Sloan, Stevens & Morris v. State

| Wis. | Mar 24, 1881

Lead Opinion

Lxorr, J.

The lands donated to the state by congress to aid in the construction of certain railroads, when accepted by the state, were held by it in trust for the uses and purposes speci-fled in the several acts of congress donating the same. Within the limits hereinafter stated, it was the clear duty of the state, thus acting as a trustee, not only to apply the lands and the proceeds thereof to the purposes of the trust, but also to protect the lands from spoliation while the title thereto remained in the state, and to compel persons who had unlawfully taken timber therefrom to re-imburse the trust fund to the extent of the damages they had committed upon the lands. In the execution of these duties the power of the legislature is plenary, with the single limitation that it cannot authorize expenditures beyond the amount of the trust funds in that behalf under the control of the state. To do so would be to create a state debt not authorized, and therefore prohibited, by the constitution. Const., art. VIII, secs. 4, 10.

The constitution provides that “ whenever grants of land or other property shall have been made to the state, especially dedicated by the grant to particular works of internal improvement, the state may carry on such particular works, and shall devote thereto the avails of such grants, and may pledge or appropriate the revenues derived from such works in aid of their completion.” But over this grant of power, controlling and inflexibly limiting it, is the prohibition, “ the state shall never contract any debt for works of internal inypropementP Section 10, supra.

Section 6 of art. VIII authorizes the state, under certain conditions and limitations, to contract public debts, not exceeding in the aggregate $100,000, <¡for ^ pU1.p0se 0f defraying extraordinary expenditures.” But manifestly the expenditures for which such indebtedness may be contracted must be made by the state in the performance of functions pertaining to its sovereignty. The execution of the trust assumed by the state, in respect to the lands granted to it in aid of the construction of railroads, is not one of those functions.

When our constitution was adopted, the subject of state indebtedness, particularly for works of internal improvement, was prominent in the public mind. Some of the states had theretofore contracted large debts- in the prosecution of such works, and the weight thereof pressed heavily upon the people. Moreover, the territory of Wisconsin had incurred liabilities, the amount of which was then unascertained, on account of lands theretofore granted by congress to the territory to aid in connecting by a canal the waters of lake Michigan and Rock river. These liabilities the future state would necessarily inherit, and the act of congress for the admission of the state of Wisconsin into the Union, approved May 29,1848, provided expressly that such liabilities should be paid aud discharged by the state. Taylor’s Statutes, 85, § 2.

Beyond those liabilities the framers of the constitution were solicitous that no such evil should ever afflict this state. Hence the general prohibition of sec. 4, art. Till: “The state shall never contract any public debt, except in the cases and manner herein providedand the specific prohibition of section 10: “The state shall never contract any debt for works of internal improvement.” ITe:rce, also, section 3: “The credit of the state shall never be given or loaned in aid of any individual association or corporation;” aud section 9: “No scrip, certificate or other evidence of state debt whatsoever shall be issued, except for such debts as are authorized by the sixth and seventh sections of this article.” Reference has already been made to the sixth section. The seventh section authorizes the legislature to borrow money to repel invasion, suppress insurrection, or defend the state in time of war. Under this section the bonds of the state, known as “war bonds,” were issued during the late rebellion.

Having thus guarded against the creation of a state debt exceeding $100,000, except in case of insurrection or war, and having doubly guarded against the creation of any debt for works of internal improvement, the framers of the constitution proceeded to consider another subject vital to the interests of the future state. The policy of donating portions of the public domain in aid of works of internal improvement had been inaugurated by congress. As already stated, a grant of land had been made to the territory to aid in the construction of a canal from Lake Michigan to Rock river. Congress had also made another grant to the future state, upon its admission into the Union, to aid in the improvement of the Fox and Wisconsin rivers. Other grants to the state for kindred purposes were confidently expected, and that expectation was afterwards fully realized. The improvements in aid of which these grants were made and expected, were needed to facilitate the settlement and develop the resources of the state, and their early construction bv unaided private enterprise could scarcely be hoped for. It seemed, therefore, to be sound policy for the state to leave itself free to accept such grants and to execute the trusts thereof. And so the framers, wisely no doubt, inserted the provision that the state might carry on particular works in aid of which a grant had been made to it.

The provision of the constitution last mentioned contains a very significant clause authorizing the legislature to “ pledge or appropriate the revenues derived from such works in aid of their completion.” This clause would be surplusage but for the previous prohibition to contract debts on account of the improvements. Its insertion shows how the framers understood the instrument. The same considerations which prompted the convention to frame the constitution as it is, led the people to adopt it as the fundamental law of the state.

Reading the provision under consideration in connection with the other limitations contained in the constitution, and in the light of the conditions which existed when the instrument was framed and adopted, its true intent and meaning are perfectly plain. It prohibits file state from being a party in carrying on any work of internal improvement, unless a grant of land or other property has been made to it, specially dedicated by the grant to such work. If such grant and dedication have been made, the state may carry on the particular work, and it must devote thereto the avails of the grant. It may also anticipate the revenues derived from the work and pledge them in aid of its completion. But the legislature cannot contract a state debt on account of such work, in any event or under any circumstances whatsoever.

That large sums of money have from time to time been appropriated by the legislature and paid out of the general fund of the state, in violation of this constitutional inhibition, is undeniably true. The case of State ex rel. Martin v. Doyle, 38 Wis., 92" court="Wis." date_filed="1875-08-15" href="https://app.midpage.ai/document/state-ex-rel-martin-v-doyle-6601822?utm_source=webapp" opinion_id="6601822">38 Wis., 92, discloses such an appropriation and payment. Neither in that case nor in the late case of Martin v. The State, ante, p. 407, which was brought to recover the unpaid balance of the award mentioned in the former case, did the court reach the question now under consideration. The claim was held invalid on grounds preliminary to that question. But had the statutes upon which that claim was founded made an absolute and unconditional appropriation to pay the award, most undoubtedly it would have been held that they are in contravention of the constitution, and therefore void. The courts owe and cheerfully yield great deference . to acts of the legislature. It is vastly more agreeable to approve than to antagonize the action of a coordinate department of the government. But legislation which breaks down the most vital safeguards of the constitution, and casts upon the people the burden of liabilities which they solemnly and emphatically declared in the organic law should not be cast upon them, cannot be upheld by this court. To sustain such legislation would be a practical abdication of the functions of the court.

It remains to apply the principles herein enunciated to the present case. If this action is sustained and the plaintiffs recover, the judgment will be an indebtedness of the state, and must be paid out of the state treasury like any other judgment, whether any of the trespass fund remain in the treasury or not. R. S., 827, sec. 3203.¹ Because this is so, it necessarily follows, from the views above expressed, that the action cannot he maintained. Hence, without looking into the answer interposed in behalf of the state, the motion of the attorney general to dismiss the complaint must he granted.

But it does not necessarily follow that the plaintiffs are without remedy. We have already said that it was the clear duty of the state to protect and preserve the lands so held in trust by it, and to prosecute trespassers thereon, so far as it could do so without incurring any general indebtedness on account thereof. To this end, any money in the treasury derived from such lands may lawfully be appropriated to pay the necessary expenses. Chapter 46 of 1869, which provides for the appointment of agents for the purposes above mentioned, and for payment of the compensation and expenses of such agents out of the trespass fund in the treasury, is in strict accord with the principles above enunciated. That act only provided, however, for the payment of expenses incurred by the agents. A more extensive provision was deemed desirable, and so, by the enactment of chapter 75 of 1871, the legislature amended the act of 1869 by making an appropriation of money out of the trespass fund sufficient to pay the expenses which might be incurred in that behalf by any state officer under the direction of the governor, as well as by the agents. This amendment, although somewhat inartificially drawn, plainly authorizes the governor to bind the fund by expenditures on account of the lands thus held in trust by the state; and under it he may incur the expense directly, or he may authorize some other state officer to do so.

The plaintiffs were employed by the governor directly, as counsel in the actions pending in the supreme court of the United States, to defend the rights of the state as trustees to the lands from which the logs in controversy had been taken. Compensation for their services is as much an expense, within the amended act, as are the wages of the men employed by an agent to remove logs seized by him by virtue .of the act, and is eq ually included in the appropriation clause.

The above acts provide that such expenses shall be audited and approved by the secretary of state, and paid by the treasurer, and appropriates a sum sufficient to pay the same out of the fund collected and' paid in by agents under the acts. This fund has been mentioned as the trespass fund.

It is not necessary to discuss here the nature and extent of the general power of the secretary of state as auditor, or to determine whether he can fix the amount of compensation to be paid counsel employed by the governor under R. S. 1858, ch. 10, sec. 2, in cases where the compensation has not been agreed upon between the governor and such counsel. Under the present revision such compensation must be fixed by the governor. R. S., 92, see. 131. This seems to remove all difficulty. ' *

The plaintiffs were not employed by virtue of the general statute, but under the special statutes of 1869 and 1871. These provide all the necessary processes to enable them to obtain payment for their services out of the specific fund which alone can be charged therewith. Such services were rendered in 1874. In 1875 they filed their account therefor with the secretary of state for allowance and payment. That officer took a mistaken view of the law, and declined to pass upon the account. If any of the trespass fund still remains in the treasury, the plaintiffs may again apply to the secretary to audit and allow the account already filed, and the legality of any action by him thereon, adverse to the plaintiffs, may be reviewed by any competent court in proceedings by mandamus to compel the secretary to audit and allow the claim.

1 The section here cited is as follows: “ Sec. 3203. No execution shall issue against the state on any judgment, but whenever a Anal judgment against the state shall have been obtained in any such action, the clerk shall make and furnish to the secretary of state a duly certified transcript of such judgment; and the secretary of state shall thereupon audit the amount of damages and costs therein awarded, and the same shall be paid out of the state treasury.”

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Dissenting Opinion

Oole, C. J.

I am not able to concur in the judgment in this case, and, considering the importance of the questions involved, I deem it proper to state briefly the grounds of my dissent. I fully agree with the court in the proposition that the state cannot contract a debt for works of internal improvement, or be a party in carrying on such works; that it can only accept as a trustee grants of land made by the general government to aid in the construction of particular works, and apply the proceeds of such lands to the purposes of the grant. In accepting the grant of land to aid in the construction of a railroad from the river St. Croix to the west end of Lake Superior, it became the plain duty of the state, while it held the title, to protect these lands against trespassers, and to prosecute any person who might cut and carry away timber growing upon them. Chapter 46, Laws of 1869, and chapter 75, Laws of 1871, were necessary and proper enactments to secure that end. Under these acts the governor was expressly authorized to employ agents to look after these lands and fix their compensation. The governor was likewise authorized to employ attorneys, if necessary, to prosecute and defend suits arising under these laws. The governor probably had the power, under the general statute (Tay. Stats.,ch. 10, § 2, p. 260) to employ counsel to prosecute or defend actions in behalf of the state which affected or concerned these lands, if the rights or interests of the state as trustee required it. It appears from the complaint that the governor employed the plaintiffs to aid in defending the re-plevin suits therein mentioned; and that the plaintiffs have rendered legal services for the state in this employment, and have never been paid therefor. It appears that the state thus far has refused to pay them. I see no reason why they should not be paid what their services were reasonably worth.

It is alleged that there is now in the treasury of the state §100,000, received for collections made by agents for acts of trespass upon these lands. It seems to me it is the duty of the state to pay the expenses which have been legitimately incurred, including the plaintiffs’ services, out of this fund. It is said that any judgment which this court may render in favor of the plaintiffs must be paid out of the general fund in the treasury, and thus the state will become liable for a debt in carrying on a work of internal improvement. Rut the state is in no danger of incurring any such liability, because it has an ample trust fund out of which it may indemnify itself on paying the judgment. It will doubtless charge the amount paid on the judgment to that fund. So, upon the facts stated, the possibility of incurring an indebtedness in this matter need not be feared. I am not disposed to consider what would be the consequence if there were no trust funds in the treasury of the state to meet this claim. But I do not think the secretary of state, as auditor, has any authority under the law to settle and adjust this unliquidated claim for legal services, nor do I think it competent for the legislature to confer upon him that power. He has no authority to call witnesses, take testimony, and investigate facts as to the value of these services. That is the province of the courts. The word “ auditor,” as used in the constitution, does not, ex vi termini, import one clothed with judicial power or function. It fairly implies that the officer is one who mainly exercises or performs a ministerial duty. These points were so decided by this court in the case of The State ex rel. Dixon v. Doyle, at the January Term, 1876. I drew up the opinion of the court in that case, but the relator discontinued the action before the decision was announced. But I had not then, nor have I now, any doubt as to the correctness of these conclusions, which I understood to be concurred in by the other members of the court. Under these circumstances, I do not agree with the court that the secretary of state can audit this claim. I think both motions, in view of the matters stated in the answer, should be denied.

Taylob, J. I concur with the views of the chief justice.

By the Court.— Let judgment be entered dismissing the complaint.