State Note Board v. State Ex Rel. Attorney General

54 S.W.2d 696, 186 Ark. 605, 1932 Ark. LEXIS 391
CourtSupreme Court of Arkansas
DecidedDecember 5, 1932
Docket4-2882
StatusPublished
Cited by10 cases

This text of 54 S.W.2d 696 (State Note Board v. State Ex Rel. Attorney General) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State Note Board v. State Ex Rel. Attorney General, 54 S.W.2d 696, 186 Ark. 605, 1932 Ark. LEXIS 391 (Ark. 1932).

Opinion

Thomas C. Trimble, Jr.,

Special Justice. Appellee, State of Arkansas, through her Attorney General, filed suit against the State Note Board, attacking as unconstitutional § 17 of act No. 15, passed at the second extraordinary session of the Legislature of 1932, the same being in words and figures as follows, to-wit:

“ Section 17. It shall be the duty of the State Note Board to issue short-term notes in lieu of all legal vouchers or warrants now or hereafter issued for work, labor, materials, or supplies, heretofore done or furnished by any contractor, subcontractor, materialman or laborer in the construction, maintenance or repair of the State Highways or for the State Highway Department upon request being made therefor by the legal holder or holders of any such obligations; such short-term notes to be in substantially the form of the short-term notes heretofore sold by said State Note Board for the State Highway Commission and executed in the same manner, bearing-interest at the rate of 5 per cent, per annum from the date of issuance, and not more than $750,000 worth of snch notes shall mature on February 1, 1934, and the maturities of the balance thereof shall be equally divided, one-half to mature on February 1, 1935, and one-half to mature on February 1,1936. The State Note Board shall use its discretion in arranging the maturity dates of the various notes issued so that any of such legal holders of said obligations shall not be given preference as to the maturity date of the notes issued to him. Said short-term notes shall be in denominations of $100, $500 and $1,000, and, if the amount due any of the legal holders of such obligations is less than the amount which can he paid by notes of those denominations, then such legal holder may pay the difference in cash and receive such note, or he may take from the State Highway Commission a voucher showing the balance that is due him and which cannot be paid in notes of that description, and which voucher shall be paid as soon as there shall be in the State Highway funds moneys available for the purpose; provided, this act shall not validate any claim, voucher, or warrant or other evidence of indebtedness issued under or pursuant to an illegal contract, and provided further that no note or notes shall be issued in lieu of any such claim in excess of $150, where such claim is based on a cost-plus contract or a contract not let on competitive bidding until such claim is approved and the issuance of such notes are authorized by the State Highway Audit Commission, or until the validity of such claim is finally adjudicated and determined by a court of competent jurisdiction. No additional highway bonds or highway notes shall be authorized, issued or sold in the calendar year of 1932, except those highway notes provided for in this section of this act to be issued in lieu of legal vouchers or warrants for work, labor, material or supplies heretofore done or furnished by any contractor, subcontractor, laborer or materialman in the construction, maintenance or repair of the State Highways, or for the State Highway Department, and not more than $1,750,000 worth of highway bonds shall be issued in the calendar year of 1933 or in any calendar year thereafter, this being the approximate amount necessary to match Federal aid and thereby prevent the loss of such aid; and no highway bonds shall hereafter be issued except with the approval of a majority of the State Note Board including the Governor, or with the approval of at least seven members of the State Note Board, nor shall any highway bonds be issued in any year in excess of the amount of Federal aid allotted to Arkansas under Acts of Congress for that particular year. No bonds or other evidences of indebtedness shall ever be sold under the provisions of this act for less than par.”

The ground upon which the validity of the statute was assailed being that said section was not within the purview of the Governor’s proclamation convening the General Assembly, and asking that the State Note Board, which met and adopted resolutions for the issuance of $2,100,000 in short-term State notes as provided under said section of said act No. 15, be forever enjoined and restrained from causing the printing or lithographing of said State notes and from issuing the same.

Appellant demurred to the complaint because it did not state a cause of action, and that the appellee was not entitled to the relief prayed for, and that the said State Note Board was acting within its authority in issuing the notes mentioned in the complaint.

The demurrer to the complaint was overruled, and the appellant elected to stand on its demurrer, and a decree was rendered perpetually enjoining the board from issuing said short-term notes.

The sole question involved is whether or not the provisions of § 17 of said act are reasonably within the purposes specified within the Governor’s call.

The Constitution of 1874, in reference to extraordinary sessions of the General Assembly, contains the following provisions, to-wit: “The Governor may, by proclamation, on extraordinary occasion convene the General Assembly at the seat of government or at a different place, if that shall have become, since their last adjournment, dangerous from any enemy or contagions disease, and lie shall specify in Ms proclamation the purposes for which they are convened, and no other business than that set forth therein shall be transacted until the same shall have been disposed of, after which they may, by vote of two-thirds of all the members elected to both houses, entered upon their journals, remain in session not exceeding fifteen days.”

The General Assembly of the State of Arkansas convened in special session on March 15, 1932, by proclamation of the Governor of the State of Arkansas, same having been issued on March 12, 1932, that part of the call affecting this suit being as follows, to-wit:

“First. To authorize the issuance of revenue bonds that will bring about an extension of the maturity dates of the road district bonds which the State is now paying under the Martineau road law and thereby prevent a default in the payment of such bonds, and render available sufficient funds for the maintenance of the State Highways and for matching Federal aid for new construction. ’ ’

As will be observed from the proclamation of the Governor, and the act passed by the General Assembly, said call was made for the following reasons: First, to prevent a default in the payment of the road district bonds which the State was paying under the Martineau road law. Second, to render available sufficient funds for the maintenance of the State Highways. Third, to render available sufficient funds for matching Federal aid for new construction.

All of the above subjects are so closely connected and dependent upon each other that no one of them can be entirely segregated from the whole and treated by itself. Act No. 15 embraced all of the subjects and made provisions for each.

The rule announced in decisions of this court, in the cases of Jones v. State, 154 Ark. 288, 242 S. W. 377, and Sims v. Weldon, 165 Ark. 18, 263 S. W.

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Bluebook (online)
54 S.W.2d 696, 186 Ark. 605, 1932 Ark. LEXIS 391, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-note-board-v-state-ex-rel-attorney-general-ark-1932.