Rural Independent School District of Eagle v. Daly

• Decision Date: 09 February 1926
• Docket Number: 36999
• Citation: 207 N.W. 124,201 Iowa 286
• Parties: RURAL INDEPENDENT SCHOOL DISTRICT OF EAGLE et al., Appellants, v. W. A. DALY et al., Appellees
• Court: Iowa Supreme Court

207 N.W. 124

201 Iowa 286

RURAL INDEPENDENT SCHOOL DISTRICT OF EAGLE et al., Appellants, v. W. A. DALY et al., Appellees

No. 36999

Supreme Court of Iowa, Des Moines

February 9, 1926

Appeal from Dubuque District Court.--P. J. NELSON, Judge.

ACTION at law, tried to the court, the jury having been waived, to recover money paid from the corporate funds of a consolidated independent school district by the officers of said district under the authority of its board of directors, in payment of legal services rendered the school corporation at its instance and request. The opinion states the material facts. The trial court determined that the legal services in question were rendered for and on behalf of the school corporation under a lawful contract of employment, and that the defendant-officers of the school corporation were in the proper exercise of their official duties in drawing, signing delivering, and paying the school warrants for said services. Judgment was entered, dismissing the petition at plaintiffs' costs. Plaintiffs appeal.

Affirmed.

Frantzen Bonson & Gilloon, for appellants.

Kenline, Roedell, Hoffmann & Tierney, for appellees.

DE GRAFF, C. J. STEVENS, FAVILLE, and VERMILION, JJ., concur.

OPINION

DE GRAFF, C. J.

The defendants W. A. Daly, J. R. McMahon, and Peter Wolf were president, secretary, and treasurer, respectively, of the Consolidated Independent School District of Bankston, in Dubuque County, Iowa. The plaintiff-appellants are school districts which, with the defendant Rural Independent School District of Bankston, originally formed the said consolidated independent district, and which were recreated upon the dissolution of the consolidated district.

The statute provides the method and manner of the apportionment of all assets and liabilities of a dissolved consolidated school district, and it is by virtue of rights thus created that the plaintiffs claim the benefit of the moneys in suit, alleged to have been expended without authority of law by the consolidated district prior to its dissolution. Chapter 175, Acts of the Thirty-ninth General Assembly.

This action was commenced to recover personal judgment against the individual defendants in the sum of $ 513.98. This sum was paid by said defendants, as school officers, under authority of the board of directors, from the school funds of said consolidated independent district, and represented fees for services rendered by the law firm of Kenline, Roedell & Hoffmann, of Dubuque, under a contract of employment with said board.

The gist of the action is to recover judgment against school officers who have disbursed money from school funds for an alleged unauthorized purpose, resulting in misappropriation.

The facts disclose that, during the years 1919 to 1922, inclusive, there existed in Dubuque County, Iowa, a corporation known as the Consolidated Independent School District of Bankston; that the defendant W. A. Daly was its duly elected and acting president and a member of the board of directors in said district; that the defendants J. R. McMahon and Peter Wolf were the duly elected and acting secretary and treasurer, respectively, of said board; that, in July, 1921, proceedings were instituted and prosecuted for the dissolution of said school corporation; that said corporation, acting through its board of directors, and in good faith, employed attorneys to represent and protect the interest of said corporation in such dissolution proceedings; that, as a result of a hearing and trial, the petition for dissolution was dismissed for a jurisdictional cause; that throughout this proceeding the board was represented by attorneys expressly employed by the board, and for such services a claim for $ 180 was filed, which was subsequently audited and allowed by said school corporation, acting through its board of directors; that thereafter, in September, 1921, another proceeding was instituted and prosecuted for the dissolution of said school corporation; that thereupon said corporation, acting through its board of directors, and in good faith, employed the same attorneys to represent and protect the interest of said corporation in such proceedings; that, as a result of a hearing and trial, the petition was again dismissed, and thereupon the petitioners appealed from said decision to the county board of education; that, upon said appeal and hearing upon the merits, the petition was allowed; that for legal services rendered in the second proceeding there was a bill allowed and audited by the board of directors in favor of the attorneys in the sum of $ 333.98; that in the employment of said attorneys and the payment of said fees the board acted upon the advice of the county attorney and the county superintendent of schools for Dubuque County; that the defendant McMahon, in the performance of his duty as secretary, drew and countersigned two orders upon the school treasurer, Peter Wolf, for the payment of said bills, in conformity to the direction of authority of the board of directors; that the defendant Daly, as president of said board, signed the two orders, in conformity to the authority of said board; that said orders or warrants were paid in good faith by the school treasurer from the moneys of the said school corporation, upon presentation by the payee thereof. The foregoing constitute the material facts disclosed by the record in this case.

The plaintiffs question the right and authority of the board of directors to employ counsel to defend the school corporation in the dissolution proceedings, and to pay the attorneys so employed from the school funds of said corporation. Conceding, without determining, that the plaintiff school districts are the proper parties in interest to maintain this action, we inquire whether the defendant-officers are personally liable in the premises.

A school district is a corporation. It is a legal entity, with power to sue and he sued, to hold property, and to exercise all powers in all school matters pertaining to said corporation within its territory. Section 4123, Code of 1924. It elects its president, who must be a member of the...