Harris v. Langford

• Decision Date: 28 March 1919
• Docket Number: No. 19924.,19924.
• Citation: 277 Mo. 527,211 S.W. 19
• Parties: HARRIS et al. v. LANGFORD et al.
• Court: Missouri Supreme Court

211 S.W. 19

277 Mo. 527

HARRIS et al. v. LANGFORD et al.

No. 19924.

Supreme Court of Missouri, Division No. 1.

March 28, 1919.

Appeal from Circuit Court, Ripley County; J. P. Foard, Judge.

Action by L. Harris and others against James K. Langford and others. Judgment for defendants, and plaintiffs appeal. Reversed and remanded, with directions.

On May 18, 1916, a petition was filed in the circuit court of Ripley county, Mo., by more than 50 individuals, as plaintiffs, claiming to be resident, solvent, and responsible taxpaying citizens of drainage district No. 3, in Ripley county aforesaid, against defendants Langford, Harper, and Glore, as justices of the county court of said county, defendant McClain, as treasurer of said county, and defendant Doniphan State Bank, a Missouri corporation doing a banking business in said county. The petition charges the members of the county court aforesaid with making an illegal agreement with the Doniphan State Bank, on May 2, 1916, by the terms of which $29,000, realized from the sale of bonds belonging to drainage district No. 3 in said county, was to be deposited with said Doniphan State Bank, in consideration of 4 per cent, to be paid by said bank on daily balances, payable monthly.

The petition further alleges that said county court, by an order entered of record, directed McClain, as treasurer of said county, to turn over the proceeds of the sale of said bonds to said bank, and, unless restrained from so doing, will turn over the same to said Doniphan State Bank.

It is further averred that there were, on above dates, three other equally solvent and available banking corporations in said county; that said court, in violation of its duty, neglected and refused to advertise for bids for said funds; that it refused and neglected to take any other steps to secure, for the use and custody of said funds, the highest amount obtainable on daily balances, payable monthly, but, upon the contrary, wrongfully, illegally, and in violation of the interests of said drainage district and the taxpayers therein, selected said Doniphan State Bank as depositary for said fund; that there were other solvent banks, in said county, who could and would have, had they been offered an opportunity so to do, bid a higher per cent. on daily balances, payable monthly, than that agreed to be paid by said Doniphan State Bank; that if offered an opportunity they will yet do so, etc.

The petition prays for a cancellation of said agreement or contract; that McClain, as treasurer, be enjoined from disposing of said funds, until the termination of this action; that the county court aforesaid be ordered to advertise for bids for the custody of the funds aforesaid; and that it be ordered to award said funds to the highest and best bidder in the manner directed by law; and for general relief.

The petition was sworn to by plaintiff L. Harris, in behalf of himself and coplaintiffs. Defendant McClain filed a separate answer, and, after admitting most of the allegations in petition to be true, denied that he will comply with the order of the county court aforesaid, or that he was about to do so. He alleges that he has complied with the law in selecting the Ripley County Bank —a Missouri corporation located in said county—which is the present depositary of the funds of said county, as the depositary of the funds of said drainage district No. 3; that he did so, because the Ripley County Bank offered to pay 4½ per centum on daily balances of said fund, whereas the Doniphan State Bank offered to pay only 4 per centum on daily balances of said fund. He prays for an order, directing him to turn over said funds to said Ripley County Bank, etc.

The Doniphan State Bank filed its separate answer, admitting therein its incorporation; that Langford, Harper, and Glore are county judges, as alleged; that McClain is county treasurer and ex officio treasurer of said drainage district No. 3. It denies every other allegation in petition. It further alleges that on May 2, 1916, the county court aforesaid selected it as the depositary for said drainage fund; that it secured said fund by a surety bond, duly approved by the county court; that thereafter said McClain, as treasurer, etc., willfully and unlawfully refused, and still refuses, to permit it to have the custody of said funds; that said treasurer deposited said funds in a St. Louis bank, which gave no bond to secure the same. It alleges that the bonds, funds, and taxes referred to in petition belong to drainage district No. 3, and not to Ripley county; that the persons named as plaintiffs have no interest therein; that they are not resident, solvent, and responsible taxpaying citizens of Ripley county, Mo., and of drainage district No. 3, within the meaning of section 3729, R. S. 1909; that the contract does not affect Ripley county, but only concerns the drainage district aforesaid. It further denies any bad faith upon its part.

Defendants Langford and Harper filed their separate answer, and admitted therein the incorporation of the bank; that they, with Glore, constituted the county court; that McClain was treasurer of the county, etc. They denied every other allegation of the petition. They further allege that they selected the Doniphan State Bank for the depositary of the $29,000 aforesaid, as well as the taxes, sinking and interest funds hereafter to be collected by said drainage district; that they secured said funds by a surety bond, signed by a surety company, admitted to do business in Missouri; that said bond was duly approved by the county court aforesaid. They allege that they acted in good faith in respect to said matter; that McClain, as treasurer aforesaid, unlawfully and in disregard of his official duty, refused to deposit skid funds with the Doniphan State Bank, or permit it to have the custody thereof, but deposited same with a bank in St. Louis, Mo., without any bond to secure the same. The remainder of the answer is similar to that of defendant bank heretofore mentioned. They claim to have acted in good faith and ask to be discharged.

Defendant Glore filed a separate answer, admitting that plaintiffs are taxpaying citizens of Ripley county, Mo., and that some of them reside in said drainage district No. 3. He admits that McClain is treasurer of said county, that defendants Langford and Harper are judges of the county court, and that the defendant bank is a Missouri corporation. He admits that on May 2, 1916, the county court aforesaid entered into a contract with defendant bank, by which said bank was selected as the depositary of the drainage funds aforesaid, at the sum of 4 per cent. on daily balances, and that defendant bank was selected without any competitive bidding and against his protest, and contrary to his demand that competitive bids be asked for and received in said matter.

The evidence in the case will be considered in the opinion.

On July 1, 1916, the trial court found the issues in favor of defendants, and entered a judgment accordingly, dismissing plaintiffs' bill, etc. Plaintiffs, in due time, filed their motions for a new trial and in arrest of judgment. Both motions were overruled, and the cause duly appealed by them to this court.

Abington & Phillips, of Poplar Bluff, for appellants.

Chas. B. Butler, of Doniphan, for respondents Doniphan State Bank and Ripley County.

RAILEY, C. (after stating the facts as above).

1. The evidence clearly shows that some of the plaintiffs, at least, are resident taxpaying citizens of drainage district No. 3, in Ripley county, Mo. They are prosecuting this action in behalf of themselves, as well as all other taxpayers of said district similarly interested and, in our opinion, have the legal right to do so. Newmeyer et al. v. Railroad Co. et al., 52 Mo. loc. cit. 88, 89, 14 Am. Rep. 394; Dennison v. City 6f Kansas, 95 Mo. loc. cit. 429, 430, 8 S. W. 429; Lilly v. Tebbein, 103 Mo. loc. cit. 488, 489, 15 S. W. 618, 23 Am. St. Rep. 887; State ex rel. v. Woodside, 254 Mo. loc. cit. 586-595, 163 S. W. 845; State ex rel. v. Harris et al., 176 S. W. loc. cit. 10; Tucker v. Wadlow, 184 S. W. loc. cit. 71; Webb v. Cope, 192 S. W. loc. cit. 935; 1 Spelling on injunctions and Other Extraordinary Remedies (2d Ed.) § 678; 1 High on Injunctions (4th Ed.) §§ 372-574.

II. Did the county court of Ripley county, Mo., comply with the laws of this state, in appointing the Doniphan State Bank as the depositary of the $29,000 of drainage funds, belonging to drainage district No. 3 in controversy here?

Section 3803, R. S. 1909, relating to county depositaries, reads as follows:

"It shall be the duty of the county court of each county in this state, at the May term thereof, in the year 1909, and every two years thereafter, to receive proposals from banking corporations, associations or individual bankers in such county as may desire to be selected as the depositaries of the funds of said county. For the purpose of letting such funds such county court shall, by order of record, divide said funds into not less than two nor more than ten...