Washington Suburban Sanitary Commission v. Scrivener

Parke, J., delivered the opinion of the Court. The appellees are the owners in fee of a parcel of land, with a frontage of seventy-eight feet on a public street in the town of Kensington, Montgomery County, and within that portion of Montgomery and Prince George’s Counties which comprises the Washington Sanitary District. An assessment for water and sewerage systems was imposed in 1923 by the Washington Suburban Sanitary Commission at the rate of nine cents for the former and of seven cents for the latter, to continue throughout a period of fifty years, for every foot of this frontage. In 1925, this front foot rate of assessment was increased to twelve cents for the water system and nine cents for the sewer.

The appellees admit that the first assessment is valid, and tendered themselves ready and willing to pay it. Their objection is to the increase, on various grounds, but it will be not required to consider any but the one involving the correct construction of the statutory law in force throughout the sanitary district. For the purpose of compelling the commission to rescind its action in increasing these two rates against ⁷⁰ their property, the appellees filed in the Circuit Court for Montgomery County a petition for mandamus against the commission. This petition was answered, and appellee’s demurrer to the answer was sustained, whereupon, as appears from a stipulation of the parties filed in this Court, the appellant submitted to a judgment on demurrer, a writ of mandamus went forth, and this appeal was taken.

The facts, therefore, are not in dispute. The town of Kensington had constructed water and sewerage systems for the use of the properties and of those living within its limits, and had operated and maintained these systems until October 30th, 1922, when they were duly acquired by the Washington Suburban Sanitary Commission at a purchase price representing the construction cost of the systems to the town. Tfie commission assumed the outstanding bonds which had been issued by the town on account of these public works; and relieved the appellees as abutting land-owners (a) from paying their front foot proportionate share of two-thirds of the whole yearly interest charge and the annual cost of redemption of one thousand dollars of a bond issue which was not to exceed fifty thousand dollars, and which was to be paid at the rate of one thousand dollars yearly, beginning for the first of said payments at the end of three years from the date of the bond issue; and (b) from paying, along with all the other taxpayers of the town, the remaining one-third. Acts of 1914, ch. 829, secs. 1, 2, 7, 8; Acts of 1916, ch. 241.

The commission was fully authorized to acquire these municipal water and sewerage systems, and in the concession by the appellees that the original assessment of benefits against their property is valid and operative was involved an admission that all the necessary preliminary acts for the legality of the first rates of assessment had been duly done. So it must be accepted that the levy on July 1st, 1923, of the special assessment, was after the commission had caused surveys, plans, specifications, and estimates to have been made for the water supply and sewerage ⁷¹ system in the particular sub-district in which Kensington was situated, after the commission had completed the plans for the projected public works, and after the commission had given the prescribed notice by publication of the contemplated improvements and their probable cost, and that their plans might be seen, and that at a time specified any person interested in the matter would be heard. These provisions for notice to those persons interested in the proposed improvements and for a hearing of them at a specified time were mandatory provisions of the Acts of 1918, ch. 122, secs. 4 and 7, and conditions precedent to the undertaking by the commission of any projected general plan. They afforded to the landed property owners of the sub-district the only opportunity for discussion, suggestion, or objection, with a view to the modification, revision, or rejection by the commission of the plans submitted.

The measures proposed were authorized on the theory that they would subserve the general welfare of the residents of that sub-district and so it was of the utmost importance that the wisdom, utility, and financial practicability of the project, as tentatively adopted, should be first submitted to the test of a public hearing, at which those who would have to bear the cost could search the soundness, completeness, and practical utility of the plans, expose their financial inexpediency, or urge any ground of opposition. The. imperative form of section 4, with the details directed to be included in the notice, and the plain command of section 7, that the commission is not to decide to proceed with the construction until “after opportunity for a hearing has been given,” prevent a construction that the provision for a hearing, after notice, was merely directory. Aor is it tenable that the necessity of a hearing, after notice, is dispensed with by the repeal and re-enactment of section 4 by the Acts of 1924, ch. 189, sec. 4. As thus amended, section 4 no longer prescribes the method of notice and its contents, nor uses the imperative form of “shall give notice,” but requires “that wherever such construction is upon the motion of the ⁷² commission, without petition or request from any party interested, said commission may give such reasonable notice as it deems advisable.” If this language stood alone it would present some difficulty, but it must be read in connection with the remaining provisions of the statute, and a construction made which will give, if possible, harmonious effect to all the terms.

Section 7 remains unchanged in its requirement that, before the commission make a decision to proceed with any of the authorized p-ublic improvements, it shall be “after opportunity for á hearing to be given.” See section 7 of chapter 518 of Acts of 1920. So, a reasonable conclusion from the language of the amended section 4, and of the unchanged section 7, is that prior notice and a hearing must be given of the projected construction of a water supply, sewerage, or drainage system, to all those interested who have not petitioned or requested the commission to- construct the public work contemplated. This construction is not only consistent with the terms of the statute as amended, but also gratifies a legislative intent, sufficiently expressed, that costly and extensive public improvements by a centralized and bureaucratic commission shall-not be undertaken until its contemplated 'action may become the subject of investigation and public hearing. This conclusion, however, is confined by the text of the statute to the adopted originating surveys, plans, specifications, and estimates of the particular system when first projected.

The requirement of a prior notice and hearing is accordingly limited to the occasion when the commission, intending to initiate an authorized system, has adopted the tentative general plan for that system. After the notice and hearing and the final adoption of the plan, changes in the specifications, subsequent modifications and alterations of the first plan, later additions supplementary or complementary to the original system, are within the exercise by the commission of a reasonable discretion necessarily committed, and may be undertaken by the commission without a prior notice and hearing. ⁷³ As has been stated, the appellees and the other persons interested are conceded to have had notice of the hearing preceding the final adoption by the commission of the plans under which the systems of water supply and sewerage disposal were to he constructed, and the controversy here does not arise over the building of another and different system, but over an increase of benefits assessed against appellees’ property and other abutting owners because of alleged additional advantages to abutting property following the construction of a trunk line sewer and water mains' throughout the district, but complementary to the original systems built and necessary for the adequacy and maintenance of both systems. Eor this indispensable additional construction, to improve and develop an existing system, neither notice nor hearing was a prerequisite to the commission’s authority. 2. The questions on this appeal, therefore, do not hinge on the power and procedure of the commission in the construction of these adjunctive improvements and trunk line to subsisting water and sewer systems, but they do involve the power-of the commission to increase an original benefit assessment against an abutting landowner because of such subsequent developments; and, if such power exist, the right to make any such additional assessment without notice 'and opportunity for a hearing.

The answer to these inquiries is clearly made by the statutory law of the commission’s being. The funds for the purchase and construction of the water supply and drainage system in the sanitary district are provided by the issue and sale of bonds, from time to time, and in such amounts as the commission may deem necessary to carry on its work, hut the total of all bonds issued, exclusive of those assumed iu the purchase of an existing system, shall at no time exceed twelve per centum of the total assessable basis of all property assessed for county purposes within the sanitary district, and each issue of bonds shall mature not exceeding fifty years from the date of issue, and be guaranteed as to payment of principal and interest by both Montgomery and Prince George’s Counties in such proportion as the assessable basis of that part of either county within the sani ⁷⁴ fcary district bears to tbe assessable basis of tbe whole of the district. Acts of 1918, ch. 122, sec. 5; Acts of 1924, eh. 189, sec. 5. The payment of the principal and interest of the bonds is to be met by an annual tax upon all the assessable property within the sanitary district so long as any of said bonds are outstanding and unpaid, and the rate of this tax is ascertained by the sanitary commission, after deducting all amounts in their hands applicable to the payment of the interest and principal on the bonds issued and outstanding.

If any deficiency should arise in any year, the deficiency is to be added and collected in the next year’s tax. Acts of 1918, ch. 122, sec. 6. The only funds in the hands of the sanitary commission available for the payment of the principal and interest of these bonds are (a) all sums collected by the commission for benefits levied against property in the sanitary district for water supply, sewerage, and drainage construction and (b) one-half of all moneys collected by the commission for water, sewer, and drain connections as provided in sections 8 and 11. Acts of 1918, ch. 122, sec. 12.

The chief source of such revenue is from the benefits assessed on the abutting property owners of the sub-districts into which the commission is charged with dividing the sanitary district. These benefit charges are thus made. The statute commanded that the commission divide all the properties binding upon a street, lane, or alley or right of way, in which a water pipe or sanitary service is laid, into four classes for the purpose of assessing the benefits flowing from the construction of water supply and sewerage systems. The classification into which all the property of such abutting landowners was to be divided and grouped was (1) agricultural, (2) small acreage, (3) industrial or business, and (4) subdivision property.

The classification could be changed, from time to time, so as to conform to altered use. The benefits assessed on eách class of property were to be based on the number of front feet so abutting upon the water pipe or sewer line of every property, and were to be uniform in rate for every one of the classes of property, except under certain specified conditions. The procedure prescribed that ⁷⁵ upon the commencement of a water supply or sewerage project in any sub-district, the commission would fix and levy a benefit charge upon all the abutting property in that district in accordance with the rate and classification made; and then should notify in writing every owner of the class into which his property fell of the charge determined for every front foot thereof, and of the time and place when and at which the owner would be heard. This preliminary classification was confirmed and the determination of benefits charged was adopted, unless revised at the hearing.

After the hearing and determination of the benefits to be assessed, the statute expressly provided that no benefit charge could be subsequently increased. Acts of 1918, ch.