Court Opinion

ID: 9865348
Source: CourtListenerOpinion
Date Created: 2023-09-25 16:32:25.727912+00
Date Added: 2024-06-11T12:38:30.549260
License: Public Domain

Mr. Justice Hilliard,
dissenting.
The decision of the court sustaining the plea in bar brings, I presume, an end to the shameful history of the construction and leasing of the Moffat tunnel. Shameful, I say, because as the records and opinions of the courts that have been concerned indicate too plainly, never, either in the deliberations of the tunnel commission or in the courts, were the taxpayers of the district given a reasonable opportunity to be heard. Shameful, I say, because by legal gymnastics the actual issue, the question of the validity of the supplemental bonds, has been foreclosed and the taxpayers and their descendants who will groan for fifty years before this monstrous folly is paid for, have had, and will have, no opportunity, in court or out, to present arguments or evidence that the supplemental bond issues were void. Shameful, I say, because there is every reason to believe, if one is not blinded to the obvious insincerity of most of the actors in this melancholy drama, that the tunnel was conceived in iniquity, constructed in bad faith, and leased without regard to fairness. Those who care to read this record of shame, to observe the adroit maneuvers of men learned in law and skilled in politics, to see for themselves how the taxpayers were betrayed by the only representative permitted them, should examine the records, the briefs *68and decisions in Milheim v. Moffat Tunnel Improvement District, 72 Colo. 268, 211 Pac. 649; Milheim v. Moffat Tunnel Improvement District, 262 U. S. 710, 67 L. Ed. 1194, 43 Sup. Ct. 694; Denver Land Co. v. Moffat Tunnel Improvement District, 87 Colo. 1, 284 Pac. 339; Denver and Salt Lake Railway Co. v. Moffat Tunnel Improvement District, 35 Fed. (2d) 365; Moffat Tunnel Improvement District v. Denver and Salt Lake Railway Co., 45 Fed. (2d) 715; Boynton v. Moffat Tunnel Improvement District, 57 Fed. (2d) 772.1 say to read those things and draw such conclusions therefrom as may he warranted. I make no attack upon courts, counsel or commission. I submit only that courts have been misled, that counsel have varied in their respective displays of zeal for their clients, and that the commission has reaped the whirlwind which is the fruit of the wind it sowed.
Before addressing myself to the merits of the plea in bar I think it not improper to consider somewhat of the burden the decision of the court visits for generations upon the taxpayers of the district. If Denver alone is considered — and to the credit of its administration it has appeared here and protested — -the figures are staggering. $6,000,000 of the supplemental bonds bear interest at five and one-fourth per cent, an annual amount of $315,000. The remaining $2,750,000 of supplemental bonds bear interest at five per cent, an annual amount of $137,500, making a total interest charge each year of $452,000. Denver, constituting in assessed valuation 90 per cent of the district, in addition to paying finally $7,875,000 of the principal of the supplemental bonds, must contribute each year toward payment of interest the sum of $406,800. And in order that we may plainly see what this imposition means, let it be noted that the annual interest charge alone is. almost exactly the amount Denver has fallen short this year in raising what is needed for its starving* and freezing* people, and is mor’e than twice the sum, $192,000, the city has been obliged to borrow from the federal government for its current *69needs, which must also be exacted ultimately from Denver’s burdened taxpayers. And the taxpayers outside of Denver', within the district, are likewise relatively oppressed. For understanding- of what all must finally pay the tunnel commission has not left us in doubt, for the assessments levied for payment of the supplemental bonds, principal and interest, aggregate $30,498,164.43. To what ends other follies may lead us, based upon the precedents heaped up in the tragic history of the Moffat tunnel, heaven alone has knowledge, and it seems that to heaven alone may the taxpayers look for relief.
The judge who wrote the opinion of the circuit court of appeals in the Boynton case wrought better than he knew, for he may claim the distinction of having written both the opinion of that court and this. And since he was also the author of the decision in Moffat Tunnel Improvement District v. Denver and Salt Lake Railway Co., supra, and cited that case as authority for his decision in the Boynton case, he may take credit for having made about all the law in this particular litigation. I can only wish that this court were as brave to defend the jurisdiction of the highest tribunal of a sovereign state as the circuit court has been quick and bold to assert its jurisdiction. If we had been brave then the taxpayers of the district would have had the comfort at least of an examination of the canse on its merits. But instead, when the circuit court appeared over the brow of the hill this court stacked arms and surrendered. And not only that, but we adopt as our own the language of a court that belittles us. Arid more than that, gravely cite the decision of the circuit court in support of the conclusion that the plea in bar is good when the circuit court very carefully and in terms: denies that there is any conflict of jurisdiction and asserts not once but twice that parties not before it are not bound by its decision.
Neither court nor counsel has made any attempt to claim that the decision in the Boynton case is res judicata as to the case at bar. It is too plain that it is not. *70But upon the question of estoppel by judgment this court has eagerly asserted that such exists. To make that assertion has required a defense of the acts of the Moffat tunnel commission, and to my mind if it is necessary to urge a defense for that body that fact alone makes it certain that estoppel by judgment does not exist.
The position of the court is that the plaintiff here is estopped, because, forsooth, the Moffat Tunnel Improvement District was a party in the federal court and was representative of all the taxpayers, including* the plaintiff. I say that in all the books one will not find a parallel for so astounding a statement. Manifestly, and painfully so, the taxpayers were misrepresented by the Moffat Tunnel Improvement District. Manifestly, the Boynton case was a sham battle. Manifestly, the improvement district made no' real attempt to assert the invalidity of the bonds. Manifestly, the commissioners, the managers of the district, desired to have the validity of the bonds sustained for if they were held invalid there was reason in law to believe that the commissioners might become personally liable. It does not require citations to support the view that under such circumstances the taxpayers are not represented by the commission. The commissioners could not very well represent themselves and the taxpayers at the same time when their interests differed sharply.
No, in the face of the facts, it is entirely untrue as fact and unsound as law to say that the improvement district represented the taxpayers. I have not forgotten, although my brethren seem to have, that when this matter was before the court on oral argument counsel for the improvement district sat at the same table with and made the same arguments as counsel for the bondholders. Counsel for the.plaintiff, a taxpayer and more certainly a representative of the taxpayers than any one else in that room, sat lonely and alone, belabored alike by the bondholders and the commission. Can one ask for' better evidence of constructive fraud upon the part of the com*71mission than the fact that it made no real defense in the federal court and opposed the plaintiff in this cause? And the authorities say that unless the representative shall actively and in good faith plead and prosecute all known defenses that the taxpayers are not bound by the judgment. "What should we hold here, when upon the face of the record before us there can be no question that the improvement district utterly failed to assert any of the known defenses, defenses which were set up in this suit and which could have been pleaded in the federal court simply by the exercise of the skill of a copyist? Should we hold that because the district “demanded strict proof” that it has properly represented the taxpayers? I say not, and more, that it has convicted itself of constructive fraud upon the face of the record.
Much is said in the opinion of the court of the failure of the plaintiff to intervene in the federal court. That is to censure counsel for refusing to take the bait and be caught in the trap; in other words, condemning them for doing that which was best for their client. As the circuit coiirt held that the bondholders had a statutory right to bring their case in the federal court and were not obliged to intervene in the state court, so had the plaintiff the right to maintain its action in the state court. Besides, the relief sought by the plaintiff and the relief sought by Boynton were so unlike that neither would have properly been a party in the other’s suit. If the plaintiff had intervened in the federal court it would have been subordinated to the issues tendered by the bill of complaint, could obtain no relief such as it prayed for here, and would have run the risk of being bound by an adverse decision.
As I have said, the circuit court found there was no conflict of jurisdiction. At page 782 of the opinion in the Boynton case that court said: “A final decree in the state court suit would be persuasive authority in this court, but it would not be res judicata as to the parties in this case who are not parties in that; neither would a *72decree of this court be res judicata as to parties in the state court who are not parties here; and different issues are, to a. considerable extent, presented in the two courts.”
And at page 781: “Furthermore, the issues in the state court suit are not identical with the issues in this case; the most that can be said is that one issue in that suit is identical with one issue in this. The state court suit is an ordinary taxpayer’s suit to relieve its property from a threatened-tax lien; the issue in this suit is to recover on bonds, with no reference to what particular piece of property is assessed therefor * *
Hence, the circuit court concluded that there was no conflict and entered judgment accordingly. "Why has this court been so eager to find that there was conflict, that the issues were the same, that the improvement district represented the taxpayers, including the plaintiff whom it had fought with energy and bitterness for four years ? I confess I do not know the answer or even find ground for speculation. We have simply supinely dodged a vexing issue, and left the plaintiff helpless after its four years of effort.
What of the validity of the bonds themselves? As counsel for the plaintiff have very well said in one of their briefs, “Such a bewildering number of cases, theories, briefs, arguments and transcripts have been presented that this court could not be criticized for cutting through the maze of technicalities involved and determining this case by a construction of the Moffat Tunnel Act, which after all has something' to do with this litigation.” And yet, all that is said in the opinion of the court is that the bonds must be valid because two state district judges have so held and their opinions adopted by the circuit court of appeals. Mr. Justice Butler and Mr. Justice Campbell, sensing, I suspect, the unsoundness of the estoppel by judgment, authorize the announcement by Mr. Justice Moore that it is their belief the bonds are good. And so the taxpayers are con*73demned to pay over $30,000,000, by about as many words as there are millions of dollars involved.
It will do small good for me to elaborate my views on the validity of the bonds. I think them utterly void. They were issued in virtual secr'ecy. They were issued upon the advice of at least some attorneys who had asserted in the Milheim case that the limitation of $6,720,-000 in the tunnel act meant that only that much money could be spent. They were sold for par or less to a bond house that reaped a golden harvest by selling them at more than par. They were issued, so say the circuit court and the district judges, in light of a positive command from the legislature that the commission must build that tunnel. I wonder if the legislature would have passed the tunnel act if it had been known to its members that the tunnel was going to cost in excess of $15,-000,000, or if they had known they were commanding the completion of the tunnel even if it cost $43,000,000? I wonder if it ever occurred to the Moffat tunnel commissioners to apply to the Legislature for additional legislation? The commission knew long before it issued the supplemental bonds that the tunnel could not be completed for the $6,720,000 authorized by law. Three regular sessions of the legislature met between the time the commission was organized and the tunnel completed. At least one and likely two of those sessions came before the supplemental bonds were issued. But instead of consulting the Legislature and making known to the people what financial straits it was in, and how much more money than contemplated was required, the commission employed eminent counsel, both local and foreign, and discovered it must drill that tunnel at any cost short' of $44,000,000. So, I say, the arguments in favor of the validity of the bonds, in light of the facts we all know now, are specious. But they are the law, and I can only register my protest that the law has come to such a state. 1 am constrained to add, however, that as I contemplate the Moffat tunnel scheme in full outline, the visitation of *74burdens and bestowal of benefits, my sense of outrage fails of adequate expression. In my helplessness I adopt from the United States Supreme Court the following language: “To lay with one hand the power of the government on the property of the citizen, and with the other to bestow it upon favored individuals to aid private enterprise and build up private fortunes, is none the less a robbery because it is done under the forms of law and is called taxation.” Loan Association v. Topeka, 20 Wall. 655, 664, 22 L. Ed. 455.
In my opinion the plea in bar should be denied, and the cause reversed with direction to enter judgment for the plaintiff as prayed for.