ATTORNEYS FOR APPELLANTS ATTORNEYS FOR APPELLEE
George T. Patton, Jr. Kevin W. Dogan
Kevin S. Smith Indianapolis, Indiana
Bryan H. Babb
BOSE McKINNEY & EVANS, LLP David L. Copenhaver
R. Scott Hayes
E. Edward Dunsmore HAYES, COPENHAVER & CRIDER
Knightstown, Indiana New Castle, Indiana
ATTORNEYS FOR AMICI CURIAE R. Thomas Bodkin
CITIZENS OPPOSING ANNEXATION, Jason P. Lueking
ET AL. Douglas A. Welp
BAMBERGER, FOREMAN, OSWALD
John H. Brooke & HAHN, LLP
Casey D. Cloyd Evansville, Indiana
BROOKE & CLOYD, P.C.
ATTORNEYS FOR AMICUS CURIAE
INDIANA MUNICIPAL LAWYERS
Karl L. Mulvaney
BINGHAM SUMMERS WELSH & SPILMAN
SUPREME COURT OF INDIANA
JAMES E. BRADLEY, KAY C. MILLER, ) and Certain Other Persons Owning ) Property in the Proposed Annexed ) Territory, ) No. 33S01-0104-CV-195 ) in the Supreme Court Appellants (Plaintiffs Below ),) ) v. ) No. 33A01-9807-CV-281 ) in the Court of Appeals CITY OF NEW CASTLE, INDIANA, ) ) Appellee (Defendant Below ). )
March 12, 2002
The trial court rejected all the Remonstrators challenges to the annexation. The
Court of Appeals reversed, faulting the City Council on a variety of procedural
points (although the Remonstrators make no claim that their substantive rights were violated)
and faulting the trial court for allowing the City to supply additional evidence
in support of the adequacy of the Fiscal Plan. Annexation is essentially
a legislative process, and courts should not micromanage it.
We affirm the trial court.
The Council followed a three readings approach. On November 2nd, it adopted
a written Fiscal Plan for implementing the annexation and voted in favor of
the Ordinance on first reading. On November 16th, the Council amended the
Ordinance to eliminate a twenty-four acre tract from Area 4, thereby splitting that
Area into 4 East and 4 West, and also amended the Plan.
It then passed the Amended Ordinance on second reading. On December 7th,
the Council again amended the Plan and passed the Amended Ordinance on final
In February 1993, certain property owners residing in the annexed areas filed a
Petition for Declaratory Judgment and a Petition for Remonstrance. These Remonstrators claimed
that the Council failed to observe some statutorily required procedures in passing the
Ordinance. They also challenged the sufficiency of the Fiscal Plan as adopted
at the time of the Ordinances passage.
In May 1994, Remonstrators filed a Third Amended Petition for Declaratory Judgment and Remonstrance. Judge John Kellam treated the Citys response as a motion for summary judgment and, in July 1995, granted summary judgment in favor of the City on the petition for declaratory judgment and on portions of the petition for remonstrance. See footnote
The hearing on the remaining portions of the petition for remonstrance began in
November 1995. Remonstrators requested a continuance after the City changed its theory
of annexation on Area 2 to reflect an intervening Court of Appeals decision.
The trial court granted the continuance and the hearing resumed in July
1996. During the hearing, the court allowed the City to present evidence
revising and supplementing the Fiscal Plan that the Council adopted in 1992.
On March 3, 1997, the City filed a motion under Ind. Trial Rule
53.2, and on April 8 this Court appointed Judge Barbara A. Harcourt to
replace Judge Kellam. On June 17, 1998, Special Judge Harcourt issued a
judgment in the Citys favor, supported by findings of fact and conclusions of
Remonstrators appealed. The Court of Appeals held that the trial court erred
in granting partial summary judgment on the petition for remonstrance and in allowing
the City to make significant changes to its Fiscal Plan during the remonstrance
Bradley v. City of New Castle, 730 N.E.2d 771, 787 (Ind.
Ct. App. 2001). We granted transfer. 753 N.E.2d 10 (Ind. 2001).
In short, annexation of territory to a city is not a taking of
the property, nor does it deprive any person of his property. Taggart
v. Claypool, 145 Ind. 590, 596, 44 N.E. 18, 20 (1896). Property
owners therefore have no vested interest in the maintenance of municipal boundaries at
any particular location. Forks v. City of Warsaw, 257 Ind. 237, 273
N.E.2d 856 (1971), cert. denied, 409 U.S. 841 (1972).
B. The Trial Courts Role. Annexation is an essentially legislative function.
Rogers v. Mun. City of Elkhart, 688 N.E.2d at 1239 (citing City of
Indianapolis v. Wynn, 239 Ind. 567, 157 N.E.2d 828 (1959)). It is
subject to judicial review only as provided by statute, and [t]he larger object
of the annexation statute is, as it always has been, to permit annexation
of adjacent urban territory. Id. at 1242.
Therefore, a remonstrators challenge to annexation is not a regular lawsuit, but rather
a special proceeding the General Assembly may control. See Thorn v. Silver,
174 Ind. 504, 510, 89 N.E. 943, 946 (1909) (action by remonstrators challenging
a drain construction assessment). Indiana Code §§ 36-4-3-11 through 13 establish requirements
See footnote give trial courts authority to hear and enter judgment on remonstrances;See footnote
and direct courts to order annexation provided that the city meets specified requirements
on matters such as contiguity and has adopted a fiscal plan showing that
it will provide municipal services to the annexed area that are equivalent to
those enjoyed by residents in similar areas of the municipality.See footnote
The trial courts role is to decide whether the municipality has operated within
its authority and satisfied the statutory conditions for annexation.
Rogers, 688 N.E.2d
at 1239-40. At the remonstrance hearing, the municipality bears the burden of
showing compliance with the requirements of the annexation statute. Id.
Although the municipality bears the burden of proof when properly challenged, we afford
legislative judgment considerable deference. It is well-established that we avoid scrutinizing legislative
processes, even those that are constitutionally mandated. See State ex rel. Masariu
v. Marion Superior Court No. 1, 621 N.E.2d 1097, 1098 (Ind. 1993) ([T]his
Court has held repeatedly that courts should not intermeddle with the internal functions
of either the Executive or Legislative branches of Government.); see also Roeschlein v.
Thomas, 258 Ind. 16, 280 N.E.2d 581 (1972).
The General Assembly has delegated part of its power to re-establish and change
governmental unit boundaries to local legislatures. See Perry Township v. Indianapolis Power
& Light Co., 224 Ind. 59, 64 N.E.2d 296 (1946). We do
not abandon our deferential approach simply because the state legislature has delegated a
legislative function to subordinate agents, the municipalities. See City of Valparaiso v.
Gardner, 97 Ind. 1, 3 (1884) ([C]ourts will not interfere with mere matters
of municipal legislation . . . . ).
Therefore, a trial court hearing a remonstrance is not an examiner conducting an
audit of a challenged fiscal plan. Rather, it should focus on whether
that plan represents a credible commitment by the municipality to provide the annexed
area with comparable capital and non-capital services.
B. The Appellate Courts Role. When a trial court enters special findings,
as it did here, we review issues of fact for sufficiency of the
evidence and look to the record only for evidence favorable to the judgment.
Ind. Trial Rule 52; Rogers, 688 N.E.2d at 1240. We do
not set aside findings and judgments unless they are clearly erroneous. T.R.
52. We review questions of law de novo. Rogers, 688 N.E.2d
at 1240 (citation omitted).
For example, Remonstrators point to the requirement in Ind. Code § 36-4-3-3 that
says, The legislative body of a municipality may, by an ordinance defining the
corporate boundaries of the municipality, annex territory . . . . Remonstrators
argue that this statute requires a legal description and, because the City did
not prove that the annexation ordinance (which referred to City boundaries generally) had
a map attached to define the Citys legal boundaries, the annexation fails.
They do not claim that they were misled or disadvantaged in any way
by this approach.See footnote
As another example, Remonstrators point to Ind. Code § 36-4-6-13, which says:
A two-thirds (2/3) vote of all the elected members, after unanimous consent of
the members present to consider the ordinance, is required to pass an ordinance
of the legislative body on the same day or at the same meeting
at which it is introduced. (Appellants Br. at 62-63.) They claim
that the November 16, 1992, Council action deleting twenty-four acres of land from
Area 4 was more than just an amendment and thus triggered the unanimous
consent requirement.See footnote (Appellants Br. at 64-65.) They do not, however, assert
any specific harm arising out of this course of events.
Judge Kellam declined to address these individual challenges on the merits and granted
summary judgment to the City, concluding that all sufficiently specific allegations fell outside
the scope of judicial review. The Court of Appeals disagreed and remanded
for a new remonstrance hearing.
Bradley, 730 N.E.2d at 787.
We begin by noting that the separation of powers doctrine, which both the trial court and Court of Appeals discussed at length, does not preclude judicial review, if only because Indianas legislature has provided a specific judicial role in annexation challenges. The question is whether judicial review should extend beyond the confines of Sections 11 through 13.
The Court of Appeals f[ou]nd nothing in the Annexation Act See footnote that shows that the General Assembly intended to limit the judicial review of a municipalit[ys] annexation power. Bradley, 730 N.E.2d at 782. It therefore concluded that Remonstrators could challenge the annexation based on noncompliance with statutes that do not deal specifically with remonstrances.
We disagree. According to Ind. Code § 36-4-3-13, a court shall order
a proposed annexation to take place if the following requirements are met.
(Emphasis added.) These requirements are contiguity (or specified alternatives to contiguity) plus
a fiscal plan that covers enumerated subjects. This language seems plain enough:
if the City satisfies Section 13s listed requirements, the court shall order
We recognize, of course, that annexing municipalities may commit procedural wrongs so severe that courts must act to protect remonstrators substantial rights. An example of such is King v. City of Bloomington, 239 Ind. 548, 159 N.E.2d 563 (1959). There, remonstrators claimed to have incurred great expense to challenge an annexation ordinance. 239 Ind. at 556, 159 N.E.2d at 567. If they succeeded, a statute prohibited any reannexation attempt for two years. 239 Ind. at 558, 159 N.E.2d at 568. In an alleged attempt to frustrate the remonstrators efforts, the city repealed the ordinance and then three months later started the entire process over by annexing substantially the same territory under a new ordinance. 239 Ind. at 557, 159 N.E.2d at 567-68.
Although no statute forbade this practice, this Court held:
[I]f it is shown that a defendant prepares at considerable time and expense to defend and the action is then dismissed for the avowed purpose of repeatedly filing like actions to harass and wear down the defendant without giving him an opportunity to adjudicate and settle the issues on the merits, equity has a remedy. . . . The principle is invoked to prevent vexatious litigation, multiplicities of suits, or circuit of actions. Equity will not suffer a wrong without a remedy.
239 Ind. at 563-64, 159 N.E.2d at 570-71 (citations omitted).
Similarly, due process and due course of law may require judicial relief where
plausible claims of fraud or discrimination are established. See, e.g., State ex
rel. City of Marion v. Grant Circuit Court, 239 Ind. 315, 157 N.E.2d
188 (1959)(allowing judicial review of citys sewage disposal rate scheme). However, [w]e
start from the premise that there can be no protected property interest in
adherence to established procedure . . . . and the mere failure to
follow applicable rules or procedures does not, without more, amount to a due
process violation. Shook Heavy & Envtl. Const. Group v. City of Kokomo,
632 N.E.2d 355, 361 (Ind. 1994)(quoting Rice v. Scott County Sch. Dist., 526
N.E.2d 1193, 1196-97 (Ind. Ct. App. 1988))(citations omitted)(denying judicial review to unsuccessful bidder
for public contract).
As we noted above, Remonstrators complaints here are relatively technical in nature, and
do not assert any impairment of substantive rights. The trial court therefore
correctly concluded that the alleged procedural violations fell outside the scope of judicial
review of annexations.
We answered this question in City of Hobart v. Chidester, 596 N.E.2d 1374
(Ind. 1992)(Chidester I), after remand, 631 N.E.2d 908. There, remonstrators argued that
the City of Hobarts fiscal plan failed to set out all the information
required under the statute. Id. at 1375. The City introduced evidence
at trial addressing this deficiency. Id. We said:
Remonstrators are correct in that the plan must be more than a mere recital of the statutory language. We do not think, however, that comparisons between the citys topography, patterns of land use, and population density and those of the annexed territory need be set out in the plan itself. Such comparisons would do little to advance the ability of landowners to enforce their rights to services under the plan. . . . The statutes do call upon the trial court to determine whether the citys written resolution and plan are according to statute, but they also tell the court to enter judgment on the question of the annexation according to the evidence which either party may introduce. Ind. Code § 36-4-3-12(a)(2)(West Supp. 1991). . . . There would be no need for an evidentiary hearing . . . if all proof of a citys ability to provide like services had to be set out in the written plan.
Id. at 1378 (emphasis added).
Here, Judge Harcourt found that [t]he Fiscal Plan contained a number of errors.
Some of which were quite obvious i.e. that the tax increase from
8.2465% to 14.3604% was a 6% increase [as opposed to a $6 increase].
(R. at 900.) Most significantly, the required capital improvement expense for
water services should have been $78,500 rather than the $11,000 shown in the
Plan. (R. at 906.) After taking into account the evidence at
the hearing, however, Judge Harcourt found as fact that:
The current building, policing, fire and medical, water, sewage, street lighting, street and road maintenance, street construction, parks, animal control, transit and administrative services currently provided to the citizens of New Castle in comparable areas will be provided to the citizens of the annexed areas in a manner that is equivalent . . . in standard and scope. This includes both capital and non-capital services. All of the non-capital services will be supplied to the annexed territory within one year of the date of annexation and all capital expenditures will be within three years of the date of annexation.
(R. at 911.) She went on to say:
19. The Court agrees that the municipality, bearing the burden of proof, may present matters outside the Fiscal Plan during the trial of the case. The municipality is not required to include every detail in the plan which may be presented at trial.
20. However, at some point new evidence presented at trial would constitute a complete
reworking of the plan. Such reworking of the plan would create undue
hardship upon remonstrators.
. . . .
34. The Court . . . identified three purposes for written fiscal plans in
Hobart v. Chidester:
First, the publication of the written plan permits landowners to make an intelligent
decision as to whether or not to accept annexation or remonstrate.
Second, requiring a written plan makes the opportunity for remonstrance and judicial review
more realistic. As a practical ma[tt]er, more than vague promises are needed
for a Court to test a citys ability to provide like services to
the annexed territory.
Third, a fiscal plan needs to be in writing to protect the rights
of the landowners to institute proceedings to force the annexing city to provide
the services pro[mis]ed under the plan.
Hobart at 1377-78.
35. In the present case, the Fiscal Plan certainly allowed the remonstrators to determine
whether or not to remonstrate. They chose to remonstrate.
36. The written plan also allowed for a complete judicial review.
37. The Fiscal Plan quite clearly stated what services were to be provided to
the areas being annexed.
38. The Fiscal Plan contained some errors. Some of the errors [were] obvious,
such as the percentage of increase of taxes and could easily be identified
by the lay public as well as the Court. Other errors involved
an increase of funds needed, such as sewage costs. These increases were
39. The Plans errors were corrected by amendment or at trial. At trial,
the Plan still served as the basis for review.
40. The third purpose served by a plan is protection for landowners in
the future. The Plan in this case, along with the extensive testimony
and exhibits produced at trial certainly provides the landowners in the Annex Areas
1, 2, 3, 4 East and 4 West with a concrete statement of
the citys promise to provide certain services to them.
. . . .
43. The Court concludes that the city has met its burden with regard
to provision of services to annexed areas, both capital and non-capital in a
manner which is equivalent as that provided to the comparable areas. The
city has carried its burden as to the cost of services to annexed
areas and method of financing the services.
. . . .
48. Therefore, the Court concludes that the Fiscal Plan as supplemented at trial
is not so seriously defective as to thwart the purposes announced under Hobart
49. The central issue remains as to whether or not the evidence offered at trial in 1995 and 1996 essentially rewrote the Fiscal Plan to the point that substantial unfairness resulted to the remonstrators.
. . . .
52. This case presents serious, strong competing public policies. On one
hand, is the need for municipalities to grow in a regulated, planned fashion.
On the other hand, individual landowners need to be fully informed of
proposed annexation actions. These interests must always be carefully balanced.
. . . .
55. The function of the Court in the annexation process is quite
limited. Annexation is primarily a legislative decision. Nevertheless, the judiciary is
charged with ensuring that the minimum requirements for annexation, as prescribed by the
General Assembly have been satisfied. Town of Sellersburg v. Proposed Annexation of
Certain Property, 677 N.E.2d 608, 612. (Ind. App. 1997); Chidester v. City
of Hobart, 631 N.E.2d 908, 910 (Ind. 1994).
56. It appears to the Court that this case presents a close question.
. . . .
58. The city made a number of errors in its Fiscal Plan and the Plan preparation could be termed sloppy.
59. Plaintiffs expert witness testified that errors may be expected for Fiscal Plans.
. . . .
61. . . . [A]t the end of the trial in this case,
the remonstrators had complete information as to the citys plans for provision of
services to the annexed areas.
62. The Court concludes that the errors are not fatal to the Fiscal Plan or to the annexation process as a whole. The Citys supplementation of the Plan at trial did not unduly prejudice Plaintiffs. The city has borne its burden of proving it met the minimum requirements set forth by the Indiana General Assembly.
(R. at 915-22.)
We quote these findings and conclusions at length because Judge Harcourt followed the appropriate path. Her analysis correctly focused on the purposes for requiring fiscal plans and measured the Citys Plan against those purposes. She allowed the City reasonable leeway in updating the Plan within the bounds of fairness to the Remonstrators.
At the end of the day, Judge Harcourt concluded that although the Plan
was imperfect it was legally sufficient to protect the annexed landowners future rights.
This conclusion is supported by sufficient facts, and it is a correct
application of the law.
Dickson, Sullivan, Boehm, and Rucker, JJ., concur.