Isley v. School Dist. No. 2 of Maricopa County, 6192

• Decision Date: 26 December 1956
• Docket Number: No. 6192,6192
• Citation: 81 Ariz. 280,305 P.2d 432
• Parties: Phil A. ISLEY, as Treasurer of Maricopa County, Arizona, and W. W. Dick, as County School Superintent of Maricopa County, Arizona, Appellants, v. SCHOOL DISTRICT NO. 2 of MARICOPA COUNTY, Arizona, a body politic, Appellee.
• Court: Arizona Supreme Court

Page 432

305 P.2d 432

81 Ariz. 280

Phil A. ISLEY, as Treasurer of Maricopa County, Arizona, and W. W. Dick, as County School Superintent of Maricopa County, Arizona, Appellants, v. SCHOOL DISTRICT NO. 2 of MARICOPA COUNTY, Arizona, a body politic, Appellee.

No. 6192.

Supreme Court of Arizona.

Dec. 26, 1956.

Snell & Wilmer, and Perry M. Ling, Phoenix, for appellants.

William P. Mahoney, Jr., County Atty., and Jos. F. Walton, Special Counsel for School Affairs, Phoenix, for appellee.

LA PRADE, Chief Justice.

The action upon which this appeal is based arose out of undertainty as to meaning and effect of certain provisions contained in section 54-603, A.C.A.1939, as amended, sections 15-1201 and 15-1202, A.R.S.1956, pertaining to school district budgets and the accouting and administrative responsibilities with respect to school district funds resulting under these provisions. The school district, county superintendent of schools and county treasurer were unsure of their respective duties under these statutes, and the school district-appellee sought a declaratory judgment for the purpose of clarifying this situation. The court granted the school district's motion for summary judgment, holding in effect that under then existing statutes a six-line rather than a forty-one-line 'Operating Expense' budget controlled; that the treasurer was bound to keep a separate account for each school district, and pay warrants when such would not result in an overdraft of either the 'Operating Expense' or 'Capital Outlay' divisions of the budget, respectively; and that registered warrants drawn on school district funds should be paid in accordance with sections 17-706 et seq., A.C.A.1939, sections 11-636 through 11-639, A.R.S.1956. From this judgment the county superintendent of schools and county treasurer appealed.

Section 54-603, supra, contains a budget format for school districts, applicable portions of which are as follows:

'54-603. School district budgets. Not later than July 3rd of each year the board of trustees of each common or high school district shall prepare and furnish to the county school superintendent and the state superintendent of public instruction a proposed budget for the current fiscal year, which shall contain the information and be in form as follows:

'(Name and No. of District)

Proposed School District Budget for the fiscal year 19__ to 19__ (General categories III, IV, V and VI, which also include subitems, are omittedfor brevity.)

At the request of the school district the county attorney of Maricopa County gave an opinion that the general categories (I, II, etc.) under the 'Operating Expense' division controlled the operating budget, and that the subitems were merely explanatory of the general categories. He founded this conclusion upon the fact that no lines were provided in the three vertical columns for the forty-one subitems included in these general categories. The attorney general subsequently rendered an opinion to the effect that expenditures were limited to amounts set up in each of the subitems-hence the uncertainty confronting the officials to which reference is above made.

School district expenditures are controlled by a budget which is prepared by the board of trustees, as governing body of the district, using the above budget format, pursuant to section 54-603, supra. The general scheme for discharge of school district obligations involves the issuance of a voucher by the board of trustees at the time an obligation is incurred; the drawing of a warrant by the county superintendent of schools on the county treasurer against the school funds upon receipt of a valid voucher, section 54-301, A.C.A.1939, 1952 Supp., section 11-514, A.R.S.1956; and payment of such warrant, when presented to the county treasurer, section 54-606, A.C.A.1939, 1952 Supp., section 15-1231, A.R.S.1956.

The appellants contend that the court below erred, as to the content of the declaratory judgment it rendered, in four specified particulars. Separate treatment and disposition of each assignment of error is made in the discussion which succeeds except that assignments 2 and 3 are considered together.

First, appellants contend that the trial court erred in declaring that section 54-603, supra, permits the county school superintendent to draw warrants for expenditures in excess of the amounts budgeted for subitems within any of the first six general categories in a school district budget, if such expenditures are not in excess of the available balance to the credit of the general category which includes such subitems.

The first part of section 54-603, supra (now section 15-1201, A.R.S.1956) merely makes provision for preparation of a budget by the board of trustees using the form set forth therein. A later provision in the action (now part of section 15-1202(F), A.R.S.1956) recites that '* * * No expenditure shall be made for a purpose not particularly itemized and included in such budget, and no expenditure shall be made, and no debt, obligation or liability shall be incurred or created in any year for any purpose itemized in such budget in excess of the amount specified for such item, * * *.'

Section 54-301, supra, sets forth specifically the superintendent's responsibilities relative to the administration and control of school district expenditures. One part of this section directs that the superintendent, upon receipt of a valid voucher, draw a warrant on the county treasurer against the school fund of the district concerned. A latter portion of the section prescribes that

'* * * no warrant shall be drawn for any expenditure for a purpose not included in the budget of such school district, nor for any expenditure in excess of the amount budgeted and not theretofore expended, except for expenditures authorized by the board of supervisors in accordance with subsection (b) of section 54-608. * * *'

(Now section 15-1245, A.R.S.1956.)

It is our opinion that this provision in effect precludes the superintendent from drawing a warrant against the school fund of the school district concerned unless the expenditure upon which such warrant is based is for a 'purpose' included within the budget, and that the expenditure will not result in an overdraft of the amount budgeted for such 'purpose', except to the extent of increases authorized under subsection (b) of section 54-608, supra. We hold that the word 'purpose', as used in both section 54-603, supra, and section 54-301, supra, was intended to have the same meaning. The question then arises whether, with respect to the 'Operating Expense' division of the budget, 'purpose' as used in the above sections has reference to each of the six general categories of this budget division or to the forty-one subitems contained in these categories.

In instances requiring a construction of statutes the fundamental rule is to ascertain and give effect to the intention of the legislature as expressed in the statute. Automatic Registering Mach. Co. v. Pima County, 36 Ariz. 367, 285 P. 1034; Hicks v. Krigbaum, 13 Ariz. 237, 108 P. 482. In arriving at the intention of a statute resort may be had to the words, context, subject matter, effects and consequences, spirit and reason of the law, and other acts in pari materia. Coggins v. Ely, 23 Ariz. 155, 202 P. 391.

In chapter 147, Section Laws of 1954, which introduced the budget format as it appears herein, the legislature did not include lines opposite the forty-one subitems in the ...