Horner v. Chamber of CommerceAnnotate this Case
68 S.E.2d 660 (1952)
235 N.C. 77
HORNER v. CHAMBER OF COMMERCE OF CITY OF BURLINGTON, Inc. et al.
Supreme Court of North Carolina.
February 1, 1952.
*662 William R. Dalton, Jr., Burlington, for plaintiff, appellee.
Cooper, Sanders, & Holt and W. D. Madry, Burlington, for defendants, appellants.
There is certainly no statutory warrant for the outlay of tax funds under scrutiny unless it can be found in G.S. § 158-1, which provides that the governing body of any city, whose qualified voters have approved Chapter 158 of the General Statutes in an appropriate election, may annually set apart and appropriate from the funds derived annually from the general taxes levied and collected in the city an amount not less than one-fortieth of one per cent, nor more than one-tenth of one per cent, upon the assessed value of all real and personal property taxable in the city, which funds shall be used and expended under the direction and control of the governing body of the city, under such rules and regulations or through such agencies as such governing body shall prescribe, for the purpose of aiding and encouraging the location of manufacturing enterprises, making industrial surveys and locating industrial and commercial plants in or near the city; encouraging the building of railroads thereto, and for such other purposes as will, in the discretion of the governing body of the city, increase the population, taxable property, agricultural industries, and business prospects of the city.
The facts found by the trial judge undoubtedly sustain the adjudication that *663 the outlay in question does not fall within the compass of G.S. § 158-1, and by reason thereof constitutes an unlawful diversion of tax funds from the treasury of Burlington. The findings are binding on the parties to the appeal if they are supported by evidence. Poole v. Gentry, 229 N.C. 266, 49 S.E.2d 464.
This brings us to the chief question presented by the assignments of error: Does the testimony support the findings of fact of the trial judge?
In determining whether there is evidentiary support for the findings of the trial judge in an action where trial by jury is waived, this court considers not only the facts in evidence favorable to the successful party, but also all reasonable inferences which may be drawn from such facts in his favor. 5 C.J.S., Appeal and Error, § 1656i.
When the evidence in the instant case is considered in this manner, it indicates that the tax moneys in controversy were appropriated and used under these circumstances:
1. The governing body of Burlington, i. e., the Burlington City Council, made an absolute gift of the tax moneys to the Chamber of Commerce without specifying how they were to be spent, and without reserving the right to direct or control their use.
2. The Burlington City Council did not, in fact, direct or control the Chamber of Commerce to any degree in its disposition of the tax moneys. Indeed, the Chamber of Commerce did not even report to the Burlington City Council what it did with them.
3. The Chamber of Commerce indistinguishably commingled the tax moneys and all its other revenues, and indiscriminately used the resultant common fund to pay rents, salaries, and other expenses incurred by it in carrying out its corporate functions.
These things being true, there is sufficient evidentiary support for the findings of the trial judge that the tax moneys in controversy were not used or expended under the direction and control of the Burlington City Council through the agency of the Chamber of Commerce for the purposes specified in G.S. § 158-1, but on the contrary, they were used or expended by the Chamber of Commerce at its own untrammeled discretion for its own ordinary activities.
The trial judge rightly rejected for irrelevancy the statements of Philip Swartz and R. S. Winslow, witnesses for the defendants, that they had examined "Exhibit B showing various expenditures by the Burlington Chamber of Commerce * * * for publicity," and "that the matters for which the expenditures shown were made are generally accepted as approved methods of publicity for obtaining new industrial, commercial, and business enterprises for a city * * * in * * * North Carolina and elsewhere." The expenditures listed in Exhibit No. 8 antedated the payment of the tax moneys to the Chamber of Commerce, and do not represent outlays of those moneys. Besides, whether a particular disbursement falls within the compass of G.S. § 158-1 is not a proper subject for opinion evidence. State v. Cuthrell, 233 N.C. 274, 63 S.E.2d 549.
Since no occasion for so doing arises on the present record, we do not express any opinion as to whether the objects enumerated in G.S. § 158-1 constitute public purposes in a constitutional sense under Article V, Section 3, of the State Constitution.
The trial judge found as a fact that the officials of both the Chamber of Commerce and the City of Burlington acted at all times in the honest belief that the appropriation and expenditure of the $2,000 was within the law. Their good faith does not impair the legal doctrine that "a tax is an imposition for the supply of the public treasury and not for the supply of individuals or private corporations, however benevolent they may be." 51 Am. Jur., Taxation, Section 6.
The judgment requiring the restoration of the tax moneys to the municipal treasury is affirmed.