272 S.W. 887 | Ky. Ct. App. | 1925
Affirming.
Appellant, Sutherland, suing as a citizen and taxpayer of the city of Corbin for himself and others similarly situated, prays an injunction restraining the defendants, board of education of the city of Corbin, and its members, from incurring an additional indebtedness by issuing and selling bonds of the city in conformity to a vote of the people taken in February, 1922, authorizing a bond issue of $75,000.00 for school buildings and school improvement purposes, only a part of which bonds have been issued, on the grounds, (1) that the indebtedness of the school board will be increased beyond the two (2%) per cent limit fixed by section 158 of the Constitution, and (2) the right to issue bonds under the election has been lost by abandonment, delay and laches.
The petition filed by appellant, Sutherland, sets forth all the facts and these averments of fact are correct, as shown by an agreement of the parties, made a part of the record. The lower court held on the facts stated in the petition that the board of education of Corbin is "authorized to issue and sell bonds to the amount of $33,500.00 under and pursuant to the authority of the special bond election of February 25, 1922, described in the petition, and is authorized to carry out the resolutions of the said board passed on the 11th of May, 1925, and copied in the petition, according to the provisions and terms of the said resolution; and the court is further of opinion and adjudges that all such bonds, to the amount of $33,500.00 which may be issued and sold by the said *353 board of education, pursuant to said resolution, will be legal, valid and binding obligation on the said board of education, and that the plaintiff and taxpayers of the city of Corbin are without right or authority to enjoin, or cause to be adjudged, the issual or sale of said bonds, or any of them," illegal.
Immediately after the special election at which the $75,000.00 was voted by the city of Corbin, in 1922, a test case was instituted in the Whitley circuit court to determine the validity of the bonds. The bond election was held valid, and an appeal was prosecuted to this court. In an opinion found in
This court has held in a number of cases that the voting of bonds does not create an indebtedness — that the indebtedness is not incurred within the meaning of the Constitution, section 158, unless and until the bonds are issued and sold. Young v. Fiscal Court Trimble County,
In brief of counsel for appellee, it is said:
"We insist that the authority granted to the board of education by the election of 1922, to issue and sell bonds to the amount of $75,000.00 has not been exhausted. It has sold only $28,000.00 worth of bonds pursuant to that election. We find nothing in the Constitution or statutes which renders the authority to issue bonds void because not exercised. We think there is no statute of limitation or doctrine of laches which would prevent the issual of bonds authorized by an election of the people, because the bonds were not issued immediately, or within a short time, or possibly within any length of time."
We have held in the cases of Young v. Fiscal Court,
The constitutional provision, section 158, says that municipalities and taxing districts shall not be authorized or permitted to incur indebtedness to an amount, including the existing indebtedness, in the aggregate exceeding " 'certain named maximum percentages' on the value of the taxable property therein, to be estimated by the assessment next before the last assessment previous to the incurring of the indebtedness.' " As the indebtedness is not incurred until the bonds are issued and sold, the indebtedness may be estimated upon the assessment of property next before the bonds are issued. The amount of indebtedness which may be incurred is not controlled by the assessment next before the election at which the bonds are authorized, but by the assessment next before the indebtedness is incurred by the issual and sale of the bonds. We conclude that the board of education of the city of Corbin is entitled under the facts shown in the petition of appellant, Sutherland, to issue and sell bonds in the amount proposed, $33,500.00 under the election held in February, 1922. The lower court was correct in sustaining the general demurrer to the petition of appellant, Sutherland, and in dismissing his petition when he declined to further plead.
Judgment affirmed.