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McGahan v. Kenai Peninsula Borough (4/16/93), 850 P 2d 636
Notice: This is subject to formal correction
before publication in the Pacific Reporter.
Readers are requested to bring typographical
or other formal errors to the attention of
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THE SUPREME COURT OF THE STATE OF ALASKA
NORTH KENAI PENINSULA ROAD )
MAINTENANCE SERVICE AREA and )
BILL McGAHAN, )
) Supreme Court File No. S-4754
Appellants, ) Superior Court File No.
) 3KN-91-0739 Civil
) O P I N I O N
KENAI PENINSULA BOROUGH, )
Appellee. ) [No. 3944 - April 16, 1993]
Appeal from the Superior Court of the
State of Alaska, Third Judicial District,
Jonathan H. Link, Judge.
Appearances: John R. Strachan,
Anchorage, for Appellants. Kristine A.
Schmidt, Deputy Borough Attorney, Kenai
Peninsula Borough, for Appellee.
Before: Moore, Chief Justice,
Rabinowitz, Burke, Matthews and Compton,
Kenai Peninsula Borough Ordinance 91-18 abolished the
North Kenai Peninsula Road Maintenance Service Area
(North Service Area) and consolidated it with three
other service areas in the Kenai Peninsula Borough
(Borough). North Service Area and Bill McGahan sought
a judgment declaring the ordinance null and void and
enjoining its enforcement. They also filed a Motion
for Preliminary Injunction. The superior court denied
their motion and dismissed their suit. We affirm.
I. FACTUAL AND PROCEDURAL BACKGROUND
In 1981 the Borough Assembly enacted Ordinance 81-63,
which proposed the establishment of the North Service
Area. The proposition was subject to approval by a
majority of the people voting within the area. The
proposition would allow road maintenance services to be
provided within the North Service Area. A five member
board elected from residents of the service area was to
advise the mayor and the Assembly regarding the
management of the North Service Area. No mill levy
could be established without further voter approval.
Three virtually identical ordinances proposing
companion maintenance service areas were enacted at the
same time.1 All four service areas were approved by
the voters in their areas. The Assembly then passed
ordinances providing for the operation and organization
of the service areas.2
In 1985 the Assembly placed on the ballot in each
service area a proposition which would give the service
area power to provide for road improvement and to levy
up to one-half mill for road improvements. A majority
of the voters in each service area approved the
proposition for its respective service area.
On August 6, 1991, the Assembly enacted Ordinance 91-
18,3 which repealed the ordinances establishing the
four service areas and created the Kenai Peninsula
Borough Road Service Area in their stead. The
ordinance did not add to or modify any of the powers
previously vested in the four service areas. Under
Ordinance 91-18, the mayor appoints the new service
Bill McGahan was a resident of the North Service Area
and a member of its board at the time of its
disestablishment. He filed a Complaint and Motion for
Preliminary Injunction on behalf of himself and the
North Service Area. The complaint requested: 1) an
injunction restraining the implementation of Ordinance
91-18, and 2) a declaratory judgment finding Ordinance
91-18 null and void.
After two hearings, the superior court orally denied
the motion for preliminary injunction. The court later
issued a written decision concluding that: 1) North
Service Area is not an independent political entity
capable of suing or being sued,4 2) whether Ordinance
91-18 violated the will of the people is a
nonjusticiable political question, and 3) Ordinance 91-
18 is valid without voter approval. Since the court
concluded that North Service Area's claims were without
merit, it denied the motion for preliminary injunction.
The court then dismissed the suit because it concluded
that the "basic issue"was nonjusticiable.
A. STANDARD OF REVIEW
This court applies an abuse of discretion standard when
reviewing an order granting a temporary injunction.
State v. Kluti Kaah Native Village, 831 P.2d 1270, 1272
n.4 (Alaska 1992). The same standard applies when
reviewing an order denying a preliminary injunction.
We apply to preliminary injunctions a "balance of
hardships" approach which entails a three part test:
1) the plaintiff must be faced with irreparable harm;
2) the opposing party must be adequately protected; and
3) the plaintiff must raise serious and substantial
questions going to the merits of the case; that is, the
issues raised cannot be "frivolous or obviously without
merit." Kluti Kaah, 831 P.2d at 1273; Alaska Pub.
Utils. Comm'n v. Greater Anchorage Area Borough, 534
P.2d 549, 554 (Alaska 1975). The "serious and
substantial question"standard applies only where the
injury which will result from the preliminary
injunction is relatively slight in comparison to the
injury which the person seeking the injunction will
suffer if the injunction is not granted. State v.
United Cook Inlet Drift Ass'n, 815 P.2d 378, 378-79
(Alaska 1991). Where the injury from the preliminary
injunction is "not inconsiderable and may not be
adequately indemnified by a bond, a showing of probable
success on the merits is required before a temporary
restraining order or a preliminary injunction can be
issued." Id. at 379.
The decision to dismiss a suit because it involves a
nonjusticiable political question is a question of law,
subject to independent review. "On questions of law,
this court is not bound by the lower court's decision;
. . . Our duty is to adopt the rule of law that is most
persuasive in light of precedent, reason, and policy."
Guin v. Ha, 591 P.2d 1281, 1284 n.6 (Alaska 1979).
Questions of standing to sue and the validity of an
ordinance adopted without voter approval are also
questions of law, subject to independent review.
1. North Service Area
The superior court concluded that the North Service
Area did not have standing to sue, since it was not an
independent legal entity. Using our independent
judgment, we conclude that the superior court was
As a general rule, only independent legal entities may
sue or be sued. See Waller v. Butkovich, 584 F. Supp.
909, 925 (M.D.N.C. 1984); Meyer v. City and County of
Honolulu, 729 P.2d 388, 390 n.1 (Hawaii App. 1986)
aff'd in part, reversed in part, 731 P.2d 149 (Hawaii
1986). Alaska law specifically gives cities and
boroughs corporate status, and the right to sue and be
sued. AS 09.65.070-.080, AS 29.04.010-.020, AS
39.35.010(14). There are no similar provisions for
A service area is a specific geographical area within
which a municipal service is furnished by a borough.
Its powers derive from statute, charter and ordinance.
Service areas have no corporate status or right to sue
under any Alaska statute. Neither the Kenai Borough
charter nor Borough ordinances confer such status or
right. Therefore, the North Service Area does not have
standing to sue the Borough.
2. Bill McGahan
The superior court did not decide whether Bill McGahan
had standing to sue, since it concluded that his claims
had no merit and ultimately dismissed the suit on the
ground that the "basic issue" presented was
nonjusticiable. In order to reach the issues of the
validity of Ordinance 91-18 and justiciability, we must
first determine whether McGahan has standing to sue.
"[T]he concept of standing has been interpreted broadly
in Alaska." Moore v. State, 553 P.2d 8, 23 (Alaska
1976). "The basic requirement for standing in Alaska
is adversity." Trustees for Alaska v. State, 736 P.2d
324, 327 (Alaska 1987), cert. denied, 486 U.S. 1032
(1988). This court recognizes interest-injury standing5
and taxpayer-citizen standing. Id. Arguably McGahan
has standing under either of these doctrines. However,
taxpayer-citizen standing is more appropriate to his
Taxpayer-citizen standing will be granted if certain
criteria are satisfied. First, the case must be one of
public significance. Second, the plaintiff must be
"appropriate." This means that the plaintiff must
have an adverse interest. If another party is more
directly affected by the outcome, the plaintiff may be
denied standing. Finally, the plaintiff must capably
and competently represent the position asserted.
Trustees, 736 P.2d at 329-30.
Whether Ordinance 91-18 is valid without voter approval
is a matter of public significance. Consolidation of
the service areas directly affects the manner in which
road maintenance and improvement services are provided
in and by the Borough.
As a resident of the North Service Area, McGahan is an
appropriate plaintiff. No plaintiff or class of
plaintiffs would be more directly affected by the
outcome. It is not argued that he has not or cannot
capably and competently advocate his adversarial
We conclude that McGahan has standing to challenge the
ordinance which altered the service area by
consolidating it with three other service areas.
C. JUSTICIABILITY OF ORDINANCE 91-18
The superior court ultimately dismissed the suit
because it concluded that the question whether
Ordinance 91-18 violated the will of the people is a
political question upon which the court should withhold
judgment. To the superior court, the "basic issue"was
whether the ordinance was "right or wrong."
This court has recognized that political questions are
best left to legislative bodies. "It is not a court's
role to decide whether a particular statute or
ordinance is a wise one: the choice between competing
notions of public policy is to be made by elected
representatives of the people." Concerned Citizens of
So. Kenai Peninsula v. Kenai Peninsula Borough, 527
P.2d 447, 452 (Alaska 1974).
McGahan does not argue that the Borough's perceived
violation of the will of the people is a separate basis
for invalidating Ordinance 91-18. Rather, he argues
that the ordinance was adopted illegally, i.e. without
voter approval. Hence, the will of the people, as
expressed in 1981 and 1985, was frustrated. Construed
in context, this statement is nothing more than a
On the other hand, the Borough argues that the court
correctly held that the ordinance was valid without
voter approval. Since the suitability of the ordinance
was the only issue remaining, suit was properly
dismissed as presenting a nonjusticiable political
The superior court erred in dismissing this suit as
presenting solely a nonjusticiable issue. The validity
of Ordinance 91-18 without voter approval presents a
justiciable issue. We will therefore decide whether
Ordinance 91-18 required voter approval.6
D. VALIDITY OF ORDINANCE 91-18
WITHOUT VOTER APPROVAL
McGahan argues that when the voters approved the
exercise of power by the North Service Area to maintain
roads, a compact arose between the people and the
Borough. The voters approved a service area which
provided for local control by an elected board. On the
other hand, the new service area has an appointed
board, does not provide for local control, and in fact
encompasses three other service areas. The terms of
the compact approved in 1981, and altered in 1985 after
another vote, can only be changed if the voters approve
The Alaska Constitution provides that service areas
"may be established, altered, or abolished by the
assembly, subject to the provisions of law or charter."
Alaska Const. Art. X, 5. Alaska Statute 29.35.450(a)
codifies this provision, restating that service areas
may be established, operated, altered, or abolished by
Alaska Statutes and Borough ordinances require the
Borough to seek voter approval to exercise a power for
which the service area has been established. AS
29.35.490(a)(1); Kenai Peninsula Borough Ordinance
(KPBO) 16.04.060 (1981). However, no voter approval is
necessary to operate, alter or abolish a service area.
Thus, Ordinance 91-18 is valid without voter approval
if it is merely an "alteration"of existing service
The change from an elected to an appointed board is an
alteration in the administration of the service area.
The Assembly may provide for an elected or an appointed
board, or no board at all. AS 29.35.460. Changing the
method of the selection of the board is an alteration
of the service area which does not require voter
Although consolidating four service areas into one is a
more fundamental change, the same powers are being
exercised within the same areas. The mayor and the
Assembly still have final authority. KPBO 16.56.080,
which provided for the powers and duties of the North
Service Area board, is virtually identical to KPBO
16.41.070, which provides for the powers and duties of
the new board. In each, the board's power to provide
for improvement and maintenance of roads is subject to
Assembly approval and appropriation of funds. Since
the mayor and Assembly are exercising the same powers
within the same geographical area and are subject to
the same constraints with respect to approval and
appropriation that existed before the alteration, voter
approval is not required. Ordinance 91-18 is valid.
In view of the trial court's correct determination
that Ordinance 91-18 is valid without voter approval,
the trial court did not abuse its discretion in denying
McGahan's motion for preliminary injunction.7 The
decision to deny the preliminary injunction is
The superior court improperly dismissed the suit on the
ground that it presented a nonjusticiable political
question. However, McGahan would not succeed on his
justiciable claim that Ordinance 91-18 is invalid
because it was adopted without voter approval. On the
alternative ground that the complaint failed to state a
claim on which relief can be granted, the dismissal is
1. Ordinances 81-55, 81-60, and 81-53, proposing the
South, Central, and East Kenai Peninsula Service
Maintenance Areas respectively.
2. Ordinance 82-29, codified as KPB 16.56, provided for
the North Service Area.
3. Ordinance 91-18 provides an effective date of July 1,
1991, although it was not enacted until August 6, 1991.
The superior court concluded as a matter of law that
the effective date of the ordinance was August 7, 1991,
the day after it was passed by the Assembly. No party
argues that this conclusion is incorrect.
4. The superior court concluded that a decision regarding
McGahan's standing to sue was unnecessary, since it
ultimately decided that his claims had no merit.
Unless McGahan had standing, however, the court should
not have reached the merits of his claims.
5. For interest-injury standing, "a plaintiff must have an
interest adversely affected by the conduct complained
of." Trustees for Alaska, 736 P.2d at 327.
6. The superior court dismissed the case on its own motion
after two hearings on North Service Area's Motion for
Preliminary Injunction. We may uphold the decision of
the superior court if an alternative ground would
support, as a matter of law, the result reached by the
superior court. Carlson v. State, 598 P.2d 969, 973
(Alaska 1979); Stordahl v. Government Employees Ins.
Co., 564 P.2d 63, 67 n.16 (Alaska 1977); Moore v.
State, 553 P.2d 8, 20-21 (Alaska 1976). We will
therefore consider whether an order of dismissal would
be appropriate on the record before us. Carlson, 598
P.2d at 973. We may uphold the decision to dismiss if
the complaint failed to state a claim on which relief
can be granted. Alaska R. Civ. P. 12(b)(6).
The complaint is based on the invalidity of Ordinance
91-18 without voter approval. The superior court has
decided that the ordinance is valid. McGahan has had
ample opportunity to argue the issue. We may therefore
reach the issue and uphold the dismissal if, as a
matter of law, the ordinance is valid without voter
7. The trial court made no findings with respect to the
potential for irreparable harm without the preliminary
injunction or the possibility of protecting the Borough
if the preliminary injunction were issued. It is
therefore unclear whether the trial court applied the
"serious and substantial question" standard or the
"probable success on the merits"standard. Even under
the less rigorous "serious and substantial question"
standard, the trial court did not abuse its discretion.
No authority supported the position that the voters and
the Borough entered a "compact"which precluded the
Borough from altering the service area as allowed by