Court Opinion

ID: 3821412
Source: CourtListenerOpinion
Date Created: 2016-07-06 07:56:10.032672+00
Date Added: 2024-06-11T13:50:54.276283
License: Public Domain

In the majority opinion filed in this case, the fourth section of the syllabus is as follows:
"4. An action based upon warrants issued by a municipal corporation is not an action based upon contract within the meaning of chapter 106, S. L. 1925."
The statute referred to has been very little used since it was passed. Perhaps some of the courts have overlooked it, and it has slumbered because of the fact that the courts rely, instead of searching for themselves, on the interested parties to bring it to their attention. The evil intended to be avoided by that statute was that claimants, for judgments against municipalities, would very frequently have a stand in with the officials, and, under the doctrine of res judicata, those desiring to *Page 108 
get the advantage of the people who pay taxes could get judgments through inadvertence as well as collusion of municipal officers, and thereby saddle upon the taxpayers not only claims that had no foundation, but excessive claims that were forbidden by the Constitution. Similar questions have been before the court before, and this appears to be about the first time that the court has undertaken to construe out of existence the plain language of the statute. The statute was passed by the Legislature, and it had a right so to do, in order to protect the people against the machinations of buccaneers and freebooters and their allies, as well as the indifference of judges and county officials.
The Constitution, in article 10, sec. 26, provides that no municipality shall be allowed to become indebted in an amount greater than the revenue provided. The exact language, which has been repeated so often that a great many officials ought to know it by heart, is as follows:
"Sec. 26. Limitation upon debts of city, county, etc. — vote by people — sinking fund. No county, city, town, township, school district, or other political corporation, or subdivision of the state, shall be allowed to become indebted, in any manner, or for any purpose, to an amount exceeding, in any year, the income and revenue provided for such year, without the assent of three-fifths of the voters thereof, voting at an election to be held for that purpose, nor in cases requiring such assent, shall any indebtedness be allowed to be incurred to an amount, including existing indebtedness, in the aggregate exceeding five per centum of the valuation of the taxable property therein, to be ascertained from the last assessment for state and county purposes previous to the incurring of such indebtedness; Provided, that any county, city, town, township, school district, or other political corporation, or subdivision of the state, incurring any indebtedness, requiring the assent of the voters as aforesaid, shall, before or at the time of doing so, provide for the collection of an annual tax sufficient to pay the interest on such indebtedness as it falls due, and also to constitute a sinking fund for the payment of the principal thereof within 25 years from the time of contracting the same."
It will be observed that the words used are "shall be allowed to become indebted, in any manner, or for any purpose." The Constitution created this court. It is called the Supreme Court, but this positive requirement of the Constitution binds this court in all its supremacy, just the same as it binds all other officials connected with the administration of the affairs of the people.
In the present case, as disclosed by the record, warrants were issued on the same day by the township officials far in excess of the estimate made and approved. In the brief that was filed on behalf of the Gulf Pipe Line Company is contained a list of the warrants with their respective numbers, practically all issued on the 24th day of September, 1924, and at the same time, amounting to $29,698.89. The entire appropriation for the township for the year 1924-25, was $13,665.43. From that statement, it clearly appears that the warrants on which the judgments were rendered were excess warrants. The brief thoroughly discusses the matter, and in it there is a statement, practically unchallenged, showing that at one sitting warrants totalling $28,884.29 were issued.
If the story recited in the brief as to the irregularities connected with these warrants and how they were issued is half true, everybody connected with it, if the prosecuting officers did their duty, should have been informed against and been brought to the bar of justice, to answer for dereliction of duty. The testimony is set out in the brief, and it is startling. To indulge in a presumption arising from the issuance of the warrants under the circumstances detailed in this record, is to presume that which is not presumable, and to think that which is unthinkable. When one examines the method pursued in this case in the rendition of judgment, it is amazing that any court, independent of the Statute of 1925, would sanction the proceedings. The Board of Tax Review investigated and evidently were impressed that the judgments procured were fraudulent.
The prior decisions of this court, independent of the statute, cited in the brief on behalf of the Gulf Pipe Line Company, and in support of the decision of the Board of Tax Review, are ample to sustain the decision of the Tax Review Court. However, the Legislature, recognizing the abuses that had been vitalized by the doctrine of "res judicata," passed a law that is set out in the opinion, referred to by title in the syllabus, prescribing that before final judgment on any suit based on contract could be rendered against any municipality, by any court of any county, in the state of Oklahoma, there should be a showing made as to the indebtedness of the municipality, and the essentials of that showing are prescribed. It is very evident that none of the things prescribed by that statute were done in the present case. At page 39 of the brief of the defendant in error, quoting the statute, we find the following: *Page 109 
"Before final judgment in any suit based on contract shall be rendered against any municipality by any court of any county in the state of Oklahoma, except in proceedings to refund any indebtedness of said municipality, proof shall be made to the court, of the existence, character and amount of the outstanding legal indebtedness of said municipality, which proof shall include a statement compiled by the various officers having custody of the records from which the information required in the statement is taken, under oath, showing the following:
"1. An itemized statement of the bonded indebtedness of said municipality.
"2. An itemized statement of the legal indebtedness of said municipality, exclusive of the bonded indebtedness and the alleged indebtedness proposed to be converted into a judgment.
"3. An itemized statement of the indebtedness proposed to be converted into a judgment, so classified as to show, in separate exhibits, all items of questionable legality, if any, and the reasons of said officer or officers therefor:
"(a) The appropriations against which each warrant was drawn or claim accrued, if in judgment, and if within the limits and purposes thereof, as provided by law;
"(b) The income and revenue provided for the respective years, consisting of taxes levied and the actual collections of estimated income'; the total warrants issued against the same or the accumulated accruals as the case may be, and the amount, if any, in excess of the total income and revenue of the year;
"(c) The condition of each fund from which such indebtedness is payable as of the close of the month next preceding the filing of application. * * *
"Section 3. No judgment shall be rendered against any municipality by any court until the provisions of section 2 hereof, have been fully complied with. Any judgment rendered in violation of the provisions of this act shall be void and of no effect."
"The record in the instant case discloses that no attempt was made to comply with this act. If there had been introduced in evidence in this case a statement showing the income and revenue provided for the year in question and the total warrants issued against the same prior to the issuance of the warrants in question, this evidence would have conclusively shown that none of the warrants reduced to judgment had any legal standing, but were reduced to judgment in violation of the provisions of section 26, art. 10 of the Constitution of the state of Oklahoma, which section provides that no indebtedness may be incurred in excess of the appropriation and the estimate made and approved for any given year.
"We have here a statute which makes certain proof mandatory before any lawful judgment can be entered, and since it appears in this case that no evidence was offered in support of the prayer of the plaintiff for a judgment and no attempt was made to comply with this statute, as shown by the testimony of the attorney for the plaintiff in the cases below, we submit that the judgment in each case is absolutely void and is subject to collateral attack in any court of the state.
"It may be that we have been a bit harsh in some of the things said in this brief. We have been unable to find any milder terms which could be used in properly painting the picture. We have, we think, fairly stated the case and in the light of the record, it should occasion no wonder that the annual appropriation of this little municipality for the purposes of its sinking fund should be in the neighborhood of $42,000 a year and it should occasion no wonder that the books and records of this municipality went up in smoke or took wings and flew to places where honest eyes might not discover them.
"In the brief of the plaintiff in error herein, counsel have cited numerous authorities stating the general proposition that judgments of courts of competent jurisdiction may not be collaterally attacked. With these decisions we are not here concerned. This court has uniformly held that in suits brought by taxpayers to question the validity of levies made to pay judgments obtained as this judgment was obtained, can be prosecuted to finality and relief granted. See In re Protest Carter Oil Co., supra, and In re Gypsy Oil Company,141 Okla. 291, 285 P. 67, and cases cited therein.
"We submit that on the record here submitted, the judgment entered in favor of A.M. Smoot, in the district court of Creek county, was an outrage upon the municipality and the taxpayers thereof, when viewed in the light of the undisputed facts, and in the light of the testimony and admissions of Mr. Smoot himself. If we forget every item of the evidence, except the testimony of Mr. Smoot and the verified itemized statement of his which was introduced in evidence, we would be confronted with the fact that he actually worked for this township twenty-one days between July 1st and September 25th, both days inclusive, and that his wages was $7 per day. For this 21 days he has received through the Diehl judgment the entire amount due him. Notwithstanding this fact, it is now contended that this individual should be permitted to recover by warrant and judgment route, the sum of $1,204 additional. If such is permitted instead of being paid the $7 per day for the actual time he worked, he would receive by this process approximately $64 a day.
"Mr. Smoot, the judgment creditor, appeared before the Court of Tax Review, and *Page 110 
his attorney was also present (not a legal appearance that either was a party to the proceedings) and had ample opportunity to explain to the Court of Tax Review just what these warrants were all about. His testimony clearly establishes the fact that when the municipal authorities issued the $1,204 warrant to Mr. Smoot, they were guilty of the grossest misfeasance and malfeasance of office, and we feel that the Court of Tax Review, on the fact of such a record, quite properly found from the facts and circumstances adduced in evidence that the judgments in the district court of Creek county, Okla., were tainted with such palpable fraud that they should be treated as void."
The startling position is taken in the opinion of the majority in this case that a suit based on warrants is not a suit based on contract. Everybody at all conversant with the meaning of language knows that a suit on warrants issued for claims arising on contract or otherwise is a suit based on contract. To reverse the action of the Court of Tax Review on the ground here alleged for holding that the judgments were good, it seems to me, is unwarranted by principle or precedent. The language could not be plainer.
The majority, in the opinion, in generalizing its conclusions on the last page, says:
"We do not think the findings and judgment of a court of general jurisdiction can be impeached in this manner."
This court, though supreme in name, is hedged about by law and by the Constitution that created it. It should not upturn the plain provisions of that Constitution. It should not set aside and hold for naught the plain provisions of the statute, duly enacted by a co-ordinate branch of government, for the purpose of preventing fraud being practiced upon the taxpayers and the institutions that are dependent on the ability of the tax-payer to pay. The provisions of the Constitution and the statute are too plain for argument. The way pointed out therein is so plain that the wayfaring man, described by the Prophet Isaiah, in the 35th chapter and 8th verse, should not err therein. To undertake to distinguish in this matter so as to arrive at a different meaning from what the plain language requires, would be undertaking to explain to a man, blind from nativity, red, the color of the text, as found in the Lawyer's Bible, of the passage referred to. It is highly probable that those who have to provide funds in this state are now seeing in the color that the chapter is printed in.
It occurs to me that the decision as now rendered is sowing to the wind with a reasonable expectation of reaping the whirlwind that is referred to by another of the prophets of old, as found in chapter 8, verse 7, page 838, of the red-letter Bible found in most lawyers' offices, and copyrighted by the John C. Winston Company in the year 1905.
This being a matter of general importance and fundamental in its nature, I feel warranted in registering this dissent.
See under (5) R. C. L. Perm. Supp. p. 4749.