275 Mo. 636 | Mo. | 1918
Lead Opinion
An alternative writ of mandamus was issued June 12,1917, by the judge of the circuit court of Cole County, commanding the respondent, as State Auditor, to sign and deliver to the relators, Kelly & Kelly, a warrant for twenty thousand dollars upon the Capitol Building Fund of the State, or to show cause in term time, for refusing. The writ was granted upon.a petition containing these averments: The petitioners were partners under the style of Kelly & Kelly; the sum of twenty thousand dollars was appropriated to them out of the Capitol Building Fund by the General Assembly at its last session to pay money due petitioners by the State of Missouri; said appropriation was part of the General Appropriation Act and was approved by the Governor; prior to his approval petitioners agreed with him to reduce their claim to twenty thousand dollars; petitioners were and are willing to accept the State Auditor’s warrant for that sum in satisfaction of the appropriation, had so advised him and had demanded that he issue a warrant in petitioner’s favor in accordance with the terms of the appropriation, but he had refused.
The item of the General Appropriation Act of April 11, 1917, on which this proceeding is based, reads:
“There is hereby appropriated out of the State Treasury chargeable to the Capitol Building Fund the sum of twenty-five thousand dollars for the relief of Kelly & Kelly of Kansas City, Missouri, in full pay
That part of the Appropriation Act is the only evidence in this case of an agreement between relators and the State and of what the agreement was.
In his return to the writ the State Auditor set forth ten reasons why he had not issued the warrant in question and should not.be compelled to issue it. They were in substance as follows:
A denial that the appropriation was to pay money due to the relators from the State, or that there was any money in the Capitol Building Fund to pay a warrant for the appropriation;
Averments that the Cápitol Building Fund was in the nature of a trust fund, set apart by a vote of the people for these specific purposes, first, to build a new State Capitol; second, ’ to furnish and equip it; third, to purchase any additional premises that might be needed as a site for the Capitol; that, therefore, the Legislature was without power to divert any part of the Capitol Building Fund to other purposes;
That as the Capitol Building Fund consisted of money derived from a liability contracted by the State, for the three purposes aforesaid, it could not be appropriated for any other than those, purposes, or to repay the debt of the State, without violating Section 20 of Article 10 of the State Constitution. This section of the State Constitution provides, in effect, against the use of any money arising from a loan, debt or liability contracted by the State, for any purposes other than that for which the debt was contracted, or for the repayment of the debt;
That the appropriation for relators was contrary to the provisions of Section 48 of Article 4 of the Constitution, which reads: “The General Assembly shall have no power .to grant, or to authorize any county or municipal authority to grant any extra compensation, fee or allowance to a public officer, agent, servant or
That the appropriation amounted to a grant to the relators of public money, in violation of the inhibition of Section 46, Article 4, of the State Constitution;
That the appropriation impaired the obligation of contracts previously made by the State, for the construction and furnishing of the Capitol, and finally,
Averments to the effect that the claim of relators for which the appropriation was made, did not arise under a contract made with the State Capitol Commission Board, nor was the relators’ demand allowed and certified by said board, in conformity to the act creating the board. [Laws 1911, p. 108 et seq.]
A replication in the form of a general denial of the return was filed.
At the hearing in the circuit court it was admitted there was then in the Capitol Building Fund $707,844.87; that said fund (i. e. the amount then in it and what had been in it)consisted of the proceeds of the sale of bonds of the State authorized by act of the General Assembly (see Laws 1911, pp. 406-417), together with funds placed in it under Section 16-A. of the Act of the General Assembly relative to contingent and incidental expenses for years 1915-1916 (Laws 1915, p. 9). It was admitted the additional sum of $27,500 had been transferred to the Cápitol Building F'und pursuant to said Section 16-A (Laws 1915, p. 9) and that $21,000 derived from the rent and sale of buildings on the Capitol grounds had been added. There were admissions relative td submitting to the popular vote the Act of March 16, 1911 (Laws 1911, pp. 416-417), providing for contracting a liability of the State through an issue of bonds to a maximum of three and a half million dollars, to provide
Evidence was put in by the respondent to show contracts the State was under for building the Capitol and the amount of the State’s liability under them; also that other contracts would be necessary in the future in order to complete, light and furnish the Capitol.
The trial court found that when the Appropriation Act was approved and at the time of the hearing, there was enough money in the Capitol Building Fund to pay a warrant for $20,000 in favor of relators, and that, too, without impairing the obligation of any contract in existence when the appropriation was approved or when the cause was heard.
The alternative writ was quashed in the circuit court and relators appealed.
By way of further explanation we state that the issue/ of State bonds to construct, furnish and equip a new capítol building was authorized by an Act of the General Assembly approved March 6, 1911. (Laws 1911, p. 416). That act provided for the contracting of a liability of the State by an issue of bonds, not to exceed three and one-half millipn dollars, for a submission of this act to a vote of the people as required by Section 44, Article 4, of the State Constitution, prescribed the denominations of the bonds, mode' of authenticating them, and further provided as follows: “Said bends, when so prepared and executed under the supervision of the State Board of Fund Commissioners, shall be sold to the best advantage by said board, but not for less than par. The proceeds of said sale or sales shall constitute a fund to be designated as the Capitol Building Fund, and shall be applied exclusively to the building of a new state capítol at the present seat of government of the State, including the furnishing and other equipment of said building and the purchase by
Withastate The proposition mainly relied on by respondent as a defense is, that the appropriation to pay the claim of relators violated that clause of the State Constitution quoted above, which forbids the General Assembly to pay or authorize the payment of a claim created against the State under any agreement or contract made without express authority of law, and declares all such unauthorized agreements and contracts shall be null and void. The claim of relators is of a -kind that could only accrue from ’ a contract, and whatever may have been the contract out of which the claim arose, it must have been made between the: relators and the State acting through the Board of Fund Commissioners, as it is apparent from the recital in the Appropriation Act that the purpose of the particular item was to pay relators for a plan for the sale of the State Capitol bonds, submitted by them to that board. Moreover, if a contract of the kind in question was possible, it could only have been made with the said board, which was the body of officials charged with the task of selling the bonds, by the act that authorized them: ,.
There are two inquiries to be answered in determining whether or not the claim of relators was created against the State under a valid agreement. First, is there proof in the record that an agreement was entered into by the relators with the Board of Fund Commissioners for the former to submit a plan to sell the bonds? Second, if there is, did the board possess express authority of law to make the agreement, or was it a mere nullity for lack of authority?
Proceeding to the inquiry whether it was possible for the-contract in controversy to have been made by express authority of law, we note that the Board of Fund Commissioners is composed of the Governor, Auditor, Treasurer and Attorney-General, and that it is part of the Treasury Department, created by an act of the Legislature approved March 25, 1891. [Laws 1891, p. 16.] This act, as amended in a few particulars, constitutes. the 3rd Article of Chapter 121 of Revised Statutes of 1909. One amendment was made to provide a plan to-.refund the State Capitol bonds (Laws 19.13, p. 772); but we do not consider the change thus made as controlling the decision of the point in this case which arises on the act. The 13th section of the Law as it
' “The Board of Fund Commissioners are hereby authorized and empowered to enter into contracts, and to refund any part of the bonded indebtedness of the State, whenever they can do so to the advantage of the State in reducing the rate of interest of the outstanding State bonds, and to this end they are authorized and empowered to cause new bonds to be prepared, issued, sold or exchanged for outstanding bonds of such denominations, dates and rate of interest as they may deem proper, payable at such times and places, principal and interest, as they may agree upon as being to the best interests of the State: Provided, always, that the rate of interest of said bonds to be issued shall not exceed three per centum per annum, and that such ‘refunding bonds’ fall due, or become redeemable at the pleasure of the State, at such dates as will permit the redemption or payment, at par, of at least two hundred and fifty thousand dollars of the bonded debt of the State every year, until all of the bonds of the State are paid off. All bonds or State certifications of indebtedness hereater issued by this State under the direction of the Board of Fund Commissioners shall be signed by the Governor, countersigned by the Secretary of State, with the great seal of the State attached, and the coupons for interest shall have a facsimile of the State Treasurer’s signature engraved thereon. The bond shall be registered by the State Auditor, to which he shall certify on each bond, and authenticate such registration by his signature and his official seal attached.”
That section was altered, as stated, in 1913, by inserting certain provisions about the State Capitol bonds. The question is whether the clause authorizing the Board of Fund Commissioners to enter into contracts, conferred on the board the right to mate contracts regarding any duty that might be committed to them by law, or only regarding the refunding of State bonds. Most of the section relates to refunding, but in a prior section (now See. 11890, R. S. 1909) it was pro
In the case of Church v. Hadley, 240 Mo. 680, decided in 1911, this court, without passing upon the effect of said Section 11900, Eevised Statutes 1909, held the Fund Commissioners had express authority to contract for help to sell the Capitol bonds, by reason of these facts: first, that their efforts .to sell without help had demonstrated it was impossible to do so; second, the urgency of the need to sell in order that the State’s archives might be safely housed. The 'two opinions in the case were both concurred in by a majority of the court, and the gist of them was that an emergency existed which created a necessity for help in selling the bonds, “and that such necessity is within the intendment of the statutes,” namely, the statutes which authorized the bonds. The decision was based both on an interpretation of those statutes and on adjudications in other states wherein the right of officials to agree to pay a commission for the sale of public securities was held to have been conferred by laws authorizing them to sell. [Armstrong v. Village of Fort Edward, 159 N. Y. 315; Mayor, etc. v. Sands, 105 N. Y. 210; Manitou v. First National Bank, 37 Colo. 344; State v. West Duluth Land Co., 75 Minn. 456.] It would be difficult to sustain the proposition that at common law, an agent appointed to sell property, as the Fund Commissioners were, was empowered merely by virtue of his appointment, to bind his principal by contracts with third persons to help him sell, even if it should turn out that he could not sell without help. [2 Cor. Jur., p. 595, and note 13; 9 Cor. Jur. p. 519, and note 95; Mechem, Agency, sec. 357; Atlee v. Fink, 75 Mo. 100; Carroll v. Tucker, 2 N. Y. Misc. 397.] Nor did the decision in Church v. Hadley announce as a rule of general application, that agents might do this; but, instead, took pains to declare that the decision stood on all the facts of the particular case
In the light of the foregoing arguments and. precedents, we think the constitutional provision in question was not adopted with the intention to abrogate the doctrine of the common law that incidental powers may accompany the grant of an express power, as necessary to the exercise of the latter; but to enforce the .rule of strict construction in determining what agreements public agents and officials are given the-right to make, in connection with the performance of some duty imposed on them, when such subsidiary- agreements are not mentioned in the law imposing the duty.
The defenses of respondent that there was no money in the Capitol Building Fund to .pay relators’ claim, and that to pay it would impair the obligations of contracts made by the State, are answered by the findings of the trial court, which are supported by the evidence.
The judgment is reversed and the cause is remanded with direction to the circuit court to reinsert it -in the docket and issue a peremptory writ of mandamus to the respondent to issue, a warrant in favor of relators in the sum of $20,000.
Dissenting Opinion
(dissenting) — I do not concur in the majority opinion. The Appropriation Act the validity of' which we are called upon to determine in this case,, is as follows:
“Sec. 59. Relief of Kelly and Kelly. There is hereby appropriated out of the State. Treasury chargeable to the Capitol Building Fund the sum of twenty-five thousand dollars for the relief of Kelly & Kelly of Kansas City, Missouri, in full payment-of their claim against the State of Missouri for the plan submitted to the Board of Fund Commissioners for the sale of State Capitol bonds.”
. It is not inappropriate to state generally, preliminary to a discussion of the facts in- this particular case, that no appropriation act under our system of laws' derives any operative force from its own terms alone. As we will demonstrate, something more is necessary to authorize the withdrawal of funds from the public treasury than a mere arbitrary declaration of the General Assembly for that purpose. This-being true, we must look to other than this act itself in determining its validity. A confusion in terms may be avoided by keeping in mind that the appropriation will be referred to as “the act,” and the law it.designates as creating the fund from which the appropriation is sought to be
■ Section 48 of Article 4 of the Constitution, so far as same is applicable to the matter at issue, is as follows:
“The General Assembly shall have no power to pay or authorize the payment of any claim hereafter created against the State, under any contract made without express authority of law; and all such unauthorized agreernents or contracts shall be null and void.”
This provision is mandatory and like any other constitutional provision of like nature (St. Joe Ry. Co. v. Shambaugh, 106 Mo. 1. c. 571) it inserts itself into all appropriation acts, and a compliance with its mandate is a prerequisite to- their validity. What are the terms, therefore, of the statute upon which this act must rely
A contrary conclusion finds no support in either the reasoning or the conclusion reached in Church v. Hadley, 240 Mo. 680. The argument is that case while recognizing the supremacy of the General Assembly in its own field as one of the co-ordinate branches of the government, nowhere holds that the courts may not with discriminating care and a quickened conscience, especially where the interests of the State are concerned, examine every act of the appropriation of public money submitted for their review to determine its validity. In so doing- they but comply with a sworn duty, and in no respect do they interfere with legislative supremacy, which in this class of cases does not exist until after the acts have received judicial approval, if submitted for that purpose. The Church-Hadley case did not involve the construction of an appropriation act, and hence the provision of the Constitution (Sec. 48, Art. 4) affirmatively restricting legislation of this character was neither considered nor construed. The ruling in that case conferring power upon the Board of Fund Commissioners to pay a commission for the sale of the the Capitol Fund bonds was based upon- public necessity, and properly so, and not upon any power to be inferred from the language of the statute. Confined to the. latter, no rule of construction would have authorized the holding of such a power by implication. A recital of the facts in the Church-Hadley case will demonstrate the wisdom
Liberal as our Legislatures have been in the appropriation of public money, the approval of a claim for an offer to perform a service for the State has heretofore been unheard of. Certain it is, that no claim such as this, in the very teeth of the Constitution, has received the sanction of the courts. Given judicial approval, it will set the pace for a most pernicious practice, and hereafter, not one, but all of the unsuccessful bidders for state employment, will seek legislative intervention to secure compensation, not for services rendered, but for plans proffered.
This claim, therefore, is not only unauthorized, but unconscionable, and it should not be approvéd.