Opinion
Nos. ED76402 and ED76403.
April 25, 2000.
APPEAL FROM THE CIRCUIT COURT OF ST. LOUIS COUNTY, HON. KENNETH M. ROMINES.
James E. Mello, One Metropolitan Square, Suite 2600, St. Louis, MO 63102, for appellant.
Kevin M. O'Keefe (Hazelwood), Corinne N. Darvish (Hazelwood), 130 S. Bemiston, Suite 200, St. Louis, MO 63105, Richard W. Fischer (Braudis), Mary M. Creamer (Braudis), 7751 Carondelet Ave., Suite 600, St. Louis, MO 63105, for respondent.
Crane, P.J.; Robert G. Dowd, Jr.,; Sullivan, J., concurring.
Florissant Valley Fire Protection District, John Wheadon, Shannon Duffy, Gary Henke, and Jack Gallagher (collectively referred to as the District) appeal from the trial court's grant of summary judgment in favor of Chris Braudis and Steve Knobbe (collectively referred to as the individual plaintiffs) and the City of Hazelwood (Hazelwood). We reverse and remand with instructions.
The individual plaintiffs, at all relevant times, were property owners, residents, and taxpayers in the District. The District is a political subdivision created pursuant to Chapter 321 of the Missouri Revised Statutes and is located within St. Louis County. Hazelwood is a charter city organized pursuant to article VI, section 19 of the Missouri Constitution and located within St. Louis County.
In 1994, Hazelwood annexed certain portions of unincorporated St. Louis County located within the boundaries of the District, including an area known as the "Northwest Area." After the annexation, a circuit court instructed the District to provide fire, emergency, and ambulance services to the Northwest Area. The circuit court further instructed Hazelwood to pay fees to the District for such services.
On April 12, 1995, Hazelwood and the District entered into a Fire Service Agreement in which the District agreed to provide fire, emergency, and ambulance services to the Northwest Area. Hazelwood agreed to pay an annual fee to the District using the formula specified in Section 321.675, RSMo 1986, which amounts to the tax rate within the District. At the time Hazelwood and the District entered into the Fire Service Agreement, the District's tax rate, and therefore, the fee under the Fire Service Agreement was sixty-six cents per hundred dollars of assessed valuation. The taxpayers of the Northwest Area do not pay the District's tax; instead, they pay Hazelwood's property tax and Hazelwood makes the payments to the District under the Fire Service Agreement.
Section 321.675 was repealed effective May 19, 1993. However, Section 321.675 continues to control the payment arrangement between Hazelwood and the District pursuant to the Fire Service Agreement. Section 321.675 provided:
The amount to be paid annually by the municipality to the fire district . . . shall be the annual assessed value of all property subject to tax in the excluded area determined from the tax assessment ledgers, and including public utilities and intangible property within such area, multiplied by the annual tax rate as certified by the fire protection district to the municipality (but not including any portion of the tax rate for ambulance service provided by the district) per one hundred dollars of assessed value in such area. The tax rate so computed shall include any tax on bonded indebtedness incurred subsequent to such exclusion, but shall not include any of the tax rate for bonded indebtedness incurred prior to such exclusion.
On August 6, 1996, the St. Louis County Board of Election Commissioners held an election in which the District requested voters within the District to approve an increase in its tax rate of ten cents per hundred dollars of assessed valuation, beginning in the year 1996, increasing the 1996 tax rate to seventy-six cents per hundred dollars of assessed valuation. On August 19, 1996, the official results of the tax increase election showed the tax increase passed by a vote of 4,445 in favor and 4,432 against.
An election contest was filed to challenge the results of the tax increase election. While the election contest was pending, the District levied the tax increase. Hazelwood made the payments required under the Fire Service Agreement at the increased 1996 tax rate, stating that the payments were "under protest."
On January 2, 1997, the trial court in the election contest entered an order containing findings of fact and conclusions of law. The trial court found thirteen eligible voters were not presented with ballots containing the tax increase issue at the August 6, 1996 election. The trial court found this to be an irregularity "of sufficient magnitude to cast doubt on the validity" of the election and set the election aside. On February 14, 1997, the trial court in the election contest entered an amended judgment setting aside the election. On appeal, the judgment in the election contest was affirmed. McBride v. Board of Election Commissioners, 945 S.W.2d 622 (Mo.App.E.D. 1997). The trial court ordered a new election and subsequently, the tax increase was not approved.
On January 3, 1997, the individual plaintiffs filed their action against Florissant Valley Fire Protection District, Shannon Duffy, Gary Henke, Jack Gallagher, and the St. Louis County Collector of Revenue, Robert Peterson (Collector), alleging a violation of the Hancock Amendment, article X, section 22(a) of the Missouri Constitution. They claimed the District improperly levied and the Collector collected the additional ten-cent tax because the voters of the District did not approve the tax increase since the August 6, 1996 election was set aside. The individual plaintiffs sought to enjoin the District and the Collector from collecting and disbursing the increased tax. The individual plaintiffs also sought "a refund to all taxpayers of the Defendant District or in the alternative . . . a credit to all taxpayers . . . equal to the amount of the 1996 increase" and an award of attorneys' fees as provided by article X, section 23 of the Missouri Constitution.
On February 13, 1997, Hazelwood filed an action seeking the recovery of taxes paid under protest, naming Florissant Valley Fire Protection District, the Collector, and the chief of the District, John Wheadon, as defendants. Hazelwood sought recovery of taxes paid under protest pursuant to Section 139.031, RSMo 1994. Hazelwood also sought recovery of money had and received on the theory the District was unjustly enriched by Hazelwood's mistaken payment of the additional sum. Hazelwood further sought a declaratory judgment as to whether its agreement with the District required payment of the tax increase. Finally, Hazelwood sought refund of the additional amounts paid pursuant to the Hancock Amendment, article X, sections 22 and 23 of the Missouri Constitution, alleging that it was entitled to a refund of payments made to the District pursuant to the Fire Service Agreement because the election of August 6, 1996, had been set aside.
All further statutory references are to RSMo 1994 unless otherwise indicated.
The District moved to have the cases consolidated. On June 25, 1997, the motion was sustained and the matters were consolidated. On July 2, 1997, the trial court dismissed Hazelwood's claims against the Collector without prejudice. On June 24, 1998, the individual plaintiffs moved for class certification. The District opposed class certification as both contrary to Missouri law in a tax suit and unnecessary for fair and efficient administration of the case. The trial court denied class certification "at this time." Thereafter, all parties filed motions for summary judgment.
The trial court entered a single judgment on all claims. The trial court reversed its previous decision on class certification and ordered that the individual plaintiffs' claims "shall be maintained as a class action. The class shall consist of all persons . . . who paid ad valorem taxes to the [District] for the year 1996."
The trial court found that the election result was not deemed invalid as of the date of the judgment in the election contest but was deemed to be void ab initio. The trial court stated, "[w]hile the District had the right under Sec[tion] 115.595.2, RSMo.[,] to treat the increase as having been approved while the election contest was pending, it did so at its peril and at the risk of being unable to retain the funds if the voters' approval was set aside." The trial court held that, under the Hancock Amendment, the District would be required to return the tax increase to the class of individual plaintiffs.
The trial court held that the payments Hazelwood made to the District under the Fire Service Agreement were also recoverable under the Hancock Amendment as well as the statutory tax refund mechanism. The trial court's judgment dismissed all remaining claims against the Collector.
The trial court declared the tax increase "illegal, invalid and void in that the increased tax was not approved by a majority of the voters of the District as required by article [X], section 22(a) of the Missouri Constitution." The trial court entered judgment in favor of the class members "in that amount which is equivalent to the revenue received by the District by reason of the additional ten cent 1996 ad valorem tax levy." The court entered judgment in favor of Hazelwood for its payment due to the tax increase. Further, the trial court found the individual plaintiffs and Hazelwood were entitled to costs and attorneys' fees under the Hancock Amendment.
On June 14, 1998, the trial court denied the District's motion for new trial, awarded Hazelwood attorneys' fees of $8,000, and awarded the individual plaintiffs' counsel attorneys' fees of fifteen percent of the fund to be refunded to the class. This appeal follows.
This court's review of a summary judgment is essentially de novo. ITT Commercial Finance Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo.banc 1993). The criteria on appeal for testing the propriety of summary judgment are no different from those which should be employed by the trial court to determine the propriety of sustaining the motion initially.Id. As the trial court's judgment is founded on the record submitted and the law, we need not defer to the trial court's order granting summary judgment. Id. We review the record in the light most favorable to the party against whom judgment was entered and grant the non-movant the benefit of all reasonable inferences from the record. Id. To be entitled to summary judgment, the movant must demonstrate that there is no genuine dispute of material fact and that he or she is entitled to judgment as a matter of law. Id.
All parties agree that there are no material facts in dispute and submit the case to be resolved on issues of law.
In its first point, the District contends the trial court erred in entering summary judgment because "the undisputed facts show that the District's tax increase for 1996 was valid under the Hancock Amendment in that the tax increase was approved by a majority vote of the people and at all times during 1996 when the tax increase was levied the election result was valid."
Article X, section 22(a) of the Hancock Amendment provides in pertinent part as follows:
Counties and other political subdivisions are hereby prohibited from levying any tax, license or fees, not authorized by law, charter or self-enforcing provisions of the constitution when this section is adopted or from increasing the current levy of an existing tax, license or fees, above that current levy authorized by law or charter when this section is adopted without the approval of the required majority of the qualified voters of that county or other political subdivision voting thereon.
The constitutional right established in article X, section 22(a), assures taxpayers that they will be free of increases in local taxes unless the voters approve those increases in advance.
Here, the District asserts article X, section 22(a), was not violated in this case. The District contends the tax increase was submitted to the voters. Under the official results of the August 1996 election, the tax increase was approved by a majority of the voters. The District levied the tax in reliance on the election results approving the increase. We agree.
The tax increase was submitted to the voters of the District. It is undisputed that the official results of the August 1996 election showed a majority of voters approved an increase in the District's tax levy. It is undisputed that the District increased its levy from sixty-six cents to seventy-six cents for the 1996 tax year and that levy became fixed on September 20, 1996, pursuant to Sections 137.085.2 and 137.055. The District followed the proper procedure in levying the tax increase.
The cases relied on by the individual plaintiffs and Hazelwood are distinguishable. Although these cases dealt with the application of article X, section 22(a), these cases involved situations where the political subdivision increased the tax or fee without submitting the issue to the voters for approval. None of the cases concerned an election, which by its official results approved the tax increase and then was subsequently set aside in an election contest.
Ring v. Metropolitan St. Louis Sewer District, 969 S.W.2d 716 (Mo.banc 1998) and its predecessors Beatty v. Metropolitan St. Louis Sewer District, 700 S.W.2d 831 (Mo.banc 1986) (Beatty I); Beatty v. Metropolitan St. Louis Sewer District, 867 S.W.2d 217 (Mo.banc 1993) (Beatty II); and Beatty v. Metropolitan St. Louis Sewer District, 914 S.W.2d 791 (Mo.banc 1995) (Beatty III);Keller v. Marion County Ambulance Dist., 820 S.W.2d 301 (Mo.banc 1991); Fort Zumwalt School Dist. v. State, 896 S.W.2d 918 (Mo. banc 1995).
The District relies heavily on Section 115.595, RSMo 1994, to justify its position that it should not be required to refund the money collected under the ten-cent tax increase. Section 115.595.2 provides:
In each case of a pending election contest on a question, the question shall be deemed approved or disapproved as shown by the official returns of the election until the contest is decided. When the contest is decided, the question shall be deemed approved or disapproved in accordance with the decision as of the day the contest is decided, or as of the day it would otherwise have been deemed approved or disapproved, whichever is later. (Emphasis added.)
The District argues that under Section 115.595.2 it had a right to rely on the election results and levy the tax increase for the 1996 tax year. The District contends the approval of the tax increase was valid until 1997, when the judgment in the election contest was entered. We agree.
Under the language of Section 115.595.2, the District had a right to rely on the election results "until the contest [was] decided." Once the election contest is decided, then that decision becomes effective "as of the day the contest is decided." The election contest was decided on February 14, 1997. The judgment setting aside the August 1996 election was effective "as of" February 14, 1997. Until the election contest was decided, the official results of the August 1996 election were valid under Section 115.595.2 and the District had a right to rely on those results.
In enacting Section 115.595.2, the legislature recognized that political subdivisions need to be able to rely on the official election results in order to continue to run their day-to-day affairs. This interpretation of Section 115.595.2 is also consistent with Davenport v. Teeters, 315 S.W.2d 641 (Mo.App. 1958). The Davenport court found that the winning candidate for office, as determined by the election result, is entitled to the office until an election contest is concluded. Id. at 645. In Davenport, an election contest was instituted over the results of an election for city marshal. Id. at 641. While the election contest was pending, the defendant, the declared winner, performed the duties of the city marshal and drew the city marshal's salary.Id. After two years, the election result was set aside and the court found the plaintiff, initially declared the loser, was entitled to the office. Id. at 642. Having been declared the winner, the plaintiff claimed he was entitled to recover the salary that defendant received while in office. Id. The court rejected the plaintiff's claim because the defendant who was declared to be the winner by the official election results was legally entitled to all the benefits of the office until the election contest was decided. Id. at 645.
Under the undisputed facts, the District's 1996 tax levy was proper and the individual plaintiffs' and Hazelwood's Hancock Amendment claims fail. The tax increase was submitted to the voters and approved in accordance with article X, section 22(a), of the Hancock Amendment. Although an election contest was filed, the District had a right to rely on the official results of the election pursuant to Section 115.595.2 until that contest was decided. The August 1996 election was valid until February 14, 1997, when the election contest was decided. Thereafter, the August 1996 election became invalid "as of the day the contest [was] decided."
We find no inconsistencies in the District's reliance on Section 115.595.2 and the Hancock Amendment. The Hancock Amendment contains no provision for determining the validity or effect of an election. The Hancock Amendment requires that tax increases must have the "approval of the required majority of qualified voters." Mo. Const. Art. X, Section 22. The Missouri Constitution specifically commits to the legislature the power to regulate election contests stating, "[t]he general assembly shall designate by general law the court or judge by whom the several classes of election contest shall be tried and regulate the manner of trial and all matters incident thereto. . . ." Mo. Const. Art. VII, Section 5. The legislature placed those provisions in Chapter 115. The provisions found in Chapter 115 and the Hancock Amendment are not in conflict, but work together.
Here, the conditions of article X, section 22(a), were satisfied because, pursuant to Section 115.592.2, the increased levy was deemed to be approved as shown by the official returns of the election until the contest was decided. We find no violation of article X, section 22(a), and therefore, the individual plaintiffs and Hazelwood are not entitled to a refund under the Hancock Amendment. The trial court's grant of summary judgment in favor of the individual plaintiffs and Hazelwood is reversed. As the only issue before us is a matter of law and there are no factual disputes, we remand to the trial court for entry of summary judgment in favor of the District. Because the District's first point is dispositive, we need not address its other points on appeal.
Judgment reversed and remanded for entry of judgment in favor of the District.
Crane, P.J., and Sullivan, J., concur.