STATE
v.
SPECIAL TAX SCHOOL DISTRICT NO. 3, OF PINELLAS COUNTY
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The Florida Supreme Court upheld the validation of refunding bonds issued by Special Tax School District No. 3 of Pinellas County, rejecting the argument that issuing new refunding bonds to replace older refunding bonds (without paying deferred interest coupons) would violate the Florida Constitution by creating two concurrent bond issues representing the same debt.
The court held that the refunding bonds may be issued without constitutional violation. The outstanding bonds were validly called under their express call provision, and the deferred interest coupons have no enforceability if the bonds are called before October 1, 1942. Since the old bonds cease to bear interest upon legal notice of call, there will not be two sets of bonds outstanding representing the same debt.
“The bonds proposed to be refunded provide amon'g other things that they may be called "on or prior to October 1, 1942, at par and accrued interest at the rate then prevailing as enforcible and collectible." They are being called under this provision' and all prerequisites to the call have been followed.”
Establishes that the district validly exercised the express call provision in the original bonds, satisfying the legal basis for the refunding.
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Join FLexlaw to unlock all legal intelligenceSpecial Tax School District No. 3 issued refunding bonds in 1933 (Series A, B, and C) bearing interest at 5%, 5.5%, and 6% respectively, with deferred…
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This appeal is from a final decree of the Circuit Court of Pinellas County, validating an issue of refunding bonds of Special Tax School District No. 3. The bonds proposed to be refunded were also refunding bonds *558issued in 1933 in Series A, B, and C, bearing interest at 5, 5y2, and 6 per cent. They were exchanged for original bonds and bore “deferred interest coupons,” in the sum of $150 on Series A, $100 on Series B, and $50 on Series C. The new refunding bonds bear interest at 4% per cent per annum, payable semi-annually unless a lower rate can be secured.
The question brought to this Court for determination is whether or not the refunding bonds can be issued in the manner proposed without violating Section 6, Article IX of the Constitution of Florida.
The appellant contends that this question must be answered in the negative because the refunding bonds will not be sufficient to replace the outstanding bonds and the deferred interest coupons either by sale or exchange, and that being so two sets of bonds will be outstanding for an indefinite period representing the same debt which cannot be without an approving vote of the freeholders as required by Section 6, Article IX, of the Constitution.
We do not think there is any merit to this contention. The bonds proposed to be refunded provide amon'g other things that they may be called “on or prior to October 1, 1942, at par and accrued interest at the rate then prevailing as enforcible and collectible.” They are being called under this provision' and all prerequisites to the call have been followed. The proposed refunding bonds are issued in compliance with Chapter 15772, Acts of 1931, and the entire refunding scheme is being accomplished under that Act. The provisions of said Act are as much a part of the refunding bonds as if written therein but whether or not this was done is of no consequence and does not affect the validity of the refunding bonds.
There is no authority whatever for enforcing the deferred *559interest coupons if the outstanding bonds are called prior to October 1, 1942, and replaced with funds realized through tax sources or from any source including the sale of new refunding bonds. The chancellor recognized this and so provided in' his validating decree. His decision is sttpported by Outman v. Cone, 141 Fla. 196, 192 So. 611; Taylor v. Williams, 142 Fla. 402, 195 So. 175.
The resolution and other proceedings pertaining to the issue of the refunding bonds have been examined an'd are shown to be regular and in compliance with law. There is ample power in the Board of Public Instruction to issue the refunding bonds without reference to payment of any portion of the deferred interest coupons attached to the outstanding bonds. This has been done and the outstanding bonds have been legally called.
Since this is the case, we find no fault in' the call of the old bonds, the manner of issue of the refunding bonds, and being so, whether or not the outstanding bonds are surrendered for payment when legal notice is given, they will cease to bear interest so there will not be two sets of bonds outstanding.
Affirmed.
Whitfield, Brown, Buford, Chapman and Thomas, J. J., concur.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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State v. City of New Smyrna Beach, 148 Fla. 482 (Fla. 1941)…a. 598, 190 So. 774. The next question challenges the validity of the deferred interest coupons attached to each of the refunding bonds. This question was concluded by Outman v. Cone, 141 Fla. 196, 192 So. 611; State v. Special Tax School District, 143 Fla. 557, 197 So. 127; Andrews v. City of Winter Haven, filed September 13, 1941. We find nothing in the record to remove the coupons from the rule in these cases. Other questions argued have been examined but they are concluded by the case last cited and b…
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Meredith v. City OF Winter Haven, 134 F.2d 202 (5th Cir. 1943)…of the complaint as amended1 [*204] to state a claim for relief was granted on the authority of Outman v. Cone, 141 Fla. 196, 192 So. 611; Taylor v. Williams, 142 Fla. 402, 195 So. 175; State v. Special Tax School District No. 3 of Pinellas County, 143 Fla. 557, 197 So. 127; and Andrews v. Winter Haven, 148 Fla. 144, 3 So. 2d 805, and plaintiffs have appealed. They make two contentions here. The first is that these decisions are contrary to the rule of law laid down in Sullivan v. Tampa, 101 Fla. 298, 134…
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Meredith v. City OF Winter Haven, 141 F.2d 348 (5th Cir. 1944)…lection. In Taylor v. Williams, 142 Fla. 402, 195 So. 175, additional security without an authorizing election was again condemned, but the provision touching the new security was alone enjoined, it being held severable. In State v. Pinellas County, 143 Fla. 557, 197 So. 127, where a first refund had included deferred interest coupons like those here involved, and a second refund ignored them, it seems to be held that the second refund could proceed, on the assumption that the deferred interest coupons were…
Previewing 3 of 4 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Dodge Taylor v. Williams, 142 Fla. 402 (Fla. 1940)
- Outman v. Cone, 141 Fla. 196 (Fla. 1939)