People v. Tremaine

Decision Date19 November 1929
Citation168 N.E. 817,252 N.Y. 27
PartiesPEOPLE v. TREMAINE, State Comptroller.
CourtNew York Court of Appeals Court of Appeals

OPINION TEXT STARTS HERE

Submission of controversy on agreed facts by the People against Morris S. Tremaine, as Comptroller of the state. Judgment for plaintiffs (226 App. Div. 331, 235 N. Y. S. 555), and defendant appeals.

Reversed, with directions.

Appeal from Supreme Court, Appellate Division, Third Department.

William D. Guthrie and Edward G. Griffin, both of New York City, for appellant.

Hamilton Ward, Atty. Gen. (Nathan L. Miller, of New York City, John Knight, of Arcade, and C. T. Dawes, of Albany, of counsel), for the People.

POUND, J.

From the agreed statement of facts on which this controversy is submitted to the court it appears that the Governor transmitted to the Legislature his original itemized budget and budget bill on January 28, 1929, in accordance with article 4-A of the New York Constitution (see Laws 1928, p. 1886), § 2, which reads as follows:

§ 2. On or before the fifteenth day of January next succeeding (except in the case of a newly elected Governor and then on or before the first day of February) he [the Governor] shall submit to the Legislature a budget containing a complete plan of proposed expenditures and estimated revenues. It shall contain all the estimates so revised or certified and clearly itemized, and shall be accompanied by a bill or bills for all proposed appropriations and reappropriations; it shall show the estimated revenues for the ensuing fiscal year and the estimated surplus or deficit of revenues at the end of the current fiscal year together with the measures of taxation, if any, which the Governor may propose for the increase of the revenues. It shall be accompanied by a statement of current assets, liabilities, reserves and surplus or deficit of the state; statements of the debts and funds of the state; an estimate of its financial condition as of the beginning and end of the ensuing fiscal year; and a statement of revenues and expenditures for the two fiscal years next preceding said year in form suitable for comparison. The Governor may before final action by the Legislature thereon, and not more than thirty days after submission thereof, amend or supplement the budget; he may also with the consent of the Legislature, submit such amendment or a supplemental bill at any time before the adjournment of the Legislature. A copy of the budget and of any amendments or additions thereto shall be forthwith transmitted by the Governor to the comptroller.’

In the budget bill so submitted were many lump sum appropriations, not itemized to the administrative departments. Although the budget must contain all the estimates of proposed expenditures ‘clearly itemized,’ the Governor and the Legislature seem to be in accord in the view that the budget bill submitted by the Governor need not be itemized, but that it may contain lump sum appropriations. The provisions for the department of law are typical. They were as follows:

Department of Law

‘Personal Service

‘To permit the Attorney-General to reorganize the department of law, exclusive of the appropriations made for the investigation of sale of securities and unlawful corporative activities, $582,250.00.

‘On or before June 15, 1929, the Attorney-General shall file with the Governor a tentative segregation of the amount hereby appropriated. Before any liability shall be incurred such segregation shall have the approval of the Governor and no change shall be made in this tentative segregation during the fiscal year commencing July 1, 1929, without his approval.

* * *

‘Special deputies, investigators, referees, witnesses and title searchers, services and expenses, $60,000.00.

‘Before any liabilities are incurred against the above appropriation, a tentative segregation of the amount shall be approved by the Governor. Changes in such tentative segregation may be made with his approval.

‘Investigation of Sale of Securities and Unlawful Corporate Activities

‘Services and expenses, $210,000.00

‘On or before June 15, 1929, the Attorney-General shall file with the Governor a tentative segregation of the amount hereby appropriated to be made available on July 1, 1929. Before any liabilities shall be incurred, such segregation shall have the approval of the Governor and no change shall be made in this tentative segregation during the fiscal year commencing July 1, 1929, without his approval.’

The State Finance Law, § 139, has since 1921 (Laws 1921, c. 336; Laws 1927, c. 364, § 2 [Consol. Laws, c. 56]) provided as follows:

§ 139. Segregation of lump sum appropriations. When, by act of the Legislature, a state department is created or reorganized, or state departments consolidated, or a board, commission, division or bureau within a department is created or reorganized, and a lump sum is appropriated for its maintenance and operation, or for personal service, during the first fiscal year thereafter, no moneys so appropriated shall be available for payments for personal service, except temporary service or day labor, until a schedule of positions and salaries shall have been approved by the Governor, the chairman of the finance committee of the Senate and chairman of the ways and means committee of the Assembly, and a certificate of such approval filed with the comptroller.’

Although there is no accompanying act of the Legislature reorganizing the department of law or the department of labor, it is claimed by the respondent that this section is applicable to reorganization items in the budget bill or bills for such departments. Whether this contention is upheld or not, no question is raised as to the propriety of the reorganization items as such apart from the provisions for segregation.

In each instance in the original Governor's budget bill, where a lump sum appropriation was specified for any purpose, the bill provided that the Governor should be the sole approving authority over segregations. Segregations consist of an itemized list of the positions and salaries covered by the lump sum appropriation.

The Legislature did not assent to the provision giving the Governor exclusive power of approval of such segregations. On February 27, 1929, it passed the Governor's original budget bill, striking out all the items to which the Governor had attached his provision of segregation control. The items were restated. Section 139 of the State Finance Law was allowed to take effect if and whenever applicable, and in appropriations other than for reorganization of state departments the Legislature inserted segregation clauses calling for participation of the chairman of the legislative finance committees with the Governor in the approval of segregations.

The Governor refused to approve any of the lump sum items in which the chairmen of the finance committees were to share authority. He thereafter, on March 18, 1929, sent to the Legislature two supplemental budget bills, one containing many lump sum appropriations, for the needs of many state departments, all of which appropriations were restricted to the exercise of the Governor's sole power over segregations; and the other bill itemizing and segregating most of the appropriations appearing in lump sum form in the first supplemental bill. The Legislature, on March 28, 1929, acted upon this second supplemental bill, approving most of the segregated items therein, but again setting up a few of the departmental appropriations in lump sum form, more particularly the sums for reorganizing the department of law and the department of labor, with the intent that segregations were to be approved under section 139 of the State Finance Law. In cases other than reorganization, i. e., in cases of the large lump sum construction items, the Legislature appended to them a segregation clause like the one in section 139 requiring in the same manner all three-the Governor, the chairman of the Senate finance committee, and the chairman of the Assembly ways and means committee-to approve segregations when any part of such moneys was to be used for personal service. The provision affecting the use of construction items for personal service is found in section 11 of the bill, as follows: follows:

§ 11. No part of any appropriation made by this act for construction shall be expended for personal service except on the approval of the Governor, the chairman of the Senate finance committee and the chairman of the Assembly ways and means committee. This provision may be complied with by the filing with the comptroller and the department of civil service of a list of the positions so approved and the time for which any person man be employed in such position. This provision, however, shall not apply to personal service employed by a contractor, by an institution on construction work done under special fund estimate, by an interstate commission, or on highways.’

On April 12, 1929, the Governor upon the return of the bill to him, approved the lump sum items for reorganizing the department of law and the department of labor, insisting, however, that section 139 of the State Finance Law was unconstitutional in its application to those items. He disapproved the general segregation clause, section 11, referred to above, applying to the segregation of personal service items in the large construction items, as he said, ‘on constitutional grounds.’ The bill became chapter 593 of the Laws of 1929. Other appropriation bills passed at the same session contain similar provisions, and were acted on by the Governor in the same manner. As the questions raised thereunder are, with the exception hereafter indicated as to the state office site and building commission, identical with those stated above, no special reference need be made to them.

The controversy thus arising was submitted on an agreed statement of facts to the Appellate Division, Third Department, under Civil Practice Act, §§ 546-548, inclusive, and thus became an action...

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