Court Opinion

ID: 9658383
Source: CourtListenerOpinion
Date Created: 2023-08-23 20:57:36.021645+00
Date Added: 2024-06-11T18:13:54.324411
License: Public Domain

Carter, J.,
dissenting.
This matter arises after a reargument of the issues raised by the appeal. The three members, of the court upholding the constitutionality of the act under Article Y, section 2, Constitution of Nebraska, have concluded to adhere to the former opinion. I disagree with this disposition of the case.
Due to a temporary disability, I was not able to participate in the disposition of the case originally and Col-well, District Judge, sat in my stead. Having participated in the motion for a rehearing and the reargument of the case, I deem it necessary to state my views regarding the constitutionality of the legislation authorizing the sale of the school lands held in trust for the benefit of the common schools of the state.
The statutes primarily questioned here provide in part: "All lands, now owned or hereafter acquired by the state for educational purposes, shall be sold at the expiration of the present leases. * * * Prior to such sale, the land shall be appraised for sale purposes in the same manner as privately-owned land by a representative appointed by the Board of Educational Lands and Funds, and thereafter shall be sold at public sale at not less than the appraised value; Provided, * * § 72-257, R. S. Supp., 1967. “Such land shall be sold, at public auction, by a representative of the Board of Educational Lands and Funds or by the county treasurer of the county in which the land is located, to the highest *272bidder. The appraised value for sales purposes as provided in section 72-257 shall be the starting bid price. * * * Settlement shall be made by paying cash of not less than twenty percent of the purchase price at the time of sale and the balance shall be payable in cash within ninety days of the date of sale. If the person submitting the high bid for the land fails to pay the balance of the purchase price and complete the sale within ninety days his rights under the sale, including the twenty per cent down payment, shall be forfeited by the board and a new sale shall be authorized.” § 72-258, R. S'. Supp., 1967. It is clear to me that if the foregoing provisions are complied with, the sale is to be final and complete and the purchaser entitled to a deed.
The original concurring opinion of Boslaugh, Smith, and McCown, JJ., State ex rel. Belker v. Board of Educational Lands & Funds, 184 Neb. 621, 171 N. W. 2d 156, in sustaining the constitutionality of the foregoing provisions of the law holds that irrespective of the shortcomings of the statutes, the trustee, or persons dealing with the trust assets, have the courts available to them to determine whether or not the rules governing trusts have been properly applied and that such fact is sufficient to sustain a holding of constitutionality. This opinion states: “The fact that the sale statute is silent as to the procedures for such a determination does not alter the law of trusts, nor relieve the trustee of its trust obligations, nor make the statute unconstitutional.” Under this theory, the Legislature can merely direct a sale and the courts will supply the missing language, compel compliance with such directions of the court, and hold the act constitutional. This has been tried many times in this state with fatal results in each and every instance. Cases in this court consistently and unanimously support such results. They are cited in the dissenting opinion by Spencer, J., in State ex rel. Belker v. Board of Educational Lands & Funds, 184 Neb. 621, 171 N. W. 2d 156, and will not be repeated *273here. In 82 C. J. S'., Statutes, § 328, p. 635, it is said in part: “It has been held to make no difference that the omission resulted from inadvertence, or because the case in question was not foreseen or contemplated, or that as a result of the omission the statute is a nullity.”
The controlling opinon in this case concedes that the school lands of this state are held in trust for the benefit of the common schools. The relationship of trustee and beneficiary is a fiduciary one imposing the utmost good faith in the handling of the trust property. Among the duties of a trustee is to require in the case of the sale of trust property that he shall obtain the highest price possible and refuse to make a sale if the sale was fraudulent, or the result of chilled bidding, or any other conduct or circumstance that resulted in an inadequate sale price. The statute under consideration provides for an appraisal and a public sale, after which, if the bid price equals or exceeds the appraisal price, the sale is completed upon payment of the bid price within 90 days. The statute therefore deprives the trustee, the Board of Educational Lands and Funds, from exercising the powers and duties of a trustee imposed by the creation of the trust relationship by the Constitution.
It is asserted in the controlling opinion that the failure to provide for the sale of school lands consistent with its trust status may be read into the statute by implication and enforced as if written into the statute. This is simply not true. See 82 C. J. S., Statutes, § 328, p. 635. An implication to be drawn from the absence of language in a statute is a mere guess and the guess, if made, is judicial legislation. But assuming, solely for the purpose of argument, that there is language in the statute from which an intent can be implied, the position of the controlling members of the court remains wholly untenable under the facts in this case.
The history of the act shows conclusively that the Legislature intended that the appraisal, sale, and payment were to constitute the sole basis for the passing of *274ownership. The right of the trustee to perform its duty was intended to be cut off. Its duty to protect, conserve, and safeguard the assets of the trust for the benefit of all its beneficiaries and its liability for loss thereof resulting from its failure to exercise reasonable care, prudence, and diligence were cast aside in favor of a summary binding sale for the very purpose of subverting the duty of the trustee and the rights of beneficiaries.
The history of the statutes under consideration is set forth in the dissent of Spencer, J., in State ex rel. Belker v. Board of Educational Lands & Funds, supra, and will be only briefly set forth here. The statutes here involved were before the Legislature in their present form. An amendment was offered that would give the Board of Educational Lands and Funds the right to reject bids. The amendment was rejected, plainly indicating that the Legislature did not intend that such board as trustee could see to it that the land did sell for its highest market price. This legislative action demonstrated that the Legislature intended to obstruct the trustee in the performance of its duty and to provide for a completed sale if the bid equalled or exceeded the appraised value whether or not the best interests, of the beneficiaries were served. That this was the intent of the Legislature is further shown by the provision that the county treasurer of the county in which the land was located could sell school lands, a person not even a trustee. With this situation existing, a court cannot possibly justify finding or creating a legislative intent contrary thereto by implication or otherwise.
In Love v. Wilcox, 119 Tex. 256, 28 S. W. 2d 515, 70 A. L. R. 1484, it is said: “No court could justify putting into a statute by implication what both houses of the Legislature had expressly rejected by decisive votes. The House and Senate Journals leave no room for doubt of the legislative intent to deny the power exercised by the State Committee in seeking to debar names from the primary ballots under the resolutions of February 1, *2751930. Once the legislative intent is ascertained the duty of the court is plain. To refuse to enforce statutes in accordance with the true intent of the Legislature is an inexcusable breach of judicial duty, because an unwarranted interference with the exercise of lawful, legislative authority.” See, also, Blome Co. v. Ames, 365 Ill. 456, 6 N. E. 2d 841, 111 A. L. R. 940; 50 Am. Jur., Statutes, § 330, p. 322.
In Long v. Poulos, 234 Ala. 149, 174 So. 230, the court said: “If the intention of the Legislature can be ascertained from the language used and the history of the enactment, it is not necessary to apply any presumptions of law which will aid in the interpretation when its meaning does not otherwise appear. * * * We do not think it is necessary to draw upon such presumptions in this case because we think that without them we are able to ascertain the legislative intent.”
In State, Department of Highways v. Busch (La. App.), 220 So. 2d 513, it was said: “We cannot supply by interpretation what our lawmakers have failed or refused to do by legislation.”
“If legislative intent has meaning for the interpretative process it means not a collection of subjective wishes, hopes, and prejudices of individuals, but rather the objective footprints left on the trail of legislative enactment. Legislative intent can’t be ‘dreamed-up.’ It can be speculated about; but it can be discovered only by factual inquiry into the history of the enactment of the statute, the background circumstances which brought the problem before the legislature, the legislative committee reports, the statements of the committee chairman, and the course of enactment. To pursue this course means work and hard work, but if it is pursued it is seldom that the pursuit is fruitless. An honestly conducted inquiry into these considerations will fail but infrequently to disclose to the inquirer the purpose and intent of the legislature and will clarify the applicability of the statute to the question in litigation.” 2 Suther*276land, Statutory Construction (3d Ed.), § 4506, p. 321.
“Be this as it may, judicial interpretation should never be judicial legislation. We may not, therefore, under the guise of interpretation, read into a statute matters which have been omitted by the legislature particularly where it appears that the omission might have been intentional.” In re Estate of Barnett, 97 Cal. App. 138, 275 P. 453.
“There are two well established rules by which we must be governed in construing a statute. On the one hand, we must give effect to each and every part of it; on the other, we are not permitted to read into a statute anything which we may conceive the legislature may have unintentionally left out. Rather than violate the latter rule, the court will leave ambiguous phrases, of statutes ineffctive and refer their correction to the legislature. And that is what must be done with respect to the phrase we are considering. * * * To render the phrase effective would require much supplementation by the court. * * * To supply these deficiencies in the act in order to give effect to the ambiguous phrase, would amount to judicial legislation. From the phrase itself, we think it would be a violent assumption to say that the legislature intended in any manner to change or modify our long established practice and procedure with respect to the appointment of trustees for insolvent corporations. That such an assumption would be repugnant to the legislative intent, is apparent from the title of the act, * * Seattle Assn. of Credit Men v. General Motors Acceptance Corp., 188 Wash. 635, 63 P. 2d 359.
“In the same case it was also held that ‘the court cannot, under its powers of construction, supply omissions in a statute, especially where it appears that the matter may have been intentionally omitted.’ ” Appeal of Infants Welfare League Camp, 169 Pa. Super. 81, 82 A. 2d 296.
“If the omission was intentional, no court can supply it. If the omission was due to inadvertence, an attempt *277to supply it by including the omitted case would be tantamount to adding to a statute a meaning not intended by the Legislature.” Mitchell v. Mitchell, 312 Mass. 154, 43 N. E. 2d 783.
The foregoing authorities when applied to the facts in this case show the plain intent of the Legislature to circumvent the duties and liabilities of the trustee and the right of the beneficiaries of the trust to have the trust property sold for the highest market price obtainable in accordance with the fiduciary relationship of the parties. The holding of the controlling opinion that the court may supply the missing legislative intent by interpretation or implementation, even though it is directly contrary to the real purpose and intent of the Legislature, is nothing more than judicial legislation and an encroachment upon the powers of the Legislature forbidden by the separation of powers provision of our state Constitution. The very idea that this court may rewrite a statute and give it effect, even though in conflict with the ascertained and real intent of the Legislature, is abhorrent to every student of constitutional government.
“In Armstrong v. Board of Supervisors, 153 Neb. 858, 46 N. W. 2d 602, it is said: ‘If the language of a statute is clear and unambiguous, courts will not by interpretation or construction usurp the function of the lawmaking body and give it a meaning not intended or expressed by the Legislature.’ See, also, Federal Farm Mortgage Corp. v. Adams, 142 Neb. 202, 5 N. W. 2d 384; 50 Am. Jur., Statutes, § 225, p. 204. A statute is not to be considered as appropriate for construction as a matter of course. It is only ambiguous statutes of uncertain meaning to which the rules of construction have application. In Cross v. Theobald, 135 Neb. 199, 280 N. W. 841, this court said: ‘Where the language of a statute is1 plain and unambiguous and its meaning clear and unmistakable, there is no room for construction, and the courts are not permitted to search for its meaning beyond the *278statute itself.’ ” Ledwith v. Bankers Life Ins. Co., 156 Neb. 107, 54 N. W. 2d 409.
“We are not warranted in supplying words which appear to have been designedly omitted, or in accomplishing the same result indirectly by giving to the words used the broad import and meaning for which the state contends.” State v. Pence, 173 Ind. 99, 89 N. E. 488.
“This being true, must we not accept the statute as we find it and concede that the General Assembly in its wisdom omitted the word ‘newspapers’ from the second sentence for some reason which appeared to that august body to be sufficient? Whatever may have influenced the General Assembly to omit the word ‘newspapers’ from the second sentence in the statute, if it did purposely do so, is sufficient, and courts are not authorized to interpolate words into a statute which the lawmaking body has purposely omitted. * * * The learned trial judge delivered a written opinion from which we take the following pertinent observation: ‘The argument of the Commonwealth is that the word “newspapers” was inadvertently omitted by the legislature in the second sentence adverted to, and having been inadvertently omitted by the legislature, it should be included by the court. This seems to me clearly to confound the functions of these two agencies of the government. Under the Constitution it is the province of the legislature to enact and the province of the judiciary to interpret, and it is of vital importance to the maintenance of our institutions that the functions of the two departments sbflll be kept separate and distinct as provided in the Constitution. However beneficent a law might be, it is for the legislature to pronounce it. However much public policy may demand the enactment of a law, the court cannot enact it.’ ” Commonwealth v. Lipginski, 212 Ky. 366, 279 S. W. 339.
“In the construction of statutes, words should never be supplied except to effectuate a meaning clearly shown by the other parts of the statute and to undertake to *279augment the substance of a statute as here desired would be an abortive act of legislation rather than a proper exercise of the power of judicial construction.” Saslow v. Previti, 17 N. J. Misc. 29, 3 A. 2d 811.
The controlling opinion, however, purports to sweep these fundamental concepts under the rug by stating that they have no application because equity courts are open to enforce the duties, liabilities, and fiduciary relationship of the parties. Let us examine the validity of this holding, a holding supported by no legal authority, court decision, or authoritative text, in the controlling decision of this case.
I am in full agreement with the controlling opinion that our equity courts have general supervisory powers over the administration of trusts. According to available records, the value of unsold school lands was at least $70,100,000. The number of tracts to be sold is not known to me but there are at least 544 since there are that many tracts under lease. Under the theory of the controlling opinion, it is possible that a minimum of 544 suits would be required to insure that the trustee procured the highest possible market value of the land for the benefit of the beneficiaries of the trust. It is not at all likely that the Board of Educational Lands and Funds would bring such suits, a board whose duties are prescribed by the Legislature and whose salaries are fixed by it. If a beneficiary brought suit to determine the adequacy of the sale price, the cost of attorneys’ fees and court expense would probably far exceed the benefit accruing to a single beneficiary even if the litigation proved successful. But more important still, the statute deprives the trustee of its duty to act in the capacity of a fiduciary and the duties and responsibilities of the trustee acting in its fiduciary capacity. It deprives the beneficiaries of the benefit of the trustee in seeing to it that the highest market price is obtained for the common schools of the state. It would subject the state to the payment of losses from sales not made in *280accordance with the law governing the sale of trust property as provided in Article VII, section 9, of the Constitution. I submit that the theory announced in the controlling opinion is not only not in accordance with law but, for all practical purposes, provides no adequate remedy fo'r a breach of the fiduciary relationship. I submit that the power of the courts to control the administration of trust property can best be exercised by insisting that the statute providing for the sale of school lands be consistent with the sale of trust property and the duties, liabilities, and benefits accruing to trustees and beneficiaries growing out of the fiduciary relationship of trustee and beneficiary created by the Constitution. I submit that the theory of the court’s opinion is unworkable, defeats the purposes of the law of trusts, and in practice provides no effective protection to the beneficiaries of the trust. I submit that the general power of equity courts to supervise trusts through collateral attack does not afford an adequate remedy, nor does it comply with the necessary attributes of due process. In addition thereto, a multiplicity of suits would be required to insure compliance with the law of trusts and the protection of the beneficiaries of the trust.
This case has been twice argued. In each argument four judges were of the opinion that the statutes were unconstitutional. In the first argument, Colwell, District Judge, sat as a member of the court. In the second, I resumed my place on the court and Colwell, District Judge, did not participate. The result is that five judges sat on the two arguments who firmly believe that the act before us is unconstitutional. On the other hand, the same three members of the court have stood in the shadow of Article V, section 2, of the Constitution, and insisted that the act is constitutional. I do not intend to infer any irregularity in constituting the court in either instance. There was none. My only comment is that three members of the court under the provisions of *281Article V, section 2, of the Constitution, are authorized to sustain the constitutionality of a legislative act without citing a single case or text authority. On the other hand, the five dissenting members of the court have cited ample authority to sustain their position that the act is unconstitutional. I submit in all fairness that if the position of the three members of the court can sustain their holding of constitutionality, and I am confident they cannot, it is encumbent upon them to do so. In my opinion, the controlling opinion is legally unsound and the failure to cite supporting authority affords some evidence to confirm that opinion.
The purpose of the statute is shown by the language of the act and the history of its enactment. It is clearly demonstrated that the legislative intent is to' make the sale therein provided the final completion of the sale to the highest bidder. The object of the controlling opinion is to avoid questions of unconstitutionality by a construction contrary to the intent of the Legislature. This is judicial legislation under all of the authorities and is violative of the division of powers provision of the state Constitution. Such a construction is not only void as judicial legislation, but it has the effect of eliminating the protection afforded the' resulting trust fund and its beneficiaries by virtue of its status as trust property. The purported remedy of the controlling opinion is not only inadequate, but it will require a multiplicity of suits to enforce the protections required by the Constitution in designating the school lands of the state as trust property. I submit that our adopted opinion is contrary to the Constitution and the applicable law, is an arbitrary assumption of legislative powers by rewriting the act contrary to the intent of the Legislature, and has the effect of circumventing the rights of the beneficiaries of the resulting trust fund by a disregard of the manner provided for the sale of trust property. The act is unconstitutional and void, and contrary to the best interests of the state, the beneficiaries of *282the trust fund, and the good conscience of a court of equity.
Simple justice and the applicable law require that its beneficiaries should be protected with the utmost fidelity without the necessity of engaging in costly collateral litigation. I submit that the controversial statute is-wholly void and arbitrary and that the only legal and adequate remedy is a declaration of unconstitutionality by this court. Having these views, I emphatically dissent from the unsupported holdings announced in the opinion of the controlling members. I would reverse the judgment of the district court and enter a declaration of unconstitutionality.
White,, C. J., and Spencer and Newton, JJ., join in this dissent.
Separate Opinion by Smith, J.
From original submission of this case on January 14, 1969, almost 14 months have elapsed. The interval, highly abnormal for this court, is an example of predilection for delay that we ought to prevent.