New First Nation Bank of Columbus v. Linderman

• Decision Date: 25 April 1921
• Citation: 198 P. 159,33 Idaho 704
• Parties: NEW FIRST NATIONAL BANK OF COLUMBUS, OHIO, a Corporation, Respondent, v. MARY B. LINDERMAN, Treasurer of the City of Weiser, Idaho, Appellant
• Court: Idaho Supreme Court

198 P. 159

33 Idaho 704

NEW FIRST NATIONAL BANK OF COLUMBUS, OHIO, a Corporation, Respondent, v. MARY B. LINDERMAN, Treasurer of the City of Weiser, Idaho, Appellant

Supreme Court of Idaho

April 25, 1921

MUNICIPAL SEWERAGE IMPROVEMENT-BONDS-INTEREST-PRINCIPAL-METHOD OF PAYMENT-CONSTITUTIONALITY OF STATUTE.

1. Under Revised Codes, section 2353, as amended by Session Laws 1911, chapter 80, subdivision 11, now C. S., section 4149 the funds raised by assessment in a municipal sewerage district should be applied first to the payment of the interest coupons on all unpaid bonds; second, to the redemption of the unpaid bonds in their order beginning with the lowest number.

2. Such method of applying the funds does not violate Idaho constitution, art. 1, section 13, which prohibits the taking of property without due process of law.

APPEAL from the District Court of the Seventh Judicial District, for Washington County. Hon. Isaac F. Smith, Judge.

Mandamus proceeding. Alternative writ issued. Motion to quash denied and peremptory writ issued. Sustained.

Judgment affirmed. Costs awarded to respondent. Petition for rehearing denied.

J. W Galloway and Frank D. Ryan, for Appellant.

The city is simply a collecting and disbursing agent for the sewer districts and could only pay out as interest what it collected as interest, and for it to take the principal of the paying property owner and use it to pay a delinquent interest assessment of another property owner who has failed to pay his sewer assessment would be a breach of trust and an unlawful application of funds, and in violation of sec. 13, art. 1, of the constitution of Idaho, in that it would, without due process of law, take the principal paid in by paying property owners and utilize it in paying the interest of delinquent property owners. (McQuillin on Municipal Corp., sec. 2179; New First Nat. Bank v. City of Weiser, 30 Idaho 15, 166 P. 213.)

The bondholder is given a plain, speedy and adequate remedy at law whereby he may proceed to collect from each property owner the amount due from him. (New First Nat. Bank v. City of Weiser, supra.)

"A writ of mandate will not issue where the party seeking it has a plain, speedy and adequate remedy at law." (Lamberton v. McCarthy, 30 Idaho 707, 168 P. 11.)

Charles F. Reddoch and J. P. Pope, for Respondent.

It is the defendant's duty to comply with the law in disbursing the funds of the local improvement districts in question. (Frontier Milling etc. Co. v. Roy White etc. Mercantile Co., 25 Idaho 478, 138 P. 825; State v. Mulkey, 6 Idaho 617, 59 P. 17; Swain v. Fritchman, 21 Idaho 783; 125 P. 319; New First Nat. Bank v. City of Weiser, 30 Idaho 15, 166 P. 213.)

Mandamus is the proper remedy to compel an officer to perform a duty enjoined by law. (Rice v. Gwinn, 5 Idaho 394, 49 P. 412; Pyke v. Steunenberg, 5 Idaho 614, 51 P. 614; Williams v. Lewis, 6 Idaho 184, 54 P. 619; Blackwell Lumber Co. v. Flynn, 27 Idaho 632, 150 P. 42; Wycoff v. Strong, 26 Idaho 502, 144 P. 341; Pfirman v. Success Mining Co., 30 Idaho 468, 166 P. 216.)

MCCARTHY, J. Rice, C. J., and Budge, Dunn and Lee, JJ., concur.

OPINION

MCCARTHY, J.

The city of Weiser created certain sewer districts and caused sewers to be installed. The property affected was duly assessed and bonds were issued under the provisions of R. C., sec. 2353, as amended by S. L. 1911, chap. 80, subd. 11, now C. S., sec. 4149. Respondent bought certain of these bonds. Appellant, the city treasurer, had on hand sufficient funds paid on assessments to pay all the interest due on outstanding bonds. Respondent presented overdue interest coupons to the amount of $ 584.68. Appellant refused to pay said coupons except in accordance with a partial payment plan whereby she makes payments upon all interest coupons and the principal of the bonds in proportion that the amount of money she has on hand bears to the entire issue of said bonds outstanding. Such method would not pay the interest on overdue interest coupons the payment of which was demanded by respondent. The above are the facts set forth in respondent's petition for a writ of mandate and admitted by appellant's motion to quash the alternative writ. Respondent prayed for a peremptory writ ordering appellant to apply the moneys on hand first to the payment of interest due on all unpaid bonds; second, to the redemption of the unpaid bonds in their order beginning with the lowest number. Upon the district court's denying appellant's motion to quash the alternative writ, appellant's default was entered for a refusal to plead further and a peremptory writ of mandate issued in accordance with the prayer of respondent's petition. From the order denying the motion to quash the alternative writ and the judgment, appellant appeals.

The question is the interpretation of R. C., sec. 2353, as amended by S. L. 1911, chap. 80, subd. 11, now C. S., sec. 4149. Appellant contends, first, that moneys paid on sewer assessments should be kept in two funds, a fund for interest and a fund for principal, and applied accordingly; second, that the judgment conflicts with the decision of this court in New First Nat. Bank v. City of Weiser, 30 Idaho 15, 166 P. 213; third, that applying the money in the method contended for by respondent would result in depriving property owners in the district of their property without due process of law; and, fourth, that mandamus is not the proper remedy.

We cannot agree with the contention of counsel for appellant that the statute contemplates a separate interest fund and a separate principal fund. The provision that "The city treasurer or other authorized officer of such city, town or village, shall pay the interest on the bonds authorized to be issued by this chapter out of the respective local improvement funds from which they are payable," refers to the "funds" of the various improvement districts, each district having its own special fund. It is clearly intended that the interest and principal collected for the payment of the bonds of a given district shall be placed in the same fund. Otherwise...