Stark County v. State

• Decision Date: 18 April 1968
• Docket Number: No. 8434,8434
• Citation: 160 N.W.2d 101
• Parties: STARK COUNTY, North Dakota, a Public Corporation, Plaintiff and Respondent, v. The STATE of North Dakota and Walter Christensen, State Treasurer of the State of North Dakota, Defendants and Appellants. Civ.
• Court: North Dakota Supreme Court

Page 101

160 N.W.2d 101

STARK COUNTY, North Dakota, a Public Corporation, Plaintiff and Respondent, v. The STATE of North Dakota and Walter Christensen, State Treasurer of the State of North Dakota, Defendants and Appellants.

Civ. No. 8434.

Supreme Court of North Dakota.

April 18, 1968.

Rehearing Denied July 19, 1968.

Syllabus by the Court

1. Any power to create a liability against the State must be derived from specific statutes. Courts have no inherent power to create such liability.

2. North Dakota has, by statute, consented that it may be sued in certain instances, including cases arising upon contract. This includes implied as well as express contracts. Sec. 32--12--02, N.D.C.C.

3. Any suit on a claim not within the provisions of the statute by which the State has consented to be sued may not be brought against the State.

4. A quasi contract arises where a transaction between parties gives them mutual rights or obligations, but does not

involve an express agreement between them. Receipt of benefits, which it would be inequitable to retain without paying therefor, constitutes the essence of quasi-contractual obligations.

5. An implied contract is one where the agreement of the parties is arrived at by considering their acts and conduct rather than by their agreement in words. Where the contract is found to be implied in fact, the court tries to determine what the parties actually intended.

6. Where the State, by legislative enactment, provides for the distribution of a portion of the motor-vehicle registration moneys to the counties, and an error is made in the distribution of such moneys, which error results in some counties receiving too small a share and some counties receiving too large a share of such funds, but where the State retains no part of the moneys which are to be distributed to the counties, no action will lie against the State by a county which receives less than the portion of such fund to which it is entitled under such distribution.

7. For reasons stated in the opinion, the complaint of Stark County against the State of North Dakota is dismissed.

Freed, Dynes & Malloy, Dickinson, for plaintiff and respondent.

Helgi Johanneson, Atty. Gen., and Paul M. Sand and Myron E. Bothun, Asst. Attys. Gen., Bismarck, for defendants and appellants.

STRUTZ, Judge, on reassignment.

This is an action brought by Stark County, a public corporation, against the State of North Dakota for a balance which the County claims is due it from the Motor Vehicle Registration Fund of the State. The facts do not seem to be in dispute, the controversy being over the law as applied to the facts.

An examination of our laws discloses that a registration fee has been levied on motor vehicles in the State of North Dakota since 1911. Chap. 6, S.L.1911. Under that statute, the moneys received from motor-vehicle registrations were paid into the county treasuries for highway purposes, there being no State Highway Department until subsequent to that time. Thereafter, a Motor Vehicle Department was created in the State, and such motor-vehicle registration fees, after payment of necessary expenses, were paid into the State treasury and deposited to the credit of the State Highway Fund.

In 1933, the Legislature enacted a law which provided that, after payment of all salaries and other expenses, the moneys remaining from such motor-vehicle registrations should be transferred by the State Treasurer to the North Dakota Real Estate Bond Payment Fund. Chap. 160, Sec. 11, S.L.1933. This law was amended in 1935, S.L.1935, c. 177, to provide that moneys in the Motor Vehicle Registration Fund, in excess of the amount required to pay salaries and necessary expenses, be transferred by the State Treasurer by depositing fifty per cent of such balance to the credit of the State Highway Department of by distributing '50 per cent to the counties of the State of North Dakota,' without any direction as to the basis for the transferring of such funds to the various counties of the State.

This law subsequently was amended in 1955, but the provision here under consideration remained unchanged and the moneys still were to be distributed: '3. Fifty percent to the counties of this state.' Chap. 244, Sec. 5, S.L.1955.

In 1957, the Legislature again amended this law and provided for transferring such portion of the Motor Vehicle Registration Fund to the counties as follows:

'3. Fifty percent to the counties of this state in proportion to the number of certificates of title credited to each county. Each county shall be credited with the certificates of title of all motor vehicles registered by residents of such county.' Chap. 259, S.L.1957.

Under this amendment, the State Treasurer paid such fifty per cent to the various counties on the basis of the total amount of registration fees received from each county. This allocation was made pursuant to an Attorney General's opinion written on August 19, 1957, shortly after the 1957 law went into effect. In such opinion, the Attorney General's office advised the Motor Vehicle Registrar:

'* * * distribution under this provision of law can and properly should be made on the basis of motor vehicle collections in each county as your present distribution is made.'

The statute again was amended in 1959, but the provision for distribution to the counties was not changed from the provision as found in the 1957 law. Chap. 289, S.L.1959.

When the 1959 law became effective, the Attorney General's office again advised, on July 21, 1959, that distribution under the provisions of the Act was to be made

'* * * on the basis of motor vehicle collections in each county.'

In 1961, a new administration took over the government of the State of North Dakota, and the above law was re-examined. Instead of allocating such moneys to the counties on the basis of the amount of money collected from each county, the distribution thereafter was made strictly on the basis of the number of vehicles registered from each county. For example, if 10,000 vehicles were registered from County A in a given year and the registration fees for such vehicles totaled $100,000, and 10,000 vehicles were also registered from County B during the same period paying a total registration fee of $200,000, the amount to be distributed to each of these two counties would be the same because the number of cars registered from each county was the same, although the amount collected from County B was twice the amount collected from County A.

On these facts, Stark County brought this action against the State of North Dakota to recover some $18,000 which is the amount of difference in the allocation of the Motor Vehicle Registration Fund to Stark County between what it actually did receive when such distribution was made on the basis of the amount collected in each county and what it would have received had the distribution been made on the basis of the number of motor vehicles registered from that county. The plaintiff's claim in this action covers the years 1957 through 1960.

The action was commenced on December 14, 1965. The trial court denied recovery for any amounts on distributions made more than six years before the commencement of the action, on the ground that any deficiency in the payment made to the plaintiff prior to December 14, 1959, would be barred by our six-year statute of limitations. This ruling limited the plaintiff's recovery to the difference in the amount it would have received on registrations made between December 14, 1959, and the time the new method of distribution was adopted, in January 1961, which made such distribution on a per-car basis instead of an a basis of the amount collected in each county.

From the judgment entered in favor of the plaintiff for $3,130.06 and costs, the defendant has appealed to this court, claiming that the trial court erred in permitting the plaintiff to recover in any amount. The plaintiff has cross-appealed, contending that the trial court erred in holding that the plaintiff's recovery for the years prior to December 14, 1959, was barred by the statute of limitations.

The plaintiff did not contend nor did it try to show that the State in any way benefited from the alleged erroneous distribution which it made of motor-vehicle registration moneys prior to 1961. The basis of the plaintiff's claim is that, because of the improper distribution made by the State some counties were paid too little and some counties were paid too much during the period in question. The plaintiff contends that the State is responsible to those counties which received too little under the improper method of distribution.

The first question for us to determine on this appeal is whether the State is liable at all, assuming that the distribution of the Motor Vehicle Registration Fund to the counties was made on an improper basis prior to 1961. It has generally been held that any power to create a liability on the State treasury must be derived from specific statutes, and courts have no inherent power to create such liability. 81 C.J.S. States § 128, p. 1134.

Consent to be sued may be expressed in the State's Constitution, but such provisions generally are held not to be self-executing and no suit may be maintained until the Legislature provides therefor. 81 C.J.S. States § 215--a, p. 1304.

We find that Section 22 of the North Dakota Constitution provides that suits may be brought against ...