Krebs v. Thompson

56 N.E.2d 761, 387 Ill. 471
CourtIllinois Supreme Court
DecidedSeptember 19, 1944
DocketNo. 27961. Decree affirmed.
StatusPublished
Cited by60 cases

This text of 56 N.E.2d 761 (Krebs v. Thompson) is published on Counsel Stack Legal Research, covering Illinois Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Krebs v. Thompson, 56 N.E.2d 761, 387 Ill. 471 (Ill. 1944).

Opinions

Mr. Justice Smith

delivered the opinion of the court:

This is a direct appeal from a decree of the circuit court of Sangamon county. The suit was brought by appellee as a taxpayer, under Illinois Revised Statutes 1943, chap. 102, par. 11. Its purpose was to enjoin the Director of Registration and Education, the Director of Finance, the Auditor of Public Accounts and the State Treasurer from expending any funds of the State for the administration of an act entitled, “An Act to regulate the practice of professional engineering.” (Ill. Rev. Stat. 1943, chap. 48y2.) By the complaint the validity of the act was challenged on several grounds. The trial court overruled a motion of appellants to dismiss the suit. Appellants stood by this motion. The court entered a decree granting a permanent injunction, as prayed. The appeal has been perfected to this court by the above-named State officials and an intervening appellant.

It will be necessary to first dispose of appellants’ contention that appellee, as a taxpayer, cannot maintain the suit. Appellee bases his right to prosecute the suit on the sole ground of his status as a taxpayer. He does not claim that he will be subject to the provisions of the act, or affected by its provisions, except as a taxpayer.

To appellants’ motion to dismiss, certain affidavits were attached. Those affidavits tended to show that, in the opinion of the appellants, the act, from a financial standpoint, will be self-sustaining. That is, that the fees paid in by registrants under the act will exceed the cost of administering the act. In one of these affidavits, made by the Superintendent of Registration in the Department of Registration and Education, it was estimated that the number of registrants under the act would be approximately five thousand; that the cost of administering the act would not exceed $11,000. Presumably, this estimate refers to the annual cost. No counter affidavits were filed. He'nce the affidavits, in so far as material, must be accepted as true. By section 27 of the act each applicant for registration is required to pay a fee of $20.

It has long been the settled rule in Illinois that the expenditure of public funds by an officer of the State, for the purpose of administering an unconstitutional act, constitutes a misapplication of such funds. It is equally well settled that a taxpayer may maintain an action to enjoin the expenditure of public funds for such purpose. Reid v. Smith, 375 Ill. 147; Fergus v. Russel, 270 Ill. 304; Burke v. Snively, 208 Ill. 328.

• Appellants do not challenge this rule. They deny its application to this case. The basis on which this rule is founded is that the taxpayers are the equitable owners of State funds; that such taxpayers are injured by the misapplication of such funds; that an expenditure of public funds in pursuance, of an unconstitutional statute is a misapplication of the funds, which may be restrained at the suit of a taxpayer. Fergus v. Russel, 270 Ill. 304; Jones v. O’Connell, 266 Ill. 443; Dudick v. Baumann, 349 Ill. 46.

The challenge of appellants to the right of appellee to maintain this suit as a taxpayer is based upon a novel and ingenious argument. The argument is that the fees paid by applicants for registration under the act will exceed the cost of administering the act and will result in a net profit to the State. From this premise it is argued that a taxpayer cannot be injured because he has no interest in the fees paid under the act; that such fees are not tax money and hence the taxpayer has no interest in the funds.' The argument presupposes that in the administration of the act the fees paid by the applicants for registration do not belong to the State until .the administration expenses have been deducted and that the ownership of the State attaches only to the net balance, after the payment of operating costs. We do not think * this argument is sound. The source from which the funds expended in the administration of the act are derived is not .material. All of the funds, regardless of their source, belong to the State. Section 27 of the act (Ill. Rev. Stat. 1943, chap. 48^2, par. 27,) fixes the fees to be paid by applicants for registration. These fees belong to the State. The administration of the act is committed to the Department of Registration and Education. By section 2 of an act in relation to the payment of public money of the State into the State Treasury (Ill. Rev. Stat. 1943, chap. 127, par. 171,) every department or agency of the State is required to pay to the State Treasurer the gross amount of all money received, not later than the day following its receipt. All moneys so paid into the State Treasury, unless the statute requires such money to be paid into a special fund, or such funds are paid under protest in accordance with section 2a of that act (Ill. Rev. Stat. 1943, chap. 127, par. 172,) immediately become a part of the general revenue funds of the State. In view of this statute it would be the duty of the Director of the Department of Registration and Education to pay into the State Treasury all funds received from applicants for registration. Under this statute, such funds constitute a part of the general revenue funds of the State. People ex rel. Barrett v. Bradford, 372 Ill. 63; Chicago Board of Trade v. Cowen, 252 Ill. 554; Whittemore v. People, 227 Ill. 453.

The departments of the State Government are not operated on a net profit basis. All the funds received by them must be covered into the State Treasury. The cost of administering the act will not be paid, in any event, out of the revenues derived therefrom. Such costs can only be paid out of the general funds in the State Treasury, in accordance with appropriations made for that purpose. (Const, art. IV, sec. 17.) All funds expended for the administration of the act belong to the State and constitute a part of the general revenues of the State.

The argument that a taxpayer has no interest in the funds for the reason that the revenues produced by the act will exceed the cost of administering its provisions must necessarily fall of its own weight. The showing of appellants by the affidavits attached to their motion to dismiss is that there will be an estimated administration expense of $11,000. This can be paid only out of the general funds of the State. The expenditure of this or any other amount from the general funds of the State for the purpose of administering an unconstitutional statute is such an injury to every taxpayer that he may bring a suit to enjoin such unlawful expenditure and misapplication of the funds of the State. The fact that an equal or greater amount than the amount expended for the administration of the act will be ultimately produced from fees paid under the act, and paid into the State Treasury, has nothing whatever to do with the right of a taxpayer to enjoin the misapplication of public funds for the administration of the act, if it is not a valid statute. Under the settled rule in this State, every taxpayer is injured by the misapplication of public funds, whether the amount be great or small. Such injury is not prevented by the fact that the State may thereafter receive fees under an unconstitutional statute in excess of the cost of its administration.

Under the averments of the complaint, which was sworn to, and which averments were admitted by the motion to dismiss, appellee clearly had the right to maintain the action to prevent what was alleged would constitute a misapplication of State funds.

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Bluebook (online)
56 N.E.2d 761, 387 Ill. 471, Counsel Stack Legal Research, https://law.counselstack.com/opinion/krebs-v-thompson-ill-1944.