First Nat. Bank of Anniston v. City of Jacksonville
This text of 184 So. 338 (First Nat. Bank of Anniston v. City of Jacksonville) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinions
In our opinion the case is not governed by the law of private trusts, wherein there is a settler, a beneficiary as the equitable owner of the fund, and a trustee for pres *641 ervation and accumulation for a specified time.
On the other hand this is a public fund, owned by a governmental body or agency, to be used by the public authorities for public uses, either strictly governmental or proprietary in such sort as municipal governments may lawfully engage in.
It appears the City of Jacksonville, and its City Board of Education, owned public school buildings and grounds with which they were operating local public schools— state schools. The state school authorities desired to take over the operation of these schools so as to conduct them as a model school in connection with a State Teacher Training Institute.” To that end the state took over the legal title, transferred the school management from one state agency to another. The property conveyed continued to be devoted to the same public uses as before. To acquire the legal title and transfer of control the state paid the money now in question.
The transaction on its face contemplated the city would no longer engage in operating public schools. A City Board of Education would no longer have legal functions to perform and would cease to be.
But, said the local authorities, here is this fund, derived not from a sale of school properties in the ordinary sense, but from a mere change of set-up in the operation of public schools with public monies, not including this fund, and using the same school properties.
What shall be done with this money? Maybe, said these public authorities, this set-up may not prove satisfactory, and we may wish to again operate public schools under local school authorities authorized by law. Let’s conserve this fund for a waiting period of 15 years. Thereupon, the fund was deposited in the bank under the trust agreement. By this agreement the bank was made custodian for safe-keeping and accumulation. It could hardly be contended the bank was more than a managing agent for these purppses.
Quite clearly it was never contemplated this fund should ever be employed for public school purposes, except on the contingency that the arrangement out of which it grew should prove undesirable. There was a mere tie-up of the fund for successors to determine whether it should be so used. Apart from any questions of legality of the transaction in whole or in part, and dealing with the status quo, here is a voluntary trust in which the settler is the beneficiary. The settler is a governmental unit or agency, functioning through public authorities who represent the school children and the general public in relation to this fund. The school children are not beneficiaries in the sense of equitable owners of private property. Governing agencies are set up to safeguard their interests as a public interest.
The- sole question of importance is, did the stipulation of a test period of 15 years, by the then governing body, strip their successors, with like governing power, of all authority to ascertain whether the occasion for a waiting period has now passed, and to declare and prove in a court of equity, that this, the sole purpose of the trust, has been fulfilled and it should end?
Our view is the then governing body had no such power. They had no power to' say: Our successors can have nothing to do with this, unless they choose to retake the fund for operation of • public schools under loqal authority. No power to say: W:e pass on to successive boards for fifteen years this right of election, we fix fifteen years as an arbitrary period within which no governing body may determine that the -new set-up is a success and satisfactory to the public they represent.
Probably, the then governing body had no such purpose; but fixed a maximum period, subject to like powers in each successive board.
In either event, the case is sui generis. Public policy is involved in a tie-up of public funds on contingencies for fifteen years.
Our opinion, therefore, is that the decree of the trial judge should be affirmed.
Affirmed.
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Cite This Page — Counsel Stack
184 So. 338, 236 Ala. 639, 1938 Ala. LEXIS 422, Counsel Stack Legal Research, https://law.counselstack.com/opinion/first-nat-bank-of-anniston-v-city-of-jacksonville-ala-1938.