Turnipseed v. Blan

• Decision Date: 27 April 1933
• Docket Number: 3 Div. 47.
• Citation: 226 Ala. 549,148 So. 116
• Parties: TURNIPSEED et al. v. BLAN, State Treasurer.
• Court: Alabama Supreme Court

148 So. 116

226 Ala. 549

TURNIPSEED et al. v. BLAN, State Treasurer.

3 Div. 47.

Supreme Court of Alabama

April 27, 1933

Appeal from Circuit Court, Montgomery County; Leon McCord, Judge.

Taxpayers' bill by Thomas B. Turnipseed, E. T. Davis, A. F. Harman, and Elizabeth Baldwin Hill against S. H. Blan, as State Treasurer, to enjoin payment of warrants. From a decree sustaining a demurrer to the bill, complainants appeal.

Affirmed.

BOULDIN J., dissenting.

Rushton Crenshaw & Rushton, of Montgomery, for appellants.

Thos E. Knight, Jr., Atty. Gen., and John H. Peach, Legal Advisor to the Governor, of Sheffield, for appellee.

FOSTER Justice.

The bill of complaint describes the warrants, whose payment out of funds raised or set apart for school purposes for the tax year beginning October 1, 1932, is sought to be enjoined, as having been issued in favor of various school boards and educational, eleemosynary, and correctional institutions in various amounts, and were acquired and are now held by a bank in the city of New York. Some of them were issued under an Act of August 25, 1927 (Gen. Acts 1927, p. 442). The first eleven sections of that act make continuing appropriations to the state board of education for various purposes. Some of them are for current expenses, some for libraries, and some for rural school buildings. Section 12 makes continuing appropriations for the quadrennium to the Alabama College, Alabama Polytechnic Institute, and the University of Alabama, without specifying the uses to be made by such institutions. Section 13 makes continuing appropriations for the quadrennium for the normal schools to be used for capital investment in grounds, buildings, and equipment, and for payment of outstanding debts incurred for capital outlay (dealt with in In re Acts 1927, p. 442, Making Appropriations for State Normal Schools, 220 Ala. 539, 126 So. 161). Section 14 makes such appropriations for capital investment for Alabama College, Alabama Polytechnic Institute, and University of Alabama separately. So that a large part of such appropriations are for permanent capital investment. Such capital investments were for the most part limited to the quadrennium, and those for operations continued, as a rule, without limitation as to time.

The last section of the act (No. 31) provides that the several appropriations shall be payable out of the special trust fund created and set apart for educational purposes by section 2 of the General Revenue Act (Gen. Acts 1927, p. 139); and that, in event it be insufficient to cover such appropriations, the balance shall be payable out of any other funds in the treasury not otherwise appropriated. Some of the warrants here in question, all of which we will call certificated warrants, were drawn and are payable pursuant to the requirements of that provision of the act.

The general public school fund is provided for by section 260 of the Constitution, consisting principally of the special annual tax of 30 cents on each $100 of taxable property, with provision that it shall be increased from time to time as the necessity therefor and the condition of the treasury and resources of the state may justify. This public school fund, save that which shall be supplemented from the general fund, shall be apportioned to the several counties in proportion to the number of school children of school age therein-section 256, Constitution; Opinions of the Justices, 215 Ala. 524, 111 So. 312-and all is so apportioned by section 242, School Code. The county boards then exercise their discretion in its further distribution. State v. Board of Education of Russell County, 214 Ala. 620, 108 So. 588.

In addition to such public school fund, the Legislature of 1927, in its General Revenue Act, § 2 (Gen. Acts 1927, p. 139), levied certain special taxes (within the resources of the state, as provided by section 260, Constitution), and by subdivision 2-K of that act constituted such revenue the "Alabama Special Educational Trust Fund," and directed that same be kept separate and apart from all other funds in the state treasury, and paid out of appropriations from such fund for educational purposes. The trust fund was also specially supplemented by appropriations from the general fund for that purpose for the year 1932, in the sum of $1,500,000, and for 1933 and 1934 in the sum of $2,000,000 each. The act which thus supplements such fund provides that the additional sums "shall be expended under and in accordance with the terms and provisions of" the Appropriation Act of 1927, to which we have referred as that by authority of which the certificated warrants were issued.

The bill alleges that the state treasurer, unless enjoined, will pay those warrants out of the public school fund raised under authority of section 260, Constitution, as well as out of the trust fund.

Since section 256 of the Constitution, supplemented by section 242, School Code, is specific that the "public school fund" shall be apportioned to the several counties in proportion to the number of children of school age therein, it can mean nothing else but that the whole of such fund shall be so apportioned each year, and that there can be no part of the same left at the end of any fiscal year not so disposed of, and which may be otherwise used. So that all of such fund must be so apportioned for the fiscal year beginning October 1, 1932, and all of it paid out for use in the several counties as there specified, and no part of it, under the express mandate of the Constitution, can be used to pay the certificated warrants or any of them. Some of the certificated warrants are drawn on that fund. To that extent we think the bill shows a right to injunctive relief.

But in respect to the use of trust funds received during the year beginning October 1, 1932, waiving any other question, it is sufficient for the purposes of this case to say merely that the bill alleges that for the year beginning October 1, 1932, there will be no more money in such trust fund than will be needed to pay the current appropriations out of it for that year, and that the schools largely dependent upon such appropriations of it for current operations are being forced to suspend, since the funds appropriated for that purpose are being withheld to permit payment of those warrants, and that they will be so applied unless enjoined by this court. The injunction sought relates only to school funds, general and special, for the present fiscal year.

That situation was not involved in the inquiry which the Governor submitted to the justices and answered by us, reported in In re Acts 1927, p. 442, Making Appropriations for State Normal Schools, 220 Ala. 539, 126 So. 161. That inquiry was predicated upon section 13 of the Appropriation Act of 1927, to which we have referred. It made an annual appropriation for permanent investment by the normal schools continuing through 1930. The specific inquiry was in substance whether it would be a violation of section 213 of the Constitution if the normal schools, which are authorized by law to borrow money, shall borrow an amount substantially equal to the sum of such annual appropriations, pledging the warrants thus authorized by law, and make the investment of it all at once rather than to make separate investments each year. Obviously it could not thus violate section 213. We did not say directly nor indirectly that such debt so contracted by the schools, or the warrants issued under the act of 1927, which secured it, should be paid in priority to current appropriations of the fund for the years subsequent to the last of those in which such appropriation for them specifically applied. We were not asked a question whose answer tended to express an opinion on that subject.

We think that the substantial equity of the bill is well sustained by the facts alleged, and that the injunction should be granted if the facts are as alleged, unless there is something else lacking to give the court the right to do so.

Appellee argues that a taxpayer does not possess the right to enjoin state officers in this respect.

We have recognized the right of a taxpayer to maintain a suit in equity to restrain an officer of a city or county from disbursing funds without statutory authority or under an unconstitutional statute. Travis v. First National Bank of Evergreen, 210 Ala. 620, 98 So. 890; Allen v. Intendant & Councilmen of La Fayette, 89 Ala. 641, 8 So. 30, 9 L. R. A. 497. Some states refuse to concede such right of action when the purpose is to enjoin a state officer from thus illegally disbursing state funds. But a great majority of the states which have considered the subject have applied such right of suit, though it relates to a state officer. This is said to be based upon the necessity for prompt action to prevent irremediable public injury. The taxpayer bears the same relation to state funds as to municipal funds, except in degree, a point which should not control. 58 A. L. R. 588 et seq., note.

Appellee also argues that the decree sustaining his demurrer should be affirmed because of a want of necessary parties, which is made the basis of special grounds.

The bill does not allege the name of the holder of the certificated warrants, but its allegations do not show that complainant is ignorant of its name, referred to as a bank in New York. No reason is given why it is not made a party. The bill would have the court to enjoin their payment out of the trust fund, as well as the general school fund, during the year beginning October 1, 1932, which is the present fiscal year. The claim to such injunction is the assertion that the current appropriations of that fund for this year will exhaust all the money received or to be received during the...