The opinion of the court was delivered by: Oxner, Justice.
June 19, 1957.
This is an appeal from an order of the Circuit Court upholding the constitutionality of Act No. 582 of the 1955 Acts of the General Assembly, 49 Stat. at Large, p. 1400. Appellants attack this Act upon the grounds (1) that it is special legislation in contravention of Article III, Section 34, Subdivision IX of our Constitution, and (2) that it deprives them of their property without due process of law and denies them the equal protection of the laws, in violation of both the State and Federal Constitutions. Const. art. 1, § 5; U.S. Const. Amend. 14.
The Act in controversy creates a public corporation to be known as "Una Water District", embracing a certain area in Spartanburg County Adjacent to the City of Spartanburg, for the purpose of having said territory served by publicly operated water and sewer systems. The corporate authorities of the district were further empowered to make provision for the collection and disposition of garbage. In the preamble to this Act it was recited that the General Assembly had found that the area involved had become populated to the extent that these facilities were "necessary and desirable for the health and welfare of the inhabitants thereof."
It is contended that there was in effect at the time of the passage of the foregoing Act a general law on the subject enacted in 1934. Appellants argue that Act No. 734 of the Acts of 1934, 38 Stat. at Large 1292, now comprising Sections 59-601 through 59-625 of the 1952 Code, was clearly applicable and that there was no sound reason for special legislation.
The terms of both Acts are accurately set out in the dissenting opinion of Mr. Justice Legge and need not be repeated.
The major differences may be briefly stated as follows:
(1) The Act of 1955 creates a public service district. The Act of 1934, which is a general law, authorizes the formation of such a district upon a petition signed by a certain number of landowners in the proposed district followed by a favorable vote of the qualified voters. Stated differently, the landowners and qualified voters were given no voice in the formation of the Una Water District, while they are in the formation of a district under the general law.
(2) The 1934 Act authorized the establishment of a district "for the purpose of supplying lights, and/or water and/or providing fire protection and/or providing a sewerage collection system and/or sewerage treatment plant or plants to that portion of any county in this State which is not included in any incorporated village or city." The collection of garbage is not included. The facilities covered by the 1955 Act are garbage, water and sewerage.
(3) The governing body of the Una Water District is appointed by the Governor upon the recommendation of a majority of the legislative delegation of Spartanburg County, while under the general Act the commissioners are elected by the qualified voters.
(4) Under the 1934 Act the rates must be fixed at a public hearing had after due notice. This is not required under the 1955 Act.
(5) Under the 1955 Act the commissioners are authorized to make regulations compelling the residents of the district to use water and sewer facilities. There is no such authority in the 1934 Act.
We might add that under neither act can general obligation bonds be issued without a favorable vote of the qualified electors.
In the area embraced within the Una Water District, the General Assembly, after due investigation, has found that the health of the inhabitants thereof requires that there be installed publicly operated water and sewer systems and that the corporate authorities of the district should be further empowered to make provision for the collection and disposition of garbage. While these findings are not conclusive, they are entitled to great respect. The testimony taken in this case falls far short of showing that these legislative conclusions are wholly unsupported. The Circuit Judge stated in his decree:
It appears from the record that some time prior to the passage of the legislation now under attack, a proceeding was instituted under the Act of 1929 creating the Spartanburg Metropolitan District, 36 Stat. at Large 992, as amended, for the purpose of creating as a water and sewer subdistrict the identical area which was incorporated in the Una District. It was contemplated in this proceeding issuing general obligation bonds in the amount of $500,000. This proposal was opposed by the present appellants and the proceeding is still pending. Meanwhile, the Act of 1955 was passed.
Before a subdistrict can be formed under the 1929 Act, it is necessary that a petition be filed by one-third of the freeholders in the proposed subdistrict followed by a majority favorable vote of the qualified electors.
Evidently the General Assembly concluded that a water and sewer district covering this area would not be formed either under the 1929 Act or that of 1934 by voluntary action on the part of the freeholders and qualified electors or that the creation of same would be considerably delayed, and for the protection of the public health immediate State action was necessary. The apparent apathy on the part of some in this area doubtless led to the provision in the 1955 Act authorizing the commissioners to compel the residents to use water and sewer facilities. We do not think that the effort to remove the unsanitary conditions prevailing in this territory by special legislation was obnoxious to Article III, Section 34, Subdivision IX of the Constitution.
Under the circumstances, there was no general law applicable.
The foregoing conclusion is fully sustained by numerous decisions of this Court relating to special purpose districts. In fact, some of them go much further than it is necessary for us to go in the instant case, for here we are concerned with public health. Some of the special purpose districts which have been upheld were concerned primarily with mere conveniences or other matters not so vital to the public welfare.
In Rutledge v. Greater Greenville Sewer District, 139 S.C. 188, 137 S.E. 597, 598, the Court sustained the validity of a special act creating the "Greater Greenville sewer district", embracing the territory known as "Greenville school district" and "Parker school district." Alley v. Daniel, 153 S.C. 217, 150 S.E. 691, upheld a special act establishing a sewer district in Spartanburg County to be known as "Spartanburg Metropolitan District." In Floyd v. Parker Water & Sewer Sub-District, 203 S.C. 276, 17 S.E.2d 223, this Court upheld a special act empowering the Parker Water and Sewer Sub-District, which was a special purpose district and a part of the Greater Greenville Sewer District, to issue bonds for the purpose of extending and enlarging water lines throughout the district, installing fire hydrants, establishing a fire protection system, extending the sewer lines, and instituting a system of garbage disposal. Fire protection and garbage disposal were added facilities. In Sanders v. Greater Greenville Sewer District, 211 S.C. 141, 44 S.E.2d 185, a special act was sustained providing a method whereby an area lying without the limits of the Greater Greenville Sewer District might become incorporated into that district and form a part of one of its subdistricts. Following these and other decisions along the same line, the General Assembly has created by special acts numerous water and sewer districts. In no instance has such an act been declared invalid by this Court.
Prior to the decision in Rutledge v. Greater Greenville Sewer District, supra, this Court had sustained legislation creating special districts for highway and bridge purposes. One of the leading cases in this category is Briggs v. Greenville County, 137 S.C. 288, 135 S.E. 153.
It has also been generally held that special legislation relating to the fiscal affairs of a county, including the issuance of bonds by a county, a school district or other political subdivision, is not obnoxious to Article III, Section 34, Subdivision IX of the Constitution. Gaud v. Walker, 214 S.C. 451, 53 S.E.2d 316; State ex rel. Milford v. Brock, 66 S.C. 357, 44 S.E. 931; Burriss v. Brock, 95 S.C. 104, 79 S.E. 193. In Briggs v. Greenville County, supra, the Court said: "It is settled by the decisions of this court that a special act authorizing a county or other political subdivision to issue bonds is not within the constitutional prohibition."
Our attention is called to the fact that in Rutledge v. Greater Greenville Sewer District, supra, and the subsequent cases involving the validity of water and sewer districts, no issue was made as to Section 34, Article III of the Constitution. The omission might have been due to an assumption that as to special purpose districts the question had been settled in Briggs v. Greenville County and several other cases involving road districts. The failure to raise the question in the Rutledge case was alluded to by Mr. Chief Justice Stukes in Owens v. Smith, 216 S.C. 382, 58 S.E.2d 332, 335, [137 S.C. 288, 135 S.E. 162.] The Court there declared invalid, as special legislation, an act empowering the commissioners of a public service district in Charleston County to promulgate and enforce zoning regulations. It was stated in this case: "Appellants also cite and rely upon the cases of Rutledge v. Greater Greenville Sewer District, 139 S.C. 188, 137 S.E. 597, and Floyd v. Parker Water & Sewer Sub-District, 203 S.C. 276, 17 S.E.2d 223. They are distinguishable as involving public improvement districts, necessitating special legislation for their creation and operation, which appears to have been properly assumed in the opinions." (Italics ours.) Later in Wagener v. Johnson, 223 S.C. 470, 76 S.E.2d 611, 614, the Court quoted with approval the following from the Circuit Court decree: "Numerous decisions of our Court uphold the validity of legislation creating special purpose districts, including districts established for the purpose of constructing, operating and maintaining Waterworks Systems and it is needless for me to discuss this question in further detail."
It is further argued that Rutledge v. Greater Greenville Sewer District, supra, is not applicable because it was rendered prior to the enactment of the general law in 1934. But we do not understand that Subdivision IX, Section 34 of Article III permits special legislation in all cases where there is no general law on the subject. After enumerating in Section 34 certain subjects concerning which local or special laws shall not be enacted, it is provided in Subdivision IX: "In all other cases, where a general law can be made applicable, no special law shall be enacted." The controlling question is not whether there is a general law on the subject but whether a general law can be made applicable.
There may be some foundation for the statement in one of the briefs that our decisions are not entirely clear as to the basis upon which it has been held that legislation creating special purpose districts is not within the prohibition of Article III, Section 34 of the Constitution. But the reasoning is not as important as the result. As to those decisions upholding special districts created for the purpose of furnishing water, sewerage, garbage collection, etc., the writer, speaking only for himself, thinks they may be soundly sustained under Section II, Article VII of the Constitution which authorizes the General Assembly to "make special provision for municipal government." As pointed out in Sanders v. Greater Greenville Sewer District, supra, 211 S.C. 141, 44 S.E.2d 185, these are functions which are usually performed by a municipality. In fact, districts of this nature have been regarded as municipal corporations with limited functions. In Floyd v. Parker Water and Sewer Sub-District,, supra, 203 S.C. 276, 17 S.E.2d 223, 227, the Court said that the sub-district there under discussion was "a corporation or agency endowed with limited corporate functions, but they are derived from the same source and exercised in substantially the same way as any other municipal corporation. It is an arm of government created by the Legislature for a specific public purpose, that is, fire protection and garbage disposal. And we find nothing in the Constitution which takes from the Legislature the power to create a special district with limited powers." In Rutledge v. Greater Greenville Sewer District, supra, 139 S.C. 188, 137 S.E. 597, 600, the Court said: "While the term `municipal corporation' is generally understood to mean cities and towns incorporated under the general laws of the state, it is also true that where, as in the case at bar, a body politic and corporate is established by the Legislature with power to perform municipal functions, such as the establishment of a sewer system for the benefits of the inhabitants of such area, and with power to issue bonds for the purpose of raising funds for such purposes, that such an area being a public corporation and having certain municipal powers and duties, is properly held to be a municipal corporation within the meaning of the section of the Constitution."
In concluding our discussion of this phase of the case, we desire to say that there may be some merit in the view that our decisions have gone rather far in upholding the constitutionality of special purpose districts, particularly in those instances where there was no real necessity for a special act. But upon the strength of them millions of dollars in bonds have been issued and are outstanding. In this field, as in the case of the law relating to real estate, it is very important that there be stability and uniformity in our decisions.
The next question is whether the Act denies appellants the constitutional guaranty of due process of law and the equal protection of the laws.
Appellants point out that at considerable expense they have heretofore installed water and sewer facilities which adequately serve their plants and have also permitted all individual property owners who so desire to tap their lines. For this reason, it is said they will receive no benefit from the contemplated public improvements. It is also contended that the boundaries of the district were arbitrarily fixed by the Legislature with the view of requiring appellants, large taxpayers, to assume the major burden of supporting the district.
We do not think that the mere fact that a taxpayer has installed water and sewer facilities which are adequate to serve his property precludes the General Assembly from thereafter incorporating his lands in a publicly operated water and sewer district. The right of the sovereign to improve is paramount and a voluntary improvement for the owner's own convenience cannot be used to relieve him from his share of the costs where it has been determined that a general improvement is necessary. Appellants installed these facilities with full knowledge of the possibility that this area might later be incorporated in a public improvement district. Applicable is the following language of the Court in City of Atchison v. Price, 45 Kan. 296, 25 P. 605, 611:
"Some of the defendants in error had constructed private sewers or drains at their own expense, and they now claim that they should not be taxed for the sewer built by the city. While one of these drains was quite expensive, it is not found or stated that any of them were authorized or adopted by the city as a part of the sewer system, nor that they are suitable or adequate for the purposes intended. The legislature has conferred upon the city authorities the discretion and power to provide sewerage facilities, and for that purpose has given them control of the streets and alleys where the sewers are built. They are to determine the necessity for sewers, as well as the character and capacity of those that are required to be built. To allow property owners to decide for themselves whether their lots needed sewerage facilities, or to permit them to provide private ditches, drains, sewers, or cess-pools as they might determine to be sufficient, would be wholly impracticable, and would prevent the adoption of a general sewerage system under the control of the city, as the statutes evidently contemplate."
There are other decisions to the same effect. City of
Philadelphia v. Odd Fellows' Hall Association, 168 Pa. 105,
31 A. 917; Hempel ex rel. Michigan Limestone &
Chemicals Co. v. Rogers Tp., 313 Mich. 1,
20 N.W.2d 787; Northern Pacific Terminal Company v. City of Portland,
9 Cir., 80 F.2d 738. In the last mentioned case it
was held that the fact that a railroad terminal company had
constructed a private sewer system adequate for its needs
did not preclude assessment of its property, on the basis of
benefits received, for construction of a city sewerage system.
It may not be amiss to point out that the commissioners of the Una District are authorized by the Act to "purchase, acquire and continue the use and operation of any and all of the water lines and sewer lines that may presently exist in the area." It is fair to assume that under this provision appellants will be compensated for any of their lines which are suitable for use in the plans adopted by the commissioners.
We cannot say that the Legislature palpably abused its discretion in fixing the boundaries of this district. Its creation was an act of sovereignty. The Legislature itself may create a district of this kind and fix its boundaries. Where it does so, the landowners included therein are not entitled to a hearing on the question of whether their lands will be benefited. Prior inquiry by the legislative body is presumed. Sanders v. Greater Greenville Sewer District, supra, 211 S.C. 141, 44 S.E.2d 185. The Legislative determination can be assailed under the due process and equal protection clauses "only where the legislative action is `arbitrary, wholly unwarranted,' `a flagrant abuse, and by reason of its arbitrary character a confiscation of particular property.'" Branson v. Bush, 251 U.S. 182, 40 S.Ct. 113, 115, 64 L.Ed. 215.
It is equally well settled that to justify an assessment of benefits to particular lands, it is not essential that the benefits be direct or immediate. Valley Farms Co. v. County of Westchester, 261 U.S. 155, 43 S.Ct. 261, 263, 67 L.Ed. 585. Nor is there any requirement "that for every payment there must be an equal benefit." Houck v. Little River Drainage District, 239 U.S. 254, 36 S.Ct. 58, 60 L.Ed. 266. Due process does not require absolute equality. Sanders v. Greater Greenville Sewer District, supra. In Kansas City Southern Ry. Co. v. Road Imp. Dist. No. 3, 266 U.S. 379, 45 S.Ct. 136, 139, 69 L.Ed. 335, the Court said: "True, the amount of benefits which will accrue to the railway property is largely a matter of forecast and estimate; but the same thing is true of the farm lands and town lots, and also of benefit assessments in general. * * * Forecast and estimate, based on a solid premise of fact and experience, are not to be confused with mere speculation and conjecture."
Reverting now to the facts of this case, the area comprising the Una Water District constitutes a part of the Spartanburg Metropolitan District created in 1929. Since that time there has been a six mill levy on all property in the master district for sewerage disposal. No benefits have accrued from this tax assessment to any of the property owners in the Una District except those who have privately installed water and sewer facilities. Adjoining the Una District are the City of Spartanburg and several water and sewer subdistricts. It is probable that the Legislature was undertaking to provide a general and comprehensive water and sewerage system for those areas which had developed around the City of Spartanburg and in doing so found it was not practicable to exclude appellants' lands and other small portions now served by these facilities. But be that as it may, we cannot say that the fixing of the boundaries of the Una Water District was a flagrant abuse of legislative discretion.
Nor can we say that appellants have successfully rebutted the presumption that their property will be benefited. Their plants are near certain areas in the district known as the Una and Johnson City communities. The undisputed testimony shows that unsanitary conditions are prevalent in these two communities and constitute a health menace. The danger does not always stop at the boundaries of such areas but may extend to the entire neighborhood. When these unsanitary conditions are removed, it may result in the improvement of public health throughout the district. It further appears that several of the appellants have considerable undeveloped acreage surrounding their plants which may be benefited by the installation of a publicly operated water and sewer system. It is well known, as pointed out in Floyd v. Parker Water & Sewer District, supra, 203 S.C. 276, 17 S.E.2d 223, that the installation of water and sewer facilities generally results in considerable enhancement of property values. A further consideration is the fact that the corporate authorities of the district are authorized to provide for garbage disposal, a facility not previously enjoyed by anyone in the district. While appellants may receive considerable less benefits than those property owners now without sewerage and water, we would not be warranted in saying that the tax burden which will be placed upon them will so materially exceed the benefits received as to be palpably arbitrary.
All exceptions are overruled and the order of the Circuit Court affirmed.
TAYLOR and MOSS, JJ., concur.
Being unable to agree with the majority of the court in their view of this case, I shall record as briefly as may be the reasons that compel my dissent.
In two cases consolidated in the trial court, appellants, individually and on behalf of other taxpayers in Una Water District in Spartanburg County, attacked Act No. 582 of the 1955 General Assembly as unconstitutional; and from an adverse decree they now appeal. With this court's permission, North Charleston Public Service District has intervened on the side of the respondents, and its counsel have filed a brief, in which counsel for numerous "special purpose" districts have joined, in support of the circuit decree. Two substantial issues are here presented, viz.:
1. Is the act special legislation within the prohibition of Subdivision IX of Article III, Section 34, of the Constitution of 1895?
2. Is the effect of said act to deprive appellants of property without due process of law in violation of Section 1 of the Fourteenth Amendment of the Constitution of the United States and Article I, Section 5, of the Constitution of this State?
The Act in question (Act of May 19, 1955, XLIX Stat. at Large 1400) is entitled:
"An Act To Create Una Water District In Spartanburg County; To Define Its Areas; To Establish A Governing Commission Therefor; To Prescribe The Functions And Powers Of The District And Its Commission; To Make Provision For Borrowings By The District, Including The Issuance Of Not Exceeding Five Hundred Thousand Dollars Of General Obligation Bonds; To Prescribe The Terms And Conditions Under Which Monies May Be Borrowed By The District; And To Make Provision For Their Payment."
Its preamble recites that the General Assembly, after due investigation, has found that the district in Spartanburg County created by the act "has become populated to an extent that makes it necessary and desirable for the health and welfare of the inhabitants thereof to be served by publicly operated water and sewer systems, and that in addition thereto the district hereby created should be empowered to make provision for the collection and disposition of garbage for the district", and that as a consequence of such findings the General Assembly has ...