Ullrich v. Board of Thomas County Comm'Rs

The opinion of the court was delivered by This is an action brought by the plaintiff, Robert E. Ullrich, a Thomas County taxpayer, to enjoin the transfer of assets of the Thomas County hospital by the Board of County Commissioners of Thomas County to a private nonprofit corporation, the defendant, Thomas County Hospital Association (TCHA). In a separate action, plaintiff also sued the individual county commissioners to recover the value of all assets previously transferred to the hospital association. The trial court granted summary judgment in favor of the defendants in both cases, and the plaintiff has appealed. The primary issue in the case is the constitutionality of the Thomas County Hospital Assets Transfer Act (K.S.A. 1982 Supp. 19-18,133 and 19-18,134). The facts are essentially undisputed and are as follows: Since 1976, there has been a dispute among the citizens of Thomas County over whether to build a new hospital. Two earlier cases before this court have addressed other phases of the controversy. In Thomas County Taxpayers Ass'n v. Finney, 223 Kan. 434, 573 P.2d 1073 (1978), it was determined that the statute on the authority of which bonds were to be issued to construct a new hospital by the county was not applicable and did not allow for the issuance of the proposed bonds. Later in Pratt v. Board of Thomas County Comm'rs, 226 Kan. 333, 597 P.2d 664 (1979), it was held that the county commissioners had no authority to issue and sell general obligation bonds, because there was no properly issued certificate of need as required by K.S.A. 19-18,128. Being unsuccessful in satisfying the legal requirements for construction of a publicly owned and financed county hospital, a group of citizens formed the Thomas County Hospital Association, a private nonprofit corporation. The objective was to have TCHA construct its own hospital and have the county transfer all of the assets owned by the old county hospital to TCHA.