Board of Educ. of Paducah v. City of Paducah

• Decision Date: 03 December 1935
• Citation: 261 Ky. 549,88 S.W.2d 292
• Parties: BOARD OF EDUCATION OF PADUCAH v. CITY OF PADUCAH et al. (two cases).
• Court: Kentucky Court of Appeals

88 S.W.2d 292

261 Ky. 549

BOARD OF EDUCATION OF PADUCAH v. CITY OF PADUCAH et al. (two cases).

Court of Appeals of Kentucky

December 3, 1935

Appeal from Circuit Court, McCracken County.

Two actions by the Board of Education of Paducah against the City of Paducah and others. From an adverse judgment, the plaintiff appeals.

Affirmed in part and reversed, with directions in part.

C. C Grassham, of Paducah, for appellant.

W. V Eaton, of Paducah, for appellee City of Paducah.

Brady M. Stewart, of Paducah, for appellees Chas. C. Rieke and United States Fidelity & Guaranty Co.

J. D Mocquot, of Paducah, for appellees Ross Rutter and Fidelity & Deposit Co.

RICHARDSON Justice.

These actions were tried as one in the circuit court. The pleadings, the evidence, and the questions of law involved in both are identical. The first is to recover of Rieke and his surety and the city of Paducah; the second, to recover of Rutter and his surety and the city the alleged balance of taxes, interest, and penalties claimed to be due the city board of education for certain years.

The city of Paducah is of the second class. Rieke was its commissioner of public finance for the years 1932 and 1933. With the United States Fidelity & Guaranty Company as surety, he executed and delivered a bond for the use and benefit of the city in the sum of $10,000, conditioned that he will "faithfully and regularly perform and discharge all of the duties of his office and that he will not violate any law in the performance of his duties," and pay any damages occurring from any act or omission of any of his duties.

Rutter was the commissioner of public finance of the city for the years 1926, 1927, 1928, 1929, 1930, and 1931, under a bond containing the same conditions and provisions, with the Fidelity & Deposit Company of Maryland, his surety.

The actions were transferred to equity by agreement of the parties. The court dismissed the actions as to Rieke and Rutter and their sureties, and rendered judgment against the city for $23.32. The city board of education is here insisting that the developed facts authorized judgments against Rieke and Rutter and their sureties, and the judgment against the city is improper as to the sum of the recovery.

To consider and dispose of the issues properly, we are required to review the statutes involved and apply them to the evidence adduced.

The city board of education (section 3235a-1, Ky.St.Supp. 1933) is a body corporate with the power "to sue and be sued, contract and be contracted with, purchase, receive, hold and sell property," to "do all things necessary to accomplish the purpose for the attainment of which such school district is organized," and has "general and supervising control, government and management of the public schools" of the city. Section 3235a-2, Ky. St. Its members are elected by the legal voters of the city at large for a term of four years. Section 3235a-7 Ky. St. It is its duty (section 3235a-26 Ky. St.) "annually, in the month of January, approximately ascertain the amount of money which will be necessary to be used to defray the expenses of maintaining the schools, including sinking fund, repairs and improvements of buildings and any liquidation of liabilities falling due during the current fiscal year," and enter the same at large upon its minute books. The power is conferred upon it by this section "to impose and levy ad valorem taxes upon all real and personal property in such city subject to and assessed for taxation for city purposes, not exceeding a rate of one dollar upon each one hundred dollars of taxable property. Provided, however, that an additional twenty-five cents (25¢) on each one hundred dollars ($100.00) of taxable property may be levied for operating and maintaining the schools with the approval of the board of commissioners or general council of such city or cities upon due proof presented to said board of commissioners or general council by said board of education that the extra levy is necessary for school purposes." The consent of the city's commissioners is required respecting only the extra levy of 25 cents. The statute contains this language: "The taxes accruing from so much of said levy as is made for sinking fund purposes shall be by said board of education at once irrevocably set aside and used for that purpose and not otherwise."

On a presentation to the city commissioners of the board of education's budget, it becomes their duty to make a levy at a rate fixed and certified by the board. It also becomes their duty to add to and include the taxes called for by the board's budget, in the regular tax bills of the city containing the ordinary levy for city purposes, and collect the same "by the same officers, and in the same manner and at the same time as the ordinary taxes for said city are collected by the collecting officer of the city, and all powers and duties conferred upon and required of officers in collecting the ordinary city taxes are hereby conferred upon and required of them in collecting the taxes levied by the board of education. *** As and when said taxes are collected the city treasurer, or collecting officer, of said city, shall promptly pay the same to the treasurer of the board of education, taking the receipts of said treasurer for the sum so paid, which shall be a full acquittance of said treasurer therefor."

The city of Paducah has adopted, and is acting under, the commission form of government, authorized by sections 3235c-1 to 3235d-2, inclusive, Ky.St.Supp. 1933. The administrative departments of the city government are divided into five (section 3235c-16), one of which is the department of public finance. Section 3235c-2 continued in existence all laws applicable to and governing cities of the second class and not inconsistent with the provisions of the act authorizing the city to adopt the commission form of government, after the adoption of the commission form of government. Section 3235c-4 abolishes all the city offices save those of mayor and police judge after the expiration of their respective term. Section 3184 requires the auditor of the city to deliver the assessment books of taxes to the city clerk and the latter to make out tax bills showing the taxes of each taxpayer, and deliver the same to the treasurer. Section 3185 declares the "taxes shall be due and payable, without demand therefor, at the treasurer's office, one-half each on the first day of June and the first day of October in each year. *** Taxes not paid within one calendar month after they are due, shall be deemed delinquent and shall have added to them a penalty of ten per centum (10%) of the amount thereof, and shall thereafter bear interest at the rate of one-half of one per cent (1 1/2%) for each month or faction of a month until paid, or until the property of the delinquent has been sold for the tax." Section 3186 confers upon the treasurer the power of sale of personal property, and section 3187 prescribes the procedure for the sale of real estate for taxes.

It is not disputed that the duties imposed by the statutes, supra, upon the city treasurer are now required of the commissioner of public finance.

In its petition against Rieke, the city board of education charged that the total amount of the taxes for the year 1932 was $179,447.94, and Rieke had collected and accounted to its treasurer for $177,267.31, leaving a balance due the board of $2,180.63 and, by reason thereof, it is entitled to recover of Rieke, his surety, and the city this sum. It made like allegations, differing only in the total assessment and the amount due for the year 1933 taxes, interest, and penalty, aggregating the sum of $2,132.84.

In its action against Rutter, like allegations are made, differing only in the assessment...