Clark v. Pearman

• Decision Date: 27 June 1921
• Docket Number: 22023
• Citation: 88 So. 716,126 Miss. 327
• Court: Mississippi Supreme Court
• Parties: CLARK v. PEARMAN et al

88 So. 716

126 Miss. 327

CLARK v. PEARMAN et al

No. 22023

Supreme Court of Mississippi

June 27, 1921

1 DRAINS. Bond issue of district in excess of assessed betterments held void.

Where a drainage district is organized under chapter 195, Laws of 1912, and amendments thereto (sections 4450 to 4483 inclusive, Hemingway's Code), under section 25 thereof (section 4471, Hemingway's Code), which, among other things, provides that for the payment of the principal and interest of the bonds or other indebtedness of such district the entire revenues of such district are pledged, "in an amount not to exceed the amount of betterment assessed against said lands and railroads," and issues the bonds of said district, the principal and interest of which exceed in amount the assessed betterments of the district, such bonds are unauthorized and void.

2 DRAINS. District not authorized to incur indebtedness principal and interest of which exceeds amount of betterments.

Under said section 25 (section 4471, Hemingway's Code), the amount of the assessed benefits or betterments against the lands of such district is the measure of the liability of both the lands and the landowners of such district; and no indebtedness of any character whatever can be incurred by such district, the principal and interest of which will exceed the amount of such betterments.

HON. G E. WILLIAMS, Chancellor.

APPEAL from chancery court of Bolivar county, HON. G. E. WILLIAMS, Chancellor.

Bill by Mrs. E. T. Clark against W. L. Pearman and others for an injunction. Decree for defendants, and complainant appeals. Reversed and remanded.

Reversed and remanded.

Sillers, Clark & Sillers, for appellant.

The Lead Bayou Drainage District, which was organized as shown by the agreed statement of facts in this record issued twenty-year serial bonds of the district for the payment of work proposed to be done at the time in the district in an amount of one hundred and seventy-five thousand dollars, bearing interest at the rate of six per cent from date, payable semi-annually. These bonds were issued under authority of chapter 195 of the Laws of Mississippi of 1912, and the amendments thereto.

The board of commissioners of the said drainage district now propose to issue bonds for an additional seventy-five thousand dollars under the provisions of section 4468 of Hemingway's Code, for the purpose of perfecting the drainage scheme of this district and adding new drains in the district, and have levied a tax, or attempted to levy a tax, on the original assessed benefits. Section 4470 of Hemingway's Code provides as follows: "That all bonds and evidences of indebtedness issued by the commissioners under the terms of this act shall be secured by a lien on all lands and railroads subject to taxation under this act, in amount not to exceed the amount of benefits assessed against such lands and railroads," and further provides that a tax shall be levied and collected annually so long as is necessary for the payment of any bonds issued or obligations contracted under its authority, together with interest thereon.

Section 4459, of Hemingway's Code provides that the commissioners may borrow money and may issue their serial bonds therefor not exceeding in amount the total amount of benefits assessed against the real property in the district, and provides that the said bonds shall bear interest at a rate not exceeding six per cent. Just here we call the court's attention that under another system of drainage provided by Hemingway's Code, as shown by Section 4287, special provision is there made for the installments of the total assessments to draw interest at a rate not exceeding six per cent per annum. The Act of 1912 and its amendments do not make this provision.

Section 4470 cited above providing that the bonds issued by the commissioners shall be a lien on the lands in the district subject to taxation in a sum not to exceed the assessed benefits, and providing that a tax shall be levied and collected so long as necessary for the payment of the bonds and the interest thereon when construed with section 4459, which authorizes the issuance of the bonds in an amount not to exceed the total assessed benefits, show conclusively that the intention of the legislature was that the taxes which could be collected for the payment of these bonds and interest, together with ten per cent added for unforseen contingencies, should not exceed the total amount of assessed benefits.

In the case of Huston v. Mayo, 82 So. 334, it was held that a drainage district was not a taxing district, and if we correctly understand, that decision was based on the fact that in a drainage district the lands were only liable for the amount of benefits which the commissioners had assessed as accruing to each particular tract of land.

In the case at bar, as shown by the agreed statement of facts, the total amount of assessed benefits, accruing to the lands in this district was three hundred fifty-four thousand, four hundred sixty-four dollars and fifty-two cents and, as shown by the agreed statement of facts, the total amount of taxes which will be collected on these assessed benefits for the retirement of the bonds, interest and ten per cent added for unforseen contingencies, is the sum of four hundred eighty-nine thousand, four hundred thirty-two dollars and ninety-two cents. In other words, the taxpayers of the district, if this last bond issue and assessment is allowed to stand, would pay one hundred thirty-four thousand, nine hundred sixty-eight dollars and forty cents more than the total amount of benefits which the district proposes to give to their lands.

We think this is directly in the face of the statutes above cited. We think that these statutes conferring upon these commissioners the power to assess these amounts and to install this drainage system must, under all of our decisions, be strictly construed, and the commissioners of this district have no more power than is conferred upon them by a strict construction of the statute under which they operate, and we respectfully submit that the decree of the chancellor dissolving the injunction sued out herein was error, and that the same should be overruled and the injunction be made perpetual by this court.

Sam Montgomery, for appellee.

We are confronted here with the simple question as to whether or not the commissioners in issuing their bonds must take into consideration the interest which the bonds will bear as well as the bonded debt itself to determine the limit of the amount of bonds they may issue.

As hereinabove noted, section 4450 gave to each landowner of the district the right to pay his assessment in cash; and if he did, he would be liable for no interest thereon and no bonds could be issued which would be a lien upon his land. If, however, he elects to take advantage of the twenty-year installment payment given him by the bonds, this then is an accommodation and a benefit to him. In other words, the assessment against his land, by the express language of the statute, constitute a judgment against his land for the amount of the money assessed thereon; and the provisions of the statute allowing the commissioners to issue their serial bonds is simply a provision placed therein for the benefit of the landowner, allowing him to pay this judgment in installments instead of having execution issue against his land for the total amount due in one lump sum as soon as the assessment is confirmed and his time for appeal has elapsed.

Section 2708 of Hemingway's Code, provides: "That all judgments and decrees founded on any contract shall bear interest after the rate of the debt on...