Mackey v. McDonald

• Decision Date: 04 February 1974
• Docket Number: No. 73--128,73--128
• Citation: 255 Ark. 978,504 S.W.2d 726
• Court: Arkansas Supreme Court
• Parties: B. Frank MACKEY et al., Appellants, v. Steve McDONALD, Jr., Appellee.

Page 726

504 S.W.2d 726

255 Ark. 978

B. Frank MACKEY et al., Appellants, v. Steve McDONALD, Jr., Appellee.

No. 73--128.

Supreme Court of Arkansas.

Feb. 4, 1974.

Lee Munson, Pros. Atty. and Henry Ginger, Deputy Pros. Atty., Little Rock, for appellants.

Eubanks, Files & Hurley, Little Rock, for appellee.

FOGLEMAN, Justice.

This action was instituted by appellee Steve McDonald, Jr., (a justice of the peace for Big Rock Township in Pulaski County) as a citizen, taxpayer and property owner of Pulaski County, on behalf of himself and all others similarly situated. The suit was a proceeding against B. Frank Mackey, individually and as County Judge of Pulaski County, and William L. Tedford, individually and as County Treassurer of Pulaski County. Appellee sought to have certain appropriations made by the county's levying court, commonly called the quorum court, declared void and to have Mackey, individually and as county judge, and Tedford, individually and as county treasurer, enjoined from authorizing, issuing, paying or disbursing any county warrants or otherwise expending any public funds under the authority thereof.

The appropriations questioned by appellee were made at meetings of the levying court held on January 12, 1973, and March 5, 1973. At the January meeting, the court made an appropriation to 'County Court' for a 'Contingent Fund' in the amount of $63,410.61. On March 5, 1973, the court made an appropriation of $222,265 from Federal Revenue Sharing Funds designated only as 'Contingent Fund.' The chancery court held that both appropriations were unlawful and unauthorized, and granted an injunction against Mackey, in his capacity as county judge or individually, from initiating, directing or authorizing any expenditure from either 'Contingent Fund' and against the county treasurer from paying out any monies from these funds.

Judge B. Frank Mackey was called as a witness by appellee. His testimony reveals he has a rather good grasp of the functions of the judge of the county court with reference to county liabilities and appropriations. He said the contingent fund was for emergency purposes to cover legitimate county expenses for which there is no appropriation. He classified these as: (1) financial obligations, placed on the county by legislative enactment for which no appropriation has been made by the quorum court or the appropriation made is inadequate; (2) obligations of the county for proper county purposes, the payment of which results in allowances in excess of appropriations made by the quorum court. As examples, Judge Mackey mentioned a legislative increase in the allowance for operating the office of the prosecuting attorney amounting to $100,000 more than the appropriation theretofore made by the quorum court, and increased obligation on the county for the payment to court reporters for transcripts to be used for appeal purposes by indigent persons convicted in the criminal courts, for which no appropriation had been made, and obligations arising after appropriations made have been exhausted. Judge Mackey made it quite clear that no contingent fund appropriation was made to the county judge, that all payments from the contingent fund were made through the regular process of county court action on claims filed and that no payments were made in any other manner. Judge Mackey stated that he felt legally bound to allow expenses incurred pursuant to legislative enactments, both when no appropriation had been made for the purpose by the quorum court and when the quorum court's appropriation was not sufficient to meet all obligations so established. Judge Mackey testified the claims were processed through the county comptroller who audited the claims before their submission to him for approval. As we understand Judge Mackey's testimony, the comptroller indicates to the county court those claims which must be paid from the contingent fund. Mackey said the comptroller worked under his direction. There is nothing in the record to indicate that Mackey has ever acted individually or in any capacity except as judge of the county court in any of these matters. There is no contention that there has been any fraudulent action or lack of good faith on the part of either of the county officials who are defendants in the action. The appropriation was not made to or for the benefit of the county judge but clearly was placed as an item under the general heading 'County Court.'

The situation is a little different as to the federal revenue sharing funds. Those funds were appropriated by adoption of allocations proposed by the budget committee of the quorum court. These allocations fall into three general categories, none of which mentioned the county court and one of which was simply 'contingent fund.' Judge Mackey was aware that Pulaski County is required to assure the Secretary of the Treasury that these funds will be used by the county only in accordance with laws and procedures governing the county's own revenues and that misapplied funds must be repaid along with a 10% penalty. He stated that, at the time of the trial, these funds had been placed in a separate trust account and that none of the money had been spent.

Appellants filed a general demurrer to appellee's pleading, which was styled 'Petition for Injunction,' and specifically alleged that the chancery court was without jurisdiction under Ark. 16, Sec. 13, of the Constitution of Arkansas over federal revenue sharing funds.

After hearing the matter, the chancellor expressed grave concern about the jurisdiction of the chancery court to act in the matter, as well he might. In view of the disposition we make of the case, however, we need not concern ourselves too much with the serious doubt about the jurisdiction of the chancery court over this action, which basically would appear to fall within the jurisdiction of the circuit court under Art. 7, Sec. 14. The county treasurer, however, is a party to the action. It is the duty of the county treasurer to pay and disburse monies payable into the county treasury on warrants drawn by order of the county court. Ark.Stat.Ann. § 12--1310 (Repl.1968). If he neglects or refuses to pay any warrant drawn on him by order of the county court, when he has in his hands money available for the payment thereof, the law requires him to forfeit to the holder fourfold the amount of the warrant. Ark.Stat.Ann. § 12--1311 (Repl.1968). Furthermore, the refusal constitutes a misdemeanor in office, and subjects the treasurer to removal. Ark.Stat.Ann. § 12--1312 (Repl.1968). Clearly, the treasurer is a ministerial officer of the county, who is not vested with discretion in such matters.

It is true that appellee had the right to appeal from the appropriations made by the quorum court. Lee County v. Robertson, 66 Ark. 82, 48 S.W. 901. It is not clear, however, that his remedy at law was plain, adequate and complete. Under similar circumstances, this court has held that the chancery court properly exercised jurisdiction in an action against the county clerk to restrain the clerk from issuing warrants based on allegedly unauthorized orders of the county court. Worthen v. Roots, 34 Ark. 356. We consider this case to be controlling authority as to the chancery court's jurisdiction, at least insofar as the county treasurer is concerned. See also, Farrell v. Oliver, 146 Ark. 599, 226 S.W. 529. Under the authority of the cited cases, it seems that all the issues here raised may be adequately treated within the jurisdiction of the chancery court.

Appellants' first point for reversal is based upon their contention that the court had no jurisdiction insofar as the federal revenue sharing funds are concerned. They base their argument upon the assertion that Art. 16, Sec. 13, of our Constitution applies only to county tax funds but not to federal funds and that jurisdiction of misuse of federal funds is governed by the Federal Revenue Sharing Act which does not place jurisdiction in any state or local court. We do not agree with appellants.

At the outset, we should say that the application of Art. 16, Sec. 13, has not been strictly limited to exactions of county, town or city tax funds. See, e.g., Eddy v. Schuman, 206 Ark. 849, 177 S.W.2d 918; City of Bentonville v. Browne, 108 Ark. 306, 158 S.W. 161; McCain v. Hammock, 204 Ark. 163, 161 S.W.2d 192; Nelson v. Berry Pteroleum Co., 242 Ark. 273, 413 S.W.2d 46; Parker v. Laws, 249 Ark. 632, 460 S.W.2d 337; Price v. Edmonds, 231 Ark. 332, 330 S.W.2d 82; Cunningham v. Stockton, 235 Ark. 345, 359 S.W.2d 808; Needham v. Garner, 233 Ark. 1006, 350 S.W.2d 194. It seems that, under this section of the constitution, equitable remedies are accorded the taxpayer to prevent misapplication of funds when the taxpayer may be required to replenish those funds if exhausted through the misapplication. Eddy v. Schuman, supra. It also seems clear that this constitutional provision is applicable in every case where taxpayers will bear the burden of replenishing funds exhausted by misapplication. McLellan v. Pledger, 209 Ark. 159, 189 S.W.2d 789; Samples v. Grady, 207 Ark. 724, 182 S.W.2d 875; Farrell v. Oliver, 146 Ark. 599, 226 S.W. 529. The cited cases make it quite clear that a citizen and taxpayer may maintain a suit to prevent a misapplication of funds or to protect against unlawful official acts which could logically result in illegal exaction as well as to require reparation for that which has been done. See also, Grooms v. Bartlett, 123 Ark. 255, 185 S.W. 282. We do not consider the case of Gipson v. Ingram, 215 Ark. 812, 223 S.W.2d 595, relied upon by appellants to be applicable here. The opinion in that case clearly points out that it was shown that the cash funds involved, admittedly public funds, were not derived from taxes but from the operation of the state agencies and institutions involved. For the purposes of the opinion in that case, these cash funds were treated as those received...