Girard v. Diefendorf, 6116

• Decision Date: 26 May 1934
• Docket Number: 6116
• Citation: 54 Idaho 467,34 P.2d 48
• Parties: FRANKLIN GIRARD, Secretary of State of the State of Idaho, Plaintiff, v. BEN DIEFENDORF, Commissioner of Public Investments of the State of Idaho, Defendant
• Court: Idaho Supreme Court

34 P.2d 48

54 Idaho 467

FRANKLIN GIRARD, Secretary of State of the State of Idaho, Plaintiff, v. BEN DIEFENDORF, Commissioner of Public Investments of the State of Idaho, Defendant

No. 6116

Supreme Court of Idaho

May 26, 1934

SCHOOLS AND SCHOOL DISTRICTS-PUBLIC SCHOOL ENDOWMENT FUND-INVESTMENT-CONSTITUTIONAL LAW.

1. Tax anticipation negotiable note, issued by school district under 1933 emergency law, held not "school district bond" on which permanent educational funds could be loaned within constitutional amendment of 1900, permitting such funds to be loaned on school district bonds (S. L. 1933, chap. 160; Const., art. 9, sec. 11, as amended).

2. Legislature cannot, by definition, extend meaning of words used in Constitution to include meanings not within intent of framers of Constitution.

Original proceeding for Writ of Prohibition. Alternative writ granted. Peremptory writ ordered to issue as prayed for.

Peremptory writ of prohibition issued.

W. H Langroise, Sam S. Griffin and James F. Ailshie, Jr., for Plaintiff.

The permanent educational funds are a trust fund and may be loaned only upon the securities provided therefor in the Constitution. (State v. Fitzpatrick, 5 Idaho 499, 51 P. 112; Parsons v. Diefendorf, 53 Idaho 219, 25 P.2d 236; sec. 3, art. 60, Idaho Const.)

The provisions of the Constitution for its own amendment are mandatory--any course which disregards such provisions is a direct violation of the fundamental law, the vote of the electors cannot validate it--each step provided must be followed--otherwise the change would be by resolution. (McBee v. Brady, 15 Idaho 761, 100 P. 97; Utter v. Moseley, 16 Idaho 274, 100 P. 1058, 133 Am. St. 94 18 Ann. Cas. 723; Neil v. Public Utilities Com., 32 Idaho 44, 56, 178 P. 271; Lane v. Lukens, 48 Idaho 517, 523, 283 P. 532.)

The legislature cannot, by definition, extend the meaning of words used in the Constitution to include meanings not within the intent of the framers of the Constitution. (Perry v. Industrial Acc. Com., 180 Cal. 497, 181 P. 788; 1 Cooley Const. Lim., 8th ed., pp. 123, 124; Scott v. Sandford, 19 How. (U.S.) 393, 15 L.Ed. 691.)

The meaning of the Constitution is fixed when it is adopted, and it is not different at any subsequent time when a court has occasion to pass upon it. (Quoted from 1 Cooley Const. Lim., 8th ed., p. 124; People v. Blodgett, 13 Mich. 127, 138.)

The fundamental, substantial and practical difference between tax anticipation notes and bonds as that term is properly used, is that tax anticipation notes are secured by pledge of specific anticipated revenues from a designated source and a current year, and for the purpose of the notes deemed already in the treasury, hence no addition to the public debt, whereas a bond is the primary obligation of the municipality supported by its full faith and credit, and is a substantial addition to the public debt. (Bolton v. Wharton, 163 S.C. 242, 161 S.E. 454, 86 A. L. R. 1101 (1931); Thomson v. Christopher, 141 S.C. 92, 139 S.E. 178; Barnwell v. Matthews, 132 S.C. 314, 128 S.E. 712; 1 W. & Ph., 4th ser., 309.)

Maurice H. Greene, Sam Blaine and Z. Reed Millar, for Defendant.

There is a "substantial compliance" with provisions of the Constitution prescribing procedure for its amendment if the object sought thereby, the protection of a right or the conferring of a benefit, has been as fully attained as though there had been literal compliance. (Martien v. Porter, 68 Mont. 450, 219 P. 817.)

The self-imposed limitations on the power to amend the Constitution should not be so construed as to defeat the will of the people plainly expressed, on account of a slight and unimportant failure to comply with such limitations if the requirements are substantially observed. (State v. Winnett, 78 Neb. 379, 110 N.W. 1113, 15 Ann. Cas. 781, 10 L. R. A., N. S., 149.)

A general obligation of a school district to which the full faith and credit of the district is pledged in payment, is a school district bond within the meaning of section 11, article 9 of the Constitution. (State v. Clausen, 40 Wash. 95, 82 P. 187.)

HOLDEN, J. Budge, C. J., and Givens, Morgan and Wernette, JJ., concur.

OPINION

HOLDEN, J.

This is an original application for an alternative writ of prohibition.

September 11, 1933, Springfield School District No. 57, Bingham county, issued a certain tax anticipation negotiable note, in the following words and figures, to wit:

"UNITED STATES OF AMERICA

"STATE OF IDAHO

"1500.00 6%

"TAX ANTICIPATION NEGOTIABLE NOTE

"Springfield, Idaho, Sept. 11, 1933, FOR VALUE RECEIVED The Trustees of Springfield School Dist. 57, Bingham County, Promises to pay to the Department of Public Investments of Idaho, in the City of Boise, Idaho, on the first day of July, 1934, the sum of Fifteen Hundred & no/100 DOLLARS ($ 1500.00) with interest from date of warrant issued in purchase at the rate of six per cent (6%) per annum until paid. This note is issued in pursuance of a resolution duly adopted by the Trustees of Springfield School Dist. No. 57, Bingham County, on the eleventh day of September, 1933. IT IS HEREBY CERTIFIED AND RECITED THAT each and every act, condition and thing required to be done, to have happened and to be performed precedent to and in the issuance of this note, has been done, has happened and has been performed in full and strict compliance with the Constitution of the State of Idaho and the provisions of Chapter 160 Idaho Session Laws of 1933 and amendments thereto, and that this note is within every debt and other limit prescribed by law, and the faith and credit of Springfield Dist. 57, Idaho, is hereby irrevocably pledged to the punctual payment of the Principal and Interest of this note, according to its terms. IN WITNESS WHEREOF, the Trustees of Dist. 57, Bingham Co., State of Idaho, by its trustees in legal session, has caused this note to be signed by the Chairman and trustee attested and the corporate seal to be hereunto affixed by the Clerk of said Springfield School Dist. 57 at Springfield, Idaho, this 11th day of Sept., 1933.

"(Seal)

(Sgd.) M. G. LLOYD,

"(Chairman)

"(Sgd.) DOROTHY HOUGHLAND,

"(Trustee)

"Attest:

(Sgd.) ARTHUR J. SNYDER,

"(Clerk)

"The Notary Public of Springfield, Idaho hereby certified to the genuineness of the above signatures.

"(Seal)

(Sgd.) THOMAS BLACKBURN,

"Notary Public Title."

January 15, 1934, defendant Diefendorf, as commissioner of public investments of the state of Idaho, made a certain application to the board of land commissioners of the state of Idaho, in the following words and figures, to wit:

"APPLICATION TO STATE BOARD OF LAND COMMISSIONERS. TO THE HONORABLE STATE BOARD OF LAND COMMISSIONERS OF THE STATE OF IDAHO: The Department of Public Investments of the State of Idaho, in pursuance of the provisions of Section 65-2901, I. C. A., as amended by Chapter 13, Extraordinary Session Laws of 1933, respectfully makes application for authorization to loan and invest a portion of the permanent educational funds of the State of Idaho, and in that connection submits the following data required by the statute aforesaid: 1. SECURITY IN WHICH INVESTMENT IS PROPOSED TO BE MADE: 1. Tax Anticipation Note, issued by School District No. 57, Bingham County, Idaho, a true copy of which is annexed hereto and made part hereof, the form, procedure for issuance of which and substance of which were approved by the opinion of the Attorney General of Idaho. 2. PERMANENT FUND IN WHICH INVESTMENT OR LOAN IS PROPOSED TO BE MADE: Public School Endowment Fund. 3. REASON FOR INVESTMENT: Uninvested, idle funds in the hands of this department may be profitably and safely invested by this department in the security aforesaid. 4. Price at which it is proposed to acquire such tax anticipation note: $ 1500.00, to bear interest at 6% per annum from date of purchase.

"DEPARTMENT OF PUBLIC INVESTMENTS.

"(Sgd) BEN DIEFENDORF,

"Commissioner."

On the same day, January 15, 1934, that board approved the foregoing application in the following words and figures, to wit:

"MINUTE ENTRY, STATE BOARD OF LAND COMMISSIONERS. WHEREAS, the Department of Public Investments of the State of Idaho has heretofore made written application to this Board for permission and authorization under the provisions of Chapter 13, Extraordinary Session Laws of Idaho 1933 Session, to purchase as an investment of idle funds in the Public School Endowment Fund in the hands of the Department of Public Investments for investment one tax anticipation note of School District No. 57, Bingham County, Idaho, which application and copy of which note are annexed hereto for particularity, and WHEREAS, it appears to the satisfaction of this Board that such investment is a proper investment of such funds and that the authority requested should be granted and the said investment approved. IT IS ORDERED BY THE STATE BOARD OF LAND COMMISSIONERS that the said application of the Department of Public Investments annexed hereto be, and the same is hereby approved and allowed, and the investment aforesaid is hereby approved.

"Dated and entered this 15th day of January, 1934.

"(Sgd) C. BEN ROSS Chairman

"(Sgd) HARRY C. PARSONS Auditor

"(Sgd) JOHN W. CONDIE.

"I dissent.

"FRANKLIN GIRARD

"Secretary of State."

January 29, 1934, plaintiff as Secretary of State of the state of Idaho, ex-officio a member of the state board of land commissioners, made an original application in this court, upon his affidavit of that date for an alternative writ of prohibition, from which it appears that the defendant threatens to, and will, unless prohibited and restrained by the writ prayed for, invest public school endowment funds in said tax anticipation negotiable note. January...