Case Name: SCHOOL DIRECTORS v. CITY OF ASHEVILLE
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1905-03-21
Citations: 137 N.C. 503
Docket Number: 
Parties: SCHOOL DIRECTORS v. CITY OF ASHEVILLE.
Judges: 
Reporter: North Carolina Reports
Volume: 137
Pages: 503–513

Head Matter:
SCHOOL DIRECTORS v. CITY OF ASHEVILLE.
(Filed March 21, 1905).
Law of {he Gase — Practice of Supreme Gourt — Fines—Ordinances — Statute of Limitations.
1. Where no rights of property have become vested or change made in the status of the parties by reason of a ruling at some former stage of the litigation, a court should not be concluded under the doctrine of “the law of the ease” from reviewing itself and correcting its errors, and especially is this true in a case involving the construction of the Constitution.
2. When questions of law have been considered, and decided, the Court will not re-examine the questions and reverse its former decision, unless -it clearly appears that it is erroneous.
3. The Legislature has no power to appropriate to a town or city all or any part of the fines imposed upon conviction of misdemeanors committed by violating its ordinances, but under Article IX, sec. 5, of the Constitution, such fines belong to the genera] school fund of the county.
4. A city or town cannot be called upon to account for fines collected beyond two years. Board v. Greenville, 132 N. C., 4, approved.
ActioN by County Board of School Directors against the City of Asheville, heard by Judge M. R. Justice, at the September Term, 1904, of the Superior Court of BunCOMBE County. From a judgment in favor of the plaintiff, the defendant appealed.
Loche Craig and J. D. Murphy, for the plaintiff.
Davidson, Bourne & Parker, for the defendant.

Opinion:
Connor, J.
This action was before ns upon complaint and demurrer at February Term, 1901 (128 N. C., 249). It was then decided that the plaintiff was entitled to maintain the action for the recovery of the fines collectéd by the defendant in the manner set forth in the complaint. The cause was thereupon referred for the purpose of ascertaining the amount of fines collected, etc. Upon the filing of the report the plaintiff moved for judgment for the amount found to be due by the referee. Defendant resisted the motion, etc. Judgment was rendered as set forth in the record. Defendant excepted and appealed. The defendant's counsel in their well considered brief thus states its contention: "This appeal involves the power of the Legislature of North Carolina to appropriate all or any part of its fines — as distinguished from penalties — arising from the violation of the ordinances of the city of Asheville, to said city," etc. The appellant also insists that each fine as collected by the city is properly the subject of a separate action and that notice should have been given of each claim before suit brought. That it appearing that each fine was less than $200, the Superior Court had no jurisdiction, etc. The plaintiff contends that the question presented upon this appeal has been expressly decided in this cause as reported in 128 N. C., 249; that the decision therein rendered is the "law of the case" and not open to further litigation. It is not contended that any such judgment has been rendered in the cause as will work an estoppel of record, or bring the case within the operation of the principles of res judicata. That a final judgment rendered upon a demurrer which is directed to and involves the merits of the controversy works an estoppel upon parties and privies is settled by several decisions of this Court. The principle is thus stated in 6 Enc. PI. and Pr., 356: "When a demurrer goes to the merits of the action, judgment sustaining it is conclusive upon the parties and will bar another action for the same cause, but when it goes only to matters of form it does not have this effect." Johnson v. Pate, 90 N. C., 334; Willoughby v. Stevens, 132 N. C., 254. We are not prepared to hold that in this or a similar case, we may not, before final judgment, review our former decision upon a demurrer and if found erroneous, correct our mistake. The limitations by which courts of appeal are bound by "the law of .the case" are not clearly defined. Certainly when no rights of property have become vested or change made in the status of the parties by reason of a ruling at some former stage of the litigation, a court should not be concluded from reviewing itself and correcting its errors. While we think this the correct view in any case, there would seem to be no doubt of our duty in a case involving the construction of the Constitution. No one can have a vested right in the decision of a constitutional question. We cannot very well see how the Supreme Court can, before tbe case bas gone to final judgment, be estopped by "tbe law of tbe case" to discharge its duty to declare tbe law. A very different question is presented when a final judgment bas been rendered and tbe case bas passed beyond its control. Tbe principle upon wbicb tbe matter in controversy becomes fixed does not grow out of tbe idea that tbe Court is concluded, but that tbe parties are estopped to again litigate tbe question because it is res judi-cata. We are referred by counsel to tbe case of City of Hasting v. Foxworthy, 45 Neb., 676, in wbicb tbe foundations of tbe doctrine are traced and its limitations pointed out. We concur in tbe views expressed and tbe conclusion reached by tbe Court as stated in the opinion by Irvine, J.: "Tbe cause having been remanded generally there was no adjudication of any rights between tbe parties; that tbe record presents the questions upon this trial as well as upon tbe others and that it is within tbe power of tbe Court to re-examine its former decisions and apply tbe law correctly. We think that ordinarily tbe Court is justified in refusing to re-examine tbe questions of law once passed upon, and that it is only when it clearly appears that tbe former decision was erroneous that this should be done." If this record presented tbe conditions stated, we should find no difficulty in performing our duty to render such judgment as in our opinion is in accordance with tbe Constitution and laws of tbe State. We also concur in tbe opinion that when tbe question bas been considered and decided tbe Court will not reverse its former decision unless it clearly appears that it is erroneous. Tbe considerations wbicb guide and control tbe Court in this respect are obvious. While this Court bas in four cases by unanimous opinions decided the very question now presented and debated, we recognize tbe fact that both plaintiff and defendant are public governmental agencies seeking to discharge their duty in respect to these funds and are prompted by no other consideration in asking a reconsideration of our former decisions. We are quite sure that the defendant representing the interest of the city of Asheville, acting under the advice of learned counsel, has no other purpose than to present in the strongest possible view the argument sustaining its contention that the funds in controversy should go into the treasury of the city of Asheville. The .argument made before us is entitled to and has received the most careful consideration. After an examination of the opinions written in Board, etc., v. Henderson, 126 N. C., 689; School Directors v. Asheville, 128 N. C., 249; Bearden v. Fullam, 129 N. C., 477, we are not prepared to say that the construction put upon Article IX, sec. 5, of the Constitution is not correct. In Board, etc., v. Greenville, 132 N. C., 4, the'sole question was the statute of limitations. It must be conceded that the language of Article IX, sec. 5, is not so clear as might be desired. This Court in Katzenstein v. R. R., 84 N. C., 688, first discussed the power of the Legislature to give to informers the entire penalty incurred for the violation of a statutory duty. Mr. Justice Ashe says: "There is a distinction between those penalties that accrue to the State, and those that are given to the person .aggrieved, or such as may sue for the same, and no doubt this distinction was in contemplation of the framers of the Constitution when they adopted that section." The learned Justice concludes that it is within the power of the Legislature to give to the person aggrieved, or to the person who will sue for the same, the entire penalty incurred. This construction of the Constitution has been accepted and followed both by this Court and the Legislature since 1881. Hodge v. R. R., 108 N. C., 24. Mr. Justice Avery in a concurring opinion expresses his dissent from the conclusion reached in Katzenstein's case. Certainly much may be said to sustain his view. The question was again fully considered by the Court in Sutton v. Phillips, 116 N. C., 502, and the decision in Katzenstein's case approved. Faircloth, C. J., and Avery, J., dissenting. The defendant does not question these decisions; on the contrary, it insists that they are correct and that the Legislature has the power to appropriate to a municipal corporation a portion, or all, of the fines collected, etc., in the same manner and to the same extent .as penalties. The question has been fully considered by this Court and its conclusion uniformly adhered to. We have examined the arguments and authorities upon which the decisions are based. Without intending to be critical, we think the question stated in defendant's brief is not strictly accurate. It is said, "This appeal involves the power of the Legislature to appropriate all or any part of fines — as distinguished from penalties — arising from the violations of ordinances of the city of Asheville, to the said city." Eor the reasons we will undertake to give, the question presented is: lias the Legislature the power to appropriate all or any of the fines imposed upon conviction of misdemeanors committed by violating the ordinances of the city of Asheville? We think the argument to a very large extent hinges upon the different ways of stating the question. While there is much force in the defendant's contention, it is difficult to conclude that the authors of the Constitution intended that fines imposed in criminal prosecutions could be appropriated to private citizens or municipal corporations. The argument, if sound, leads to the conclusion that the Legislature may give to private prosecutors a portion or all of the fines imposed and collected as a punishment for offenses against the criminal law. It is settled that the Legislature may give to cities and towns the entire penalty incurred for the violation of ordinances to be recovered in a civil action, but when the State interposes and declares the violation of an ordinance a 'misdemeanor, the fine im posed for tbe criminal offense must go in tbe way directed by tbe Constitution. Tbe town may, under its authority to make and enforce ordinances for its better government, enforce sucb ordinances by tbe imposition and collection of penalties. It bas no power to impose fines, and .although in many instances tbe word fine is used, it is but a penalty to be recovered as other penalties by a civil action. Code, sec. 3804. Prior to the Act of 1871, Code, sec. 3820, there was no other way provided for tbe enforcement of obedience to town ordinances; a violation of sucb ordinances was not a misdemeanor. State v. Parker, 75 N. C., 249. In Wilmington v. Davis, 63 N. C., 582, it was held that the special courts authorized to be created by tbe Legislature by section 14, Art. IV, bad no jurisdiction to try an action for tbe recovery of a penalty imposed for tbe violation of a town ordinance. Tbe power of tbe mayor or other chief officer of a town to bear and determine a criminal action is derived from section 3818 of Tbe Code, by which be is constituted an inferior court to be called a municipal court. He is made a magistrate and conservator of tbe peace, and within tbe corporate limits of any city or town given tbe jurisdiction of a justice of tbe peace in all criminal matters arising under tbe laws of tbe State, or under the ordinances of tbe town. In imposing fines for misdemeanors, whether committed by violating an ordinance or any other criminal law, be has tbe same power and jurisdiction and concurrent with a justice of tbe peace in sucb town. It is therefore not accurate to say that fines imposed by him are for tbe enforcement of a town ordinance or punishment for tbe violation thereof; they are so only because by the criminal law tbe violation of a town ordinance is made a misdemeanor. Tbe warrant runs against tbe form of tbe statute and tbe peace and dignity of tbe State. State v. Taylor, 133 N. C., 755. It is held that a justice of tbe peace bas concurrent jurisdiction of a charge of vio lating a town ordinance, because it is a misdemeanor. State v. Merrill0, 83 N. C., 677. A party violating a town ordinance may be prosecuted by tbe State for tbe misdemeanor and sued by tbe town for tbe penalty. State v. Taylor, supra. We can see no more reason wby it should be competent for tbe Legislature to give to tbe town all or a part of tbe fine imposed for a misdemeanor committed by violating a town ordinance, than for a misdemeanor committed by violating any other criminal law of tbe State. A fine imposed for an assault, or for retailing without license, or any other misdemeanor committed within the corporate limits, cannot be distinguished, in respect to tbe power of tbe Legislature to appropriate or give it, or any part of it, to tbe town, from a like fine imposed for a misdemeanor committed by violating a town ordinance. Nor can we see wby, if the fine or any part of it may be given to tbe town, it may not by tbe same power be given to tbe prosecutor, or to any private citizen. When tbe power is conceded, we find no limit to its exercise save the wisdom of the legislative department of the government. If we found tbe power in tbe Constitution we should not hesitate to so declare; it is not our province to construe it out of tbe organic law because of any supposed apprehension on our part that it might be abused. AVben, however, tbe language of tbe Constitution or meaning thereof is doubtful, and a general purpose is indicated in respect to that matter in controversy, it is not only legitimate but our duty to test the strength of the argument by looking to its practical effects and ascertain how tbe general purpose may be affected by adopting tbe proposed conclusion.
Judge Ashe draws tbe distinction between "those penalties that accrue to tbe State and those that are given to the person aggrieved." This distinction is recognized in Hodge v'. R. R., supra. We should be slow to conclude that it was intended that fines imposed for violation of tbe criminal laws wbicb accrue to tbe State could be distributed among or appropriated to objects other tban those named in tbe Constitution. It is conceded that but for tbe word "of" between tbe words "and" and "all," no doubt could be entertained that "all fines" were given to tbe school fund. An analysis of the entire sentence indicates a purpose on tbe part of tbe draughtsman to make a distinction between "penalties and forfeituires" and "fines" and to group 'them into separate classes, "tbe clear proceeds of all penalties and forfeitures, and of all fines," etc. Why insert tbe conjunction between "penalties" and "forfeitures," and again between these two and "fines," if they were included in one class? It is true that tbe word "of" leaves tbe entire sentence.obscure and open to construction. It may be that as suggested by Judge Ashe, "If it was intended to give tbe school fund all penalties, as well those that belong to tbe State as those that are given to tbe party aggrieved or common informer, then tbe statutes giving penalties in both cases would be a 'dead letter.' " It is a common custom to give either, all or a part of penalties to tbe person aggrieved or any person who will sue for tbe same, whereas it would introduce a novelty into our law to distribute a fine imposed for tbe violation of the criminal law and bring many strange and dangerous innovations into our criminal jurisprudence. Tbe able counsel for tbe defendant says that if this Court will define "clear proceeds" tbe difficulty will be cleared up. If we adopt tbe argument of counsel, we must bold that fines are in tbe same, class as penalties, and following Katzenstein's case, we would be forced to tbe conclusion that tbe disposition of both are entirely within tbe power of tbe Legislature, wbicb nullifies tbe clearly expressed purpose of tbe people, that they shall go into tbe county school fund. If we stop short of this conclusion and limit tbe words "clear proceeds" to the power to dispose of only a part of tbe fine, we might well say that tbe power of the Legislature is exhausted by giving to the Clerk or Sheriff a reasonable commission for collecting the fines — to be deducted from the amount before paying it over to the treasurer of the school fund. The words "clear proceeds" could thus have full force and operation without giving the unlimited power claimed by the defendant. By reference to section 3739 of The Code, regulating the fees of the Clerk, we find that he is given "five per cent, commission on all fines, penalties, amercements, and taxes paid to him by virtue of his office." We might well conclude that the ninety-five per cent, of the fines constitutes the "clear proceeds" and that this or such other reasonable commission as should be fixed exhausted the power of the Legislature to appropriate the amount so collected and was in the contemplation of the draughtsman in using the term "clear proceeds" as applied to fines. The defendant's counsel strongly urges upon us the hardship visited upon cities and towns by the decisions made by this Court. They say that they have been deprived of an important source of revenue. This condition has resulted from the fact that they have been heretofore appropriating these fines, and we fully recognize the hardship imposed by requiring the payment. This Court, beginning in the Henderson case, held that no statute of limitations protected them; it now holds that they cannot be called upon to account for amounts collected beyond two years. Board, etc., v. Greenville, supra. We presume that a large majority of the towns have acquiesced in the decisions and made settlement with the boards of education. However this may be, we must declare our conclusion as we reach it. While the fines collected for violations of the criminal laws in the city of Asheville will not in the future go into the general treasury of the city, they will contribute to the support of her splendid system of public schools, which reflect so much credit upon the wisdom and foresight of her citizens. It is a wise policy to apply the fines imposed for the commission of crimes to one of the most useful and valuable agencies for the prevention of crimes, the public schools — whereby the children of the State are educated to obey the law and strengthen the Commonwealth.
The judgment of the Superior Court must be
Affirmed.