Russell v. Frank

• Decision Date: 28 July 1941
• Docket Number: 37493
• Citation: 154 S.W.2d 63,348 Mo. 533
• Parties: Charles E. Russell, Clarence L. Bollinger, Patrick J. Kinsella and Robert R. Rosenthal v. Harry A. Frank, T. Frank Wood, John J. Fitzwilliam, Paul J. Hewitt, Loy W. Ledbetter and Oscar E. Life, comprising the Board of Education of the School District of University City; June S. Courson, Secretary of the Board of Education of the School District of University City; Walter Miller, Clerk of the County Court of St. Louis County; Willis W. Benson, Collector of St. Louis County; and Maurice Dwyer, Treasurer of St. Louis County, Appellants
• Court: Missouri Supreme Court

154 S.W.2d 63

348 Mo. 533

Charles E. Russell, Clarence L. Bollinger, Patrick J. Kinsella and Robert R. Rosenthal v. Harry A. Frank, T. Frank Wood, John J. Fitzwilliam, Paul J. Hewitt, Loy W. Ledbetter and Oscar E. Life, comprising the Board of Education of the School District of University City; June S. Courson, Secretary of the Board of Education of the School District of University City; Walter Miller, Clerk of the County Court of St. Louis County; Willis W. Benson, Collector of St. Louis County; and Maurice Dwyer, Treasurer of St. Louis County, Appellants

No. 37493

Supreme Court of Missouri

July 28, 1941

Rehearing Denied September 25, 1941.

Appeal from Circuit Court of St. Louis County; Hon. Julius R Nolte, Judge.

Affirmed.

M P. Phillips for appellants; Arthur U. Simmons of counsel for County Clerk.

(1) The Legislature has committed to the school board the duty to make estimates for the year within the lawful limits of the levy constitutionally authorized by the voters, and the courts cannot revise such estimate merely because it may be thought the levy recommended will raise a sum in excess of the needs of the funds for which the levy is made nor because there may be some evidence of intent to divert the money, after the collection, to another purpose, since that can be dealt with when such attempt is made. Pope v. Lockhart, 252 S.W. 375, 299 Mo. 141. (2) A levy for "school building purposes" is a separate tax and not included in the term "school purposes," as the term "school purposes" in Article X, Section 11, relates to taxes for ordinary expenses of maintenance and operation of schools, and hence no school building tax receiving two-thirds majority vote of the voters of a district at a legally called election can be held violative of the Constitution. Peter v. Kaufmann, 38 S.W.2d 1062. (3) The Legislature has the power and authority to authorize the transfer of any favorable balance in the tax building fund at the end of the year for which it was levied and collected to the incidental fund for school purposes. State ex rel. Davis v. Smith, 75 S.W.2d 828, 335 Mo. 1069; State ex rel. Police Comm. of St. Louis v. County Court of St. Louis County, 34 Mo. 546; State ex rel. Applegate v. Taylor, 123 S.W. 892; Clark v. Jordon, 170 S.W. 892; Wright v. Morgan, 187 S.W. 54; Sec. 9233, R. S. 1929, amended, Laws 1939, p. 707. (4) The trial court committed error in admitting as evidence the record of the school district for the years preceding the year for which the levy of taxes was voted. Alleged errors of a previous administration can in no wise be a restraint upon the exercise by the board of education for the current year of the constitutional or legislative powers or duties conferred or imposed upon the school district and their managing officials. (5) Since under the Constitution, Article XI, it is contemplated that general revenue will be adequate to establish, maintain and sustain free public schools in each district for a guaranteed period of four months in each year, Section 7 of Article XI of the Constitution authorized the levying of taxes in the event that general revenue is inadequate to supplement those state revenues and the amounts so necessary are in addition to the amounts for school purposes limited by Section 11 of Article X of the Constitution. Sharpe v. Miller, 65 Mo. 50.

Harold S. Cook, B. Sherman Landau and Eliot, Blayney & Bedal for respondents.

(1) The proposition submitted by the Board of Education of University City School District to the voters of said district on April 23, 1940, "To levy a tax of 44c on the $ 100.00 assessed valuation for Building Fund purposes" was not in form a proposition to levy a tax "for the purpose of erecting public buildings" in said school district within the purview of Section 11 of Article X, Missouri Constitution. Harrington v. Hopkins, 288 Mo. 1, 231 S.W. 263; Jacobs v. Cauthorn, 293 Mo. 154, 238 S.W. 443; State ex rel. Marlowe v. Himmelberger-Harrison Lbr. Co., 332 Mo. 379, 58 S.W.2d 750. (2) The testimony shows conclusively that the Board of Education of University City School District did not contemplate the erection of any school building during the school year July 1, 1940, to June 30, 1941, and that the proposition to levy a building fund tax was submitted for the purpose of raising money to make up a deficiency in the ordinary school funds to be raised by the tax rate of $ 1 on the $ 100 assessed valuation for school purposes, through the method of transferring the balance in the building fund at the end of the school year to the incidental fund. This is a legal fraud on the taxpayers of the school district. (a) The moneys raised by the University City School District in each of the past three school years through taxes levied for "Building Fund purposes" have actually been used by the board of education during the respective years for which such taxes were levied for general school purposes. The method of showing a large balance in the building fund and a large deficit in the incidental fund at the end of each school year was a pure bookkeeping device not reflecting the actual financial condition of the school district. (3) The General Assembly has not authorized the transfer of any balance remaining in the building fund to the incidental fund until the purpose for which such fund was levied is accomplished. Where a proposition for the levy of a tax for the purpose of erecting a school building is submitted to the qualified voters of a school district and approved by the proper majority, no part of the amount raised by the levy of such tax can be transferred to the incidental fund at any time until after the school building has been erected and a balance remains unexpended for such purpose. Sec. 10366, R. S. 1939. The transfer by the Board of Education of University City School District of $ 102,174.77 on July 11, 1940, from the building fund to the incidental fund was illegal, unauthorized and improper and was made for the purpose of showing an ostensible need for the levy of additional taxes to replenish the building fund. (4) The theory advanced by appellants in this court, to-wit: That the General Assembly, pursuant to power given to it in Section 7 of Article XI of the Constitution, may levy taxes for school purposes, which taxes are not governed by the rate limitations in Section 11 of Article X, was not raised in the trial court, was not passed on by that court, and should not be considered here. Kansas City Pub. Serv. Co. v. Ranson, 328 Mo. 524, 41 S.W.2d 169; Benz v. Powell, 338 Mo. 1032, 93 S.W.2d 877; Nulsen v. Natl. Pigments & Chemical Co., 145 S.W.2d 410. (5) Any and all taxes levied by the School District of University City under authority delegated to it by the General Assembly are subject to the limitations prescribed by Section 11, of Article X, Missouri Constitution. The General Assembly is prohibited by Section 10 of Article X of the Constitution from imposing taxes upon property in University City School District for school purposes, since a school district is a "municipal corporation" as those words are used in Article X of the Missouri Constitution. Even if Section 7 of Article XI of the Missouri Constitution could be construed as a grant of power to the General Assembly to levy local property taxes for school purposes, such taxes would be limited as to rates by the specific provisions of Section 11 of Article X which are expressly referred to in Section 7 of Article XI.

OPINION

Hays, J.

This is a suit in equity brought by certain citizens and taxpayers of the School District of University City, Missouri, against the members of its Board of Education, their secretary, and the county clerk, collector, and treasurer of St. Louis County, in which said district is located. The object of the suit was to obtain a decree declaring illegal the levy of a school tax of forty-four cents on the one hundred dollar valuation "for building fund purposes," and to enjoin the county clerk from extending the said levy on the tax books. The tax mentioned had been authorized at a special election held on April 23, 1940. Upon the trial of the issues in Division No. 1 of the Circuit Court of St. Louis County, the chancellor found for the plaintiffs and entered a decree declaring the levy illegal and enjoining the clerk from extending it upon the tax books. From this decree the members of the Board of Education, defendants below, have appealed.

The School District of University City is a town school district organized under the laws of the State and having a population of less than one hundred thousand. At the regular election held on the 2nd of April, 1940, there were duly submitted to the voters of said district two propositions: (1) to increase the rate of taxation for general school purposes to one dollar per one hundred dollars, this being the maximum rate permitted by the Constitution for such tax; and (2) to levy a tax of forty-four cents per hundred dollars "for building fund purposes." It is this latter tax that is here involved. Both of such propositions were defeated. A few days later the school board called a special election to resubmit the same two propositions, fixing the date therefor as the 23rd of April. This time each proposition was carried by the requisite majority. The results of the latter election were certified to the county clerk so that he could extend the levy upon the tax books of the county. Thereupon the present suit was brought. The facts developed in evidence may best be stated in the course of the opinion.

Section 11 of Article 10 of the Constitution of Missouri, cited and relied on in the plaintiffs' petition, contains a list of limitations imposed upon the powers of various local taxing authorities in the State. The portion...