Good. v. Western Pulaski County School Corp.

210 N.E.2d 100, 139 Ind. App. 567

• Court: Indiana Court of Appeals
• Decided: November 22, 1966
• Docket: 19,989
• Status: Published

Opinions

Hunter, J.

— The plaintiffs below, some of whom are appellants in this appeal, as representative citizens, voters and taxpayers in Pulaski County filed suit for an injunction against the defendants, appellees herein. The action below asked to have set aside and held for naught the comprehensive plan for the reorganization of the school corporations in Pulaski County and to have set aside and held for naught the establishment of the Western Pulaski County School Corporation, and to enjoin it and its individual officers from taking over any of the assets of the Pulaski County School Corporation, and to enjoin Pulaski County’s School Corporation and its officers from turning over any of its assets to Western Pulaski County School Corporation. The trial was by the court without jury. The issues were formed on the plaintiffs-appellants’ complaint, the cross-complaint of the defendant-appellant, Pulaski School Corporation, the defendant-appellants’ answer to the complaint and the answer in denial by Western Pulaski School. Corporation to the complaint of plaintiff-appellant and cross-complaint of defendant-appellant, and the answer of the defendant-appellee, Western Pulaski School Corporation alleging the de jure existence of Western Pulaski School Corporation and compliance with the school reorganization act of 1959, as amended in 1961, and the replies to such affirmative answers by the plaintiffs and cross-complainants.

The judgment of the court below was that the plaintiffs on their complaint and the defendant, Pulaski County School Corporation, on its cross-complaint, were not entitled to the injunctive relief prayed for; that the restraining order previously issued by the court should be dissolved. The court properly did not render judgment on the affirmative answers alleging the de jure existence of the defendant, Western Pulaski School Corporation, since the determination of the de jure existence of a municipal corporation or title to office is not properly recognizable in a suit of equity. State ex rel. McClure etc. v. Marion Sup. Ct. etc. (1959), 239 Ind. 472, 158 N. E. 2d 264; Landes v. Walls (1903), 160 Ind. 216, 66 N. E. 679; Felker v. Caldwell (1919), 188 Ind. 364, 123 N. E. 794; Parsons et al. v. Durand (1898), 150 Ind. 203, 49 N. E. 1047. Separate and several motions for a new trial were timely filed by the plaintiff and cross-complainants, which motions were denied by the court. The various plantiffs and cross-complainants jointly, separately and severally moved the court for new trial and subsequently, by leave of the court, filed a new and supplemental motion for new trial and subsequently the cross-complainants filed an amended motion for new trial. Taking the motions collectively, we find that they all assign that the decision and judgment of the court is contrary to law; that the decision and judgment of the court is not sustained by sufficient evidence and as to certain special parties that the court erred in admitting evidence over the objection of the plaintiffs and cross-complainants; that the court erred in sustaining the objections to questions asked by the plaintiffs and cross-defendants and the questions asked in testimony offered by the plaintiff's and cross-complainants; that the court erred in overruling the cross-complainants’ verfied motion to strike all the answers of certain defendants and cross-defendants and to render a judgment of injunction; that the eourt erred in excluding certain testimony of the cross-complainants’ witness, one Ross Robertson; that the court erred in admitting certain testimony of Lamoin Nice, which said testimony is embraced in thirteen separate specifications of error in the motion for new trial of all of the plaintiffs.

On the 16th day of March, 1963, the court overruled the motion for new trial filed by the plaintiffs and cross-complainants.

The assignments of error are:

“1. The Court erred in overruling the amended and supplemental motion for a new trial of the Appellants, Lorin Good, Harold Mahler, James Allen, Harold Hoover, Richard Thompson, Richard Fahler and Daniel Sayers.

“2. The Court erred in overruling the amended motion for a new trial of the Appellants, Pulaski County, School Corporation, (identical with the County Board of Education of Pulaski County, Indiana), and John S. Capper as the Treasurer of the Pulaski County School Corporation.”

The appellants concede in their argument that the alleged errors presented in the various motions for new trial are substantially the same; that the basic theory of the complaint and cross-complaint are similar and the evidence presented applied almost equally to each and the principles of law were almost identical. The appellants then state for the purpose of the brief the argument of plaintiff-appellants and defendants-appellants will be combined.

The appellants concede that the assignment in their motion for a new trial to the effect that the decision of the court is not sustained by sufficient evidence raises no question, since this is an appeal from a negative judgment, rather the appellants present their entire argument under the assignment that the decision of the court is contrary to law. We feel that it is necessary to trace through the various proceedings leading from the original action of the County Committee up to the perfection of the appeal to this Court and we will set these proceedings out in narrative form.

The County Committee for the reorganization of school corporations of Pulaski County was created and the members were appointed; the Committee met and organized and after a series of meetings, several of which were public meetings, the plan as finally presented by a majority of the County Committee and approved required the creation of two school corporations, one to be known as the Western Pulaski School Corporation and the other as the Eastern Pulaski School Corporation ; during the time the plan was being formulated, the Pulaski County School Corporation was the corporation operating in both areas and has continued to do so during the pending of this action and appeal; later hearings were had on the plan and the State Commission then approved the plan.

The appellees in this cause applied for and secured an extension of time within which to file brief, in which petition the appellees were required to and did show that said appellees’ brief would be on the merits and that all motions to dismiss had been filed. Rule 2-16. This rule, as far as it is binding upon the court, is set forth very clearly by the Supreme Court in the case of Gamble v. Lewis (1949), 227 Ind. 455, 85 N. E. 2d 629. The Supreme Court cited an opinion by this court — Brodt v. Duthie (1933), 97 Ind. App. 692, 697-698, 186 N. E. 893 — in which case the word “merits” was defined in the following language:

“ ‘The word ‘merits’ should be understood as meaning the strict legal rights of the parties, as contradistinguished from those mere questions of practice which every court regulates for itself, and from all matters which depend upon the discretion or favor of the court.’ 5 Words and Phrases, First Series, page 4493, and cases cited. 40 C.J., p. 650.”

The Supreme Court, using this case as authority, stated:

“The appellee applied for and received an extension of time for the filing of his briefs. Rule 2-16 requires the petition to ‘state facts showing that the court in which the cause is pending has jurisdiction and that the brief will be on the merits.’ An objection that the evidence is not in the record does not go to the merits of the appeal, and by his petition for extension of time the alleged error was waived. Brodt v. Duthie (1933), 97 Ind. App. 692, 186 N. E. 893.” Gamble v. Lewis, supra, at p. 459.

Following the case of Gamble v. Lewis, supra, this court, in very significant language in the case of Biel, Inc. v. Kirsch (1958), 130 Ind. App. 46, 49-50, 153 N. E. 2d 140, stated as follows:

“The Supreme Court said in Gamble v. Lewis (1949), 227 Ind. 455, 85 N. E. 2d 629, 632: ‘An objection that the evidence is not in the record does not go to the merits of the appeal, and by his petition for an extension of time the alleged error was waived.’ If the absence of the evidence from the record does not concern the merits of an appeal surely its absence from the appellant’s brief could not be so considered. This court specifically held that an objection that the appellant’s brief is not in proper form or does not comply with the rules does not go to the merits of the cause, (citing) Brodt v. Duthie (1933), 97 Ind. App. 692, 186 N. E. 893. We therefore conclude that the appellee has waived his right to the affirmance of the judgment herein because of defects in the appellant’s brief and this case must be decided on its merits.”

Therefore, considering this case on the merits, as we are permitted to do by reason of the holdings of this court and the Supreme Court, supra, the first major contention asserted by the appellants in their brief on the merits of this case¹ is that it is not legally possible for this plan to be put into effect and that the same cannot be implemented so that it can become operable. A Condensed Recital of the contents of the comprehensive plan is set forth in extensive substance in Appellants’ Brief. The plan as finally adopted by a majority of the county committee and approved by the State Commission required the creation of two school corporations. One was to be known as the Western Pulaski School Corporation and the other was to be known as the Eastern Pulaski School Corporation. The Eastern Pulaski School Corporation was to include all of the territory over which the Winamae-Monroe Township School had jurisdiction and a part of the territory included within the Pulaski County School Corporation. The Western Pulaski County School Corporation was to include a part of the Pulaski County School Corporation, Gillam Township of Jasper County, and left out all of Richgrove Township and a part of Cass Township of Pulaski County over which the Pulaski County School Corporation previously had jurisdiction. At the time the plan was adopted, the Pulaski County School Corporation was the only corporation operating in both areas. The Pulaski County School Corporation had assets, students and liabilities in both areas.

It is provided within the plan in seventeen instances where assets and liabilities are to become the property of Eastern Pulaski County School Corporation. There are eleven instances where division is to be made of assets and liabilities between Eastern and Western as shown in the Condensed Recital of the Evidence in Appellants’ Brief. There are eight instances where division was to be made of assets and liabilities between the proposed Western and Eastern with such division to be made by the superintendents of the proposed Western and Eastern. As shown in the Condensed Recital of the evidence in the brief, the statutory method to attempt to bring Eastern Pulaski County School Corporation into existence was the holding of an election in an area comprising the Eastern Pulaski County School Corporation area in May, 1962. The plan was defeated by the voters of that area by secret ballot by a vote of 2,242 to 933. The County Committee did not meet again until June 25, 1962. At that meeting it decided to do nothing, although the County Committee was fully aware the Eastern Pulaski County School Corporation had not and could not come into existence at the time of the final adoption of this comprehensive plan.

No provision is made in the comprehensive plan as to what would happen if Eastern Pulaski County School Corporation failed to come into existence.

It is interesting to note that in all of these cases of the attempted division of assets and liabilities in the plan that there was wide variance in the percentages providing that Eastern should pay 38% and Western would pay 62% of the obligations to the school buildings and maintenance located in Jefferson Township of Pulaski County, and all other contractual obligations of all other personnel should be divided 53.8% to Eastern and 46.2% to Western. Since Eastern Pulaski County School Corporation did not come into existence it is impossible to implement and put the plan into operation. The plan is completely dependent upon the creation of Eastern Pulaski County School Corporation which plan was decisively rejected by the voters of that larger area of Pulaski County. This court has no authority to rewrite this plan. Pulaski County School Corporation is an entirely different unit and entity, different territory than that of the proposed Eastern Pulaski County School Corporation.

In arguments of counsel in support of an affirmance of the judgment below, they have sought to treat the Pulaski County School Corporation as the Eastern Pulaski County School Corporation which did not come into existence and which was an entirely different corporation as to geographical area or existence. The plan appears to be a unified whole which is not possible of implementation and carrying into effect because Eastern did not come into existence.

The effect of any affirmance of this judgment could not establish the de jure existence of Western Pulaski County Corporation and would lead to a multiplicity of other suits in an attempt to take from Pulaski School Corporation assets and property which are incapable of definition since there is no Eastern Pulaski County School Corporation.

This court is without power and authority to rewrite the plan and to make a division between the Pulaski County School Corporation and the Western Pulaski County Corporation.

Another reason why the plan is impossible of being implemented and put into operation as shown in the condensed recital of the evidence in Appellants’ Brief is that such plan required a division of the school books’ rental system with a value of more than $40,000. The uncontra-dieted evidence as demonstrated by the testimony of George Gerichs and other witnesses, established the fact that the book rental system belonged to the Pulaski County School Corporation by reason of its purchase with private funds and not from public resources. The school book rental system of the Pulaski County School Corporation, the appellants herein, was derived by it from sources other than the state and may be held by it and by the terms of its acquisition and grant for such uses, and from which it cannot be diverted by the legislature, and it is the property of said school corporation and such school book rental system is protected by all the safe-guards from legislative interference possessed by individuals and private corporations. Lucas v. Board of Commissioners of Tippecanoe County (1873), 44 Ind. 524, aff'd by 93 U.S. 108, 23 L. Ed. 822.

Another very serious question which is raised on the merits by the appellants with proper citation of the statute verbatim relates to the provision wherein it is mandatorily required of the County Committee that they show the costs of the current and proposed programs of education at the public hearings required under the School Reorganization Law.² We are not dealing here with the interpretation of the school reorganization statute as such. Our decision here would not change or alter the provisions of the school reorganization laws as they existed under the original Act of 1959 or the amendments thereto in 1961. What we are called upon to determine by the points made in the Appellants’ Brief • is whether a plan was adopted which was capable of inplementation and being put into effect with the additional serious questions as to whether the plan was legally adopted and the required statutory procedures followed in the adoption of the plan. The Supreme Court, in a school reorganization case, has very definitely laid down rules to be followed in cases where the plaintiff school corporations and plaintiff taxpayers question procedures taken contrary to law. In this case interpreting the school reorganization law — State ex rel. Jones v. Johnson Circuit Court (1962), 243 Ind. 7, 12, 181 N. E. 2d 857— the court stated the following rule:

“The establishment of a community school corporation, as here under consideration, being a special statutory proceeding, the procedural requirements prescribed in the act must be strictly followed. The court has no authority to ignore such procedure or adopt a different method of procedure. State ex rel. M. West Ins. Co. v. S. Ct. of Marion Co. (1952), 231 Ind. 94, 100, 106 N. E. 2d 924, 927; State ex rel. Gary v. Lake Sup. Ct. (1947), 225 Ind. 478, 493, 76 N. E. 2d 254, 261 and cases cited therein.”

The appellants cite, verbatim, parts of Sec. 28-6108 Burns’ Indiana Statutes, 1948 Repl., Vol. 6, Pt. 2, 1962 Gum. Supp., which requires public hearings and notice to taxpayers and residents affected, and which requires that the County' Committee shall show the costs of the current and proposed programs of education as nearly as may be estimated. Sec. 28-6108, supra, in its pertinent provisions is set forth below.³ See also State ex rel. Jones v. Johnson Circuit Court, supra.

The County Committee failed to comply with the provisions of the above-mentioned section of the statute. This Committee resolved to establish a two-unit plan for Pulaski County in the early stages of its work without a consideration of the studies and surveys they were required by statute to make. The briefs and transcript contain the transcribed testimony taken from a tape recorder, as well as the testimony of the various members of the County Committee— Mr. White and Lamoin Nice in particular, that it was impossible to make an estimate of cost of the proposed program of education. The words of the statute are plain and unambiguous that they must explain the costs of the proposed programs of education as nearly as may be estimated.

This statute, by its terms, along with all the other provisions of such statute, requires that the County Committee suggest programs of education and that the County Committee show the estimated costs of such proposed programs of education. The only reasonable inference to be drawn from the condensed recital of the evidence in the briefs is that this County Committee did not, at any time, estimate the costs of any proposed programs of education on their repeated statements that it was impossible so to do.

This statute was not followed and the legislative intention that it was mandatory clearly appears when the statute was later amended in 1963 so that it was not required to be done. Certainly, when the legislature requires that the public be shown estimated costs, the public is entitled to have those costs shown as required by the statute.

The entire record in this case, as shown in the briefs, discloses that the County Committee, in formulating this plan, acted outside the authority as provided by statute. State ex rel. Jones v. Johnson Circuit Court, supra. From the condensed recital of the evidence in the briefs, it is shown that the County Committee failed to do things mandatorily required by the statute. The County Committee failed to adopt its Final Comprehensive Reorganization Plan within 18 months after the creation of said committee and submit two copies of the some to the State Commission within said time. Burns’ 1962 Cumulative Pocket Supplement, § 28-6109.⁴

The third major contention raised in the court below by un-contradicted evidence admitted without objection and the complaint must be deemed amended as to such evidence is that such evidence and the record show that the date of the County Convention was August 10, 1959, and the date of the creation of the County Committee was August 11, 1959, and that the organization and election of officers occurred on September 8, 1959, and that the adoption of the Final Comprehensive Plan and the filing of two copies of the same on August 1,1961, was more than 23 months from the creation of the County Committee and more than 23 months from the date of the County Convention. The request for extension of time to the State Commission, as shown by the record, was May 2, 1961, which is more than 20 months after the County Convention and more than 20 months after the creation of the County Committee. The statute must be followed. State ex rel. Jones v. Johnson Circuit Court, supra.

The uncontradicted evidence shows that at that time the State Commission did not act upon such motion for extension of time, but instead the Director of such Commission, as an employee of same, purported to give such extension by letter, and he was without power or right to grant such extension of time on behalf of the State Commission, as shown in the case of State ex rel. v. Sloan (1926), 197 Ind. 556, 151 N. E. 418. Other cases cited in Appellants’ Brief are: Bullock v. Billheimer (1911), 175 Ind. 428, 94 N. E. 763; State ex rel. v. Goldthait (1909), 172 Ind. 210, 87 N. E. 133; Keane v. Remy (1929), 201 Ind. 286, 168 N. E. 10.

Therefore, pursuant to the statute, the State Commission had the exclusive duty of preparing such Comprehensive Plan upon the failure of the County Committee so to do. The County Committee lacked jurisdiction to submit a plan after the expiration of eighteen (18) months from the date of the County Convention without a valid extension of time from the State Commission. The County Committee lacked power to adopt this plan and it was within the sole jurisdiction of the State Commission to prepare such plan after the expiration of twenty (20) months. Burns’ 1962 Cumulative Pocket Supplement § 28-6115 (f) ;⁵ State ex rel. Jones v. Johnson Circuit Court, supra; McCreery v. Ijams (1945), 115 Ind. App. 631, 59 N. E. 2d 133.

Furthermore, in connection with this case, we must be mindful of the decisions holding that all doubtful claims to power by governmental boards and agencies must be resolved against them. Pittsburgh, etc., R. Co. v. City of Anderson (1911), 176 Ind. 16, 95 N. E. 363; Local 26, Natl. Bro. of Op. Potters v. City of Kokomo (1937), 211 Ind. 72, 5 N. E. 2d 624.

Finally and in conclusion, the appellees have raised the question that this action was not timely filed by the appellants. The record before us reveals that in the fall of 1961 a petition was circulated' in the area comprising the Western Pulaski County School Corporation asking that such corporation be formed without an election. Following the circulation of the petition, the Clerk certified to the County Committee that more than fifty-five (55%) per cent of the eligible voters had signed the petition. On December 7, 1961 notice was published announcing that the corporation would come into being on January 1, 1962. The appellants’ action was filed on January 5, 1962 and within the thirty (30) days provided by statute.⁶ We therefore hold that the appellees’ assertion is not sustained by the record, and that the appellants did file their action within time pursuant to the provisions of the statute.

For the reasons given herein, the judgment of the trial court is reversed and remanded for further proceedings not inconsistent herewith.

Prime, P.J., Carson, Faulconer, and Smith, JJ., concur.

Martin, J., participated and concurred in the adoption of this opinion prior to his death.

Mote, J., dissents with opinion in which Bierly, C.J., concurs.

1 . Rhetorical paragraph 16(b) of plaintiffs’ complaint, p. 23, Appellants’ Brief, Vol. I “(b) The Comprehensive Plan creating the WESTERN PULASKI COUNTY SCHOOL CORPORATION is arbitrary, capricious, unreasonable, uncertain, indefinite, incapable of being performed, unfair, unworkable and in violation of existing contractual rights and obligations.” and the answer filed thereto.

2 . Sub-paragraph 39 of rhetorical paragraph 10 of cross-complaint, p. 60, Appellants’ Brief, Vol. I “(39) Said approved plan and its adoption and approval are unlawful for the reason that the Pulaski County Committee for the Reorganization of School Corporations wholly failed to show within the same and to show at the public hearings conducted by it and by the State School Reorganization Commission the costs of the proposed programs of education as nearly as may be estimated.” and the answer filed thereto.

Sub-paragraph 7 of rhetorical paragraph 10 of cross-complaint, p. 49, Appellants’ Brief, Vol. I “(7) Said plan fails to show the cost of the proposed proposed program of education under the plan for the reorganization of school corporations of Pulaski County and Gilliam Township of Jasper County, as required by the enabling statute.” and the answer filed thereto.

3 . “At the hearing the county committee shall explain the proposed reorganization plan, . . . and shall show the cost of the current and the proposed programs of education as nearly as may be estimated ... In such hearing, any resident of the county or of any affected school corporation . . . may be heard with reference to the proposed changes . . (Acts 1959, ch. 202, § 5(5), p. 451; 1961, ch. 231, § 1(5), p. 544.) (our emphasis)

4 . “The committee . . . shall thereupon adopt its final comprehensive reorganization plan, and, within ten (10) days after such adoption, but not later than eighteen (18) months after the creation of the county committee, shall submit at least two (2) copies of its comprehensive plan to the state commission: Provided, however, That if a county Committee encounters any difficulties in formulating its comprehensive plan for the reorganization of school corporations, through no lack of diligence upon the part of the committee, so that it is unable to submit its plans to the state commission within the eighteen (18) months specified, such county committee may make application to the state commission for extension of time in which to complete its comprehensive plan.

The state commission, in its discretion, and if the facts and circumstances warrant, may grant such extension as it may see fit: Provided, however, that in no ease shall such extension be for a longer period than six (6) months.” (Acts 1959, ch. 202, §5(6), p. 451, 1961, ch. 231, §1(6), p. 544.)

5 . “The state commission shall make surveys and prepare plans for the reorganization of school corporations in any county in which the county committee fails or refuses to submit plans, records, reports, and other data as provided for in this act. . . .” (Acts 1959, ch. 202, §6(3), p. 451.)

6 . “Community school corporation — Creation by petition.— . . . The Clerk shall establish a record of his certification in his office, and shall return the petition together with his certification to the eounty committee. If the certification or certifications received from the clerk or clerks disclose that fifty-five per cent (55%) or more of the registered voters residing within the boundaries of the community school corporation have signed the petition, the county committee shall publish in two (2) newspapers of general circulation within the boundaries of the community school corporation a notice stating that the steps necessary to the creation and establishment of the community school corporation have been completed, and setting forth (a) the number of registered voters residing within the boundaries of the community school corporation who signed the petition and (b) the number of registered voters residing within the boundaries of the community school corporation.

The community school corporation shall be created and come into being on July 1 or January 1 following the date of publication of said notice, whichever date is the earlier. In the event any public official shall fail to do his duty within the time prescribed in this section, this omission shall not invalidate the proceedings taken hereunder. No action to contest the validity of the formation or creation of a community school corporation under the provisions of this subsection (1), to declare it has not been validly formed or created or is not validly existing, or to enjoin its operation shall be instituted at any time later than the thirtieth day following publication of said notice.” (Acts 1959, ch. 202, §7(1), p. 451; 1961, ch. 302, §1(1), p. 816.)