Breckenridge v. Johnston

• Decision Date: 12 December 1940
• Docket Number: 6802
• Citation: 62 Idaho 121,108 P.2d 833
• Parties: J. G. BRECKENRIDGE, SEYMOUR R. NELSON and JOHN P. TATE, Commissioners of Drainage District No. 3 of Ada County, Idaho, and MARGARET GILBERT, Treasurer of Ada County, Idaho, Respondents and Cross-Appellants, v. A. A. JOHNSTON, Appellant and Cross-Respondent
• Court: Idaho Supreme Court

108 P.2d 833

62 Idaho 121

J. G. BRECKENRIDGE, SEYMOUR R. NELSON and JOHN P. TATE, Commissioners of Drainage District No. 3 of Ada County, Idaho, and MARGARET GILBERT, Treasurer of Ada County, Idaho, Respondents and Cross-Appellants, v. A. A. JOHNSTON, Appellant and Cross-Respondent

No. 6802

Supreme Court of Idaho

December 12, 1940

Rehearing denied January 13, 1941.

DRAINAGE DISTRICTS-ASSESSMENTS-INTEREST ON PAST DUE BONDS.

1. Drainage district could not levy assessment to obtain money with which to pay interest on past due bonds unless authorized to do so by law. (I. C. A., secs. 41-2501 to 41-2564.)

2. The statute authorizing assessments by drainage districts for expense incurred for "extraordinary reasons" does not authorize levying an assessment to pay interest on past due bonds after all interest coupons have been paid. (I. C A., sec. 41-2562.)

3. The statute authorizing the county treasury to call as many drainage district bonds as he is able to pay with funds in his hands and providing that the bonds so called shall cease to bear interest 30 days after first publication of call, is an "acceleration statute" which authorizes county treasurer to call and pay bonds before maturity and to thus stop payment of interest, but it does not authorize payment of interest on past due bonds or on bonds other than bonds called. (I. C. A., sec. 41-2557.)

4. The general statute providing for payment of interest on money after it becomes due does not authorize payment of interest on past due drainage district bonds in absence of authority therefor in special drainage district statute. (I. C. A secs. 26-1904, 41-2501 to 41-2564.)

5. Drainage, districts are special improvement districts of limited liability. (I. C. A., secs. 41-2501 to 41-2564.)

6. When a drainage district levies an assessment against a particular, separate piece of property and the assessment is paid, its share or proportion of the bonded indebtedness is liquidated and such piece of property is discharged from any further obligation. (I. C. A., secs. 41-2501 to 41-2564.)

7. Under the drainage district code, power to levy assessments for payment of drainage district bonds, interest as well as principal, is limited, except as specifically provided, to original assessment of benefits. (I. C. A secs. 41-2530, 41-2531, 41-2552, 41-2554, 41-2556, 41-2557, 41-2558, 41-2562.)

8. The construction given a statute by the executive and administrative officers of the state is entitled to great weight and will be followed unless there are cogent reasons for a change.

9. The drainage district statute does not authorize payment of interest on past due drainage district bonds after all attached interest coupons have been paid, and administrative construction to the contrary will be disregarded. (I. C. A., secs. 41-2552, 41-2554, 41-2556 to 41-2558, 41-2562.)

10. The functions of a drainage district are business and economic, rather than political or governmental. (I. C. A., secs. 41-2501 to 41-2564.)

11. Assessments by a drainage district are made in proportion to the benefits received and are intended primarily to serve and advance the proprietary interests of the land owners within the district. (I. C. A., secs. 41-2501 to 41-2564.)

12. Generally, except where otherwise provided by statute, one cannot, either by set-off or counterclaim, or by direct action, recover back money which he has voluntarily paid with full knowledge of all the facts, and without any fraud, duress or extortion, although no obligation to make such payment existed.

13. One who voluntarily and without mistake of fact pays interest in excess of that which is legally due, cannot recover back the excess payment or have the excess applied on principal, except where otherwise provided by statute.

14. Drainage district could not recover back, or offset against principal, the amount of after-maturity interest which district had improperly paid to bondholder. (I. C. A., secs. 41-2552, 41-2554, 41-2556 to 41-2558, 41-2562.)

APPEAL from the District Court of the Third Judicial District, for Ada County. Hon. Charles F. Koelsch, Judge.

Suit on two causes of action: First, for declaratory judgment, to determine whether drainage district bonds draw interest after maturity; and second, whether such payments, if not authorized, may be offset and credited against payment of principal of bonds. Judgment for plaintiffs on first cause of action and for defendant on second cause of action. Affirmed.

Affirmed.

Luther W. Tennyson and W. A. Johnston, for Appellant and Cross-respondent.

As a private corporation authorized by law a drainage district stands on the same footing as does an individual or body of persons upon whom a like special franchise has been conferred, and it is liable in the same manner as an individual or private corporation would be under like circumstances, for after-maturity interest. (Elliott v. McCrea, 23 Idaho 524, 130 P. 785; Booth v. Clark, 42 Idaho 284, 244 P. 1099; Straus v. Ketchen, 54 Idaho 56, 28 P.2d 824; Nampa & Meridian Irr. Dist. v. Barclay, 56 Idaho 13, 47 P.2d 916, 100 A. L. R. 557; Oregon Short Line R. Co. v. Kimama Highway District, 287 F. 734; Eldridge v. Black Canyon Irr. Dist., 55 Idaho 443, 43 P.2d 1052.)

The interest bearing bonds of a private corporation or a quasi-municipal corporation, which stipulate in terms for the rate of interest stated therein, from date until redeemed or paid, will draw interest at the agreed rate after, as well as before, maturity, in the absence of a provision of statute to the contrary. (Cromwell v. Sac County, 96 U.S. 51, 24 L.Ed. 681, 687; 33 C. J., Interest, sec. 109; 44 C. J., Municipal Corporations, sec. 4221; I. C. A., sec. 26-1904, subd. 2; as amended, Sess. Laws of 1933, chap. 197, sec. 1, subd. 2.)

When for some time past the executive department or coordinate branch of the government, charged with the duty of administering drainage district law, has placed upon such law the construction that drainage district bonds bear interest after maturity, such contemporary construction is, whenever courts are called upon to construe the statute, entitled to consideration and carries weight for several reasons: First, it is a practical and administrative construction of the act; second, where extended over a period of time leads to the conclusion that such construction being known to the legislature has received its tacit approval as being correct; and third, property rights have vested upon faith in the interpretation. (State v. Omaechevviaria, 27 Idaho 797, 152 P. 280; United Pacific Insurance Co. v. Bakes, 57 Idaho 537, 545, 67 P.2d 1024; Cooley's Constitutional Limitations, 4th ed., p. 76.)

The rule of estoppel applies against drainage districts whenever necessary to prevent injustice or a result amounting to fraud. (Emmett Irrigation District v. Thompson, 253 F. 316, 164 C. C. A. 98; Page v. Oneida Irrigation District, 26 Idaho 108, 141 P. 238; Walker v. Hughes, 52 Idaho 234, 13 P.2d 249; Hemenway v. Craney, 36 Idaho 11, 208 P. 407; Owen v. Nampa & Meridian Irr. Dist., 48 Idaho 680, 285 P. 464.)

Elam & Burke, for Respondents and Cross-appellants.

Bonds of a special assessment district, with limited and fixed liability as against the property owner, do not bear interest after maturity. (Meyer v. City and County of San Francisco, 150 Cal. 131, 88 P. 722, 10 L. R. A., N. S., 110; Heath v. Green City Irr. Dist., 91 Colo. 202, 13 P.2d 1113; Denver-Greeley Valley Irr. Dist. v. McNeil, 80 F.2d 929; Bates v. Gerber, 82 Cal. 550, 22 P. 1115.)

Bonds of a drainage district in this state are local improvement bonds, in that they are issued against special assessments, which are definite and certain as to the landowners' liability, and to continue to pay interest on such bonds after maturity, extends his liability beyond that upon which he was given notice and a hearing before the court. ( Elliott v. McCrea, 23 Idaho 524, 130 P. 785; Straus v. Ketchen, 54 Idaho 56, 28 P.2d 824; McDonald v. Pritzl, 60 Idaho 354, 93 P.2d 11.)

No estoppel can arise against a municipality from acts of municipal officers done in violation of, or without authority of, law. (McQuillin, Municipal Corporations, vol. 3, sec. 1363, p. 972; 10 R. C. L. 707; James v. State, 160 Okla. 99, 15 P.2d 591; State ex rel. National Bank of Tacoma v. City of Tacoma, 97 Wash. 190, 166 P. 66.)

Where a wrongful payment is made by the agent or officers of a public corporation in violation of law, it is not a voluntary payment and such payments may be recovered back. (48 C. J. 739; Hawthorne Park Dist. v. Seipp, Princell & Co., 286 Ill.App. 599, 4 N.E.2d 117; Packard v. City of Mobile, 151 Ala. 159, 43 So. 963; School District No. 49, Logan County, v. Community High School, 126 Kan. 51, 267 P. 23; Ritchie v. City of Topeka, 91 Kan. 615, 138 P. 618.)

HOLDEN, J. Budge and Morgan, JJ., concur. GIVENS, J., Concurring in Part and Dissenting in Part. AILSHIE, C. J., Dissenting.

OPINION

HOLDEN, J.

In 1913 the legislature enacted a complete drainage district code (1913 Sess. Laws, p. 58, now chap. 25, Tit. 41, secs. 41-2501 to 41-2564, inclusive, I. C. A.), providing "for the establishment of drainage districts, and the construction and maintenance of a system of drainage," and for an assessment of benefits against each tract of land within the district, issuance of bonds, levy of assessments to pay the same and interest coupons. Some ten years later, to wit March 2, 1923, Drainage District No. 3 of Ada County was regularly organized under the provisions of this drainage district code. Since its organization the district has been entitled to exercise all of the powers and privileges conferred upon drainage districts. For the purpose of paying costs, etc., and...