State ex rel. Drainage Dist. No. 8 of Pemiscot County v. Duncan

• Citation: 68 S.W.2d 679,334 Mo. 733
• Parties: State ex rel. Drainage District No. 8 of Pemiscot County, a Municipal Corporation, Relator, v. John E. Duncan, Judge of the Circuit Court of Pemiscot County
• Decision Date: 03 February 1934
• Court: United States State Supreme Court of Missouri

68 S.W.2d 679

334 Mo. 733

State ex rel. Drainage District No. 8 of Pemiscot County, a Municipal Corporation, Relator, v. John E. Duncan, Judge of the Circuit Court of Pemiscot County

Supreme Court of Missouri

February 3, 1934

Provisional rule discharged.

Von Mayes for relator.

(1) The proceeds of taxes levied to pay bonds and interest constitute a trust fund, the legal title to which is vested in the municipality as trustee for the bondholders. 28 Cyc. 1643; Knox Co. v. Hunolt, 110 Mo. 67; 44 C. J., sec. 4217 p. 1233. Drainage districts are the owners of funds collected by taxation for their benefit, and may sue to recover the same. 19 C. J., sec. 300, p. 761; Watson v. El Paso Co., 202 S.W. 126. The proceeds of taxes levied to pay bonds. when not sufficient to pay all matured bonds of the same class, should be prorated among the holders of such bonds. Jewell v. City of Superior, 135 F. 24. When there is any doubt about the collection of sufficient taxes to pay all, the risk of the district not being able to discharge its obligations in full should be borne by all bondholders alike and none should be paid in full out of the proceeds on hand. Coquard v. Drainage District, 69 F. 870. (2) The drainage district owning and being in control of such funds must be made a party to any action to compel the treasurer to pay out such funds for any purpose so that it may defend its rights or those of the beneficiaries it represents as trustee. Where its control over such funds is interfered with by a court, without it having been given an opportunity to be heard and to appeal from an adverse decision, such action is an excessive and wrongful exercise of judicial power. Railroad v. Wear, 135 Mo. 230; State v. Riley, 276 S.W. 884, 40 A. L. R. 921; State v. Ossing, 16 S.W.2d 81. (3) The drainage district as trustee of the bondholders may represent them in any litigation concerning the proceeds of taxes in which they have a vested interest. 39 Cyc. 453-454; 28 Cyc. 1641. The treasurer is a mere receptacle, having no vested interest in the funds in his hands, and it is not his duty to appeal from any judgment against him concerning said funds, and he has no public money which he can use to defend the rights of bondholders and he is not expected to defend their rights at his own expense and make appeal bonds. (4) The only remedy open to the district was prohibition, since it could not intervene in the mandamus suits. State ex rel. v Burkhardt, 59 Mo. 75; State v. Cook, 201 S.W 364. The district was a necessary party, owning and being in control of the funds, and a number of defenses would be possible in such actions. The bonds or coupons might be spurious; it might be necessary to prorate the funds or mandamus might not lie under the facts. State v. Van Winkle, 43 N. J. Law 579.

Ward & Reeves for respondent.

(1) The respondent, as the Circuit Court of Pemiscot County, Missouri, had jurisdiction of the persons and the subject-matter in the Diekroeger cases in question; they were mandamus suits to compel the county treasurer to pay past due bonds and coupons out of available funds in his hands for that purpose, and respondent was not in that matter exceeding its jurisdiction or wrongfully exercising its jurisdiction, nor attempting to usurp any authority not given it by law. Therefore, prohibition will not lie in this case. The writ of prohibition shall be granted only to prevent usurpation of judicial power; or to prevent the exercise of judicial power where there is a lack of jurisdiction, or where the court has jurisdiction but is proceeding in excess thereof. It is to be used with great caution and forbearance for the furtherance of justice, and to secure order and regularity in judicial proceedings; and should be used only in case of extreme necessity and never in a doubtful case; but may be used in a proceeding properly within the court's jurisdiction, where the court is assuming to apply judicial force in excess of its power and authority so to do. Sec. 1609, R. S. 1929; State ex rel. v. Hartman, 221 Mo.App. 226; State ex rel. v. Stobie, 194 Mo. 45; State ex rel. v. Fort, 210 Mo. 525; Wand v. Ryan, 166 Mo. 646; State ex rel. v. Scarrett, 128 Mo. 231; State ex rel. v. Williams, 310 Mo. 267; State ex rel. v. Shain, 297 Mo. 369; State ex rel. v. Dearing, 291 Mo. 169; State ex rel. v. Stolte, 1 S.W.2d 209. It is fundamental that the writ of prohibition will not be permitted to assume the function of an appeal, writ of error or certiorari. Respondent having jurisdiction in this case, cannot be prohibited from deciding the case upon the theory set out in relator's petition that he might make an error and decide it wrong. Wand v. Ryan, 166 Mo. 646; In re Breck, 252 Mo. 327; State ex rel. v. Stokey, 194 Mo. 45; State ex rel. v. Tracey, 237 Mo. 119; State ex rel. v. Porterfield, 6 S.W.2d 47. (2) A motion for judgment on the pleadings admits all facts well or properly pleaded. Wand v. Ryan, 166 Mo. 646; State ex rel. v. Elkins, 130 Mo. 90; State ex rel. v. Shields, 237 Mo. 329; State ex rel. v. McQuillan, 262 Mo. 256; State ex rel. v. Garshe, 210 S.W. 900. (3) Mandamus is the proper remedy for Diekroeger against the county treasurer to require the county treasurer to pay the bonds when the treasurer had sufficient funds on hand for that purpose. State ex rel. v. Grand River Drainage Dist., 49 S.W.2d 121. The duties of the county treasurer under the laws of this State are purely ministerial. State ex rel. v. Williams, 232 Mo. 64; State ex rel. v. Adams, 161 Mo. 349; State ex rel. v. Meier, 143 Mo. 447. Though the party may have another remedy, he is entitled to mandamus to compel either a corporation or a ministerial officer to exercise his authority and functions. State ex rel. Black v. Wilson, 158 Mo.App. 105. Mandamus lies to compel the Secretary of State to do what he ought to do. State ex rel. v. Johnson, 234 Mo. 338. It lies against the county treasurer to pay interest coupons if he has the funds on hand. State ex rel. Lane v. Craig, 69 Mo. 565; State ex rel. v. Drainage Dist., 49 S.W.2d 121. (4) Not only is the county treasurer a ministerial officer in paying these bonds and subject to mandamus for failure, but perforce of the statute itself mandamus is the proper remedy to force him to perform his duty in this regard. "The performance of all duties prescribed in any existing or future law of this State governing the organization and administration of drainage or levee districts may be enforced by mandamus at the instance of any person or corporation interested in any way in any such district." Sec. 10885, R. S. 1929; State ex rel. v. Nelson, 310 Mo. 534.

Ellison, J. All concur, except Hays, J., absent.

OPINION

ELLISON

This is an original proceeding in prohibition. The relator is a drainage district organized by the County Court of Pemiscot County under Article IV, Chapter 41, Revised Statutes 1909, which, with amendments, is now Article II, Chapter 64, Revised Statutes 1929. Under that law the county treasurer of the county in which the district is located acts as treasurer thereof, holds custody of its funds and disburses the same. Between 1912 and 1922 the relator drainage district issued four sets or series of drainage bonds, a several part of each series maturing each year after issuance and the whole aggregating over $ 630,000. In January, 1932, bonds for the principal amount of $ 187,500 were past due and unpaid. One Charles W. Diekroeger was the owner and holder of certain of said matured bonds, and interest coupons, calling for a total sum of about $ 33,000. In that month he instituted eight mandamus proceedings in the Circuit court of Pemiscot County against the county treasurer to enforce payment in full of his said bonds and interest out of the funds of the district. The respondent judge of said circuit court issued alternative writs of mandamus, heard the causes on their merits and took the same under advisement.

While the mandamus proceedings thus stood pending in the circuit court, the drainage district, which was not joined as a party defendant therein, filed a petition for prohibition in this court alleging the respondent circuit judge was about to render judgment in said causes making peremptory the alternative writs of mandamus theretofore issued. The petition further charges such action would constitute an abuse and excessive exercise of jurisdiction for the reason that the relator district is insolvent; that it has about $ 46,000 on hand, which is a trust fund pledged for the equal benefit of all its issued bonds; that if the bonds and interest coupons of the plaintiff Diekroeger be paid in full the amount remaining in the treasury of the district will be insufficient to satisfy the other matured bonds and coupons which are equally entitled to payment; that the money necessary to retire the outstanding bond issues of the district never can be raised; and that all said bond issues should share ratably in the funds on hand and such as may be derived from further tax levies. And, finally, it is alleged that the district is an interested party as trustee of said funds, and that since it was not impleaded as a defendant in the mandamus proceedings and under the law could not intervene therein or appeal from the adverse judgment about to be rendered, its only recourse is to pray the issuance of a writ of prohibition out of this court.

Our provisional rule in prohibition being issued the respondent circuit judge made return thereto denying at large that the drainage district is insolvent and affirming it suffers only temporary financial embarrassment because of the hard times, and will be amply able to pay all its bonds and interest in full out of delinquent tax collections and future tax levies within the benefit...