Quinn v. Reed

• Decision Date: 02 July 1917
• Docket Number: 77
• Parties: QUINN v. REED
• Court: Arkansas Supreme Court

197 S.W. 15

130 Ark. 116

QUINN v. REED

No. 77

Supreme Court of Arkansas

July 2, 1917

Appeal from Pulaski Chancery Court; John E. Martineau, Chancellor affirmed.

Decree affirmed.

John W Wade and Rose, Hemingway, Cantrell, Loughborough & Miles, for appellant.

1. The act is not unconstitutional. The reissue of warrants is a judgment and warrants can be made payable at a future day. 122 Ark. 557; 98 Id. 299. It merely provides that the county court may pay, for the value of his indulgence, to the holder not to exceed 6 per cent. per annum. This is not interest, nor do the warrants bear interest. Orders issuing warrants are judgments, and the Legislature can make judgments against counties bear interest. 50 Ark. 416; 66 Id. 247. See also 68 Ark. 83; 103 Id. 468.

2. None of the provisions of the Constitution are violated. Cases supra; 36 Ark. 89. The warrants are not interest-bearing. Cooley, Const. Lim. (7 ed.) 236. The act must be clearly unconstitutional. 207 U.S. 88; 32 Ark. 144; 99 Id 1; 102 Id. 166; 85 Id. 171; 100 Id. 175. Every doubt should be resolved in favor of constitutionality. Ib. The Legislature is supreme, when its acts are not violative of the Constitution. The act is not within the evil intended to be remedied. A reissued warrant is not an interest-bearing evidence of indebtedness.

Callaway & Huie, for appellants, as amici curiae.

1. Statutes are presumed to be constitutional and all doubts are to be resolved in their favor; they must be plainly violative of the Constitution and forbidden in express words or by necessary implication. 63 Ark. 576; 66 Id. 466; 1 Id. 552; 11 Id. 451; 15 Id. 664; 36 Id. 171; 58 Id. 407; 56 Id 485; 59 Id. 513; 39 Id. 353; 93 Id. 612; 114 Id. 156; 119 Id. 314.

Every word in the Constitution should be expounded in its plain, obvious and common sense meaning. 52 Id. 336; 60 Id. 343. It must be forbidden plainly. 99 Ark. 100; Ib. 136.

2. Judgments against counties bear interest. Kirby & Castle's Dig., § 6390. See also 80 Ark. 109; 50 Id. 416.

Mehaffy, Reid & Mehaffy, for appellee.

The act is unconstitutional. 36 Ark. 89; 50 Id. 416. Interest is a premium paid for the use of money. 121 N.W. 1072, 2 Words & Phr. (2 Series) 1145. It is true the warrant is not interest-bearing on its face, but it is within the inhibition if it bears interest at all. No subterfuge nor evasion is allowed. 157 F. 5141; 130 S.W. 52; 96 P. 45; 17 L. R. A. (N. S.) 552, and cases cited.

OPINION

MCCULLOCH, C. J.

Appellee, representing himself as a citizen and taxpayer of Pulaski County, instituted an action in the chancery court of that county to restrain the county judge, clerk and treasurer from reissuing the outstanding county warrants and issuing separate warrants for the payment of interest for forbearance until a future day.

It is alleged in the complaint that the outstanding warrants of the county exceed in amount, to the extent of $ 150,000, the county revenues derived this year from taxation and other purposes. The defendants offer justification for the reissuance of the county warrants and the issuance of separate warrants in payment of interest for the forbearance until the warrants are to be presented in the future, under an act of the General Assembly of 1917, Act 378, p. 1814, entitled "An Act authorizing the county court of Pulaski County to refund its county warrants." That statute provides that the county court of Pulaski County may call in its warrants for reissuance payable to bearer at a future date, and that the county court "is authorized to pay to parties accepting any of said reissued warrants payable at a future date, a fair sum, representing the value of their indulgence in waiting for payment at such future date, such price to be paid either in money or warrants, but not to exceed the equivalent of 6 per cent. per annum for the time for which said indulgence is granted."

The court sustained a demurrer to the answer, and appellants declined to plead further and suffered final judgment to be rendered against them in accordance with the prayer of the complaint.

If the proceedings of the county officials as recited in the complaint are unauthorized by law, it constituted an illegal exaction within the meaning of Section 13 of Article XVI of the Constitution, which provides that "Any citizen of any county may * * * institute suit in behalf of himself and all others interested, to protect the inhabitants thereof against the enforcement of any illegal exactions whatever." Appellee is, therefore, entitled to maintain the suit. Lee County v. Robertson, 66 Ark. 82, 48 S.W. 901.

The contention of appellee is that the statute is void and that the proposed proceedings are illegal because in conflict with the provisions of Section 1, Article XVI of the Constitution of 1874, which reads as follows:

"Neither the State nor any city, county, town or other municipality in this State shall ever loan its credit for any purpose whatever; nor shall any county, city, town or municipality ever issue any interest-bearing evidences of indebtedness, except such bonds as may be authorized by law to provide for and secure the payment of the present existing indebtedness, and the State shall never issue any interest-bearing treasury warrants or scrip."

On the other hand, learned counsel for appellants insist that this provision of the Constitution forbids only the issuance by counties and municipalities of evidences of indebtedness, which on their face bear interest, and that the provision does not prohibit counties or municipalities from entering into contracts in another form for the payment of interest.

We think that to sustain this argument would be to give too restricted a meaning to the language of the Constitution, and that such an interpretation would admit of the most flagrant evasions. This court has, in fact, expressly decided against that interpretation in the case of Jacks & Co. v. Turner, 36 Ark. 89, where it was held that a statute declaring that registered county warrants should bear interest was in conflict with the provision of the Constitution now under consideration. It is worthy of note that the circuit judge who tried that case below, and the justice of this court who wrote the opinion here, were both members of the Constitutional Convention, and they shared the same view in the interpretation of this particular provision. That case did not involve evidences of indebtedness bearing interest on their face, but the decision related to the power of the Legislature to make such evidence of indebtedness interest-bearing upon being presented and registered on account of lack of funds. Mr. Justice EAKIN, in disposing of the question, said:

"Formerly, the holder of any county warrant might have presented it to the county treasurer, whose duty it was, in case of no funds, to indorse the fact upon the warrant, with the date, after which the warrant bore interest, at the rate of 6 per cent. per annum. This made it an interest-bearing evidence of indebtedness, which was not permissible after the adoption of the new Constitution."

In giving full scope to that decision, which was an interpretation of the Constitution not a great while...