Atchison Board of Education v. De Kay

delivered the opinion of the court.

Two questions are presented: First. Were, the bonds and coupons valid obligations ? Second. If valid, was the Board of Education of the city of Atchison the proper defendant, and could judgment- be rightfully éntered against it for the sum of these bonds and coupons ?

The bond oh its face purports to be the obligation of the city of Atchison, secured by pledge of the school fund and property of the city, and was executed by the president and clerk of the Board of Education. It is insisted, that the Board of Education had no' power to bind the city by such a promise to pay. To a clear understanding of this question an examination must be made of the statutes of Kansas. The city of Atchison was incorporated under • an act of the Territory of Kansas of February 12, 1858. Private Laws, 1858, p. '172, By an act passed'the same day, providing for the organization, etc., of common schools, (Public Laws, 1858, pp. 47 and 51, c. 7, §§ 15, 37,) each county superintendent of common schools was authorized to divide his county into school districts, and every school district organized in pursuance of the act was declared, to be a body corporate, possessing the usual powers of a corporation for public purposes, with the name and style of “School District No. —, County of-.” Under thafact “ school district number 1, Atchison County,” was organized with territorial limits, the same as those of the city of Atchison.

Noting the act a little in detail, section 55 provides that “ at each annual city election, there shall be a Board of Education,consisting of two members from each ward, elected,” etc. Section 57: that such board shall “ exercise the sole control over the schools and school property of the city.” By section 67, the Board of Education was empowered to estimate the amount of funds necessary to be raised by taxation for school purposes, and report the same to the city council, by which body the amount was levied and collected as other taxes. Under section 68, the moneys thus collected were paid into the hands of the city treasurer, subject to the order of the Board of Education. Sections 69, 70, 71, 76 and 77 are as follows :

“ Seo. 69. The whole city shall compose a school district for the purposes-of taxation.

“ Seo. 70. The title of all property held for the use or benefit of public schools shall be vested in the city.

“ Seo. 71. No school property of any kind shall be sold or

“ Seo. 76. Whenever it shall become necessary, in order to raise sufficient funds for the purchase of a school site or sites, or to erect a suitable building or buildings thereon, it shall be lawful for the Board of Education of every city, coming under the provisions of this act, with the consent of the council, to borrow money, for which they are hereby authorized and empowered to issue bonds, bearing a rate of interest not exceeding tender cent per annum, payable annually or semiannually, at such place as may be mentioned upon the face of said bonds, which bonds shall be payable in not more than . twenty years from their date, and the Board of Education is hereby authorized and empowered to sell such bonds at not less than seventy-five cents on the dollar.

“ Seo. 77. The bonds, the issuance of which is provided for in the foregoing section, shall be signed by the president and clerk of the Board of Education, and countersigned by the treasurer; and said bonds shall specify the rate of interest, and the time when the principal and interest'shall be paid, and each bond so issued shall be for a sum not less than fifty dollars.”

Section 78 peremptorily required the Board of Education in its annual estimate, authorized in section 67, to include a sufficient amount to pay the interest on such bonds and create a sinking fund, and such amount the city council was’required to levy and collect. Section 81 reads : “ The school fund and property of such city is hereby pledged to the payment of the interest and principal of the bonds mentioned in this article, as the same may become due.”

What, now, are the specific objections to the validity of these bonds and coupons? First, it is objected that the bond purports to be issued under authority of an act entitled “An act to organize cities,” etc., approved February 28, 1868; that no such act is to be found in the statutes of that year ; and that, therefore, the bonds were issued without authority of law, and are not valid obligations. This is trifling. ■ There was an act giving authority to the Board of Education

Again, it is insisted that the Board of Education had no power to bind the city of Atchison as a municipal corporation, but only that other and quasi-corporation, known as School District No. 1, Atchison County. The argument is that there were two corporations: First, a school district corporation whose name and corporate existence were prescribed by the laws of 1.858; and another, a strictly' municipal corporation, known as the city of Atchison, with the ordinary powers attached to such a municipality; that though they embraced within their limits the same territory and population, they were in fact distinct corporate entities; and that the Board of Education, having control of the affairs of the one corporation, had no power to bind the other by its promises to pay. It may -well be doubted whether there were two distinct corporations. Section 14 of the acts of 1867 and 1868, incorporating cities of the second class, provided that “ each city shall constitute at least one school district.” There is no pretence, under the power reserved in that section, that the city of Atchison was ever divided into districts; so, by that section, Atchison city constituted a school district. The members of the Board of Education were to be elected at the annual city election, and to the' board was given full control of the school affairs of the city. Section 57. In other words, it was the city’s schools and the city’s school property which were placed under the management of the Board'of Education. Upon the report of the Board of Education, the city council levied and collected the school taxes, SectioA 67; and when they were collected they were retained •by the city treasurer .in his custody. Section 68. The title to all school property was vested • in the city. Section 70.

But even if this be a misconstruction of the statute, it is clear that the school district and the city were coterminous; that, by the act of 1868, the Board of Education was authorized to borrow on the credit of the school property, with the consent of the city council, and to issue bonds in payment therefor. They did proceed, as appears from the recital in the bonds, under authority given by that act, and if there were a misrecital of the name of the obligor, such mere misrecital would not vitiate the obligations. Proceeding strictly under that act, they bound the corporation whose officers they were and for which they assumed to act, and whether the name of that corporation was technically “The City of Atchison” or' “ School District No. 1, Atchison County,” by the issue of bonds they bound that corporation.

This is not the case, as counsel suggest, of a written declaration of A. that B. is indebted, and that B. promises to pay; nor a case where two corporations are so entirely distinct that the name of o^e in an instrument carries no possible suggestion that the other "was intended, but it is the case where officers of a corporation having power to borrow and issue promises

Another objection is, that there was no legal consent of the city council, as required by section 76. The record shows that on Monday, October 5, 1868, none of the councilmen being present, the oityr clerk adjourned the council to Monday, October 12. On Monday, October 12, the mayor and five of the eight councilmen appeared, the minutes of all previous meetings not theretofore read were read and approved, and the council adjourned until Monday, October 19. On Monday, October 19, council met pursuant to adjournment, and another adjournment was had until October 26, and, so, from October 26 to October 28, and thence to November 2, and to November 9. At none of these meetings were all of the city council present. At the meeting on November 9, the mayor and five councilmen, being a majority of the council, were present, and a resolution was passed giving the consent of the council to the issue of these bonds. Now, it is insisted that consent could only' be given by an ordinance, and not by resolution, and in support thereof the case of Newman v. Emporia, 32 Kansas, 456, is cited ; that even if a resolution were sufficient, there was no legal meeting of the council, because all the members were not present, and it does not appear that all were notified, or that ■ a special meeting had been duly called; that it was not at a regular, but apparently an adjourned,.meeting; and that the first adjournment, on October 5, was without validity, because .none.'of the councilmen were present, and the adjournment was ordered by the clerk alone, and in support of the proposition that notice to or presence of all the members is essential to a valid special meeting,, the cases of Paola & Fall River Railroad v. Anderson County Comm'rs, 16 Kansas, 302, and Aikman v. School District, 27 Kansas, 129, are cited.

In respeGt to. the first of these contentions: The general rule is, that where the charter commits the decision of a matter to the council, and is silent as to the mode, the decision may be evidenced by a resolution, and need not necessarily be by an ordinance. State v. Jersey City, 27 N. J. Law, (3 Dutcher,) 498; Butler v. Passaic, 44 N.

' Neither is the other contention of any force. The record of the city council was produced, showing a series of meetings extending from October 5 to November 9, at some of which meetings general business was transacted. The act of 1868, section 13, provides that regular meetings of the city council shall be held at such times as the council may provide by ordinance. No evidence was offered showing what were the dates of regular meetings, as provided by ordinance. We are left to infer that thése meetings were not regular meetings from the language at the commencement of the records thereof — “that council met pursuant to adjournment.” The first adjournment was made by the city clerk alone, no member of the city council being present. We are not advised by the testimony as to what rules, if any, had been prescribed by the city council in respect to such matter. It is not an uncommon thing for legislative bodies, such as a city council, to provide by rule that in the ábsence of all members the clerk or secretary shall have power to adjourn. That probably such a rule as that was in existence is evidenced by the fact that at succeeding meetings — which, giving full weight to the language used at the commencement of the record, were simply adjourned meetings *—the council, all but one of whom were present at one of the meetings, approved the records. All these entries of meeting appear to have, been kept upon the regular record of the city council, and it is obvious that either because an adjournment by the clerk in the absence of the council was

The case in 27 Kansas is even stronger. That was a suit on a Avritten contract, signed by tAvo members of a school district board, the board consisting of three. Such a contract could only be made by the district board, as a board. It appeared

More in point is the case of Scott v. Paulen, 15 Kansas, 162, 167, in which a session of a board of county commissioners was held to be valid, at which only two out of the three members were present; and the record failed to show either an adjournment to that date, or a call for a meeting at that time, but did show that it was not held on the regular days of session ; but its validity was not challenged until some time thereafter. • In the opinion in that case, written by the same judge who wrote the opinion in the ca.se in 16 Kansas, is this language : “ Hence it seems to us that when a quorum of the county board, with the clerk, is present, assuming to act as a county board, and at a time and place at which a legal session is possible, and to such board in actual session a proper' and legal petition is presented for a county-seat election, and an election ordered, and thereafter full and legal notice given of such election, two elections had, generally participated in by the electors, the result canvassed and declared, and no objection made thereto for more than a year, it will be too late to question the validity of the election on the ground that the record of the proceedings of the commissioners shows that the chairman was absent, and fails to show a session pursuant to a legal adjournment from a regular session, or that the session was a special session and duly called by the chairman on the request of two members.” We think, therefore, that the bonds in suit were valid obligations, and that the Circuit Court did not err in overruling these objections to them.

But it is further insisted that even if the bonds were valid the coupons were not, because coupons are not named in the section of the statute authorizing the issue of the' bonds. But coupons are simply instruments containing the promise to pay interest, and the express authority was to issue bonds bearing interest. While it is true that the power to borrow money granted to a municipal corporation does not carry with- it by implication the power to issue negotiable bonds, (Brenham v. German American Bank, 144 U. S. 173 ,) we are of opinion

The final objection is, that the proper defendant is not sued. The claim here is, that while by the act of 1872 the public schools of cities of the second class were organized into a body corporate, by the name and style of “The Board of Education of the City of-, of the State of Kansas,” and at that time, if not before, the real debtor was this distinct corporate entity, yet, at the time of the commencement of this action, the city of Atchison had passed, by reason of the growth of its population, from a city of the second to a city of the first class; and that in such cities there was no separate school corporation, but the Board of Education was simply an administrative body, having charge of the school affairs of the city.. The case of Knowles v. Topeka, 33 Kansas, 692, is a sufficient answer to this contention. Topeka, like Atchison, had been a city of the second class, and became by mere increase in population a city of the first class ; and in the opinion of the court in that case, delivered by Chief Justice Horton, it is declared that “the Board of Education of ■ the city of Topeka is a distinct corporation from the municipal corporation of the city of Topeka.” That case came to the Supreme Court from the Superior Court of Shawnee County; and in the opinion in the latter court, delivered by Webb, Judge, an opinion which is found in the report of the case,, and referred to with approval by the Supreme Court, is this discussion of the question : “ Topeka remained a city of the second class until January, 1881, when it became a city of the first class. Article 10 o.f' said chapter 122, Laws of 1876, relates to ‘public schools in cities of the first class.’ Its provisions, as to the powers and duties, of the Board of Education, are very similar to those contained in article 11 relating to ‘ public schools in cities of the second class.’ But- there is no provision in said article 10, declaring that ‘ the public schools ’ or the ‘ school district ’ of cities of the first class shall be bodies corporate. Nor has the writer of this opinion been able to find any such provision in any act or statute, although the powers conferred by said article 10 are those usually conferred upon incorporated school districts, and the gov-

That which was true of Topeka is of course true of Atchison, and the Board of Education of the city of Atchison is a distinct corporation, and the proper one to be sued for the enforcement of a debt like this. Indeed, if it were not a corporate entity, by what right does it come into court and carry on this litigation ?

We think this is all that needs to be said in reference to the questions presented. The defences interposed are purely technical, and, as we think, without foundation.

The judgment is affirmed.