Bourne v. Cole

• Decision Date: 22 March 1938
• Docket Number: 2062
• Citation: 53 Wyo. 31,77 P.2d 617
• Parties: BOURNE v. COLE, ET AL
• Court: Wyoming Supreme Court

77 P.2d 617

53 Wyo. 31

BOURNE v. COLE, ET AL

No. 2062

Supreme Court of Wyoming

March 22, 1938

APPEAL from the District Court, Albany County; V. J. TIDBALL, Judge.

Suit by Chris D. Bourne against W. Jack Cole and others to enjoin the performance of a contract executed by the named defendant and the Governor and Attorney General. Judgment for defendants and plaintiff appeals.

Affirmed.

For the appellant, there was a brief and an oral argument by Walter Q. Phelan of Cheyene.

The contract is illegal and void for the reason that it violates statutory and Constitutional provisions of the State of Wyoming. It is an unlawful attempt to delegate to defendant Cole duties which are already imposed by statute upon regularly elected and appointed officers and employees of the state. Chapter 66 of Laws 1937, under which said contract was made, is not Constitutional. The compensation provided in the contract is excessive and unreasonable. The pretended contract is an unlawful attempt to deplete permanent state funds. The following authorities support plaintiff's contention. 40 C. J. 892, 50 C. J. 1138, Sections 4 and 5 of the Act of Admission; Sections 2, 6 and 7 of Article 7 of the State Constitution; Sections 1, 2 and 6 of Article 18, State Constitution; Sections 91-106, 513, 516, 517, 522 and 808, R S. 1931; State v. Snyder, 212 P. 758; Sec. 91-201; 91-211, R. S. 1931; Magnolia Petroleum Company v. Price (Okla.) 206 P. 1033; State v. McMillen, (N. D.) 96 N.W. 310; Roach v. Gooding, (Ida.) 81 P. 642; 59 C. J. 171, 174; Rowland v. State Board of Arizona, 207 P. 359. The laws of Wyoming place competent public officers at the disposal of the Board of Land Commisioners for the express purpose of performing the duties dedicated to defendant W. Jack Cole by the contract. The duties of the state geologist are defined by Sec.91-807, R. S., and those of the commissioner of public lands by Sec. 78-302. The duties of the attorney general are defined by Sec. 109-608, R. S. See also Sec. 91-521, R. S. as to suits. A similar contract was condemned in McDougall v. Board of Land Commissioners, 48 Wyo. 493. The general doctrine is stated in Dillon's Municipal Corporations, 5th Ed. Vol. II, Sec. 824. A case squarely in point is Orton v. State, 12 Wis. 567. See also Clough v. Hart, 8 Kan. 487. The courts of Oklahoma have applied the same rule in Commissioner v. Ridings, 220 P. 96; Board of Education v. Thurman, 247 P. 996; Board v. King, 294 P. 101. The same question arose in Platte County v. Gerrard, (Nebr.) 11 N.W. 298. Chapter 66, Session Laws of 1937 is clearly a violation of the provisions of the Wyoming Constitution. Article 18, Section 2, Wyoming Constitution. The judgment below should be reversed.

For the respondent, W. J. Cole, there was a brief and oral argument by Clyde M. Watts of Cheyenne.

At the present time, the moneys sought to be recovered are not in the school fund. The legislature can abolish any office which it has created, or change the duties or emoluments thereof. Sec.109-601, R. S. The case of MacDougall v. Board, 48 Wyo. 493 involved a contract not made under a statute. Chapter 66, Laws 1937 covers the objections urged in MacDougall v. Board, supra. Chapter 66, Laws 1937 repealed earlier statutes. The contract is valid. Miles v. Cheyenne County, 148 N.W. 959; Shinn v. Cunningham, 120 Iowa 383; Brown v. Bigne, (Ore.) 28 A. S. R. 752; County v. Layman, (Ill.) 33 N.E. 1094; Church v. Hadley, (Mo.) 39 L. R. A. (N. S.) 248; Disbrow v. Cass County, (Iowa) 93 N.W. 586; State v. Davis, 217 P. 905; Nevada v. Rhodes, 4 Nev. 312; United States v. Swope, 16 F.2d 215 (C. C. A. 8th). In the construction of Constitutions, intent prevails over literal meaning. 12 C. J. 702. General principles governing the construction of statutes apply to Constitutions. Zancanelli v. Central Coal & Coke Company, 25 Wyo. 511; C. & N. W. Ry. Co. v. Hall, 46 Wyo. 380. The word "proceeds" is commonly used to designate the source rather than the extent of moneys received. Hunt v. Williams, 126 Ind. 493. See also In re Board, 133 P. 140; Governor v. McEwen, (Tenn.) 5 Humphreys 241. The action here is for damages incurred for breach of contract and there will be no money available for any purpose, if no damages are recovered. The case narrows down to these questions: (1) Can you deplete a fund that is not in existence? (2) Is the law under which the contract in question is made Constitutional? In our opinion, the answer to the first question is no, and the answer to the second question is yes.

For the respondents Ray E. Lee and Leslie A. Miller, as Governor, there was a brief by Ray E. Lee, Attorney General; Thos. F. Shea, Deputy Attorney General, and Wm. C. Snow, Assistant Attorney General, all of Cheyenne, and oral argument by Mr. Lee.

The statute, Chapter 66, Laws of 1937, authorizes the Attorney General with the approval of the Governor to enter into a contract employing special assistants to recover moneys due the state under any contract, lease or other instrument, upon a contingent basis, not exceeding one-half of the amount recovered. We accept and adopt the statement of the case and arguments contained in the brief filed on behalf of defendant Cole. We believe that generally speaking the term "proceeds" as used in Section 5 of the Act of Admission means money derived from the sale or lease of property, less expenses of sale or of the lease, including the collection of the amount due through the sale or lease. In re Dixon, 30 A. 1032. That rule applies generally. Wilson Manufacturing Co. v. Winnet, (Nebr.) 91 N.W. 514; in Re Curtis' Will, 16 N.Y.S. 180; Lumber Company v. Thompson, 35 So. 828; Commonwealth v. Alexander, 7 N.E. 1017; 59 C. J. 172, 25 R. C. L. 392. A state contract will be enforced unless it violates the Constitution or specific statutory provisions. State v. Board, 50 Wyo. 181; State v. Young, 44 Wyo. 6.

As Amici Curiae, there was a brief by Wilfred O'Leary of Cheyenne, Wyoming; John R. Moran and Harold D. Roberts of Denver, Colorado; and Harold H. Healy of Casper, Wyoming and oral argument by Robert E. More of Denver, Colorado.

The Constitution of Wyoming prohibits use of any part of the state school fund for the purposes contemplated by the Cole contract. Magnolia Petroleum Company v. Price, (Okla.) 206 P. 1033; Article 18, Section 2 Wyo. Constitution; Article VII, Secs. 2 and 6 State Constitution; Section 91-517, R. S., State v. Snyder, 29 Wyo. 163, Chapter 66, Laws 1937 does not purport to authorize any such contract as that entered into with defendant Cole. No legislative act will be construed as to present a case of violation of the Constitution. Railroad Company v. Johnson, 264 U.S. 375. The lower court erred in sustaining a demurrer to the petition. Chapter 66, Laws 1937 should be construed as not applying to school lands or other trusts of this state, and the particular contract between the respective defendants should be held violative of both the Constitution and the statutes. We append to our brief Sections of the Act of Admission, State Constitution and Revised Statutes, believed to be pertinent to this controversy and also the text of Chapter 66, Laws 1937.

BLUME, Chief Justice. RINER and KIMBALL, JJ. , concur.

OPINION

BLUME, Chief Justice.

The legislature in 1937 (c. 66, Session Laws 1937) passed an act providing in substance that the attorney general of the state is authorized to employ, with the consent of the governor, specially qualified assistants and counsel to aid him in any investigation as to whether there is due to the state any money under any lease or other contract, and to aid him in the recovery of any such money; to prosecute suits in that connection and with the approval of the governor settle and compromise any claims. Authority is given to pay to any assistants so employed an amount not to exceed fifty per cent of the money recovered as the result of any compromise or litigation, except such amount of fifty per cent necessary to pay court costs. All money so recovered is directed to be paid into the state treasury, and "there is hereby appropriated out of any moneys so recovered by the State of Wyoming, under the provisions of this act, a sum of money not exceeding one half of the amount recovered, for the purpose of paying court costs and the special assistants herein authorized, which payment shall be by warrant or warrants drawn upon the State Treasury."

On July 12, 1937, the State of Wyoming, acting through its governor and attorney general, entered into a written contract with W. Jack Cole, pursuant to the statute just mentioned. The contract recites that the State owns certain lands in Salt Creek, Grass Creek, Medicine Bow and Baxter Basin Oil Fields; that the lands are under lease; that the state wants to investigate whether true and accurate accountings have been made to the state under the leases that it takes an expert to determine that fact, and that Cole is such expert. He accordingly agreed to make such investigation for a contingent fee of twenty-five per cent of any sum which may be recovered on account of any claim which, after such investigation, may be found to exist. He was given full authority to inspect all books, accounts and leases in this connection. He agreed to pay all expenses of the investigation; to make a detailed report of his findings thereunder to the state; to assist in every way in the negotiations for compromise of any claim and in any litigation for the recovery of any amount found to be due through the investigation. It was agreed that the contract should terminate on December 31, 1938, except as to negotiations or litigation then pending. The decision of the governor and attorney general upon any proposed settlement or compromise, or as to the...