Court Opinion

ID: 6826312
Source: CourtListenerOpinion
Date Created: 2022-07-23 19:26:48.451111+00
Date Added: 2024-06-11T16:04:23.101829
License: Public Domain

CHIEF JUSTICE CARRICO,
dissenting.
I disagree with the majority. I have great difficulty, however, in stating the basis of my disagreement because I have even greater difficulty in discerning upon what basis the majority invalidates the bonds in question.
The majority concedes that “the contract permits the county to discontinue its promised appropriations.” That should be the end of the case. Yet, continuing its search for a basis to invalidate the bonds, the majority says that the Court “must . . . consider the practical effect of [the county’s discontinuance of its promised appropriations] in deciding whether the county in fact would be bound to continue to service the bond issue and, therefore, has incurred a ‘debt’ proscribed by Article VII, § 10(b).” (Emphasis added.)
The majority notes the county’s recognition of “the importance of its fiscal integrity” as well as “the disastrous effect that would follow any failure by the board of supervisors to make an annual appropriation.” then, opining that the county “impermissibly seek[s] to accomplish indirectly what [it] cannot do directly,” the majority says it is obvious that “the issuance of the bonds in accordance with the contract would bind future boards of supervisors to make annual appropriations of sufficient funds to finance the bonds.”
It might be obvious to the majority that the county would be bound to make annual appropriations of sufficient funds to finance the bonds, but it is not obvious to me. This is what the majority is saying: The practical effect of the county’s exercise of its contractual right to discontinue the promised appropriations is to make it legally obligated to continue the promised appropriations.
I thought I knew what the term “practical effect” meant. I also thought I knew what the term “legally obligated” meant. And, to me, the two terms meant quite different things. Much to my surprise and dismay, however, the majority says the two terms mean the same thing, and I daresay the business and financial communities in this state will be equally surprised and dismayed at the majority’s revelation.
*367It appears, therefore, that “practical effect’ is the basis of the majority’s invalidation of the bonds in question. If that is the basis, I consider it far too slender a reed to support such drastic action.
Rather, in my opinion, the bonds should be invalidated only if the county has undertaken an unconditional express obligation to continue making appropriations to pay the full amount of the bonds. I do not believe the county has undertaken such an obligation, and I would say this whether or not a special fund exists in this case.
The majority fails to even cite, let alone give effect to, important statutory provisions applicable to the transaction involved in this case. Code § 15.1-1358.2(a)(2) provides that “[t]he bonds and other obligations of a [transportation] district (and such bonds and obligations shall so state on their face) shall not be a debt of the Commonwealth or any political subdivision thereof and neither the Commonwealth nor any political subdivision thereof other than the district shall be liable thereon.” furthermore, pursuant to Code § 15.1-1364(b), except for claims cognizable under the Virginia Tort Claims Act, “the obligations and any indebtedness of a [transportation district] commission shall not be ... a debt or liability of the Commonwealth, or of any county or city . . . either legal, moral or otherwise.”
Furthermore, the contract between the county and the commission provides that “nothing [therein] shall be deemed to obligate the Board of Supervisors of the County to appropriate any sums on account of any payments to be made by the County [thereunder]” and that the contract “shall not constitute a pledge of the full faith and credit of Fairfax County.” And each bond proposed to be issued by the commission will bear the disclaim of the county’s liability, as required by Code § 15.1-1358.2(a)(2).
I, too, think the Court should look to the “substance and not [the] form” of the pertinent documents in this case. See Bolling v. Hawthorne Coal Co., 197 Va. 554, 566, 90 S.E.2d 159, 168 (1955). But I think the Court must also look to the substance of applicable statutory provisions in determining the real effect, rather than the mere practical effect, of the documents in question. And, when I look at the case in this way, I do not see the evil the majority seems to find lurking behind every word the parties have used to express their undertaking.
*368Nor do I understand how, in the face of all the indicia of non-indebtedness present in the statute, the contract, and the bonds involved in this case, the majority can conclude that the county has incurred binding indebtedness in violation of Article VII, § 10(b). In reaching this conclusion, the majority has taken a mighty leap in logic to get where it wants to go. This is too great a leap for me, and I dissent.