Lloyd Corp. v. Bannock County

• Citation: 25 P.2d 217,53 Idaho 478
• Decision Date: 03 August 1933
• Docket Number: 6052
• Parties: LLOYD CORPORATION, a Corporation, Appellant, v. BANNOCK COUNTY, IDAHO, and R. T. HALE, H. C. CHRISTENSEN and JAMES J. FACER, as the Board of County Commissioners of Bannock County, Idaho, and BOARD OF COUNTY COMMISSIONERS OF BANNOCK COUNTY, IDAHO, Composed of R. T. HALE, H. C. CHRISTENSEN and JAMES J. FACER, and GRACE L. HALL, as Clerk of Board of County Commissioners of Bannock County, Idaho, Respondents
• Court: United States State Supreme Court of Idaho

25 P.2d 217

53 Idaho 478

LLOYD CORPORATION, a Corporation, Appellant, v. BANNOCK COUNTY, IDAHO, and R. T. HALE, H. C. CHRISTENSEN and JAMES J. FACER, as the Board of County Commissioners of Bannock County, Idaho, and BOARD OF COUNTY COMMISSIONERS OF BANNOCK COUNTY, IDAHO, Composed of R. T. HALE, H. C. CHRISTENSEN and JAMES J. FACER, and GRACE L. HALL, as Clerk of Board of County Commissioners of Bannock County, Idaho, Respondents

No. 6052

Supreme Court of Idaho

August 3, 1933

COUNTIES-WARRANT INDEBTEDNESS - FUND BONDS - CONSTITUTIONAL LAW-STATUTES CONSTRUCTION OF.

1. Idaho Constitution is limitation on powers of state, and legislature may provide for that which is not prohibited.

2. Statutes authorizing counties to issue bonds funding their warrant indebtedness existing as of second Monday in January 1933, held not to violate constitutional provision requiring legislature to provide system of county finance (I. C. A secs. 61-803, 61-807, and secs. 30-1401, 30-1402, as amended by Laws 1933, chap. 153, secs. 1, 2; Const., art. 7, sec 15).

3. Statute authorizing issuance of county emergency warrants to meet authorized ordinary and necessary expenses held not to violate constitutional provision which places limitations on county indebtedness (I. C. A., sec. 30-1208; Const., art. 8, sec. 3).

4. Issuance of refunding bonds for purpose of retiring warrant indebtedness of county does not create "indebtedness," prohibited by constitutional provision which places limitations on county indebtedness (I. C. A., secs. 30-1401, 30-1402, as amended by Laws 1933, chap. 153, secs. 1, 2; Const., art. 8, sec. 3).

5. Statutes relating to issuance of bonds funding county warrant indebtedness existing as of second Monday in January, 1933, must be construed together (I. C. A., secs. 30-1401, 30-1402, as amended by Laws 1933, chap. 153, secs. 1, 2).

6. Counties may exchange their bonds for outstanding warrants existing as of second Monday in January, 1933, or sell bonds to raise money to pay warrants (I. C. A., secs. 55-202, 55-214, and secs. 30-1401, 30-1402, as amended by Laws 1933, chap. 153, secs. 1, 2).

7. Rebuttable presumption exists that board of county commissioners did its duty and informed itself of facts, and that statements contained in its resolution providing for issuance of funding bonds, with respect to validity of warrant indebtedness, are true (I. C. A., sec. 30-1402, as amended by Laws 1933, chap. 153, sec. 2).

8. Supreme court must give practical effect to constitutional provision requiring legislature to provide system of county finance (Const., art. 7, sec. 15).

9. Statutes in pari materia should be construed together.

10. In case of irreconcilable inconsistency between statutes in pari materia, subsequent statute controls.

11. Statutes relating to annual county tax levy for warrant redemption fund and subsequent statutes authorizing counties to issue bonds funding their warrant indebtedness existing as of second Monday in January, 1933, being in pari materia, subsequent statutes control, if irreconcilable inconsistency exists (I. C. A., secs. 61-803, 61-807, and secs. 30-1401, 30-1402, as amended by Laws 1933, chap. 153, secs. 1, 2).

12. Bonds funding county warrant indebtedness existing as of second Monday in January, 1933, held "general obligations" of county, for payment of which unlimited tax levy may be made (I. C. A., secs. 61-803, 61-807, and secs. 30-1401, 30-1402, as amended by Laws 1933, chap. 153, secs. 1, 2; Const., art. 7, sec. 15).

APPEAL from the District Court of the Fifth Judicial District, for Bannock County. Hon. C. J. Taylor, Presiding Judge.

Proceeding for writ of prohibition. Judgment for defendants. Affirmed.

Judgment affirmed, with costs to respondents.

Black & Baum, for Appellant.

The payment of a warrant indebtedness or the changing the form of a warrant indebtedness, so that it may be paid in a different manner or time, violates the provisions of article 7, section 15, Constitution of Idaho. (Golden Gate Highway Dist. v. Canyon County, 45 Idaho 406, 262 P. 1048; Laclede, Highway Dist. v. Bonner County, 33 Idaho 476, 196 P. 196; Peavy v. McCombs, 26 Idaho 143, 140 P. 965.)

Section 30-1208, Idaho Codes Annotated, is unconstitutional, and therefore void. It contravenes article 7, section 15, Idaho Constitution, as its provisions defeat the purpose of such constitutional provision, namely, of placing the counties on a cash basis. Warrants issued under an emergency order are not warrants issued in payment of the ordinary and necessary expenses of a county, as referred to in article 8, section 3, Constitution of Idaho, and section 30-1208, Idaho Codes Annotated, contravenes the provisions of article 8, section 3, of the Constitution of Idaho, in this: it places no limit as to the amount of warrants a county can issue, while article 8, section 3, Constitution of Idaho, provides a limitation on county indebtedness. (Dexter Horton Trust Bank v. Clearwater County, 235 F. 743, 752; Thomas v. Glindeman, 33 Idaho 394, 195 P. 92; Burr v. San Francisco, 186 Cal. 508, 199 P. 1034, 17 A. L. R. 581 (note p. 586); Buck v. City of Eureka, 119 Cal. 44, 50 P. 1065; 18 Cal. Jur., p. 879, sec. 177.)

B. A. McDevitt, for Respondents.

The provisions of sections 61-803 and 61-807, Idaho Code Annotated, and article 7, section 15, Constitution of Idaho, are not exclusive and there is no constitutional or statutory prohibition against the legislature providing for the issuance and sale of refunding bonds to redeem outstanding bonds or warrants of the county or municipality. (Sebern v. Cobb, 41 Idaho 386, 238 P. 1023; Frazier v. Hastings, 26 Idaho 623, 144 P. 1122; Jones v. Power County, 27 Idaho 656, 150 P. 35; State v. Sedgwick, 46 Mont. 187, 127 P. 94.)

Sections 30-1401 and 30-1402, Idaho Code Annotated, as amended by chapter 153, 1933 Sessions Laws, are consistent with the constitutional provisions which do not prohibit the issuance of funding or refunding bonds. (Jones v. Power County, supra; Veatch v. City of Moscow, 18 Idaho 313, 109 P. 722, 21 Ann. Cas. 1332; Sebern v. Cobb, supra; Crocheron v. Shea, 6 Idaho 593, 57 P. 707; Reinhart v. Canyon County, 22 Idaho 348, 125 P. 791; Frazier v. Hastings, supra; Bannock County v. Bunting, 4 Idaho 156, 37 P. 277; and also section 15, article 7, Constitution of Idaho, and notes thereto.)

MORGAN, J., HOLDEN, J. Budge, C. J., and Givens, Holden and Wernette, JJ., concur. MORGAN, J., Dissenting.

OPINION

MORGAN, J.

Appellant, a taxpayer of Bannock county, commenced this proceeding in the district court to procure a writ prohibiting said county, the board of county commissioners, the members thereof and the clerk of the board, respondents herein, from issuing bonds funding $ 347,548.06 warrant indebtedness of the county, existing as of the second Monday of January, 1933. An alternative writ of prohibition was issued and a trial of the case resulted in a judgment quashing it, and confirming the acts of respondents authorizing the issuance of the bonds. This appeal is from the judgment.

Respondents, in attempting to fund this warrant indebtedness, acted pursuant to Idaho Code Annotated, secs. 30-1401 and 30-1402, as amended by Idaho Session Laws, 1933, chapter 153, p. 231, as follows:

Sec. 30-1401. "The Board of County Commissioners of any county in this state may issue negotiable coupon bonds of their county for the purpose of paying, redeeming, funding or refunding the outstanding indebtedness of the county, whether the indebtedness exists as a warrant indebtedness or bonded indebtedness. All such bonds shall be in the form and shall be issued, sold or exchanged and redeemed in accordance with the provisions of Chapter 2 of Title 55 of the Idaho Code Annotated, known as the 'Municipal Bond Law' of the State of Idaho, except where different provision is made herein. Provided, that the authority to fund warrant indebtedness shall extend only to the funding of warrant indebtedness existing as of the second Monday in January, 1933, and providing further that all taxes and other revenues which but for the funding of warrants would have been lawfully applicable to the redemption of the warrants so funded shall, as and when collected, be apportioned to and placed in the sinking fund for the payment of the interest and retirement of the principal of such bonds. Bonds issued for the purpose of funding warrants shall bear interest payable semi-annually as the Board of County Commissioners may determine, not exceeding 6% per annum."

Sec 30-1402. "For the purpose of extending the time of payment of said outstanding indebtedness, or reducing the interest charged, or when the interests of the county require it, the board may issue said bonds in exchange for bonds, theretofore issued by the county or for valid and legal warrants of the county outstanding on the second Monday of January, 1933, and may do so by resolution of the board at a regular meeting thereof, and without a vote of the people. Before any bonds shall be issued or exchanged under this section, the Board of County Commissioners shall ascertain that the bonds or warrants the payment of which is to be extended, or which are to be taken in exchange for the new issue of bonds, are valid and legal obligations of the county, and their findings of fact shall be entered of record on the minutes of their proceedings at least ten days before any exchange is made, as herein provided. The said board shall also, before issuing any bonds under this section, deduct from the total outstanding legal indebtedness of the county at the time of the issue of said bonds, the cash on hand in the treasury of the county, that is available for the payment of said legal indebtedness, or any part thereof, and the issue of bonds...