Brown v. Marsh

21 N.H. 81

Opinion

Gilchrist, O. J.

Footnotes

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In accordance with the votes of the town, from March, 1842, to March, 1845, both inclusive, a part of the surplus revenue was applied, in each year, to defray the expenses and pay the debts of the town. The sums thus taken amounted to $4,359.41; and the selectmen, for each year, exhibited to the auditing committee, and through them to the town, an account of receipts and expenditures, which was allowed and approved by the town. In the month of March, 1846, the town voted that the interest on the surplus revenue be divided, annually, among the tax-paying polls, in part payment of their several poll taxes; and at the time of this vote there remained on hand, of the surplus revenue, an unexpended balance of $486.83. The selectmen made a list of taxes, and directed the collector to levy the amount, and pay “ to each of the tax-paying polls the sums set against their names.” These sums amount to $290, being the interest on the whole surplus fund for one year, instead of the interest on $486.85, which is $29.21 and the bill prays for an injunction to restrain the defendants from paying any more than this sum, or from allowing any larger sum than this to the tax-paying polls, in any way.

Whenever any part of the surplus fund was taken by the town of Henniker, the note of the town, for the amount, was given to the agent; and the interest, although not paid, in fact, was indorsed upon the notes, annually. When the town received the notes from the agent, they were deposited with the treasurer, and kept by him, as they had been kept by the agent; and separate accounts of the receipt and disposition of the surplus revenue were made and approved by the town.

By the act of January, 1837, providing for the receipt of the-surplus revenue, each town was accountable for the money,, whenever it should be called for by the treasurer of the State.. The towns were prohibited from appropriating or spending it; but they might lend it, and appropriate the interest as they should deem expedient. This provision is contained in the 3d section of the act. The statute of July 4th, 1838, repealed this section, and authorizes the towns to lend the money, in sums not less than twenty-five dollars, or to appropriate it to any purpose-for which towns might lawfully raise money. By the act of July 2d, 1841, the towns were empowered to make such disposition of it, as they should, by a major vote, determine; and the 3d section of ch. 8, Rev. Stat. authorizes them to dispose of it, as should be deemed equitable and expedient.

The act of 1841 gave the town unlimited power over this money. They had, before that time, taken, or borrowed, or expended, (whichever term may be proper,) the greater part of it, and had applied it to pay the debts and defray the expenses of the town. Whatever debt, by the acts prior to 1841, the town owed to the fund, or under whatever legal obligation they were by reason of their accountability for the fund, by the act in question they were relieved from all responsibility on account of it. They paid their debts with the money taken from the fund, and this money they were not bound to repay. Now, in whatever form the accounts were kept, whatever contracts the town chose to make with itself, through its own agents, we must look at the substance of the transaction. The form of paying interest, when none was paid, in fact ,* the form of a note made by the town, payable to its own agent, and kept in the possession of the town, through its agent, when no power known to the law could have enforced the payment of it; and the form of keeping separate accounts relating to this fund, which could not alter the nature of the transaction; all these, in truth, amount to nothing. A fund once existed. The town lawfully took it, and lawfully paid its debts with it; The fund then ceased to exist. It was disposed of, and the town had no farther power over it, and could not derive any income from it. This is the whole story, and no language can make it plainer; and no system of keeping accounts, and no intentions of the town, however honest they might have been, as they undoubtedly were, can give a different complexion to the affair, or cause it to express a different idea, to those who look through the forms in which it is enveloped, and regard, as it is our duty to do, the substance of the transaction.

It is not contended that the town is authorized to raise money, by a tax on property, for the purpose of distributing it among any part of the inhabitants. As our opinion is that the fund has ceased to exist, the defendants must be regarded as attempting to raise money for an illegal purpose.

The case of Davis v. Bath, 17 Maine Rep. 141, has been referred to by the counsel for the defendants, as an authority in support of his position. It appears that by the statute of Maine, of the 8th of March, 1837, the towns were empowered to appropriate the surplus revenue in their possession, for the same purposes for which they had a right to raise money by taxation. By virtue of this act, the town appropriated $7,000 of this money for building a town-house and enlarging their almshouse. It was not contended that such an appropriation of the money was not authorized by the act of 1837. The statute of-Maine, of 1838, empowered the towns to .distribute the money per capita, or to appropriate it to any other purpose for which they might raise money by taxation. The town then “ voted to distribute, per capita, the surplus money belonging to the town.” The action was brought to recover the plaintiff’s proportion of the surplus money, under this vote. It appears to us that the true question in that case was, how much surplus money then belonged to the town, which they could distribute under this vote, and the act of 1838 ; and that the lawful appropriation of $7,000 of this money, under the act of 1837, deprived the town of all power of distributing so much of it per capita ; because by their own legal act, that sum had been expended, and had ceased to exist, as a part of the surplus revenue. But the court were of a different opinion, and held that the town was bound to distribute the tvhole sum received of the state, whatever disposition had been previously made of a part of it. With the reasoning of the court we cannot concur ; and therefore we cannot regard the decision as an authority upon the question before us.

The judgment of the Court is, that an injunction issue, according to the prayer of the bill.

Perley, J. having been of counsel, did not sit.