Baggerly v. Bainbridge State Bank, 160 Ga. 556

160 Ga. 556 | Ga. | 1925

Hines, J.

(After stating the foregoing-facts.)

Are the trustees of local school districts authorized by law to borrow money for the operation of the schools in their districts ? The lack of such power is strenuously pressed by counsel for the plaintiff in error; and-the proper answer to the above question is the first matter for our consideration. It is a settled rule that public officers have only such powers as are granted them; that they take nothing by implication; that the law granting their powers is to be strictly construed, and -that persons dealing with them must at their peril ascertain the extent of their powers. Civil Code (1910), § 303; Dent v. Cook, 45 Ga. 323; Penitentiary Co. v. Gordon, 85 Ga. 159 (11 S. E. 584); City of Dawson v. Waterworks Co., 106 Ga. 696 (32 S. E. 907); Walker v. Georgia Ry. &c. Co., 146 Ga. 655 (92 S. E. 57). The powers of the trustees of local school districts which do not levy a tax for educational purposes are defined in section 121 of the Code of School Laws (Acts 1919, p. 336); and the powers of the trustees of such districts as levy a tax for such purposes are defined in section 129 of said code (Acts 1919, p. 341). There is no provision of law authorizing either class of such trustees to borrow money with which to pay the operating expenses of schools in their respective districts. Board of Education v. Fudge, 4 Ga. App. 637 (3) (62 S. E. 154). This being so, no action would lie upon notes given by trustees of a local school district to a bank, for money borrowed to maintain and operate the school in said district.

But the money borrowed by the trustees of this school district was used in defraying the current expenses of operating the school in this district for the year 1924. These expenses were lawful liabilities of the district to which its funds, derived from taxes and otherwise, could be legally applied. This being so, an action for money had and received could be maintaiúed by the bank which had loaned money to the trustees, which money had been used by them to discharge legally incurred liabilities for such current expenses, although the trustees of the district had no authority to borrow the money or to give a note therefor. The lender in these circumstances would be subrogated to the rights of the holders of such lawful liabilities against the trustees of the district which were paid out of the proceeds of the illegal loan. Butts County v. Jackson Banking Co., 129 Ga. 801 (60 S. E. 149, 15 L. R. A. (N. S.) 567, 121 Am. St. R. 244). We construe the petition as an equitable action for money had and received, and not as one undertaking to recover upon the note given by the trustees for the money borrowed from the bank. We think that the petition set forth such a cause of action, and was not subject to the general demurrer. Whether subject to special demurrer, if one had been urged, on the ground of nonjoinder of necessary parties, is not now for decision'by this court.

But it is urged by counsel for plaintiff in error that the petition does not make a case authorizing the grant of a temporary injunction, inasmuch as the claim of the complainant has not been reduced to judgment. As a general rule, creditors without liens can not enjoin their debtors from disposing of their property, nor obtain injunction or other extraordinary equitable relief. Civil Code (1910), § 5495. Even after judgment, there must be some special circumstance to authorize equitable interference in behalf of the creditor seeking to collect his debt. Dodge v. Pyrolusite Manganese Co., 69 Ga. 665. Where a creditor has a lien or title or interest attaching to the property of his debtor, he can invoke the equitable power of the court to prevent, by injunction, interference by another therewith, in a case where the facts would render the grant of such relief appropriate. Carter v. Johnson, 156 Ga. 207 (6) (119 S. E. 22). When the bank loaned this money to the trustees of this school district, the latter gave to it a draft upon the tax-collector of the county for the payment of the loan out of the taxes to be collected for the district during-the year, which had been levied upon property of owners within the district to meet the current expenses of conducting the school therein. While this draft was not an assignment of the legal title to that portion of the tax fund therein specified, it was an equitable assignment which was enforceable as such in an equitable proceeding. Rivers v. Wright, 117 Ga. 81 (43 S. E. 499); Brown v. Southern Ry. Co., 140 Ga. 539 (79 S. E. 152). Such equitable assignment of the tax fund clothed the bank with such an interest in the fund as would authorize it to apply to a court of equity for injunction to prevent illegal interference with such right in a case where the grant of such relief was proper.

It is next insisted that the equitable relief of injunction does not lie in this case, because the plaintiff has a complete and adequate remedy at law. It is true that injunction will not lie where a complainant has such complete and adequate legal remedy. Johnson v. Gilmer, 113 Ga. 1146 (39 S. E. 469); Eslinger v. Herndon, 158 Ga. 823 (124 S. E. 169, 900). But we do not think that the complainant has a full and adequate remedy at law. The plaintiff is seeking to preserve a fund to which it has an equitable title by reason of the equitable assignment of these funds. The treasurer was threatening to divert them from the payment of the claim of the bank, and to apply these funds to the payment of the current expenses of the school for the year 1925, when they were properly applicable to the payment of the expenses incurred in conducting the school for the previous year. If this purpose were carried out, the equitable title of the complainant to these funds would be defeated, and the bank could not subject them to the payment of its demand. The bank was endeavoring to preserve the fund by injunction, and to have the same applied to the payment of its demand, by virtue of its equitable, title thereto for that purpose. The purpose of this suit was to prevent the treasurer of the trustees from time to time paying out these funds to which the complainant had an equitable title, and to prevent the dissipation of a fund to which it was so entitled. The right of the plaintiff to injunctive relief is analogous to the case of destructive or continuing trespass, which a court of equity will enjoin although the trespasser may be solvent and capable of responding in damages. Camp v. Dixon, 112 Ga. 872 (38 S. E. 71, 52 L. R. A. 755); Enterprise Lumber Co. v. Clegg, 117 Ga. 901 (45 S. E. 281); Gray Lumber Co. v. Gaskin, 122 Ga. 342 (50 S. E. 164); Loudermilk v. Martin, 130 Ga. 525 (61 S. E. 122); Gray v. Guthrie, 134 Ga. 273 (67 S. E. 799). The legal remedy of the complainant to sue the treasurer for each and every conversion of these funds, ¿Ven though he is solvent and able to respond, is not as full, complete, and adequate as that afforded by the grant of an injunction to prevent the dissipation and conversion of the fund and by equitable decree for its payment to the complainant.

But it is urged that the complainant is estopped from applying for injunctive relief, by reason of the fact that he has sued out a mandamus to compel the payment of these funds to the discharge of its demand. It is insisted that the plaintiff, having resorted to the remedy of mandamus, can not now resort to a court of equity for injunctive relief. This contention is based upon the ground that the remedy by mandamus and that by injunction are inconsistent proceedings, and that the choice of the former -by the complainant precludes him from resorting to the latter'. We do not think that under the facts of this case these remedies are inconsistent. In Whigham v. Davis, 92 Ga. 574 (18 S. E. 548), this court held that the double remedy of injunction and mandamus was not appropriate for one and the same case; but in this case the complainant is not seeking the enforcement of both of these remedies. Furthermore, under the circumstances of this case both of these remedies might be appropriate.

The hearing of the application for injunction was had in vacation and prior to the appearance term of the court. The judgment rendered by the chancellor is set out in full in the statement of facts. The plaintiff in error treats this judgment as the grant of an injunction, and for this reason we shall so treat it. Under the rulings above made we do not think that the chancellor erred in granting the temporary injunction. The trial judge went further, and seems to have rendered a final judgment fixing the right of the complainant to these funds. He provided in his judgment that the treasurer should be permitted to pay out these funds to discharge the current expenses of the school for the year 1925, apd that the funds of the school district for the succeeding year should be impressed with a trust in favor of the complainant. This being a hearing in vacation of an application for injunction, the judge was without jurisdiction to make a final disposition of the case and to award these funds to the complainant. Chason v. O’Neal, 158 Ga. 725 (7) (124 S. E. 519). Furthermore, we think that the judge was without authority to authorize the treasurer to expend the funds of this district,-which arose during the year 1924, to the payment of the expenses of this school for the year 1925. However, we affirm the judgment of the court below, with the direction that it so modify its judgment as only to restrain the defendant from paying out these funds until the rights of the complainant can be determined by the final decree in the case.

Judgment affirmed, with direction.

All the Justices concur, except Gilbert, J., absent for providential cause.