Bullock County v. Sherlock
| Decision Date | 22 January 1942 |
| Docket Number | 3 Div. 365. |
| Parties | BULLOCK COUNTY et al. v. SHERLOCK, Highway Director. |
| Court | Alabama Supreme Court |
Appeal from Circuit Court, Montgomery County; Walter B. Jones Judge. [Copyrighted Material Omitted]
The petition prayed for declaratory judgment as to the following matters.
(a) Whether or not the Court of County Commissioners of Bullock County has the legal power and authority, under the provisions of Code of Alabama, 1940, Title 12, Section 81, to fund or finance the obligations of Bullock County arising under said contract by the issuance and sale of interest-bearing warrants in an amount not greater than the obligations arising under said contract, said warrants to be sold at not less than par, and to mature serially in annual installments over a period of time not exceeding twenty years from the date of the issuance of the same, and to bear interest at a rate not exceeding six per cent per annum payable semi-annually and evidenced by coupons attached to said warrants, or otherwise, as the governing body of said county deems advisable.
(b) If the Court of County Commissioners of Bullock County has such authority, out of what fund or funds of Bullock County should said warrants be payable?
(c) Whether or not the Court of County Commissioners of Bullock County has the legal power and authority, under the provisions of Code of Alabama, 1940, Title 23, Section 43, to issue and sell interest-bearing warrants, payable solely out of the funds to be received by it as its share of the proceeds of the State Excise Tax on gasoline, etc., which tax is levied under the provisions of Code of Alabama, 1940, Title 51, Section 647, and distributed as provided by Code of Alabama, 1940, Title 51, Sections 655-657, and to mature over a period of time not exceeding ten years from the date of the issuance of the same to secure the necessary money with which to discharge the obligations of Bullock County arising under said contract.
(d) If the Court of County Commissioners of Bullock County has such authority, then may the total amount of the funds to be received by Bullock County as its share of the proceeds of the State Excise Tax on gasoline, etc., be pledged to the payment of the same, or may only one-third of the amount of such funds to be received by Bullock County as its share of the proceeds of the State Excise Tax on gasoline, etc., be pledged to the payment of the same; i.e. does the limitation on the use of the funds to be received by Bullock County as its share of the proceeds of the State Excise Tax on gasoline, etc., in the payment of any debt that may have been incurred by it for the construction or maintenance of roads or bridges, contained in Code of Alabama, 1940, Title 51, Section 647, apply only to such debts incurred prior to the effective date of said code?
(e) If only one-third of the amount of such funds to be received by Bullock County as its share of the proceeds of the State Excise Tax on gasoline, etc., may be pledged to the payment of the same, does this mean one-third of the amount of such funds received at the time of the issuance of such warrants, or one-third of the amount of such funds received at the time such warrants are payable?
(f) Whether or not the Court of County Commissioners of Bullock County has the legal power and authority, under the provisions of Code of Alabama, 1940, Title 12, Chapter 9, Sections 124-128, to make a temporary loan or loans in anticipation of the collection of taxes with which to secure the necessary money to meet the obligations of Bullock County arising under said contract.
(g) If the Court of County Commissioners of Bullock County has such authority, may such temporary loan or loans be made in anticipation of the collection of ad valorem taxes for the benefit of the General Fund, ad valorem taxes for the benefit of the Road and Bridge Fund, and the funds to be received by Bullock County as its share of the proceeds of the State Excise Tax on gasoline, etc.?
(h) If such loan or loans may not be made in anticipation of the collection of all the taxes mentioned in question numbered (g), then which of said taxes may be anticipated in this manner?
(i) If the Court of County Commissioners of Bullock County has the authority to make such a temporary loan or loans, what is the maximum amount of such loan or loans which may be made, i.e., is it a sum not greater than one-half of the income of said county for the preceding year from ad valorem taxes for the benefit of the General Fund; a sum not greater than one-half of the income of said county for the preceding year from ad valorem taxes for the benefit of the General Fund and the Road and Bridge Fund, or a sum not greater than one-half of the income of said county for the preceding year from all resources?
(j) Would such a temporary loan or loans be a debt of Bullock County within the purview of Section 224 of the Constitution of Alabama, 1901?
The final decree is in pertinent part as follows:
Adjudged, Decreed and Declared by the Court as Follows:
(a) That the Court of County Commissioners of Bullock County has the legal power and authority, under the provisions of Code of Alabama, 1940, Title 12, Section 81, to fund or finance the obligation of Bullock County arising under said contract by issuance and sale of interest-bearing warrants in an amount not greater than the obligations arising under said contract, said warrants to be sold at not less than par. and to mature serially in annual installments over a period of time not exceeding twenty years from the date of the issuance of the same, and to bear interest at a rate of not exceeding six per cent per annum, payable semi-annually and evidenced by coupons attached to said warrants, or otherwise, as the governing body of said county deems advisable.
(b) That said warrants may be payable out of the funds to be received by said Bullock County as its share of the proceeds of the State excise tax on gasoline, etc., but only one-third of said funds may be pledged to the payment of the same, in view of Code of Alabama, 1940, Title 51, Section 647, since the obligations of said Bullock County arising under said contract, which are to be funded or financed by said warrants, amount to debts of the county incurred prior to the effective date of the Code of Alabama, 1940, within the purview of said section; or out of a road and bridge fund of said county, subject to all prior legal obligations now outstanding against said fund.
(c) That the said Court of County Commissioners of Bullock County has the legal power and authority, under the provisions of Code of Alabama, 1940, Title 23, Section 43, to issue and sell interest-bearing warrants, payable solely out of the funds to be received by it as its share of the proceeds of the State excise tax on gasoline, etc., which tax is levied under the provisions of Code of Alabama, 1940, Title 51, Section 647, and distributed as provided by Code of Alabama, 1940, Title 51, Sections 655-657, and to mature over a period of time not exceeding ten years from the date of the issuance of the same, to secure the necessary money with which to discharge the obligations of Bullock County, arising under said contract, the provisions of Code of Alabama, 1940, Title 12, Chapter 6, Sections 73-91, generally known as the County Financial Control Law, to the contrary notwithstanding.
(d) That only one-third of the amount of the funds to be received by Bullock County as its share of the proceeds of the State excise tax on gasoline, etc., may be pledged to the payment of said warrants, in view of Code of Alabama, 1940, Title 51, Section 647, since the obligations of said Bullock County arising under said contract, which are to be funded or financed by said warrants, amount to debts of the county incurred prior to the effective date of the Code of Alabama, 1940, within the purview of said section.
(e) That one-third of the amount of such funds means one-third of the amount of such funds received during the month in which such warrants are issued, since the proceeds of the State excise tax on gasoline, etc., are collected, and distributed to the various counties of the State, on a monthly basis.
(f) That the court of County Commissioners of Bullock County has the legal power and authority, under the provisions of Code of Alabama, 1940, Title 12, Chapter 9, Sections 124-128, to make a temporary loan or loans in anticipation of the collection of taxes with which to secure the necessary money to meet the obligations of Bullock County arising under said contract.
(g) That the Court of County Commissioners of Bullock County has the authority to make such a temporary loan or loans in anticipation of the collection of ad valorem taxes for the benefit of the general fund and the road and bridge fund only.
(h) That the maximum amount of such a temporary loan or loans is a sum not greater than one-half of the income of said county for the preceding year from all sources.
(i) That such temporary loan or loans would not be a debt of Bullock County within the meaning and purview of Section 224 of the Constitution of Alabama, 1901.
Lawrence K. Andrews, of Union Springs, for appellants.
Thos. S. Lawson, Atty. Gen., and Silas C. Garrett, III, Asst. Atty. Gen., for appellee.
Edw. B. Crosland, of Montgomery, for Division of Local Finance of State Department of Finance, amicus curiae.
The appeal is to review a decree rendered in a proceeding for declaratory judgment.
By a contract entered into between the State of Alabama, through its Highway Director, and Bullock County, through its governing body, approved by the Governor, March 3, 1939, the State undertook to improve and place a...
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