Eastern Shore Public Service Co. v. Town of Seaford

187 A. 115, 21 Del. Ch. 214, 1936 Del. Ch. LEXIS 26
CourtCourt of Chancery of Delaware
DecidedJune 11, 1936
StatusPublished
Cited by10 cases

This text of 187 A. 115 (Eastern Shore Public Service Co. v. Town of Seaford) is published on Counsel Stack Legal Research, covering Court of Chancery of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Eastern Shore Public Service Co. v. Town of Seaford, 187 A. 115, 21 Del. Ch. 214, 1936 Del. Ch. LEXIS 26 (Del. Ct. App. 1936).

Opinion

The Chancellor:

The questions which the bill and rule for injunction present arise out of proceedings taken by the town of Seaford looking to the authorization of a bond issue in the amount of one hundred and fifty thousand dollars, to raise funds for the installation of a municipally owned electric light plant. The proceedings are claimed by the defendants to be in all respects legal and in conformity with provisions of the act (39 Del. Laws, c. 25, § 4) approved December 14, 1933, amending the charter of the town.

The bill assails the proceedings in question as not conforming to the requirements of the act in several partículors, and seeks an injunction against a consummation of the end to which the proceedings were directed, viz., the issue and sale of bonds.

The act in Section 4 thereof authorizes the Council of the town to borrow money and issue bonds or certificates of indebtedness to secure the payment thereof, to provide [217]*217funds for the erection, etc., of any plant, etc., for the supply, manufacture and distribution of electricity or gas for light, heat or power purposes, etc. After making general provisions to this effect, the act proceeds as follows:

“Provided, however, that the borrowing of the money therefor shall have been authorized by the Town Council and shall have been approved by the electors in the manner and at the time following:
“1. Council by resolution shall propose to the electors of the town by resolution that the stated amount of money shall be borrowed for any of the above purposes. The resolution shall state the amount of money desired to be borrowed, the purpose for which it is desired, the manner of securing the same, and all other pertinent facts relating to the loan, and shall fix a time and place for hearing on the said resolution.
“2. Notice of the time and place of the hearing on the resolution authorizing said loan shall be printed in a newspaper published in the town at least one week before the time set for said hearing.
“3. A second resolution shall then be passed by Council ordering a special election to be held not less than thirty days and not more than sixty days after the date of its determination after said hearing to borrow the said money for the purpose of voting for or against the proposed loan.
“4. The notice of the time and place for holding the said special election shall be printed in a newspaper in the town once a week for two successive weeks prior to the election. And the special election shall be conducted by a Board of Electors as provided in the case of •an annual election.
“5. At the special election, every owner of property whether individual, partnership, or corporation shall have one vote for every dollar or part of dollar of tax paid by said owner during the year preceding said election and the said vote may be cast either in person or by proxy.
“6. The Board of Election shall count the votes for and against the proposed loan; and shall announce the result thereof, shall make a certificate under their hands of the number of votes cast for and against the proposed loan, and shall deliver the same to the Council, which said certificate shall be entered on the minutes of the Council and the original shall be filed with the papers of the Council.
[218]*218“The form of bond or certificate of indebtedness, the times of payment of interest, the classes, the time of maturity, and provisions as to the registration shall be determined by the Council. The bonds shall be offered for sale to the best and most responsible bidder therefor after advertisement in a newspaper of the town or otherwise, for at least one month before offering the same for sale. The Council shall provide, in its budget, and in fixing the rate of tax, for the payment of interest and principal of said bonds at the maturity or maturities thereof, and a sinking fund therefor. The faith and credit of the Town of Seaford shall be deemed to be pledged for the due payment of the bonds and interest thereon issued under the provisions hereof, when the same have been properly executed and delivered for value.
“The bonded indebtedness shall not at any time exceed in the aggregate the total sum of fifteen per centum of the value of the real property situate within the limits of the town as shown by the last assessment preceding the creation of the said indebtedness.”

On October 9, 1934, the Council adopted the following resolution in apparent compliance with paragraph one of the section of the statute, quoted supra:

“It is moved and seconded that a resolution be adopted that a public meeting be held to propose to the citizens of the Town of Seaford, the question whether a $150,000 bond issue be raised for the purpose of installing an electric light plant. The meeting to be held on the 25th day of October, 1934, at 8 o’clock in the evening at the school building, the manner of securing this debt of $150,000 to be by a bond issue.”

On October 12, 1934, the following notice of a hearing was published in two newspapers published in Seaford, in apparent compliance with the provisions of paragraph two of the section of the statute, quoted supra:

“Attention:
Seaford Property Owners.
“At a regular meeting of Town Council, under the date of Oct. 9th, 1934, the following resolution was adopted:
‘It is moved and seconded that a resolution be adopted that a Public Meeting be held to propose to the citizens of the Town of Seaford the question whether a $150,000 bond issue be raised for the [219]*219purpose of installing an Electric Light Plant. The meeting to be held on the 25th day of October, 1934, at 8 o’clock in the evening, at the Seaford School Auditorium. The manner of securing this debt of $150,000 to be by a bond issue.’ ”
“Mayor and Council of Seaford.”

The meeting was held on October 25, 1934, at which only a few, about fifty, of the electors were in attendance together with the officials of the town. No objections were made to the bond issue and no discussion was indulged in. Whereupon the meeting adjourned. (In July preceding a similar meeting had been called by the Council at which there was a large attendance and full discussion. The July meeting, however, may be disregarded for the reason that it was not called in accordance with the statute, and was apparently recognized by the Council as wholly nugatory.)

After the meeting of October 25, 1934, the Council adopted the following resolution on November 11, 1934, apparently in obedience to the requirements of paragraph three of the section of the statute quoted swpra:

“Be it resolved that the property owners have the privilege of voting at a referendum election to decide whether the Town Council shall have the authority of bonding the Town of Seaford for one hundred and fifty thousand ($150,000) dollars to build an electric light plant in the Town of Seaford. This election to be held on Tuesday, January 8th, 1935, between the hours of one and four o’clock P. M. at the Town Council room.”

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Grove v. City of Des Moines
280 N.W.2d 378 (Supreme Court of Iowa, 1979)
Kirby v. City of Milford
350 A.2d 760 (Supreme Court of Delaware, 1975)
Peterman v. City of Milford
104 A.2d 382 (Court of Chancery of Delaware, 1954)
Haddock v. Board of Public Education
84 A.2d 157 (Court of Chancery of Delaware, 1951)
Haddock v. Board of Public Education in Wilmington
84 A.2d 157 (Court of Chancery of Delaware, 1951)
Voss v. Chicago Park District
64 N.E.2d 731 (Illinois Supreme Court, 1946)
Town of Seaford v. Eastern Shore Public Service Co.
24 A.2d 436 (Superior Court of Delaware, 1942)
Interstate Power Co. v. Forest City
281 N.W. 207 (Supreme Court of Iowa, 1938)
Mann v. City of Artesia
76 P.2d 941 (New Mexico Supreme Court, 1938)

Cite This Page — Counsel Stack

Bluebook (online)
187 A. 115, 21 Del. Ch. 214, 1936 Del. Ch. LEXIS 26, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eastern-shore-public-service-co-v-town-of-seaford-delch-1936.