submit to the County Executive a detailed program, including an estimate of the anticipated expenditures and revenues for the forthcoming year, as well as an itemized list of the capital projects to be undertaken in the ensuing fiscal year and the next succeeding five fiscal years.

These sections of the charter further provide that the County Executive at his discretion may amend the agency proposals, and that thereafter he must cause to be prepared the county budget. The charter mandates that the county budget shall consist of “the current expense budget, the capital budget and capital program, and the budget message.” Section 503. We are here directly concerned with the capital budget and capital program. Section 507 of the county charter states: “The proposed capital budget and capital program shall be arranged to set forth clearly the plan of proposed capital projects to be undertaken in the ensuing fiscal year and in each of the next five fiscal years and also the proposed means of financing the same.

The capital budget shall include a statement of the receipts anticipated during the ensuing fiscal year from all borrowing and from other sources for capital projects.” The preparation of the capital budget and capital program in Harford County is done on what are termed “project estimate” sheets, which are combined to form the “Budget Book.” The project estimate sheet concerning the County courthouse project provides, in pertinent'part: ¹⁴⁵ “PROJECT TITLE AND DESCRIPTION: Addition to County Court House, Main Street, Bel Air. “JUSTIFICATION: The County Commissioners of Harford County entered into an architectural contract in August . . . [1972] for expansion of the present Court House Facilities. This addition will provide more space for all court facilities and court related functions.” After the county budget has been prepared, the County