Marathon Oil Co. v. Welch

• Decision Date: 21 March 1963
• Docket Number: No. 3,No. 1 and S,No. 3100,1 and S,3,3100
• Citation: 379 P.2d 832
• Parties: MARATHON OIL COMPANY, a Corporation, a Taxpayer in and of School Districtpecial High School Districtin the County of Big Horn and State of Wyoming, Appellant (Plaintiff below), v. Ford M. WELCH, Assessor, County of Big Horn, State of Wyoming, June Lamont Smith (Formerly June Lamont), Treasurer, County of Big Horn, State of Wyoming, the District Boundary Board of the County of Big Horn, State of Wyoming, Appellees (Defendants below).
• Court: Wyoming Supreme Court

Page 832

379 P.2d 832

MARATHON OIL COMPANY, a Corporation, a Taxpayer in and of School District No. 1 and Special High School District No. 3 in the County of Big Horn and State of Wyoming, Appellant (Plaintiff below), v. Ford M. WELCH, Assessor, County of Big Horn, State of Wyoming, June Lamont Smith (Formerly June Lamont), Treasurer, County of Big Horn, State of Wyoming, the District Boundary Board of the County of Big Horn, State of Wyoming, Appellees (Defendants below).

No. 3100.

Supreme Court of Wyoming.

March 21, 1963.

J. W. Gee, Findlay, Ohio, and James A. Zaring, Basin, for appellant.

John O. Callahan, Basin, and J. D. Fitzstephens, Cody, for appellees.

Before PARKER, HARNSBERGER and McINTYRE, JJ.

Mr. Justice McINTYRE delivered the opinion of the court.

Marathon Oil Company, formerly The Ohio Oil Company, as appellant challenges action taken by a school district boundary board to change the boundaries of two school districts. The lands involved in the change contain 17 producting oil wells, all of which are owned by Marathon. In fact, that company claims to own approximately 81 percent of the total property evaluation transferred from one district to the other.

It is conceded the interest of Marathon is that of a taxpayer, and the change in boundaries, if valid and permitted to remain in effect, will require such taxpayer to pay substantially more in taxes than it would pay if the boundaries remained as they were.

As a result of a joint petition previously filed by the respective boards of education of School District 28 and School District 1 in Big Horn County, the District Boundary Board of Big Horn County held a special meeting March 29, 1960 to consider the request of the boards of education of these two districts for a change in boundaries, in order to give to District 28 a part of the Byron oil and gas field from District 1. At the meeting, the boundary board adopted the proposal of the petition and the boundaries of the two districts were changed accordingly.

Marathon subsequently brought this action against the county assessor, the county treasurer and the boundary board to enjoin the collection of all taxes arising out of the change in boundaries. The district court upheld the validity of the change, and the taxpayer now seeks a reversal of its judgment.

Appellant's Claim

Appellant has not claimed the boundary board is without power to make the change which it did make. But it is claimed the board's action is void because of lack of a formal notice and hearing. In support of this contention, counsel for appellant cites School District No. 9, Fremont County v. District Boundary Board In and For Fremont County, Wyo., 351 P.2d 106; and School Dist. No. 3, El Paso County v. Perry, 126 Colo. 443, 250 P.2d 1010.

We have carefully reviewed these cases and find in them very little, if any, support for counsel's contention. The District No. 9, Fremont County, case dealt with the need for substantial evidence upon which the decision of the boundary board could reasonably have been based. Nothing was said, however, which would imply that a formal notice and hearing for property owners and taxpayers would be required.

In the Colorado case of Dist. No. 3, a change in boundaries was made by the county superintendent of schools without notice to the school district from which property was being taken and without an opportunity for it to be heard. Although there was an adjudication to the effect that the affected school district had a right to be notified and heard on the question as to whether the best interests of the schools would be promoted by a change in boundaries, nothing was said which would indicate that the notice and hearing for this determination should extend to property owners and taxpayers. Actually, by statute in Colorado, a vote of the electors was required following a determination by the superintendent of schools to propose a change in boundaries.

The Matter of Notice

The powers and duties of a boundary board, insofar as pertinent to the instant case and as they existed on March 29, 1960, were spelled out in § 21-211, W.S.1957, in the following language:

'The county superintendent of schools, the county treasurer, and the board of county commissioners shall constitute a board for laying off their county into convenient school districts, such board to be styled 'the district boundary board.' Said board by a majority vote may divide the county into school districts, may alter and change the boundaries of the districts so formed from time to time and may at any time consolidate entire districts or portions of districts, when, in the opinion of such board such changes, alterations or consolidations may be justified by existing circumstances and conditions * * *.'

There is no statutory requirement for a notice of meeting in connection with meetings of a district boundary board, and appellant does not contend the statute under which the boundary board proceeded is unconstitutional. In fact, appellant asserts the statute unquestionably is constitutional. Indeed, the validity of such legislation was recognized by this court in Chicago, B. & Q. R. Co. v. Byron School Dist. No. 1, 37 Wyo. 259, 260 P. 537, 539, wherein it was said the establishment of such districts and the change of boundaries is a legislative function which the legislature has delegated to a district boundary board in each county, and it is not questioned this may be done.

In the absence of constitutional restrictions, the question as to whether local boards may exercise their delegated power to change school district boundary lines, without notice and a hearing for property owners, is a matter solely for the determination of the legislature. Anderson v. Peterson, 78 N.D. 949, 54 N.E.2d 542, 551-553; In re Annexation of Common School Dists. Nos. 18 & 21 to Independent School Dist. No. 1, Minidoka County, 52 Idaho 363, 15 P.2d 732, 733; Antelope Valley Union High School Dist. of Los Angeles County v. McClellan, 55 Cal.App. 244, 203 P. 147, 149; 47 Am.Jur., Schools, § 18, p. 310.

Generally, statutes authorizing subordinate boards to create and alter school districts are not invalid for failure to require a notice and hearing, and a hearing is not necessary where not required by statute. Perkins v. Lenora Rural High School Joint Dist. No. 1, Norton and Graham Counties, 171 Kan. 727, 237 P.2d 228, 232-233; Prosper Independent School Dist. v. County School Trustees, Tex.Com.App., 58 S.W.2d 5, 6; 78 C.J.S. Schools and School Districts § 42, p. 731.

The Supreme Court of Oklahoma had occasion to say, in Dowell v. Board of Education of Oklahoma City, 185 Okl. 342, 91 P.2d 771, 775, that a school district is a subordinate agency of the state, and the legislature can abolish or change the boundaries of school districts without consulting the inhabitants.

It has been held in this jurisdiction that no person can have a vested right in a particular school district, and the amount of taxes to be paid by taxpayers is not a criterion, or at least a controlling criterion, in determining whether the annexation of territory to a school district is reasonable or not. Chicago, B. & Q. R. Co. v. Byron School Dist. No. 1, supra, at 260 P. 541. See also Pritchett v. County Board of School Trustees, 5 Ill.2d 356, 125 N.E.2d 476, 478; School Dist. No. 3 of Town of Adams v. Callahan, 237 Wis. 560, 297 N.W. 407, 414, 135 A.L.R. 1081; and Anderson v. Peterson, supra.

The appellants in School Dist. No. 3 of Town of Adams v. Callahan, supra, were school districts and individual property owners and taxpayers. Concerning them the court said:

'* * * no property rights on the part of the districts or any of the appellants are considered involved in the consolidation of such districts. Consequently, neither the absence of a statutory provision requiring notice to be given of a hearing before the superintendent, nor the absence of any such notice to appellants renders the statute unconstitutional or the orders under review invalid on the ground of a want of due process. * * *'

Board's Discretion

In Pritchett v. County Board of School Trustees, supra, the Supreme Court of Illinois said the sufficiency of notice, or lack of it, is purely a matter of legislative determination; however, it may be a subject for judicial review as regard to whether the county board has sufficiently apprised itself of the situation at hand before carrying out its legislative directive.

This statement, we believe, affords the answer to our decision in the case before us. The matter of requiring or not requiring notice is purely a matter of legislative determination. But it is indeed a subject for judicial review as regard to whether the county board has sufficiently apprised itself of the situation at hand before carrying out its legislative directive.

Thus it was, in the District No. 9, Fremont County, case that Justice Parker, at 351 P.2d 111, said a district boundary board must have before it sufficient information upon which it may properly find that it is to the best interests of the people in both the annexed and annexing areas. He also pointed out that information from which the welfare and interests of all of the people concerned may be determined is a prerequisite to action of any administrative board. The decision in that case was predicated squarely upon a lack of sufficient information from which it could reasonably be determined that a change should be made.

This brings us then, in the case at bar, to a review of the record in order to determine whether the boundary board of Big Horn County had sufficient information upon which to base its decision for a change. However, before reviewing the specific information upon which the board appears to have acted, we think it will be helpful to examine briefly the extent of the board's discretion.

We have repeatedly said the courts are warranted in setting aside action of an administrative agency only...