Rorick v. Board of Comm'rs of Everglades Drainage Dist.

Background

Bondholders who held outstanding Everglades Drainage District bonds sued Florida officials, including the District’s Board and the state Trustees, saying later state laws reduced taxes and revenues and changed tax collection rules in ways that broke the contract the 1913 law promised. The case began in 1931, a three-judge district court sat, an injunction was briefly issued and later vacated, a long hiatus followed, and a final three-judge decree in 1938 denied relief and dismissed the bills.

Reasoning

The central question was procedural: did this suit require the special three-judge court that federal law provides for challenges to statutes of statewide application? The Court said no. It explained that the special procedure applies only when a law truly embodies a statewide policy. The changes at issue affected the single Everglades Drainage District and local administration, not a law of general statewide application, so the three-judge requirement was not met. The Court relied on earlier decisions drawing the same limit and noted that joining state Trustees did not change the local character of the controversy.

Real world impact

Because the suit was not the kind that triggers the three-judge procedure, the Supreme Court vacated the three-judge decree and sent the case back to the district court to proceed without that special rule. This ruling is procedural, not a final decision on the contracts or taxes, so the underlying dispute will be decided in the lower court on regular procedures.