Atlas Life Ins. Co. v. Board of Ed. of City of Tulsa
| Decision Date | 02 August 1921 |
| Docket Number | 12481. |
| Citation | 200 P. 171,83 Okla. 12,1921 OK 306 |
| Parties | ATLAS LIFE INS. CO. v. BOARD OF EDUCATION OF CITY OF TULSA. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
Municipal corporations possess the incidental or implied right to alienate or dispose of the property, real or personal, of the corporation of a private nature, unless restrained by charter or statute.
Under the statutes and constitutional provisions set out in the opinion a board of education of an independent school district of a city of the first class possesses the power to lease for 99 years to a private corporation for private purposes any real estate held by it which has become unsuitable or is not needed for school purposes.
The rule of ultra vires ought to be reasonably and not unreasonably understood and applied, and whatever may fairly be regarded as incidental to and consequential upon those things which the Legislature has authorized municipal corporations to do ought not, unless expressly prohibited, be held by judicial construction to be ultra vires.
Appeal from District Court, Tulsa County; Redmond S. Cole, Judge.
Action by the Board of Education of the City of Tulsa against the Atlas Life Insurance Company. Judgment for plaintiff, and defendant appeals. Affirmed.
William F. Tucker, Hulette F. Aby, and Frank Settle, all of Tulsa for plaintiff in error.
Bell & Fellows and Rice & Lyons, all of Tulsa, for defendant in error.
This was an action for specific performance, commenced in the district court of Tulsa county pursuant to section 5303, R L. 1910, providing for the submission of a controversy touching a question which might be the subject of a civil action upon an agreed statement setting out the facts upon which the controversy depends, where it appears that the controversy is real and the proceedings are in good faith to determine the right of the parties.
The legal question involved is whether or not a certain lease for 99 years executed by the board of education of the city of Tulsa to one Earl W. Sinclar, and thereafter duly and regularly assigned to the Atlas Life Insurance Company, the plaintiff in error herein, invested the latter company with a leasehold estate in the premises described therein. The agreed statement of facts shows that the leased premises consisted of two lots in what is known as the high school block, situated in the city of Tulsa, the fee-simple title thereto being in the board of education; that originally the high school was located on this block; that subsequently, on account of the growth of the city of Tulsa, many large business structures were erected adjacent to this block rendering it of great value, but unsuitable for school purposes; that in view of this the block was duly abandoned by the board for school purposes, and subsequently several of the lots were sold, the fifteen-story Cosden office building and the city hall of the city of Tulsa being erected thereon by the purchasers. Upon the abandonment of the block for school purposes the old high school building was demolished and since that time no portion of said block has been used in any manner for school purposes nor is it suitable for such use.
The sale of the lots upon which the buildings hereinbefore mentioned were constructed was held to be valid in Cosden v. Board of Education of City of Tulsa, 60 Okl. 214, 159 P. 1108, the court holding:
"By virtue of section 3, art. 6, of chapter 219 of the Session Laws of 1913, the board of education of cities of the first class in this state possess the power and authority to sell and convey real estate and said board may exercise this power without the necessity of making any finding of the reason or necessity which induces the exercise of its discretion."
As the validity of the lease executed in this proceeding turns upon the construction to be placed on section 3, supra, and the other sections of the statute referred to in the Cosden Case, we will set them out at this point. They are as follows:
The single question presented for decision in the case at bar is: Do the foregoing sections of the statute and the provisions of the Constitution hereinafter cited either directly or by fair implication confer power upon the board of education of the city of Tulsa, a municipal corporation and an independent school district, to convey by a written lease and give merchantable title to the property described in the agreed case? That is, has the board of education authority to make, execute, and deliver a lease for 99 years covering said property, the same being held by the board of education in its proprietary character, and the same being no longer suitable or needed for school purposes?
The trial court answered this question in the affirmative and decreed specific performance against the plaintiff in error, and it is to reverse this ruling that this proceeding was commenced.
Upon examination of the agreed statement of facts and careful consideration of the able briefs filed by counsel for the respective parties, we are convinced that the judgment of the trial court was correct and should be affirmed.
At the outset it is conceded that municipal corporations possess the incidental or implied right to alienate or dispose of the property, real or personal, of the corporation of a private nature, unless restrained by charter or statute. Owen v. City of Tulsa, 27 Okl. 264, 111 P. 320.
On principle we are unable to perceive any good reason why, when this block became unsuitable and was no longer needed for public purposes, the board of education could not make a valid contract to use it in some private service. This principle was applied in the case of the City of St. Louis v. The Maggie P. (C. C.) 25 F. 203. In that case the city of St. Louis, through its harbor master, contracted to raise a sunken vessel. This contract was made with the owner of the vessel. The city filed a libel for these services, and the question was raised whether the making of such a contract was not outside the scope of municipal powers. The court, through Mr. Justice Brewer, sustained the libel after careful consideration, saying:
"When it has in its possession instrumentalities, and hires employés for the purpose of discharging some public duty, I see no reason why, when the exigencies of public duties do not require the use of those instrumentalities and employés, it may not make a valid contract to use them in some private service."
The same principle was also applied in the case of Gottlieb-Knabe & Co. v. Charles F. Macklin et al., 109 Md. 429, 71 A. 949, 31 L. R. A. (N. S.) 580, 16 Ann. Cas....
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