Opinion ID: 883920
Heading Depth: 1
Heading Rank: 2

Heading: issues

Text: Did the District Court err in granting summary judgment? Our standard of review of a summary judgment is the same as that used by a district courtwhether, pursuant to Rule 56(c), M.R.Civ.P., material issues of fact exist and whether the moving party is entitled to judgment as a matter of law. Motarie v. N. Mont. Joint Refuse Disposal (1995), 274 Mont. 239, 242, 907 P.2d 154, 156. The District Court determined that res judicata barred Lovins from challenging the legality of the proposed bond on the ground that § 7-7-2402, MCA, requires the approval of the electors of the county. The court's ruling was based on its taking judicial notice of Lovins' 1995 action. Section 7-7-2402, MCA, provides: Election required to borrow moneyexceptions. (1) Except as provided in subsection (3), the board of county commissioners may not borrow money for any of the purposes mentioned in this title or for any single purpose in an amount exceeding $500,000 without: (a) first having submitted the question of a loan to a vote of the electors of the county; and (b) the approval of a majority of the electors of the county. (2) If a majority of the votes cast are in favor of the loan, then the board may make the loan, issuing bonds or otherwise as may seem best for the interests of the county. (3) It is not necessary to submit to the electors the question of borrowing money: (a) to refund outstanding bonds; or (b) for the purpose of enabling any county to liquidate its indebtedness to another county incident to the creation of a new county or the change of any county boundary lines. Lovins points out that this statute was not mentioned in his petition for relief in his 1995 lawsuit. However, as part of its decision in the 1995 action, the District Court stated that Toole County's acquisition of over $500,000 in debt for bond repayment for construction of the clinic would require a vote of the Toole County electorate to approve the indebtedness. The defendants moved to alter or amend that judgment by removing the above language from the court's decision, in light of the then-recently enacted Ch. 520, L.1995. That legislation, which was proposed as HB 421, amended Montana laws relating to construction of county hospitals and limitations upon bonded indebtedness of counties for such purposes. The issue was briefed by both parties. In its order granting the motion to amend, the court gave thorough written consideration to the effect of HB 421. It stated: When read with the inclusion of physician office buildings as part of health care facilities which can be funded by bonds, the amendment to Section 7-6-2512 makes it clear that the vote of the electorate is not required for approval of certain bonds to construct health care facilities. See HB 421, Section 4, amending Montana Code Annotated, Section 7-34-2201. The above language clearly demonstrates that the issue was considered by the court in the 1995 case. Lovins argues that the decision on this issue in the 1995 case was, nevertheless, mere dictum. He points out that if an issue's consideration is not essential to the question involved in the action, then a ruling on the issue is obiter dictum which cannot be a basis for a finding of res judicata or collateral estoppel. If issues are determined but the judgment is not dependent upon the determinations, relitigation of those issues in a subsequent action between the parties is not precluded. Such determinations have the characteristics of dicta[.] Restatement (Second) of Judgments, § 27, cmt. h (1982). A court's decision on an issue which is before it and which was fully argued by counsel and deliberately considered by the court is not dictum. Bottomly v. Ford (1945), 117 Mont. 160, 167, 157 P.2d 108, 112. Here, although the election requirement issue was briefed and decided in the 1995 case, the issue was not before the court under the pleadings, nor was consideration of it necessary to resolve the case. The dispositive holding in the 1995 case was that Toole County was prohibited from entering into a proposed lease of Toole County Hospital and Nursing Home to a private nonprofit corporation. Because resolution of the election requirement issue was not necessary to resolution of the 1995 case, the court's consideration thereof, however well-reasoned, is dictum. Our analysis does not end there, however. We will affirm a judgment which was correct, even if it was granted for the wrong reason. Higham v. City of Red Lodge (1991), 247 Mont. 400, 402, 807 P.2d 195, 196. We therefore proceed to consider whether Toole County was required to put its hospital bonding proposal to a vote of the people. The title of Ch. 520, L.1995, describes the act, in part, as clarifying that certain bonds may be issued without an election. Section 7-34-2411, MCA, was amended as part of Ch. 520. As amended, the statute provides: County health care facility bonds authorized. (1) Notwithstanding any limitation imposed by law upon the bonded indebtedness of a county, a county acquiring, erecting, furnishing, equipping, expanding, improving, or maintaining a health care facility under 7-8-2102 or X-XX-XXXX or a boarding home under X-XX-XXXX may borrow money and issue its bonds for a health care facility or a boarding home, including refunding bonds, in the form and upon the terms as it may determine, payable out of any revenue of the facility or boarding home, respectively, including revenue derived from: (a) fees and payments for health care or boarding home services; (b) taxes levied under 7-6-2512 or X-XX-XXXX for a health care facility; (c) grants or contributions from the federal government; or (d) any other sources. (2) For the security of the bonds, the county may by resolution make and enter into any covenant, agreement, or indenture and exercise any additional powers authorized to be made, entered into, or exercised by a county, including those authorized in 7-6-2512 and this part. The sums required to pay principal and interest and to create and maintain a reserve for the bonds may be made payable from any and all revenue of the health care facility or boarding home prior to the payment of current costs of operation and maintenance of the facilities. Section 7-34-2411, MCA (emphasis supplied). Subsection (2) was added to § 7-6-2512, MCA, as part of the same legislation: If a county issues bonds under X-XX-XXXX to finance or refinance the costs of a health care facility, the board of county commissioners may covenant to levy the tax authorized by this section during the term of the bonds, to the extent necessary, and to apply the collections of the tax to the costs of erecting, furnishing, equipping, expanding, improving, maintaining, and operating the health care facility or facilities of the county or the payment of principal of or interest on the bonds. The pledge of the taxes to the payment of the bonds may not cause the bonds to be considered indebtedness of the county for the purpose of any statutory limitation or restriction. The pledge may be made by the board only upon authorization of a majority of the electors of the county voting on the pledge at a general or special election as provided in X-XX-XXXX. Section 7-6-2512(2), MCA (emphasis supplied). Section 7-34-2414, MCA, was also amended as part of Ch. 520, to provide in relevant part: Election required on question of issuance of bonds. (1) A county may not issue bonds to which all or a portion of the taxes levied under 7-6-2512 are pledged or to which the general tax authorized under X-XX-XXXX is pledged until the question of approval of the issuance of the bonds has been submitted to the registered electors of the county at a general election or a special election called for that purpose by the governing body of the county and the majority of the electors voting on the question have voted in favor of issuing the bonds. Section 7-34-2414(1), MCA (emphasis supplied). The proposal involved here, as described in the notice of public hearing attached to Lovins' complaint, the Toole County Commissioners' Resolution to issue the bonds, and the sample bond attached thereto, was solely for a revenue bond issue. Payment of principal and interest to the bondholders is to be derived solely from revenues of the Toole County Hospital and Nursing Home, and not from Toole County taxes. This was not a proposal for general obligation bonds, for which an election would have been required under the portion of § 7-34-2414, MCA, underlined above. Lovins points out that these statutes must be harmonized with preexisting statutes on this subject. He contends that such harmonization necessarily results in a conclusion that while the 1995 amendments abolish limitations on bonded indebtedness for county hospitals, they do not repeal the requirement that borrowing for such purposes is subject to a vote pursuant to § 7-7-2402, MCA. We disagree. To accept Lovins' argument would render portions of the 1995 amendments meaningless. In part, the amended statutes provide that indebtedness for repayment of health care facility bonds is not to be considered indebtedness of the county for the purpose of any statutory limitation or restriction. Section 7-6-2512(2), MCA. Certainly the § 7-7-2402, MCA, election requirement is a statutory limitation or restriction. As amended, § 7-34-2414, MCA, requires an election on such a bond issue only when all or a portion of the taxes levied under 7-6-2512 are pledged or to which the general tax authorized under X-XX-XXXX is pledged. Therefore, we conclude that indebtedness for repayment of the health care facility bonds herein proposed is not to be considered indebtedness of the county for purposes of the § 7-7-2402, MCA, election requirement. Contrary to the assertions in Justice Nelson's dissent, the present action does bring directly into issue the effect of the statutory amendments enacted as part of Ch. 520. Ch. 520 carves out an exception to the requirements set forth at § 7-7-2402, MCA, the statute relied upon by Lovins. Any lingering ambiguity in statutory intent is erased by an examination of the legislative history of Ch. 520. In summarizing the purpose of HB 421 to the Senate Local Government Committee, its sponsor, Rep. Ewer, stated: HB 421 would clarify that districts can borrow using the revenue bond route not subject to a vote of the people and general obligation bonds could be authorized which require a vote of the people. Minutes of Senate Local Government Committee, Comments of Rep. Ewer, March 21, 1995, at p. 2. We conclude that under the foregoing statutes, a vote of the electorate is not required before Toole County issues bonds for the proposed addition to the Toole County Hospital and Nursing Home. We therefore hold that the District Court did not err in granting summary judgment for the defendants.