White v. City of Decatur

• Decision Date: 15 August 1898
• Citation: 119 Ala. 476,23 So. 999
• Parties: WHITE v. MAYOR, ETC., OF CITY OF DECATUR.
• Court: Alabama Supreme Court

23 So. 999

119 Ala. 476

WHITE v. MAYOR, ETC., OF CITY OF DECATUR.

Supreme Court of Alabama

August 15, 1898

Appeal from circuit court, Morgan county; H. C. Speake, Judge.

Mandamus by Alonzo White against mayor and council of Decatur. There was a judgment denying the writ, and petitioner appeals. Reversed.

Harris & Eyster, for appellant.

D. W Speake, for appellee.

McCLELLAN J.

By an act approved February 24, 1887, the mayor and council of the town of Decatur were authorized to negotiate a loan of $50,000 for the purpose of draining, grading, macadamizing and improving the streets of the town, and to issue bonds for the payment of said loan. Section 3 of the act provides "That to meet the interest and principal at maturity upon any or all of the bonds issued under the authority of this act, the said corporate authorities shall, and it is hereby made their duty to set apart, out of the general revenues of said town each year, an amount as a sinking fund to meet and pay off the principal and interest upon said bonds at maturity, and to retain the same." Bonds were issued under this act. The city authorities failed to provide a sinking fund as required by the section just quoted, and defaulted in the payment of interest. Alonzo White, holding coupons for the interest on the bonds, sued thereon, and, recovering judgment for about $5,000, had executions issued against the town, which were returned "No property." He thereupon filed his petition for mandamus to the mayor and councilmen directing them to set apart out of the revenues of the incoming or current year funds to meet and satisfy his judgment. It is alleged in the petition, substantially admitted in the answer, and shown on the hearing that prior to the filing of the petition the mayor and council had made an estimate of the revenues from all sources for the incoming or current year, and that in their judgment the revenues for the year would probably amount to the sum of $9,906.66; and it was further made to appear that, assuming the correctness of this estimate, they (the mayor and council) had made the following estimates of, or appropriations to, what they conceived to be legitimate and necessary municipal expenses: Salaries,-mayor, $300; clerk, $480; marshal, $600; police, $540; extra police, $100; attorney, $50; public schools, $1,650; water, $900; lights, $800; streets, $1,000; miscellaneous, $500; and sinking fund (the balance of), $2,888.66. But the estimate or appropriation to sinking fund was not made under or with reference to the provision of the bond act quoted above, nor with a view to the payment of the interest or principal of said bonds; but the intention was to apply the sum so estimated or appropriated to a mortgage debt which the city had subsequently contracted. It is averred in the petition that the proposed payments by the city for lights, water, streets, and public schools, and upon said mortgage will not be legitimate expenditures for the municipality, but will constitute diversions of the general revenues into unauthorized channels, and away from necessary municipal charges; but the charter of Decatur expressly authorizes the mayor and council to make provision for supplying lights and water to the town; and a special act passed at the same session of the general assembly as the act authorizing the issuance of the bonds involved in this case empowers and requires the town authorities to establish public schools, and to appropriate funds out of the municipal revenues for their support and maintenance; and this was shown on the hearing below, and the prayer of the petition is "that a peremptory writ of mandamus issue to the respondents, as mayor and councilmen of Decatur, directing and commanding them to set apart from the general revenues of the city for the current year, 1897, as soon as collected, a sufficient amount of money to pay petitioner's said judgment, and to pay the same; and that it be required to pay said judgment as and at the time its revenue is collected; that it be required to pay said judgment before paying any money" on the contracts for lights and water, etc.; and for other appropriate relief, etc. On this state of case the circuit judge decided and dismissed the petition for mandamus, and from that judgment the petitioner prosecutes this appeal.

It is thoroughly well settled law that where the interest and principal of a municipal bonded debt is payable out of the general revenues of the town, no part of such revenues that is necessary to meet current, legitimate municipal expenses can be subjected to the payment thereof, but only the surplus of income after the governmental expenditures have been met or provided for can by any process of law be applied to such debt. 1 Dill. Mun. Corp. §§ 100, 101;...