Arkansas State Highway Commission v. Dodge

• Decision Date: 07 April 1930
• Docket Number: 268,258
• Citation: 26 S.W.2d 879,181 Ark. 539
• Parties: ARKANSAS STATE HIGHWAY COMMISSION v. DODGE
• Court: Arkansas Supreme Court

26 S.W.2d 879

181 Ark. 539

ARKANSAS STATE HIGHWAY COMMISSION v. DODGE

No. 268, 258

Supreme Court of Arkansas

April 7, 1930

Prohibition to Pulaski Chancery Court; Frank H. Dodge Chancellor; writ denied.

Writ of prohibition denied.

Hal L Norwood, Attorney General, Claude Duty and Walter L. Pope Assistants, Pace & Davis and Tom W. Campbell, for appellant.

W. E. Spence, Dudley & Dudley and Charles D. Frierson, for appellee.

SMITH, J. HART, C. J., and HUMPHREYS, J., concur. KIRBY, MCHANEY and BUTLER, JJ., dissent.

OPINION

SMITH, J.

E. L. and E. W. Lahar, partners doing business under the firm name of Lahar Brothers, brought this suit in the Pulaski Chancery Court against the chairman and members of the Arkansas State Highway Commission, and for their cause of action alleged the following facts:

That they had entered into a written contract with the State Highway Commission to construct certain portions of the State highway system, pursuant to which they had earned a large sum of money, which was payable to them under their contract, but the commission had refused to make proper estimates of the work and had declined to issue vouchers upon the State treasury, as they were in duty bound to do, whereby the plaintiffs were deprived of the compensation legally due them. Wherefore they prayed that a master be appointed to state the account between the themselves and the highway commission, and that they have judgment for the amount alleged to be due them.

The commission filed a demurrer to the complaint upon the ground "that the plaintiffs are without right to file and maintain this suit, because it is in reality a suit against the State of Arkansas, and is prohibited by § 20, of article 5, of the Constitution of the State of Arkansas, and the court is therefore without jurisdiction to hear and determine the complaint filed herein, because it is a suit against the State of Arkansas and prohibited by said section of the Constitution of the State of Arkansas."

The demurrer was overruled, whereupon the defendants filed in this court a petition for a writ of prohibition to prevent the chancery court from proceeding further with or exercising jurisdiction in said cause.

The practice is well settled that, when it appears that an inferior court is about to proceed in a matter over which it is entirely without jurisdiction under any state of facts which may be shown to exist, then the Supreme Court, exercising supervisory control over the inferior court, may prevent such unauthorized proceeding by the issuance of a writ of prohibition. Monette Road Imp. Dist. v. Dudley, 144 Ark. 169, 222 S.W. 59.

Section 20 of article 5 of the Constitution reads as follows: "The State of Arkansas shall never be made defendant in any of her courts."

The argument is made that this provision of the Constitution is declaratory merely of what has always been the law, and that it means simply that the State may not be sued in her own courts without her consent. We think, however, that the purport of the language quoted is not to be thus limited. Numerous States have the provision in their Constitution that no suit shall be brought against the State except with its consent, and it is, of course, held in those States that suits may be brought when consent is given, but that such suits must be brought in the forum provided and be prosecuted in the manner authorized, and in no other forum or manner.

Our Constitution is not, however, merely declaratory of this attribute of sovereignty. It goes further and declares that the State shall never be made defendant in any of her courts, and nowhere is provision made under the Constitution whereby this immunity may be waived. Pitcock v. State, 91 Ark. 527, 121 S.W. 742, 134 Am. St. Rep. 88.

The Constitution of Alabama contains a provision almost identical with that of our own Constitution on this subject, and in the case of Alabama Industrial School v. Addler, 144 Ala. 555, 42 So. 116, 113 Am. St. Rep. 58, it was held (to quote a headnote): "If the Constitution contains a prohibition against the State being made a party defendant to any suit, and does not provide for any waiver of such exemption, the Legislature has no power to pass a law permitting such waiver, nor can the State or its agent waive such exemption by failure to plead to the jurisdiction or otherwise." We feel constrained to give the same construction to the same provision in our own Constitution.

The question for decision, therefore, is, whether the suit which we are asked to prohibit is, in fact, a suit against the State.

Any answer to this question requires a consideration of the statutes under which the contracts sued upon were executed. At its 1929 session the General Assembly passed an act entitled, "An Act to amend and codify the laws relating to State highways." 1, Acts 1929, p. 264. This act recreated the State Highway Commission, and the commission as recreated by the act of 1929 consists of five members, with a chairman, vice-chairman and a secretary. This act declared it to be the policy of the State "to take over, construct, repair, maintain and control all the public roads in the State comprising the State highways as defined hereinafter," and authority was given to make such contracts as were needful for these purposes. By act No. 18, passed at the 1929 session of the General Assembly (1, Acts 1929, p. 26), the sum of fifteen million dollars was appropriated for the construction of roads and bridges embraced in the State highway system for the fiscal year beginning March 1, 1929, and ending the last day of February, 1930, and a similar appropriation was made for the fiscal year beginning March 1, 1930, and ending the last day of February, 1931, and the act placed this money at the disposal of the commission, to be disbursed in the manner therein provided. These acts were a continuation of the policy of road construction adopted by the State upon the passage of act No. 11 of the Acts of 1927 (Acts 1927, page 17), commonly known as the "Martineau Road Law," which act appropriated large sums of money to effect its purposes.

Upon the passage of the Martineau Road Law, and in the execution of its provisions, numerous suits arose, which hampered the work of the commission, and at the extra session of the General Assembly an act, No. 2, was passed and approved October 3, 1928, entitled, "An act to require bonds in certain suits affecting the administration of the State highway laws." Section 1 of this act reads as follows:

"Suits against the State Highway Commission, the State Highway Note Board, the members or any member of either, or against any State officer, involving any act done or proposed to be done in the administration of the State Highway Department, or of any law pertaining to the State highway system, shall be brought only at the seat of government in Pulaski County."

This act, passed at a special session called for the special purpose of considering the State's road-building program, recognized the existence of pending suits, and the probability of others being brought, and fixed the venue thereof at the seat of government, in Pulaski County, where the highway commission has its domicile and keeps its records.

While this special act did not designate the highway commission as a corporation, it was recognized as an entity, a juristic person, created for the purpose of making contracts for the distribution of the large sum of money which had been appropriated, and which it was anticipated would be later appropriated in constructing, maintaining, and repairing roads, and for other purposes. The highway commission was given no authority in the acts to which we have referred to make contracts in the name of the State. Its authority was limited to the making of contracts relating to the specific appropriations which had been made to discharge the contracts which the commission was authorized to make. The special act of 1928 contemplated that differences might arise between the contracting parties, and to take care of such controversies a forum was provided wherein and whereby these differences might be settled.

In the proceedings there provided for a judgment might be rendered fixing a liability against the highway commission, but a judgment so rendered would not be a judgment against the State as such, and could not be enforced by the seizure or sale of the property of the State, as a judgment could be enforced against a private litigant. Satisfaction can be had only out of the fund specifically appropriated for the purpose in regard to which the highway commission was authorized to contract.

The appropriation for the use of the commission is a fund set aside for a specific purpose. The highway commission is an entity, or juristic person, created to disburse this money in payment of work which it is authorized to contract for, and, while the appropriation was not made specifically to satisfy judgments rendered against the commission, it was contemplated that judgments might be rendered, and the appropriation is the State's provision for their payment. It was not contemplated that the highway commission should accede to every demand of every contractor, yet it was contemplated that in the expenditure of a sum of money so large the highway commission, in its zeal to protect the fund, might take positions which, if persisted in, would work injustice to some contractor, who could not sue the State as such. Therefore, a forum was constituted where these differences might be adjusted according to applicable legal principles, this forum being the courts at the seat of government in Pulaski County.

A judgment rendered pursuant to this act would not be a "judgment against the State." It would be only an ...