Water Works & Sewer Board of Wetumpka v. City of Wetumpka

Citations: 773 So. 2d 466; 2000 Ala. LEXIS 229; 2000 WL 739590Docket: 1981348

Court: Supreme Court of Alabama; June 9, 2000; Alabama; State Supreme Court

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Lewis Washington, an elected councilman of Wetumpka, was appointed as a director of the City’s Water Works and Sewer Board (the Water Board). The Water Board, along with its chairman Dr. J.E. Dunn and vice chairman Kendall Smith, filed a petition for a writ of quo warranto and a declaratory judgment against the City and Washington. The trial court denied their petition, leading to an appeal from the Water Board.

The Water Board was established in 1949 and its certificate of incorporation specified that its Board of Directors would consist of three members, who must be elected by the City’s governing body and shall not be municipal officers. The bylaws reiterated this requirement, stating that directors must be qualified electors and property owners in Wetumpka, Alabama. 

In 1956, the law governing such boards was amended to allow municipal officers to serve as directors, provided that the board does not consist of more than two such officers. However, the Water Board’s certificate of incorporation was not amended to reflect this change. The trial court concluded that Washington, as a councilman, was not considered an "officer" of the City for the purposes of this case and found that he could serve on the Water Board without necessitating a formal amendment to the incorporation documents. Furthermore, the court ruled that even if the City lacked the authority to appoint Washington, the Water Board was estopped from challenging his appointment and had waived any right to do so. 

Past case law indicated that council members cannot serve on the board of directors of a water works corporation organized in a municipality with a mayor and council, reinforcing the argument against Washington's appointment.

The term "an officer thereof" in the Water Board's certificate of incorporation refers specifically to the City of Wetumpka. The certificate's wording aligned with Alabama law at the time it was executed, which, under Title 37, Section 397, prohibited municipal officers from serving on the Water Board. After the 1956 amendment to this statute, which allowed municipal officers to serve on water boards, the City of Wetumpka claimed it could appoint a city councilman to the Water Board without amending its certificate of incorporation. However, precedent from Water Works Board of the City of Leeds v. Huffstutler established that a water board's certificate cannot be automatically amended by changes in statute. In Leeds, an attempt to increase the board's membership without proper amendment to the certificate was ruled invalid. Consequently, the court concluded that the City of Wetumpka cannot appoint a city councilman to the Water Board without amending the certificate of incorporation, as the eligibility of board members is distinct from the board's powers. The Water Board's certificate specifies its objectives and powers, none of which include eligibility for appointment of a city councilman. Moreover, the statute outlining the amendment procedure for a water board's certificate has not been followed, thus maintaining the prohibition against such an appointment.

The 1956 amendment to Section 11-50-234(a) is deemed permissive, necessitating compliance with Section 11-50-232(b) for any changes to the Water Board’s certificate of incorporation, which has not occurred. The Water Board is not estopped from pursuing this action as the City failed to timely plead estoppel and did not do so with the required specificity. The Water Board's motion to strike the City's untimely answer, which included an estoppel claim, should have been granted. The elements of estoppel, as outlined in Mazer v. Jackson Insurance Agency, require: (1) conduct or silence that represents or conceals material facts; (2) knowledge of these facts by the party being estopped; (3) ignorance of the truth by the other party; (4) expectation that the conduct will be acted upon; (5) reliance on the conduct by the other party; and (6) a detrimental change in position due to that reliance. The Water Board communicated its position to the City promptly, and the City did not demonstrate reliance on any representation from the Water Board, failing to satisfy several estoppel elements. The trial court's ruling that the Water Board was estopped from disputing Washington's board member status was erroneous. The decision is reversed and remanded. Justices Hooper, See, Brown, and England concur. The case was reassigned to Justice Houston on April 17, 2000.