Granada Independent Sch. Dist. No. 455 v. Mattheis

• Decision Date: 18 July 1969
• Docket Number: No. 41477,41477
• Citation: 170 N.W.2d 88,284 Minn. 174
• Parties: GRANADA INDEPENDENT SCHOOL DISTRICT NO. 455, et al., Respondents, v. Duane J. MATTHEIS as Commissioner of Education of Minnesota, Appellant.
• Court: Minnesota Supreme Court

Page 88

170 N.W.2d 88

284 Minn. 174

GRANADA INDEPENDENT SCHOOL DISTRICT NO. 455, et al Respondents, v. Duane J. MATTHEIS as Commissioner of Education of Minnesota Appellant.

No. 41477.

Supreme Court of Minnesota.

July 18, 1969.

Syllabus by the Court

1. The right of the commissioner of education to reject an application for consolidation of school districts, Minn.St. 122.23, does not include the right to arbitrarily ignore reasonable community demands and interests as they relate to a system of education which will best serve the interests of the community.

2. Where school districts are operating after denial of their petition for consolidation by the commissioner of education, and their entitlement to services and aids is in jeopardy, the commissioner of education has the responsibility of reconsidering the application in light of existing circumstances, with due regard to reasonable community demands.

Douglas M. Head, Atty. Gen., Richard H. Kyle, Sol. Gen., John L. Devney and J. Dennis O'Brien, Sp. Asst. Attys. Gen., St. Paul, for appellant.

Seifert, Johnson, Hand & Berens, Fairmont, for respondents.

Heard before KNUTSON, C.J., and NELSON, MURPHY, OTIS, and FRANK T. GALLAGHER, JJ.

OPINION

MURPHY, Justice.

This is an appeal from an order of the district court vacating an order of the commissioner of education in school district consolidation proceedings. It is contended that the court erred in holding that the commissioner's action in denying a proposed consolidation of two independent school districts was arbitrary, capricious, and in unreasonable disregard of the best interests of the territory affected.

The proceedings herein were originated by an application for consolidation submitted by Granada Independent School District No. 455 and Huntley Independent School District No. 221 to the commissioner of education pursuant to Minn.St. 122.23. Preliminary requirements for the application were properly met, including the preparation and filing of a plat of the proposed consolidation. It appears that in such a proceeding the commissioner has the power to approve, modify, or reject the application. Independent School Dist. No. 581 v. Mattheis, 275 Minn. 383, 147 N.W.2d 374; In re Appeals of Schluter, 273 Minn. 386, 141 N.W.2d 482; Bakken v. Schroeder, 269 Minn. 381, 130 N.W.2d 579.

The record indicates that the Granada and Huntley school districts lie adjacent to each other in rural Martin and Faribault Counties. Between them they have an assessed valuation of $2,467,923 and approximately 300 students at the secondary level, which places them well within acceptable criteria for consolidation. Prior to 1966, the Granada school district was on the 'advised list' of the Department of Education, principally because of deterioration of physical property and inadequate educational standards. The 'advised list,' as we understand it, implies a deficiency in standards which if not corrected may jeopardize entitlement to state aid. An attempt was made to upgrade the school district. With the help of a bond issue of $187,000, the district attempted to correct its deficiencies by the addition of a science laboratory, lunchroom facilities, music room, and classroom space. In addition, the school district acquired approximately $387,000, the proceeds of an insurance policy on the old school building which had been destroyed by fire. After the fire, one of the assistant commissioners suggested consolidation between Granada and Huntley, as a result of which the respective boards of those districts agreed to seek approval for consolidation. Representatives of the Department of Education expressed the view that their financial condition was satisfactory and encouraged them to try to consolidate. The plan of consolidation was to have the first six grades at Huntley and the last six grades at Granada. Huntley has an elementary facility, which was built about 12 years ago, and a full-time kindergarten. The Granada district proceeded to build a new high school with the insurance money and an additional $50,000, the proceeds of a bond issue. The plan for this building was approved by the Department of Education, the building has been completed, and it is now in use. In the opinion of the superintendents and district board members, the consolidation of the two districts would have enabled them to have two sections in each class, permitting the division of the better and poorer students. The plan permitted more than one foreign language to be taught, and other subjects, including agriculture and art, could be added. The proposed consolidation would provide a stronger financial unit, and the duplication of administration would be eliminated.

At the hearing on the application, members of the Fairmont and Winnebago school districts were present at the invitation of the commissioner. After the hearing, the application for consolidation was rejected, and the commissioner urged that Granada join the Fairmont district, which was contiguous to it on the south, and that Huntley consolidate with the Winnebago district, which was contiguous to it on the north. It was the view of the commissioner that the petitioning districts should join with what he considered the larger and stronger districts of Fairmont and Winnebago.

The petitioning districts appealed to the district court from the order of the commissioner, and after hearing the evidence the district court concluded that the commissioner's order was 'arbitrary and capricious, and in unreasonable disregard of the best interest of the territory affected.' For our purposes, we are concerned only with Minn.St. 127.25, subd. 1(3), which allows an appeal on the grounds:

'That the action appealed from is arbitrary, fraudulent, capricious or oppressive or in unreasonable disregard of the best interest of the territory affected.'

In support of its determination, the trial court emphasized that since 1964 Granada had been encouraged by representatives of the Department of Education to 'consider the possibility of merging with other districts, or other districts merging with Granada, so that a stronger educational system could be developed.' In August 1966, the commissioner had congratulated Granada on its building program. The court noted, 'The district was retained on the advised or conditionally approved list' pending an official...