Miller v. Jackson Township of Boone County

• Decision Date: 02 July 1912
• Docket Number: 21,747
• Citation: Miller v. Jackson Township of Boone County, 99 N.E. 102, 178 Ind. 503 (Ind. 1912)
• Parties: Miller et al. v. Jackson Township of Boone County et al
• Court: Indiana Supreme Court

99 N.E. 102

178 Ind. 503

Miller et al. v. Jackson Township of Boone County et al

No. 21,747

Supreme Court of Indiana

July 2, 1912

Rehearing Denied November 22, 1912.

From Hendricks Circuit Court, James L. Clark, Judge.

Action in the name of the State of Indiana by William B. Hedge and others, taxpayers of Jackson Township in Boone County against William H. Miller, a former trustee of the township and others.From a judgment for plaintiffs, the defendants appeal.

Reversed.

Terhune & Adney, Samuel M. Ralston, Darnell & Darnell, Enloe & Pattison, for appellants.

Samuel R. Artman, Crane & McCabe, Brill & Harvey, J. Frank Hanly and C. V. McAdams, for appellees.

Morris, J. Myers, J. Monks, J., concurs in this opinion.

OPINION

Morris, J.

This was an action in the name of the State of Indiana, brought by William B. Hedge, and three other taxpayers of Jackson township, Boone county, as relators, against appellantsWilliam H. Miller, a former trustee of the township, and Thomas F. Young and eleven other sureties on his bond, and against the civil and school townships of Jackson, for the recovery of funds alleged to have been misappropriated.The complaint, filed April 7, 1909, was in two paragraphs.

In the first paragraph it is alleged, among other things, that at the November, 1904, election Miller was elected trustee of Jackson township, and executed his bond, in the penalty of $ 20,000, payable to the State of Indiana, with Thomas F. Young, and eleven other appellants as sureties thereon; that appellant Miller served as trustee of the township from January 1, 1905, to January 1, 1909, when he was succeeded as such officer by Emery Graves.The first paragraph alleges fourteen specific breaches of the bond, containing itemized specifications of funds disbursed by the trustee, all of which, it is alleged, were paid out by the trustee, without any appropriation therefor ever having been made by the township advisory board, and without any authority therefor from the board; and it is alleged that the trustee, in his various settlements and reports, took credit for such expenditures against the various funds specified, as follows: (1) from the road fund, for bridge and culvert repair, $ 2,678; (2) from special school fund, for fuel for schoolhouses, $ 3,495.99; (3) from the township fund, for trustee's salary for three years, $ 1,866.85; (4) from township fund, for office rent and storage of township property, $ 281; (5) from special school fund, for fire insurance, $ 415.50; (6) from special school fund, for hauling children to school, $ 5,225.85; (7) from special school, township and road funds, without any notice to bidders, for school furniture, fixtures, school and road supplies, $ 7,418.97; (8) from special school fund, $ 1,757, for installing a heating plant in a schoolhouse, without notice to bidders; (9) from public funds, without legal authority, regardless of an appropriation, for car fare, livery hire, telephone service, and traveling expenses, $ 128.35; (10) from "additional special school fund," created by sale of bonds for reconstructing a schoolhouse, for payment of bank notes, and various other purposes, $ 5,000; (11) from township and special school funds, for overdrafts, $ 1,972.11; (12) from the public funds of the township, for attorney's fees, for pretended legal services that were never rendered, $ 97; (13) from the township and special school funds, for borrowed money, $ 7,400.85.

In relation to the fourteenth breach, it is alleged that there came into the hands of Miller, as trustee, public funds of the aggregate amount of $ 100,760.06, distributed among the several funds as follows: Township fund, $ 5,499.82; tuition fund, $ 32,416.81; road fund, $ 8,025.26; special school fund, $ 54,818.17; that from the total received he turned over to his successor $ 1,922.62, and expended the balance for various purposes; that of said balance, so expended, only the sum of $ 3,514 was disbursed in pursuance of appropriations made by the township advisory board, and the remainder, to wit, the aggregate sum of $ 95,323.44, was paid out by Miller without any appropriation having been made by the advisory board for the disbursements made, and without any authority from the advisory board for such disbursements.

The complaint alleges that the relators are, and were during the last five years, residents and taxpayers of the township; that on March 5, 1909, the relators made a demand, in writing, on the township trustee and members of the township advisory board that suit be instituted on Miller's bond for the recovery of the above-named funds; that no suit was instituted, and more than thirty days have elapsed since the notice was given, and for that reason this complaint is filed by the relators for the use and benefit of the civil and school townships of Jackson.Judgment is prayed in the sum of $ 20,000.

The second paragraph of the complaint is the same as the first concerning the election of the trustee, the execution of his bond, and the demand on his successor and the advisory board for instituting suit.Seven distinct breaches of the bond are alleged, as follows: (1) Miller paid to himself, out of the township fund, during his term, $ 90.85 for car fare and traveling expenses; (2) that he paid to himself, from the township fund, $ 185 for office rent, sheltering township property and election supplies, and from the special school fund he paid himself $ 30 for shedding school wagons; (3) that in 1905 and 1906he took the enumeration of school children, and charged therefor as a part of his salary the sum of $ 40 each year, and paid himself therefor, and notwithstanding such payment, he paid to one Young, for the same services, the sum of $ 60, and took credit therefor; (4) that Miller and one Gardner were partners in the drug and notion business during Miller's term of office; that said partnership sold to the trustee various school supplies, aggregating in value $ 309.66, without any notice to bidders for such supplies, and without written contract therefor, and the firm was paid the above amount out of the special school fund, and Miller took credit therefor in his settlement; (5) that the trustee, without public notice or letting, privately contracted for school supplies, furniture and fixtures, repairs to schoolhouses, etc., and paid therefor the aggregate sum of $ 11,208.89 from the special school fund; (6) that Miller paid from the same fund $ 1,751.25 for installing a heating plant in a school building, on a contract let without notice or competitive bidding; (7) that in 1908he paid $ 1,454.67 for fuel from the special school fund, in excess of the amount authorized by the advisory board to be expended; that the fuel was not needed, and in fact was not used in 1908; that the fuel was purchased without authority from the advisory board and without notice to bidders.

The trustee demurred to each paragraph of the complaint, on the ground that relators did not have capacity to sue, and that the complaint did not state facts sufficient to constitute a cause of action.A like demurrer was filed by the sureties.Each demurrer was overruled, and this action of the court is here assigned as error.

It is contended by appellants that an action at law on the bond of a municipal officer cannot be maintained by a taxpayer of a municipality, because such action must be brought by the party interested (§ 253Burns 1908, § 253 R. S. 1881), and that the township advisory board act of 1899(Acts 1899p. 150, § 9590 et seq.Burns 1908) does not authorize a suit in equity by a taxpayer against a trustee after the expiration of his term.It is appellants' theory that § 6 of the act which authorizes a suit by a taxpayer must be construed as giving such right only where the advisory board refuses to bring a suit against a trustee while in office.So much of § 6 as is applicable here reads as follows: "And any payment of any debt not so authorized from the public funds of such township shall be recoverable upon the bond of the trustee in a suit, which it is hereby made the duty of said [advisory] board to institute and prosecute in the name of the state, for the use of the township.* * * And if the board, on the written demand of any taxpayer, fails for thirty (30) days to bring suit, then such, or any other taxpayer may bring the same, in the name of the state, for the use of the township."

It is appellants' theory that inasmuch as it is the duty of the trustee to bring the suit on the bond, and he could not well institute a suit against himself, that this statute substitutes the advisory board as a proper relator to bring the suit against the incumbent trustee, but after the expiration of the term there is no reason why the successor should not bring it.It is not necessary to determine this question here.Both the advisory board and the trustee failed to sue after notice given.The right of a taxpayer to sue in equity existed before the statute was enacted.Zuelly v. Casper(1903), 160 Ind. 455, 67 N.E. 103, 63 L. R. A. 133;State, ex rel., v. Holt(1904), 163 Ind. 198, 71 N.E. 653.That right of the taxpayer was in noway abridged by the statute, except by requiring notice to the advisory board, under certain conditions, before bringing the suit; and his right was in no other respect affected, except by the portion of the enactment that declares a notice of thirty days to be sufficient.

This is not an action at law, but is a suit in equity, and such suit may be maintained by a taxpayer, after requisite notice against an officer in his individual capacity, or against him and his sureties on his bond, either while he holds the office, or afterwards.State, ex rel., v. Holt, supra;Zuelly v. Casper, sup...