Town of East Spencer v. Rowan County

212 N.C. 425

• Court: Supreme Court of North Carolina
• Decided: November 24, 1937
• Status: Published

Opinion

CoNNOB, J.

The town of East Spencer in Eowan County, North Carolina, is a municipal corporation. It was incorporated by ch. 74, Private Laws of North Carolina, 1901. Provisions are made therein for the government of said town. Its corporate limits are defined by section 2 of said chapter. Sections 21 and 22 of said chapter are as follows:

“Sec. 21. The town of East Spencer and within a radius of one-half mile or less from the corporate limits of said town, east of the railroad, shall constitute a public school district, and the proper county authorities who have the right to lay off school districts and establish school districts shall proceed at once to establish a free public school district by the name of East Spencer District, for the school children of said district, and the proper authorities as provided by law shall apportion, appropriate and set aside for this district all the school funds it may be entitled to and appoint school committees to take charge, look after and proceed to erect, equip, and construct a public schoolhouse for the white children of said town, with whatever aid and donations they may be able to get, and said school shall be proceeded with as early as possible, and be in operation not later than the fall term of public schools of .that year. The board of aldermen of said town shall apply all its school taxes collected from the property in said town toward this school.”

“Sec. 22. The board of aldermen of said town shall have the right to borrow a sum not exceeding one thousand dollars for the purpose of this school, aid in erecting a schoolhouse, building a town hall or mayor’s office, repairing the streets of said town, and may pledge the faith and credit of said town to secure the same, and execute a note or bond in the name of the town, signed by the mayor thereof, with the seal of said town, and attested by the tax collector of said town. That said note or bond shall be valid and legal in every respect in the hands of a bona fide holder thereof.”

After the organization of the town of East Spencer' as a municipal corporation, created by ch. 74, Private Laws of North Carolina 1901, the said chapter was amended by the General Assembly by eh. 15, Private Laws of North Carolina, Extra Session 1920. By said amendment the town of East Spencer was authorized, through its governing body, to issue its bonds in tbe sum of not less than one hundred and twenty-five thousand ($125,000) dollars. It was provided that if said bonds were issued as authorized by the General Assembly, bonds aggregating not to exceed the sum of eighty thousand ($80,000) dollars should be designated as “Sewerage Bonds,” and that the proceeds of said bonds, when sold, should be used by said town exclusively for the purpose of constructing and installing in said town a system of sewerage, and that bonds not exceeding the sum of forty-five thousand ($45,000) dollars should be designated as “School Bonds,” and that proceeds of said bonds, when sold, should be used by said town exclusively for the purpose of building, equipping, furnishing, and maintaining in said town public schools in which tuition for children of both races in said town should be free.

It does not appear from the record in this appeal that any bonds authorized by the General Assembly by ch. 15 of Private Laws of North Carolina, Extra Session 1920, were issued and sold by the town of East Spencer. It does appear, however, from recitals in the preamble of ch. 22, Private Laws of North Carolina 1921, that a bond ordinance passed by the governing body of the town of East Spencer as authorized by the Municipal Finance Act, 1921, was approved by a majority of the qualified voters of said town at an election held therein on 23 May, 1921. The said bond ordinance authorized the issuance by the governing body of the town of East Spencer of its bonds in the sum of $60,000 for school purposes and the levying of a tax on the property in said town to pay said bonds, when sold, as they should become due. The bonds authorized by said ordinance, and the election held approving 'the said ordinance and the issuance of said bonds, were validated by ch. 22, Private Laws of North Carolina 1921. These bonds were issued and sold by the town of East Spencer. The proceeds of these bonds, aggregating the sum of $60,000, were used by the town of East Spencer for the construction of schoolhouses in said town and the equipment of said schoolhouses for school purposes. These are the bonds which are involved in this action.

After the construction of said schoolhouses and the purchase of equipment for said schoolhouses by the town of East Spencer, ch. 10, Private Laws of North Carolina 1923, was enacted by the General Assembly of this State. By said chapter, sec. 21 of ch. 74, Private Laws of North Carolina 1901, was stricken from said chapter and the following was inserted in lieu thereof:

“The board of aldermen of the town of East Spencer shall elect and appoint school committees for the respective public or graded schools within said town, and the school committee shall have charge of said schools, the buildings belonging to said schools, the power to elect teachers, and Lave general supervision over all school property witbin said town, and that all school funds, either State, county, or city, going to or belonging to the schools of said town, which is District Number Eight, shall be paid to the treasurer of said town, and said treasurer shall disburse all school funds for school purposes on warrants issued or to be issued by the school committee of said town; and the Board of Education of Eowan County and the superintendent of public instruction of said county are hereby directed and authorized to turn over to the treasurer of said town all school funds belonging to or going to the school districts of said town.”

By virtue of ch. 70, Private Laws of North Carolina 1923, the school district known as East Spencer District in Eowan County, which was established by sec. 21, of ch. 74, Private Laws of North Carolina 1901, and whose boundaries are practically coterminous with the corporate limits of the town of East Spencer, a municipal corporation, became a special charter district of Eowan County, as defined by sec. 3, of ch. 136, Public Laws of North Carolina 1923, N C. Code of 1935, sec. 5387. Since the enactment of said ch. 70, Private Laws of North Carolina 1923, the schools of said district have been under the exclusive control and supervision of the school committee elected or appointed by the board of aldermen of the town of East Spencer. The school buildings now located in said district were constructed by the said school committee, without the approval of the Board of Education or the Board of Commissioners of Eowan County. The indebtedness incurred by the town of East Spencer for the construction and equipment of said buildings was incurred without the approval of either the said board of education or the said board of commissioners. The said indebtedness is not the indebtedness of Eowan County, but is the indebtedness of the town of East Spencer, lawfully incurred by said town, with the approval of the General Assembly of this State and of a majority of the qualified voters of said town of East Spencer.

Prior to the construction of the schoolhouses in the town of East Spencer, which were required for the operation of public schools in said town, the mayor of East Spencer appeared before the Board of Education of Eowan County and demanded that said board and the Board of Commissioners of Eowan County construct in said town school buildings reasonably necessary for the maintenance and operation of schools in said town for a minimum term of six months. This demand was refused, and properly so. The General Assembly, by the enactment of ch. 70, Private Laws of North Carolina 1923, had relieved both said boards of any duty with respect to the schools in the town of East Spencer, and had deprived the said boards of any power or jurisdiction over said schools. Sec. 30, of ch. 136, Public Laws of North Carolina 1923. N. C. Code of 1935. sec. 5430.

Tbe power of tbe Board of Education of Rowan County, witb respect to tbe bonded indebtedness of tbe town of East Spencer at tbe date of tbe commencement of tbis action, is conferred by statute, wbicb is as follows:

“Tbe county board of education, witb tbe approval of tbe board of commissioners, may include in tbe debt service fund in tbe budget (i.e., tbe May budget, wbicb tbe board is required by statute to prepare each year. See N. C. Code of 1935, sec. 5596), tbe indebtedness of all districts, including special charter districts, lawfully incurred in erecting and equipping school buildings necessary for tbe six months school term, and when such indebtedness is taken over for payment by tbe county as a whole, and tbe local districts are relieved of their annual payments, then tbe county funds provided for such purpose shall be deducted from tbe debt service fund prior to tbe division of tbis fund among tbe schools of tbe county as provided in tbis section.” N. C. Code of 1935, sec. 5599.

By virtue of tbe provisions of tbis statute tbe defendant tbe Board of Education of Rowan County, witb tbe approval of tbe defendant the Board of Commissioners of Rowan County, bad tbe power to include in tbe debt service fund in its May budget of any year prior to tbe commencement of tbis action tbe indebtedness of tbe town of East Spencer, as a special charter district of Rowan County, in tbe sum of $44,000, and evidenced by its bonds, wbicb was lawfully incurred by said town in erecting and equipping school buildings in said town necessary for tbe maintenance and operation in said town of schools for a minimum term of six months during each year, and thereby assume tbe payment of tbe said indebtedness as an obligation of Rowan County, witb tbe result that the property in said town would be relieved of taxes for tbe payment of said indebtedness.

It is expressly provided in said statute that tbe power conferred thereby on tbe board of education of a county in tbis State, witb respect to tbe assumption of tbe indebtedness of a district of tbe county, shall be exercised by said board in its discretion. When tbe board of education of a county has, in tbe exercise of its discretion, under tbe provisions of tbe statute, assumed tbe indebtedness of a district of tbe county, such assumption is valid, and will be enforced by tbe courts of tbis State. It was so held by tbis Court in Marshburn v. Brown, 210 N. C., 331, 186 S. E., 265. In tbe opinion in that case it is said:

“It is tbe mandate of tbe Constitution of tbis State that tbe General Assembly shall provide by taxation and otherwise for a general and uniform system of public schools wherein tuition shall be free of charge to all children of tbe State between tbe ages of six and twenty-one years. This constitutional mandate contemplates that tbe system of public schools which it is the duty of the General Assembly to provide for all the children of the State shall be a State system, to the end that every child in the State between the ages of six and twenty-one years, without regard to the county in which such child shall reside, shall have an opportunity, at least, to attend a school in which standards set up by the State are maintained. When provision has been made by the General Assembly for a State system of public schools, as contemplated by the Constitution, it is the duty of the board of county commissioners of each county in the State to maintain in each school district in its county one or more schools for a term of at least six months in each year. Adequate buildings and equipment are manifestly required for the maintenance and operation of these schools. N. C. Code of 1935, sec. 5467. It is, therefore, the duty of the board of county Commissioners of each county in the State to provide for the construction and equipment of adequate school buildings in each district of its county. When, for any reason, the board of county commissioners of a county has failed to perform this duty, and the buildings and equipment necessary for the maintenance and operation of schools for the minimum term required by the Constitution have been provided by the district by the issuance of bonds or otherwise by statutory authority, the board of commissioners, at the request of the board of education of the county, may assume the indebtedness of the district and thereby relieve the district of the burden of such indebtedness. In such case the board of county commissioners is performing the duty which the Constitution imposes upon said board in the first instance. In Reeves v. Board of Education, 204 N. C., 74, 167 S. E., 454, it is said: ‘There is no sound reason why a school district should have to pay out of its own taxable property a debt which the Constitution and the laws of the State impose upon the county. The authority for the assumption by the county of the bonded debt of the various school districts is contained in sec. 6, ch. 180, Public Laws 1925, as amended by ch. 239, secs. 4 and 5, Public Laws 1927, N. C. Code of 1935 (Michie), sec." 5599.’ ”

While, ordinarily, the question as to whether the board of education of a county shall assume the indebtedness of a district, under the provisions of the statute, is addressed to the discretion of the board, and may be answered by the board in the exercise of its sound discretion, after a consideration of all the fa,cts involved, there have been and doubtless will be cases in which the board is required to assume the indebtedness of a district, without the exercise of any discretion. In such cases the district has a clear legál right to the assumption by the board of its indebtedness, which may be enforced by a writ of mandamus. Thus in School District v. Alamance County, 211 N. C., 213, 189 S. E., 873, where a special charter district in Alamance County had lawfully incurred an indebtedness for tbe purpose of constructing and equipping schoolbouses in tbe district, wbicb were reasonably necessary for tbe maintenance and operation within tbe district of schools for a minimum term of six months during each year, and tbe Board of Education of Alamance County bad assumed the indebtedness of other districts in said county, lawfully incurred for tbe said purpose, it was held by this Court that tbe Board of Education of Alamance County could not rightfully or legally refuse to assume tbe indebtedness of tbe special charter district, and that tbe district was entitled to a writ of mandamus to enforce such assumption. Tbe judgment of tbe Superior Court in that case was affirmed, on tbe authority of Hickory v. Catatwba County, 206 N. C., 165, 173 S. E., 156. In tbe opinion by Clarkson, J., it is said:

“On this record it appears that tbe county of Alamance has assumed every school debt of every school district in tbe county except tbe debts of tbe special charter districts of Mebane, Haw River, Graham, and Burlington. Having assumed some, we think it mandatory on tbe county commissioners to assume all if the Mebane district buildings, sites and equipment are necessary for tbe conduct of tbe constitutional school terms.”

Tbe decisions of this Court in School District v. Alamance County and in Hickory v. Catawba County support tbe contention of tbe defendants in tbe instant ease that in the absence of an assumption by tbe defendants of tbe indebtedness of any district of Rowan County, tbe refusal of tbe defendants to assume tbe indebtedness of the plaintiff, although such indebtedness was incurred for tbe construction and equipment of schoolbouses wbicb were necessary for the maintenance and operation of schools in said district for a minimum term of six months during each year, cannot be reviewed by tbe courts for tbe reason that such refusal was tbe result of an exercise by tbe defendants of tbe discretion vested in them by statute.

At tbe trial of this case tbe jury has not found by an answer to an appropriate issue submitted by tbe court, nor has tbe court found, with tbe consent of tbe plaintiff and tbe defendants, that tbe defendants have assumed tbe indebtedness of any district of Rowan County wbicb was lawfully incurred by such district for tbe construction and equipment of schoolbouses reasonably required for tbe maintenance and operation of schools in said district for a minimum term of six months during each year. Tbe finding by tbe court, with tbe consent of plaintiff and defendants, that tbe defendant tbe Board of Education of Rowan County has, from time to time, appropriated and paid to certain districts in Rowan County sums of money to aid such districts in tbe construction and equipment of schoolbouses in said district, or as partial payments on' the indebtedness of such districts, is not a finding that said board of education bas assumed tbe indebtedness of said districts or any part thereof. Such appropriations and payments were made under statutory authority, and in the exercise of discretion vested by statute in the Board of Education of Eowan County. In the absence of an assumption by the defendants of the indebtedness of any district in Eowan County, the discretion vested by statute in the board of education of said county, with respect to the assumption by said board of the indebtedness of any district of the county, remains in said board. For this reason there is error in the judgment of the Superior Court in this case.

The judgment is reversed to the end that the action may be dismissed.

Eeversed.