CLARK, C.J., and WALKER, J., dissent.
This case has heretofore been decided by the Court in favor of the defendant, and an opinion to that effect has been reported in 135 N.C. 218. A like decision in a case substantially similar was (590) made inBank v. Comrs., 135 N.C. 230 — Justices Connor and Montgomery
dissenting in each case.
After full and careful consideration, the majority of the Court are now of opinion that the former decision was erroneous, and the law governing the case on the main questions presented is in accord with the dissenting opinions of Mr. Justice Connor filed in the two cases mentioned. The view of the Court which now prevails is so fully and clearly expressed in these dissenting opinions that we would be well content to adopt them as the opinion of the Court but as the more extended dissenting opinion is filed in Bank v. Comrs., and our present decision is of momentous concern to the parties litigant, involving, as it does, too, a reversal of the former ruling of the Court, we have deemed it proper that we should make some further statement of the reasons which have led us to our present conclusion.
The first objection made by the defendant was to the jurisdiction of the court because, as contended by them, this is a money demand and the summons should have been returned to the court in term-time. This exception was determined against the defendant in the former opinion, and for the reasons therein stated this ruling should not be disturbed. Indeed, this question is really not before us on this petition, and is only referred to in order to show that the same has not been overlooked. The cause, then, is here for review on the second and third exceptions below stated:
Second. Is chapter 289, Laws 1903, mandatory? Third. Had the Legislature the power to pass it?
The terms of the first section of that act conferring power to issue bonds are "authorized and empowered," and in ordinary acceptation and in private transactions are usually permissive; but when these words are used in statutes they are frequently imperative, and where the statute is concerning public interests, or promotive of justice, or to secure (591) and maintain the individual rights of others, such words are well-nigh uniformly construed to be mandatory. This rule is stated by text-writers of approved excellence and is sanctioned by courts of the highest authority both in England and in the United States. Mr.
Black, in his Interpretation of Laws, p. 541, formulates the rule thus: "Where a statute provides for the doing of some act which is required by justice or public duty, as where it invests a public body, municipality, or officer with power and authority to take some action which concerns the public interests or the rights of individuals, though the language of the statute be merely permissive in form, yet it will be construed as mandatory, and the execution of the power may be insisted upon as a duty." And in commenting on the rule the author says: "The most frequent illustrations of the application of this rule are found in statutes authorizing the settlement of claims held by private persons against the State or its municipal corporations, and those making provision for the levy and collection of municipal taxes." He then cites several cases in which the term "may" and "authorized and empowered" and "authorized" are respectively held to be imperative, and then proceeds: "Even where the act provides that certain public officers, if deemed advisable, or if they believe the public good and the best interests of the city required it, may levy a certain tax, though these words are purely permissive in form, yet the act will be held to be peremptory whenever the public interests or individual rights call for the exercise of the power granted. And, in general, where the statute enacts that a public officer `may' act in a certain way which is for the benefit of third persons, he must act in that way."
To the same effect is Throop on Public Officers, secs. 547 and 548, and Endlich on Interpretation of Statutes, sec. 311; Sutherland on Statutory Construction, p. 547. Adjudicated cases of like effect (592) can be found in Supervisors v. U.S., 4 Wall., 435; Galena v. Amy. 5 Wall., 705; Mayor of N.Y. v. Furze, 3 Hill, 612; People v. Flagg,46 N.Y., 401; People v. Supervisors, 51 N.Y. 401; Brokaw v. Bloomington,130 Ill. 482; S. Ex rel. v. King, 136 Mo., 309; Inhabitantsof Veazy v. China, 50 Me. 518; Johnson v. Pate,95 N.C. 68.
We are not contending here that the Legislature cannot, in terms, confer discretionary power, nor that permissive terms, when used in statutes, are always mandatory regardless of their placing and the general purpose of the statutes in which they appear, nor are we assailing the principle that where such power is expressly conferred it is usually not permissible for courts to interfere and undertake to direct how such discretion should be exercised. We are seeking to arrive at the true meaning of the Legislature as expressed in this statute, by established and accepted canons of construction.
These very terms, "authorize" and "empower," are so frequently used in legislation of this character that they may be said to have attained a
technical or statutory signification, and where a long course of judicial decision has put a certain interpretation on such words, it is a fair inference and a true rule of construction that the Legislature, in using these words, intended them to have their established meaning.
Again, as said in one of the authorities cited, 51 N.Y. 401: "To determine this question (whether the terms `authorized' and `empower' are permissive or mandatory), not only the language of the act, but the circumstances surrounding its passage and the object had in view, must be considered." Here was a county on the verge of bankruptcy. As far back as 1887, and prior to that time, these debts for necessary (593) expenses had begun to accumulate, and then amounted to $25,000. Issuing bonds to this amount under legislative sanction, the county officers have paid neither principal nor interest, with an exception so slight as not to be considered, and, in addition to this, debts of like character have been allowed to accumulate until there is $40,000 of indebtedness, additional to the bonds, accrued to 1 January, 1903, the period named in the act. The authorities of the county had failed to fulfill the purposes of its creation, and the Legislature enacted this statute to remedy the evil, as will be seen by a perusal of the entire act. It is a measure wisely conceived, carefully prepared, and presents the only feasible method by which this deplorable condition can be corrected, and the financial affairs of the county placed on a sound basis. Such being its beneficent purpose, the Court should be slow to construe the terms of the act discretionary, unless such construction is clearly required.
We do not understand that the general principle here declared is questioned, but some of our brethren are of opinion (and for their opinion we have the greatest consideration) that there are expressions in this act which forbid the application of the general rule, and require that the statute in question should be construed as discretionary.
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CLARK, C.J., and WALKER, J., dissent.
This case has heretofore been decided by the Court in favor of the defendant, and an opinion to that effect has been reported in 135 N.C. 218. A like decision in a case substantially similar was (590) made inBank v. Comrs., 135 N.C. 230 — Justices Connor and Montgomery
dissenting in each case.
After full and careful consideration, the majority of the Court are now of opinion that the former decision was erroneous, and the law governing the case on the main questions presented is in accord with the dissenting opinions of Mr. Justice Connor filed in the two cases mentioned. The view of the Court which now prevails is so fully and clearly expressed in these dissenting opinions that we would be well content to adopt them as the opinion of the Court but as the more extended dissenting opinion is filed in Bank v. Comrs., and our present decision is of momentous concern to the parties litigant, involving, as it does, too, a reversal of the former ruling of the Court, we have deemed it proper that we should make some further statement of the reasons which have led us to our present conclusion.
The first objection made by the defendant was to the jurisdiction of the court because, as contended by them, this is a money demand and the summons should have been returned to the court in term-time. This exception was determined against the defendant in the former opinion, and for the reasons therein stated this ruling should not be disturbed. Indeed, this question is really not before us on this petition, and is only referred to in order to show that the same has not been overlooked. The cause, then, is here for review on the second and third exceptions below stated:
Second. Is chapter 289, Laws 1903, mandatory? Third. Had the Legislature the power to pass it?
The terms of the first section of that act conferring power to issue bonds are "authorized and empowered," and in ordinary acceptation and in private transactions are usually permissive; but when these words are used in statutes they are frequently imperative, and where the statute is concerning public interests, or promotive of justice, or to secure (591) and maintain the individual rights of others, such words are well-nigh uniformly construed to be mandatory. This rule is stated by text-writers of approved excellence and is sanctioned by courts of the highest authority both in England and in the United States. Mr.
Black, in his Interpretation of Laws, p. 541, formulates the rule thus: "Where a statute provides for the doing of some act which is required by justice or public duty, as where it invests a public body, municipality, or officer with power and authority to take some action which concerns the public interests or the rights of individuals, though the language of the statute be merely permissive in form, yet it will be construed as mandatory, and the execution of the power may be insisted upon as a duty." And in commenting on the rule the author says: "The most frequent illustrations of the application of this rule are found in statutes authorizing the settlement of claims held by private persons against the State or its municipal corporations, and those making provision for the levy and collection of municipal taxes." He then cites several cases in which the term "may" and "authorized and empowered" and "authorized" are respectively held to be imperative, and then proceeds: "Even where the act provides that certain public officers, if deemed advisable, or if they believe the public good and the best interests of the city required it, may levy a certain tax, though these words are purely permissive in form, yet the act will be held to be peremptory whenever the public interests or individual rights call for the exercise of the power granted. And, in general, where the statute enacts that a public officer `may' act in a certain way which is for the benefit of third persons, he must act in that way."
To the same effect is Throop on Public Officers, secs. 547 and 548, and Endlich on Interpretation of Statutes, sec. 311; Sutherland on Statutory Construction, p. 547. Adjudicated cases of like effect (592) can be found in Supervisors v. U.S., 4 Wall., 435; Galena v. Amy. 5 Wall., 705; Mayor of N.Y. v. Furze, 3 Hill, 612; People v. Flagg,46 N.Y., 401; People v. Supervisors, 51 N.Y. 401; Brokaw v. Bloomington,130 Ill. 482; S. Ex rel. v. King, 136 Mo., 309; Inhabitantsof Veazy v. China, 50 Me. 518; Johnson v. Pate,95 N.C. 68.
We are not contending here that the Legislature cannot, in terms, confer discretionary power, nor that permissive terms, when used in statutes, are always mandatory regardless of their placing and the general purpose of the statutes in which they appear, nor are we assailing the principle that where such power is expressly conferred it is usually not permissible for courts to interfere and undertake to direct how such discretion should be exercised. We are seeking to arrive at the true meaning of the Legislature as expressed in this statute, by established and accepted canons of construction.
These very terms, "authorize" and "empower," are so frequently used in legislation of this character that they may be said to have attained a
technical or statutory signification, and where a long course of judicial decision has put a certain interpretation on such words, it is a fair inference and a true rule of construction that the Legislature, in using these words, intended them to have their established meaning.
Again, as said in one of the authorities cited, 51 N.Y. 401: "To determine this question (whether the terms `authorized' and `empower' are permissive or mandatory), not only the language of the act, but the circumstances surrounding its passage and the object had in view, must be considered." Here was a county on the verge of bankruptcy. As far back as 1887, and prior to that time, these debts for necessary (593) expenses had begun to accumulate, and then amounted to $25,000. Issuing bonds to this amount under legislative sanction, the county officers have paid neither principal nor interest, with an exception so slight as not to be considered, and, in addition to this, debts of like character have been allowed to accumulate until there is $40,000 of indebtedness, additional to the bonds, accrued to 1 January, 1903, the period named in the act. The authorities of the county had failed to fulfill the purposes of its creation, and the Legislature enacted this statute to remedy the evil, as will be seen by a perusal of the entire act. It is a measure wisely conceived, carefully prepared, and presents the only feasible method by which this deplorable condition can be corrected, and the financial affairs of the county placed on a sound basis. Such being its beneficent purpose, the Court should be slow to construe the terms of the act discretionary, unless such construction is clearly required.
We do not understand that the general principle here declared is questioned, but some of our brethren are of opinion (and for their opinion we have the greatest consideration) that there are expressions in this act which forbid the application of the general rule, and require that the statute in question should be construed as discretionary. The language chiefly relied upon is that expressed in section 19, that "if the bonds authorized by this act are issued." . . . This expression, standing alone and unexplained, would not, of itself, be sufficient, we think, to prevent the application of the rule we are discussing. Many of the decisions upholding this rule were made on words much stronger than this expression would impart to the meaning of the act. But it is not unexplained. On the face of the act itself is found a full explanation of these words, entirely consistent with the decision of the Court on this question. It will be noted that the act provides in section 10 for (594) the sale of the bonds, and in section 11 for their exchange with creditors holding claims, and in both sections it is directed that the bonds shall not be issued except at par value. It might turn out that
the bonds could not be sold at par under section 10. It might turn out that the creditor would not exchange them at par under section 11; and so the restriction in section 19 is explained by the restriction which the Legislature had itself put on the power to issue the bonds. This expression, no doubt, had reference to such restriction, and did not, and was not intended to weaken the imperative force of the words used in former sections of the act.
Again, it is contended that where the statute refers to the issuing of bonds it uses the words "authorize and empower," but where it provides for a board of audit, as it does in sections 7, 8, and 9, it uses the terms "authorize, empower, and direct." This difference, so far from supporting the construction contended for by the defendant, to our minds tends, rather, to confirm the decision on this point.
The act contains a complete and comprehensive plan for restoring order to the financial affairs of the county, and the issuing of bonds and the establishment of this board of audit are equal and dependent parts of the whole; one is as necessary to its successful operation as the other. The very fact that "authorize and empower" are used in one place, and "authorize, empower, and direct" at another, tends to the conclusion that, in the minds of the draftsman and legislators, the words had the same meaning and the same operative force and effect.
On the contrary, note how many of the requirements of the statute are couched in imperative terms: Section 4, in providing a form, says that the bonds "shall be signed by the chairman," and section 5, "the treasurer shall keep a separate account" . . . and section 6, "the Board of Commissioners of Madison County shall keep a separate account"; in section 8 "the board of audit are authorized, empowered, and directed to do their work"; section 15, "the treasurer of the (595) county shall pay the interest."
It is true that these words are usually in connection with the terms "bonds hereby authorized," but they serve to throw some light on the legislative intent, and to sustain the position that "authorize and empower," in the first three sections of the act, should receive their usual statutory acceptation. But this matter, we think, is conclusively set at rest by the language of section 11, and it is under this section that the plaintiff is now seeking to enforce his right. This section is as follows: "That if any creditor of the said county, whose debts or claims come within the meaning of this act, or any holder of any bond or bonds of said county, shall desire to exchange his bond or bonds and coupons, or other evidence or evidences of said indebtedness belonging to him, for one or more bonds hereby authorized, it shall be the duty of the said commissioners to pay off said creditor or creditors, and liquidate the said
indebtedness in the bonds authorized by this act, exchanging said bonds at their par value and canceling the evidences of indebtedness taken in lieu thereof."
The very reason of the rule of construction here adopted, given in many of the decisions, is that, where power is given in legislation of this character, a corresponding duty is imposed on the authorities to give the statute effect. The section here quoted, in express terms, imposes the duty which the creditor seeks to enforce. "Where the creditor desires to exchange his bonds or debt for bonds hereby authorized, and is willing to make the exchange at par, it shall be the duty of the commissioners to make the exchange."
On authority, and in consideration of the general purpose of the statute, and in view of its several provisions, we do not hesitate to declare that the act is mandatory in its force and effect, and was so intended by the Legislature.
(596) On the third question: Had the Legislature power to pass the act? The authorities are equally pronounced in favor of the plaintiff. We do not understand that the former opinion holds that the act is not within the legislative power. There is an intimation to that effect, however, and, as the present opinion will result in the enforcement of the statute, it is necessary to decide the question.
These counties are not, strictly speaking, municipal corporations at all in the ordinary acceptation of the term. They have many of the features of such corporations, but they are usually termed quasi- public corporations. In the exercise of ordinary governmental functions, they are simply agencies of the State, constituted for the convenience of local administration in certain portions of the State's territory, and in the exercise of such functions they are subject to almost unlimited legislative control, except where this power is restricted by constitutional provision. In Hamilton v. Mighels, 7 Ohio St. 109, it is said: "Counties are, at most, but local organizations, which, for purposes of civil administration, are invested with a few functions characteristic of corporate existence. They are local subdivisions of the State, created by the sovereign power of the State of its own sovereign will, without particular solicitation, consent, or concurrent action of the people who inhabit them." Again it is said: "A county organization is created, almost exclusively with a view to the policy of the State at large, for purposes of political organization and civil administration in matters of finance, of education, of provision for the poor, of military organizations, of the means of travel and transfer, and especially for the general administration of justice." "With scarcely an exception, all the powers and functions of the county organizations have a direct and exclusive reference to the general policy
of the State, and are in fact but a branch of the general administration of that policy." These statements are quoted with approval in 1 Dillon on Mun. Corp., sec. 23; Smith's Law on Mun. Corp., Vol. (597) I, sec. 10, and are sustained by a line of authorities unbroken, so far as we have been able to discover. People v. Flagg, 46 N.Y. 401;Galveston v. Pomainski, 62 Tex. 118; Philadelphia v. Fox, 64 Pa., 160;Locomotive Co. v. Emigrant Co., 164 U.S. 559, 576. Nowhere has this doctrine been more consistently adhered to than by our own Supreme Court,Mills v. Williams, 33 N.C. 558; Wallace v. Trustees, 84 N.C. 164; Whitev. Comrs. 90 N.C. 437; Tate v. Comrs., 122 N.C. 812; Mial v. Ellington,134 N.C. 131.
It will be borne in mind that we are speaking of the power of the Legislature in matters governmental. We are not asserting the right of the Legislature to compel a county to create a debt in aid of a private enterprise, nor for purposes of strictly local benefit and advantage. InPark Comrs. v. Detroit, 28 Mich. 222, it was held that the Legislature could not compel the city authorities to contract a large debt in purchasing a park, and in People v. Batchelor, 53 N.Y. 128, it was held that the Legislature had no power to compel a town to subscribe to a railroad owned and controlled by private stockholders and operated for their own advantage. These decisions were in relation to towns, in regard to which the power of the Legislature is usually more restricted, but as to counties also, they can, we think, be sustained by reason and authority.
This limitation of legislative power is not a debatable question in this State. It has been written into our organic law. In Art. VII, sec. 7, of the Constitution, it is provided that no county, city, town, or other municipal corporation shall contract any debt, pledge its faith, or loan its credit, nor shall any tax be levied or collected by any officer of the same, except for the necessary expenses thereof, unless by vote of a majority of the qualified voters therein. This section was (598) no doubt put in our Constitution because of the undefined and well-nigh unlimited power of the Legislature, which existed at the time of its adoption, and it has been altered or repealed. It will be noted that debts for necessary expenses are expressly excepted from this article of the Constitution, and all the debts which are the subject-matter of the statute now in question are of this character. It is not sought here to force the county to create a debt of any kind. These debts had already been created, and were outstanding and drawing interest at 6 per cent when this statute was passed. The current rate of taxation is not sufficient to pay them in full, and the statute, as heretofore stated, presents a comprehensive, carefully prepared, and feasible plan to fund the debt at
a lower rate of interest, and restore the county finances to a satisfactory condition. As here stated, this power of the Legislature over counties is fully sustained in Tate v. Comrs., 122 N.C. 812, and is nowhere more forcibly and tersely expressed. This was an action to compel the commissioners of Haywood County to put in force a legislative enactment requiring the county authorities to work their roads by taxation. And there was a judgment compelling the commissioners to put the law in operation. This authority is cited in the former opinion of the Court on the present case, and the distinction made between that and the case before us is that the making of roads was a governmental function; but we do not think the cases can be so distinguished. What are these debts to which this statute is addressed? They are all debts for necessary expenses. And what does this term import? They involve and include the support of the aged and infirm, the laying out and repair of public highways, the construction of bridges, the maintenance of the public peace, and administration of public justice — expenses to enable (599) the county to carry on the work for which it was organized and given a portion of the State's sovereignty. To say that the Legislature has no control in such matters would enable the county authorities, of their own will, to stay all governmental action in their locality, and entirely defeat the purposes for which they were created. This is one of the reasons, no doubt, why necessary expenses were excepted from the article of the Constitution just quoted. The exception was partly made because it would be impracticable to refer all of these current expenses to popular approval; but an equally important reason was that local authority should not be withdrawn from all legislative supervision and control.
It has been suggested that, while the Legislature might compel the laying of taxes, its power does not extend to the issuing of bonds, but we do not think this position sound, or that any such distinction exists. This method of adjusting debts which counties have lawfully created is not at all unusual. It was commended in Johnson v. Comrs., 67 N.C. 101, and expressly sanctioned in Jefferson County v. People, 5 Neb. 136; Comrs. v.City, 45 Ala. 399; Cooley on Taxation (3 Ed.), Vol. II, pp. 1300, 1301.
Again, it is contended that, while the power to the extent claimed may exist in other jurisdictions, it cannot obtain here, where the officers and agents who carry on the county government are given a place in our Constitution and their existence thereby secured. As we apprehend this position, it is argued that the very fact that these officers are so placed manifests a purpose to give them exclusive or much larger power in the management and control of local affairs. Some expressions to this effect
have found their way into a few of our decisions, notably, Brodnax v.Groom, 64 N.C. 244, and Cromartie v. Comrs., 87 N.C. 134. It will be noted that in these cases the Court was passing on the rights of the courts to interfere with the action of the commissioners, and (600) the question of legislative power was not at all before them, and any such effect from these intimations is expressly repudiated and condemned in Tate v. Comrs., supra. Even under our Constitution, as it originally existed, we do not think the position here contended for could be maintained. True, these offices were there created, and as the instrument then stood they could not be changed or destroyed; but what such officers, as agents of the State, could or could not be compelled to do was not stated in matters to which this discussion is addressed. However this may have formerly been, the position cannot be for one moment sustained under the Constitution as it now stands.
In 1875 the article in reference to counties was amended. For grave and weighty reasons, the people then added to their Constitution section 14 of Article VII, and it was there provided as follows:
"Section 14. The General Assembly shall have power by statute to modify, change, or abrogate any and all of the provisions of this article, and substitute others in their place, except sections 7, 9 and 13."
Section 7 is the one already quoted, and from its effect debts for necessary expenses are expressly excluded. Section 9 stipulates in general terms, that taxation shall be uniform and ad valorem. Section 13 prohibits the payment of debts contracted in aid of the Confederate Government. Neither of these exceptions in any way affects the question now before us, and by the provisions of this amendment the power of the Legislature to supervise and control the action of county officers in governmental matters is fully restored, even if it had ever been withdrawn.
While the Court has every disposition to uphold the principle of local self-government, the history of this transaction, as shown in the record, is in itself almost a demonstration that it is not amiss, and at times altogether desirable, to have a supervising representative authority with power and disposition to intervene when local officers (601) have failed and refused to perform their official duties.
We declare our opinion to be that the court below had jurisdiction; second, that the act in question is mandatory; third, that the Legislature had power to pass the act; and fourth, that the remedy sought is the proper remedy.
Let this opinion be certified, to the end that the judgment of the Superior Court be affirmed and that process issue to enforce its provisions.
Petition allowed.