State ex rel. Consol. School Dist. No. 8 of Pemiscot County v. Smith

• Decision Date: 16 November 1938
• Docket Number: 35884
• Citation: 121 S.W.2d 160,343 Mo. 288
• Parties: State of Missouri at the relation of Consolidated School District No. 8 of Pemiscot County, and Fred Kelley, W. E. Wright, W. E. Taylor, F. B. Hollomon, J. W. German and T. W. Whitfield, constituting the Board of Education of said Consolidated School District No. 8, and Frank Harper, Treasurer of said District, Relators, v. Forrest Smith, State Auditor
• Court: Missouri Supreme Court

121 S.W.2d 160

343 Mo. 288

State of Missouri at the relation of Consolidated School District No. 8 of Pemiscot County, and Fred Kelley, W. E. Wright, W. E. Taylor, F. B. Hollomon, J. W. German and T. W. Whitfield, constituting the Board of Education of said Consolidated School District No. 8, and Frank Harper, Treasurer of said District, Relators, v. Forrest Smith, State Auditor

No. 35884

Supreme Court of Missouri

November 16, 1938

Peremptory writ ordered.

Ward & Reeves for relators.

(1) By the pleadings and admissions herein the petition or application of relators for the alternative writ should be taken as and for the alternative writ, and under the demurrer filed herein the only questions to be determined by this court are of law, rather than of facts. State ex rel City of Jefferson v. Hackmann, 287 Mo. 156; State ex rel. Little Prairie Special Road Dist. v. Thompson, 315 Mo. 56. (a) The power of the Legislature in the creation of municipal and public corporations of any description is absolute and unlimited, in the absence of some specific provision in the State or Federal Constitution restricting and inhibiting such power. Harris v. Bond Co., 244 Mo. 664; Kocsis v. Chicago Park Dist., 198 N.E. 847; Young Women's Christian Assn. v. Gunter, 162 So 120; Mount Pleasant v. Beckwith, 100 U.S. 514; 43 C J., sec. 123, p. 143; 1 Dillon on Municipal Corporations (5 Ed.), sec. 355, p. 617. (b) The foregoing statement of the law is particularly true with respect to school districts under the specific requirement of our Constitution respecting the establishment and maintenance of free public schools. Sec. 1, Art. 11, Mo. Const.; School Dist. of Oakland v School Dist. of Joplin, 102 S.W.2d 909. (c) "The title of all school house sites and other school property shall be vested in the district in which the same may be located." Sec. 9269, R. S. 1929; School Dist. of Oakland v. School Dist. of Joplin, 102 S.W.2d 909. (d) The rule in Missouri, even in the absence of an assumption statute, is that the consolidated municipality is liable for all contracts, debts and liabilities legally created by the component districts prior to consolidation. Thompson v. Abbott, 61 Mo. 176; Abler v. School District, 141 Mo.App. 189; Boswell v. Con. School Dist. No. 8, 10 S.W.2d 665; Gray v. School Dist. No. 73, 224 Mo.App. 905. (2) The common school districts and the town school district which now constitute Consolidated School District No. 8 of Pemiscot County were permitted by law to incur the bonded indebtedness in question only for the purpose of purchasing school house sites, erecting school houses, libraries, and furnishing the same, and building additions to or repairing old buildings, and since it is conceded here that the bonds sought to be refunded were legally and lawfully issued, then it will be presumed for the purposes of this case that the bonds created the debts for the purpose authorized by the statute. Sec. 9198, R. S. 1929. (a) It is admitted by the pleadings that at the time of the consolidation these respective small school districts had within their limits school house buildings and other property used and fit for use for public school purposes, and that since the consolidation they have so been used and managed by the said Consolidated School District for the general benefit of the schools in said Consolidated School District. So the proceeds obtained from the bond issues were invested, presumedly, as required by law, and the Consolidated School District since the consolidation has received and reaped the benefit thereof. Under the circumstances stated in the foregoing paragraph it is equitable and just that the Consolidated School District assume and pay the bonds outstanding at the time of the consolidation, and our statute expressly so provides. Sec. 9356, R. S. 1929. (b) "And as incidental to territorial change, the Legislature may direct the manner in which debts or liabilities of the municipalities affected shall be met and by whom, as to it seems equitable." 12 C. J., sec. 629, p. 1007; Owsley County Bd. of Education v. Owsley County Fiscal Court, 64 S.W.2d 179; Matz v. Newport, 95 S.W.2d 1071. (3) The act authorizing the formation of consolidated school districts has been held constitutional. State ex rel. v. Brooks, 249 S.W. 73; State ex rel. v. Stauffer, 197 S.W. 248; State ex rel. v. Morgan, 268 Mo. 265; State ex inf. v. Jones, 266 Mo. 191; Troop v. Pittsburg, 254 Pa. 172, 98 A. 1034; Moore v. Pittsburg, 254 Pa. 185, 98 A. 1037; Pa. County v. Pittsburg, 226 Pa. 322, 75 A. 421; Minsinger v. Rau, 236 Pa. 327, 84 A. 902; Kocsis v. Chicago Park Dist., 198 N.E. 847; Adriaansen v. Bd. of Education, 222 A.D. 320, 226 N.Y.S. 145, Id., 248 N.Y. 542, 162 N.E. 517; Young Women's Christian Assn. v. Gunter, 162 So. 120; Davidson v. Kirkwood, 152 Ga. 357, 110 S.E. 154; Wilson v. Wilson, 50 S.W.2d 48; Owsley County Board of Ed. v. Owsley County Fiscal Ct., 64 S.W.2d 179. (a) The provision of our State Constitution requires the vote of the people on the question of incurring or creating the indebtedness. That should be kept in mind when reading the cases which apparently hold that similar acts of the Legislature to ours are held to be unconstitutional. The cases which we cite below are based upon constitutional provisions which require not only a vote of the municipalities to incur or create the indebtedness, or on the question to issue the bonds of the district, but further provide that before any tax can be levied in any district the people must vote on the annual tax with which to pay off the bonds. Our Constitution makes no such requirements or additional requirements with reference to bonded indebtedness. Huie v. Morris, 168 S.E. 566; Register v. Colter, 155 S.E. 767; St. Louis-San Francisco Ry. Co. v. Bonaparte, 286 P. 343; Burns v. Dilly County Line Indep. Dist., 295 S.W. 1091; Lyford Indep. School Dist. v. Willamar I. Schl. Dist., 34 S.W.2d 854; Young v. Edna Indep. School Dist., 34 S.W.2d 857. (b) The limitation of tax levies as provided in Section 11, Article X of our Constitution, has no application to debts created by a two-thirds vote of the people as provided in Section 12. The latter section specifically provides that (without limitation) provision shall be made for the collection of an annual tax sufficient to pay the interest when due and also to constitute a sinking fund for the payment of principal. This provision of the Constitution is self-enforcing. A vote on the levy of the tax is not necessary. State ex rel. v. Allen, 183 Mo. 283; Evans v. McFarland, 186 Mo. 703; Black v. Early, 208 Mo. 281; State ex rel. v. Hackmann, 275 Mo. 534.

Roy McKittrick, Attorney General, and Covell R. Hewitt , Assistant Attorney General, for respondent.

(1) Sections 11 and 12 of Article X of the Constitution contain limitations upon the power of political subdivisions to incur debt and to levy taxes. (a) These limitations are for the benefit of the taxpayers. Mo. Const., Art. X, Secs. 11, 12; State ex rel. Clark County v. Hackmann, 280 Mo. 702 218 S.W. 322. (2) The Supreme Court has uniformly upheld these sections and has resisted all attempts to encroach upon them. State ex rel. Clark County v. Hackmann, 280 Mo. 686, 218 S.W. 318; Hight v. Harrisonville, 328 Mo. 549, 41 S.W.2d 155; Hagler v. Salem, 333 Mo. 330, 62 S.W.2d 751. (3) If Section 9356, Revised Statutes 1929 is construed to impose upon a consolidated school district the bonded indebtedness of the component school districts and to make that indebtedness the debt of the consolidated district of like character to bonds which are voted by the consolidated district, then Section 9356 is to that extent repugnant to the Constitution. (a) A consolidated school district is a political subdivision separate and distinct from the preexisting school district and constitutes a separate corporate entity, with different powers, acting under different statutes and occupying different territory. State ex inf. Pulley v. Scott, 307 Mo. 258, 270 S.W. 382. (b) Unless specifically provided by statute, a consolidated school district does not assume any part of the bonded indebtedness of a school district out of which it is created. State ex rel. Consolidated School District No. 1 v. Hackmann, 277 Mo. 56, 209 S.W. 92. (c) Section 12, Article X of the Constitution requires, as a condition precedent to the incurring of indebtedness of any district, consolidated or otherwise, the assent of the "voters thereof." This means the voters of the district incurring the indebtedness. Mo. Const., Sec. 12, Art. X. (d) A statute which would impose upon a consolidated school district the bonded indebtedness of the component school district would be invalid because the consolidated district would be allowed to "become indebted" without the consent of two-thirds of the "voters thereof." Mo. Const., Sec. 12, Art. X; Barber v. Cummings & Sons, 167 Ga. 289, 145 S.E. 443; Perry v. Baggett, 164 Ga. 143, 137 S.E. 766; Register v. Coulter, 171 Ga. 439, 155 S.E. 767; Campbell v. Burton, 182 G. 354, 185 S.E. 323; Cummins v. Gaston, 109 S.W. 476; Eagle Lake v. Lakeside Sugar Refining Co., 144 S.W. 709; Crabb v. Celeste Indep. School Dist., 105 Tex. 194, 146 S.W. 528, 9 L. R. A. (N. S.) 601; Burns v. Dilley County Line Indep. School Dist., 295 S.W. 1091; Young v. Edna Indep. School Dist., 34 S.W.2d 857; Owsley County Board of Education v. Owsley County Fiscal Ct., 251 Ky. 165, 64 S.W.2d 179; Carpenter v. Central Covington, 119 Ky. 785, 81 S.W. 921; St. Louis, San Francisco Ry. Co. v. Bonaparte, 142 Okla. 343, 286 P. 343; State v. Froehlich, 37 A. 1024. (4) The General Assembly has no power to authorize the governing authorities of a consolidated school district to levy unlimited taxes upon all taxable property in the consolidated school...