Fidelity & Deposit Co. of Maryland v. Commonwealth, for Use and Ben. of Nelson County

• Decision Date: 25 April 1933
• Citation: 249 Ky. 170,60 S.W.2d 345
• Parties: FIDELITY & DEPOSIT CO. OF MARYLAND v. COMMONWEALTH, for Use and Benefit of NELSON COUNTY et al. MUIR, WILSON & MUIR v. WEST et al.
• Court: Kentucky Court of Appeals

60 S.W.2d 345

249 Ky. 170

FIDELITY & DEPOSIT CO. OF MARYLAND v. COMMONWEALTH, for Use and Benefit of NELSON COUNTY et al.

MUIR, WILSON & MUIR v. WEST et al.

Court of Appeals of Kentucky

April 25, 1933

Rehearing Denied June 13, 1933.

Appeal from Circuit Court, Nelson County.

Action by the Commonwealth, for the use and benefit of Nelson County, and the Nelson County Board of Education, against the Fidelity and Deposit Company of Maryland, and R. H. West and others. From the judgment, the Fidelity & Deposit Company of Maryland and Muir, Wilson & Muir appeal, and plaintiff cross-appeals.

Judgment affirmed on appeal, and, on the cross-appeal, judgment reversed, and cause remanded, with directions.

Wm Marshall Bullitt, Leo. T. Wolford, L. S. Blickenstaff Middleton Miller, and Bruce & Bullitt, all of Louisville, for appellant Fidelity & Deposit Co.

Ernest Fulton, of Bardstown, for the Commonwealth and Muir, Wilson &amp Muir.

CLAY Justice.

R. H. West was sheriff of Nelson county for the years 1926 to 1929, inclusive, and the Fidelity & Deposit Company of Maryland was his surety. This action was brought by the commonwealth, for the use and benefit of Nelson county and the Nelson county board of education, to surcharge the settlements which West as sheriff made for the years mentioned. On final hearing the lower court awarded Nelson county the sum of $3,170.48, with interest, and the Nelson county board of education and the Boston consolidated school district the sum of $21,863.80, with interest. From that judgment the surety appeals.

1. It is first insisted that the sheriff was not chargeable with the amount of Louisville & Nashville Railroad franchise taxes in the Boston consolidated school district, as these taxes were never certified by the auditor, and consequently were not owing by the taxpayer. The method of assessing railroad franchises is as follows: All railroads are required to make certain detailed reports to the auditor of the state, and from these reports and hearings thereon the state tax commission values or assesses the franchise. Sections 4077 and 4078, Kentucky Statutes. By section 4084, Kentucky Statutes, the auditor is required to certify the valuations fixed by the state tax commission to the county clerk, and that officer is required to certify the valuations to the proper collecting officers. The Louisville & Nashville Railroad might have declined to pay the taxes until the proper certificate was made. However, it did not wait for the certificate. The franchise had been valued and a proper levy had been made. The amount due the district was a matter of simple calculation. The railroad actually paid the sheriff the taxes due the consolidated school district, and he in turn accounted in his settlement for the taxes so paid. In no sense were the taxes so paid and collected illegal. The railroad owed the taxes, and they were accepted by the sheriff in discharge of its obligation. The money came into his hands by virtue or color of his office, and the statute makes the surety liable. Section 4027, Kentucky Statutes; Commonwealth v. Finch, 8 Ky. Law Rep. 961; Combs v. Breathitt County, 46 S.W. 505, 20 Ky. Law Rep. 569; Mason v. Cook, 187 Ky. 260, 218 S.W. 740. It follows that the court did not err in charging the sheriff with the taxes so collected and paid by him to the Boston consolidated school district.

2. The next contention is that appellant is not liable for the taxes collected by the sheriff for the Boston consolidated school district for the year 1926, as there was no valid levy for that year. The levy for the year 1926 was made by the county board of education. It is argued that the county board was without authority to make a levy to meet the ordinary expenses of the school. It is true that under the statute now in force levies for consolidated school districts are made by the fiscal court, and not by the county board of education Kentucky Statutes, § 4426-2; Hockensmith v. County Board of Education, 240 Ky. 76, 41 S.W.2d 656; but for the year 1926 the situation was different. Prior to the creation of the consolidated school at Boston, there had been a graded school, which had been abolished. An election was then held to establish a consolidated school, and the voters in the consolidated district voted in favor of its establishment and authorized the county board of education to levy an annual tax not to exceed $1 per hundred on value of property, and not to exceed $1 on each poll for the purpose of establishing, equipping, and maintaining a school at Boston, and for the purpose of paying all local expenses connected with the school. Pursuant to this authority, the county board of education levied a tax of 90 cents on each $100 worth of property in the district belonging to white persons and corporations, and $1 on each male citizen in the district for the purpose of maintaining and equipping the high school for the school year 1926-27, and paying all necessary expenses, and also for the purpose of providing a sinking fund for the payment of the bonds that had been voted. It is true that in respect of clearness the statutes then in force leave much to be desired. But a review of the statutes discloses the following situation: By section 4426a-9, Kentucky Statutes 1922, the county board of education was given the power to lay off a boundary, including a number of subdistricts, and submit to the voters in that boundary the proposition of a tax sufficient to provide for the consolidation of the schools within that boundary and the transportation of pupils to and from the school. By section 4426a-10, Kentucky Statutes 1922, it was provided that the term "local expense" in the notices of an election for the purpose of voting a tax to provide for the consolidation of schools should include the transportation of students to and from the consolidated school, and that, where the tax had already been voted, the term "local expenses" should be construed to include the transportation of children in such cases. Also section 4433a-1, Kentucky Statutes 1922, gave the county boards of education the power to provide funds for purchasing suitable grounds and buildings, for erecting and repairing suitable buildings, and for other expenses needful in conducting a consolidated school in that county, and also the power to order an election and submit to the voters of any consolidated school district the question of issuing bonds for the purpose of providing suitable grounds, school buildings, furniture, and apparatus for the district. By section 4433a-2, Kentucky Statutes 1922, county boards of education were authorized and empowered to levy annually a tax in addition to that already voted for the purpose of meeting the interest on bonds that had been voted and creating a sinking fund for the payment of the principal thereof. In addition to this, section 4433b, Kentucky Statutes 1922, authorized the holding of an election in a proposed consolidated and graded high school district for the purpose of taking the sense of the legal voters on the proposition whether or not they would vote an annual tax in any sum named in the order on each $100 worth of property, and also a poll tax not exceeding $1.50 per capita on each white male inhabitant over 21 years of age, for the purpose of erecting, purchasing, or repairing suitable buildings, and for purchasing, repairing, or equipping conveyances for the children to and from the school buildings, and for the equipping of school building and employment of drivers for conveyances, "and teachers for the schools." Construing these sections together, it cannot be doubted that they conferred on the county board of education, after the necessary authority had been given by the voters of the consolidated school district, the power to levy a tax within the limits fixed by the vote not only for the purpose of providing a...