Kent Corporation v. City of Winston-Salem

Annotate this Case

158 S.E.2d 563 (1968)

272 N.C. 395

KENT CORPORATION, a N. C. Corporation, Plaintiff, v. CITY OF WINSTON-SALEM, Defendant.

No. 444.

Supreme Court of North Carolina.

January 12, 1968.

*566 Blackwell, Blackwell, Canady, Eller & Jones, Winston-Salem, for plaintiff appellant.

Womble, Carlyle, Sandridge & Rice and Allan R. Gitter, Winston-Salem, for defendant appellee.

BOBBITT, Justice.

The question for decision is whether defendant, by the terms of the lease, is required to account to plaintiff for one-half or any portion of the money collected by defendant as penalties for violations of the municipal ordinances relating to parking on municipal off-street parking lots. The answer depends upon whether the money so collected by defendant constitutes "proceeds from the operation of the parking meters," or "revenue derived from the meters."

In Rhodes, Inc. v. City of Raleigh, 217 N.C. 627, 9 S.E.2d 389, 130 A.L.R. 311 (1940), ordinances purporting to regulate on-street parking by meters and providing penalties for the violation thereof were held invalid on the ground authority to enact *567 such ordinances had not been conferred on municipal corporations by the General Assembly.

When Rhodes was decided, Section 2787, Subsection 31, of the Consolidated Statutes, conferred upon municipal corporations the power "(t)o provide for the regulation, diversion, and limitation of pedestrians and vehicular traffic upon public streets, highways, and sidewalks of the city."

The statute codified as C.S. 2787(31) was amended twice by the General Assembly of 1941.

C.S. 2787(31) was first amended by Chapter 153, Public Laws of 1941, which conferred upon municipal corporations authority to regulate and limit vehicular parking on streets and highways in congested areas by parking meters as provided therein. The provisions of said Chapter 153, which relate solely to on-street parking, are the basis of decision in State v. Scoggin, 236 N.C. 1, 72 S.E.2d 97 (1952), in which a conviction for violation of a Raleigh Parking Ordinance was upheld.

C.S. 2787(31) was later amended by Chapter 272, Public Laws of 1941, which provided: "The governing authorities of all cities and towns of North Carolina shall have the power to own, establish, regulate, operate and control municipal parking lots for parking of motor vehicles within the corporate limits of cities and towns. Cities and towns are likewise hereby authorized, in their discretion, to make a charge for the use of such parking lots." Section 2 of said Chapter 272 provided: "Municipal parking lots for motor vehicles established and operated by cities and towns are hereby declared to be for a public purpose."

The above statutory provisions were in force on December 5, 1950, when the lease here involved was executed.

C.S. 2787(31), as amended from time to time, is now codified as Section 160-200, Subsection (31), of the General Statutes. (Note: We do not find that the provisions of Section 2 of Chapter 272, Public Laws of 1941, have been brought forward and incorporated in any section of the General Statutes.)

The first ordinance regulating off-street parking on public parking lots operated by Winston-Salem was adopted May 25, 1951. It provided that violations thereof were subject to the same punishment and penalties as violations of the ordinance then in effect regulating on-street parking. The provisions of the later ordinances, which amended the ordinance of May 25, 1951, are sufficiently set forth in the statement of facts. It is noted, however, that prior to the adoption of the ordinance of November 6, 1953, the General Assembly, by its enactment of Chapter 879, Session Laws of 1953, ratified April 20, 1953, had authorized municipalities to levy a penalty of $1.00 for illegal parking of motor vehicles upon any street, alley, or other public place.

Decisions of this Court relating to offstreet and on-street parking include Britt v. City of Wilmington, 236 N.C. 446, 73 S.E.2d 289 (1952), and Henderson v. City of New Bern, 241 N.C. 52, 84 S.E.2d 283 (1954). See also Town of Graham v. Karpark Corp., 194 F.2d 616 (4th Cir.1952), affirming Karpark Corp. v. Town of Graham, 99 F. Supp. 124 (M.D.N.C.1951). In our view, none of our prior decisions controls decision herein.

Plaintiff states, and rightly so, the question presented "is primarily one of construction of a written contract."

The basic rules for the construction of a contract are embodied in the following statement: "The heart of a contract is the intention of the parties, which is to be ascertained from the expressions used, the subject matter, the end in view, the purpose sought, and the situation of the parties at the time." Gould Morris Electric Co. v. Atlantic Fine Insurance Co., 229 N.C. 518, 50 S.E.2d 295. "Where the terms are plain and explicit the court will determine the legal effect of a contract and enforce it *568 as written by the parties." Church v. Hancock, 261 N.C. 764, 136 S.E.2d 81. In this connection, see 2 Strong, N.C. Index 2d, Contracts ยง 12.

The rental, according to the explicit language of the lease, is to be based on the "proceeds from the operation of the parking meters" and the "revenue derived from the meters." Absent any provision suggesting a contrary meaning, we think these expressions refer solely to coins inserted in the meters for the activation thereof.

It appears that a Winston-Salem ordinance relating to on-street parking was in force when the ordinance of May 25, 1951, relating to parking on municipal off-street parking lots, was adopted. The record does not disclose whether it was contemplated on December 5, 1950, that defendant would adopt ordinances relating to municipal off-street parking and providing penalties for violations thereof. However, the lease, after referring to "the calculation and division of the revenue from the meters," (our italics) adds: "The Lessee shall not be liable to the Lessors for any other amount or sum as rental, and the rental payable to Lessors shall be paid solely from the revenue derived from the meters as aforesaid * * *." (Our italics.)

The primary purpose of the penalties prescribed in the Winston-Salem ordinances relating to parking on municipal off-street parking lots is to enforce the provisions of such ordinances requiring that coins be deposited in the meters covering the parking periods used by the patrons. The collection of the penalty is ancillary to the accomplishment of said primary purpose. The lessors benefit from increased collections through the meters resulting from the provisions of the ordinances and the enforcement thereof by defendant at its expense.

It was stipulated that the money collected by defendant for which plaintiff seeks an accounting was collected under authority of said ordinances. It was not collected for use of space but for violation of a municipal ordinance. Neither by pleading nor by assignment of error does plaintiff challenge the validity of said ordinances. Even so, if such ordinances were invalid, the aggrieved party would be the patron of the parking lot from whom defendant unlawfully collected the penalty. Obviously, plaintiff would have no right thereto.

The conclusion reached is that any money collected by defendant under authority, or under color of authority, of said Winston-Salem ordinances, as penalties for violations of said ordinances, does not constitute "proceeds from the operation of the parking meters" or "revenue derived from the meters" within the meaning of those terms as used in the lease of December 5, 1950. Accordingly, the judgment of the court below is affirmed.

Having reached the conclusion that defendant was not obligated under the lease to pay to plaintiff or its predecessors in title any part of the sums of money collected as penalties under the authority of the municipal ordinances referred to above, the question as to when the plaintiff and its predecessors in title first learned that defendant was not accounting to them therefor is immaterial.