Court Opinion

ID: 8180012
Source: CourtListenerOpinion
Date Created: 2022-09-09 22:30:59.950644+00
Date Added: 2024-06-11T16:40:08.474329
License: Public Domain

Lovins, Judge,
dissenting:
I respectfully dissent from the conclusion reached by the Court in this proceeding.
This proceeding arises upon the act of the State Road Commission in pledging the special fund created by Section 52, Article VI, Constitution of West Virginia, which reads in part as follows: “Revenue from gasoline and other motor fuel excise and license taxation, motor vehicle registration and license taxes, and all other revenue derived from motor vehicles or motor fuels shall, after deduction of statutory refunds and cost of administration and collection authorized by legislative appropriation, be appropriated and used solely for construction, reconstruction, repair and maintenance of public highways, and also *127the payment of the interest and principal on all road bonds heretofore issued or which may be hereafter issued for the construction, reconstruction or improvement of public highways, and the payment of obligations incurred in the construction, reconstruction, repair and maintenance of public highways.”
The Road Commission, acting under the authority of the following statute pledged the fund created by Section 52, above quoted, as security for the payment of certain revenue bonds issued to raise funds to pay in part for the construction of a bridge at Winfield, West Virginia, under the authority given by the following statute: “Any bridge or bridges constructed under the provisions hereof and forming a connecting link between two or more state highways, or providing a river crossing for a state highway, are hereby adopted as a part of the state road system, but no such bridge or bridges shall be constructed without the approval in writing of the state road commissioner and the governor. If there be in the funds of the state sinking fund commission an amount insufficient to pay the interest and sinking fund on any bonds issued for the purpose of constructing such bridge or bridges, the state road commission is authorized and directed to allocate to said commission, from the state road fund, an amount sufficient to pay the interest on said bonds and/or the principal thereof, as either may become due and payable.” Chapter 117, Article 17, Section 22, Acts of the Legislature, 1949, Regular Session.
The theory on which the Court’s opinion is based is that a pledge of funds derived under the provisions of Section 52, Article VI, Constitution of West Virginia, does not constitute a debt within the meaning of Section 4, Article X of the Constitution.
At the outset, it may be said that there is considerable authority to sustain that conclusion from other jurisdictions. For want of a better term, the theory may be named the special fund theory or doctrine. This is a somewhat new development in constitutional law, and seems to be *128based on the fact that revenue derived from general taxation is separate and distinct from revenue derived from excise and license taxation.
Section 4, Article X of the Constitution of West Virginia reads as follows: “No debt shall be contracted by this State, except to meet casual deficits in the revenue, to redeem a previous liability of the State, to suppress insurrection, repel invasion or defend the State in time of war; but the payment of any liability other than that for the ordinary expenses of the State, shall be equally distributed over a period of at least twenty years.”
I think that Section 35, Article VI of the Constitution of West Virginia, reading in part as follows: “The State of West Virginia shall never be made defendant in any court of law or equity, * * *” is likewise appropriate for consideration. Sections 52 and 35 of Article VI were adopted by the people of this State in order to establish a “pay as you go” system of financing. Having regard ta the unfortunate history of the finances of the Commonwealth of Virginia, and the burden placed on this State by decrees pronounced by the Supreme Court of the United States in the case of Virginia v. West Virginia, 220 U. S. 1, 31 S. Ct. 330, 56 L. Ed. 71, (see opinions in the same case, 231 U. S. 89, 234 U. S. 117, 238 U. S. 202, 241 U. S. 531 and 246 U. S. 565), I am loathe virtually to abolish the twin safeguards against debt. The people of this State, at the time of the adoption of the present Constitution were mindful of the pitfalls and dangers attendant upon unrestrained expenditures of public funds to be derived from revenues in the future, and no doubt intended to erect permanent barriers against involuntary and voluntary creation of debts and thus prevent a recurrence of near insolvency which existed before the separation of this State from the Commonwealth of Virginia.
The framers of our present Constitution and the people who adopted it had in mind that they would erect such barriers against the recurrence of such condition approaching financial chaos. Notwithstanding that purpose and *129intent, we see at least two indirect approaches to weaken, if not destroy, those safeguards. First: The decisions of this Court in the moral obligation cases indirectly allows the imposition of a debt by court order or decree. To me, these cases are proceedings against the State of West Virginia through the State Auditor for the collection of debts allegedly incurred by the commission of torts by its agents, servants and employees. The trend of the “moral obligation” cases is to impose an involuntary indebtedness on the State. Second: The instant case will eliminate the difference between self-liquidating revenue projects, the cost of which is to be paid by the pledge of funds derived from the general levy of excise and license taxes to secure the payment of costs of such revenue project. This approach permits the voluntary assumption of secondary liability for a debt contracted on the basis of paying for a structure or improvement out of what I regard as general road funds derived from the general levy of license and excise taxes.
It is to be noted that Article X, Section 4, inhibits incurring a debt, except for specific purposes: (1) To meet casual deficits in the revenue, (2) to redeem a previous liability of the State, (3) to suppress insurrection, (4) to repel invasion or defend the State in time of war. It is to be further noted that the same section referred to “liability”, which is a general and more inclusive term than “debt”.
“Interpretation differs from construction in that the former is the art of finding out the true sense of any form of words; that is, the sense which their author intended to convey; and of enabling others to derive from them the same idea which the author intended to convey. Construction, on the other hand, is the drawing of conclusions, respecting subjects that lie beyond the direct expressions of the text, from elements known from and given in the text; conclusions which are in the spirit, though not within the letter of the text.” 1 Cooley’s Constitutional Limitations, Eighth Edition, page 97.
*130Bearing in mind the difference between interpretation and construction, we could well apply the statement made by that able writer, Judge Story, in his work on the Constitution: “In the first place, then, every word employed in the Constitution is to be expounded in its plain, obvious, and common sense, unless the context furnishes some ground to control, qualify, or enlarge it. Constitutions are not designed for metaphysical or logical subtleties, for niceties of expression, for critical propriety, for elaborate shades of meaning, or for the exercise of philosophical acuteness or judicial research. They are instruments of a practical nature, founded on the common business of human life, adopted to common wants, designed for common use, and fitted for common understandings. The people make them, the people adopt them, the people must be supposed to read them, with the help of commonsense, and cannot be presumed to admit in them any recondite meaning or any extraordinary gloss.” Section 451, 1 Story on the Constitution, Fifth Edition.
A grave question is here presented and deserves more than superficial consideration and treatment. As above stated, the doctrine herein is that of “special fund.” Some courts have permitted the pledging of special funds created by statute and held that such pledge did not create a debt within the meaning of the Constitution.
As heretofore stated, the doctrine invoked in this case is known as the “special fund doctrine.” This court has approved one phase of that doctrine which permits the use of a specific fund derived from specific revenues derived from the project or structure for which the debt is contracted. Bates v. State Bridge Com., 109 W. Va. 186, 153 S. E. 305. This Court in Bates v. State Bridge Com., supra, applied the generally accepted rule. Almond v. Gilmer (Va.), 51 S. E. 2d 272, 72 A. L. R. 687, 96 A. L. R. 1385 and 146 A. L. R. 328.
Other courts have permitted the pledging of a special fund created and ear-marked by statute. Other juris*131dictions have permitted the pledging of a special fund created and ear-marked by constitutional provision.
The decision in the instant case extends the “special fund doctrine” beyond Bates v. State Bridge Com., supra, and allows the pledging of a special fund created and allegedly ear-marked by a constitutional provision.
Where a special fund created by statute is pledged, the following criticism of such principle is appropriate: “* * * the Legislature, or the debt-contracting authority, could divide the public revenue into numerous subdivisions, calling one the ‘road fund,’ another the ‘school fund’, another the ‘agricultural fund’, another the ‘public health fund,’ and others almost without limit. Debts could then be contracted in unlimited amounts and payable in the far distant future, and still be immune from attack as violating constitutional provisions limiting indebtedness provided each debt was made payable out of some one of the specially designated funds into which all of the revenue collected by taxation from the people had been divided. A mere statement of the proposition carries with it, it seems to us, its own refutation.” State v. State Highway Commission (Mont.) 296 P. 1033, 1035. See Crick v. Rash (Ky), 229 S. W. 63.
At this point, it is fair to say that the Court’s opinion in the instant case is written on the theory that a special fund is invoked by the Constitution and will not be subject to such changes as are indicated in the above quotation.
In dealing with the “special fund doctrine”, and considering questions similar to that here presented, the Supreme Court of Oklahoma held that an attempt to pledge a portion of gasoline tax and a conditional pledge of a portion of motor vehicle registration taxes violated the constitutional provisions limiting the State’s indebtedness. Boswell v. State (Okla.) 74 P. 2d 940. A similar conclusion was reached in the case of People v. Barrett (Ill.), 26 N. E. 2d 478.
*132I think Boswell v. State, supra, and People v. Barrett, supra, represent a sound conclusion on this question. There is some doubt whether the special fund created by Article VI, Section 52, is in law a special fund. See Boswell v. State, supra.
It seems to be the opinion of this Court in holding to the opposite view that if the general revenues of the State are not pledged, no debt within the meaning of the Constitution is created. I think that applying the rule as here-inabove stated, with reference to the interpretation of the Constitution, a debt means “A sum of money due by certain and express agreement; - as by bond for a determinate sum, a bill or note, a special bargain, * * Black’s Law Dictionary, Fourth Edition, page 490. 1 Bouvier’s Law Dictionary, page 788. True, the pledge here considered is a secondary and conditional debt. Nevertheless, it conditionally binds this State to devote a special fund raised by general excise taxation to the payment of bonds issued for a self-liquidating local project.
There is another element to be considered. The instant decision opens the door for unlimited pledging of the constitutional State Road Fund to secure specific road projects all over this State.
It is entirely possible and also within the range of probability that the constitutional special road fund will be so depleted that it will be practically non-existent. What course of action could be then taken to provide funds for the general construction, repair and maintenance of a much needed road improvement or construction? It is not believed that any taxing power within this State would have the temerity or the inclination to resist a demand for increased road facilities when shown to be indispensable or a demand for necessary repairs of existing roads. Thereupon general taxation would of necessity be resorted to to take the place of funds theretofore taken from the special road fund established by Section 52, Article VI of the Constitution, to meet such liabilities as may arise under this decision.
*133After all, under the situation disclosed by this proceeding and the exigencies made necessary by progress and development of this State, the general levies of this State are indirectly affected by the pledge of the constitutional Road Fund to pay for self-liquidating projects.
It is also said that there is no commitment by the act here considered binding future legislation. A Legislature may not commit a future Legislature to the collection of certain revenues, but I cannot escape the conclusion that if there should be a default in the revenue bonds issued to pay for the project at Winfield and the constitutional Road Fund has been depleted or spent, there would be an irresistible demand to replace money in the Road Fund derived from general taxation so as to meet the pledge authorized in'this proceeding.
It has been a public policy of this State to meet its bonds and obligations, and any informed citizen of this State who knows of the financial dealings of this State can assert a pardonable pride in the financial solvency of the State and of the desirability of its bonds and obligations.
As I have pointed out, I think that this is another attack upon the pay-as-you-go theory, tending to destroy the existing solvency of this State. I would therefore hold that Chapter 117, Acts of the Legislature, 1949, violates Article X, Section 4, of the Constitution of this State and would deny the writ.