STATE ex rel. MURPHY v. BOARD OF COM'RS OF OKLAHOMA COUNTY

STATE ex rel. MURPHY v. BOARD OF COM'RS OF OKLAHOMA COUNTY
1939 OK 310
95 P.2d 101
185 Okla. 652
Case Number: 27343
Decided: 09/12/1939
Supreme Court of Oklahoma

STATE ex reI. MURPHY et al.
v.
BOARD OF COM'RS OF OKLAHOMA COUNTY et al.

Syllabus

¶0 1. COUNTIES--Members of Board of County Commissioners in Good Faith Ordering Issuance of Warrants in Payment of Claims Against Appropriation Later Adjudged Illegal Held not Personally Liable to County.
Ordinarily, the board of county commissioners of a county exercises discretionary powers in ordering the issuance of warrants in payment of claims against an appropriation approved by the excise board for county purposes, and in the absence of bad faith or of statute or previous final adjudication expressly prohibiting the particular expenditure for which the appropriation was made, the members of said board are not personally liable to the county for such expenditure made during the protest period for purposes enumerated in section 12315, O. S. 1931, 68 Okla. Stat. Ann. § 341, merely because the particular appropriation is later declared illegal by the courts. (Following rule of Board of Education v. Cloudman, 185 Okla. 400, 92 P.2d 837.)
2. SAME--County Treasurer in Good Faith Paying Warrant Fair on Its Fate and Duly Drawn on Appropriation Later Adjudged Illegal Held not Personally Liable to County.
The act of a treasurer of a county in paying a warrant fair on its face and duly drawn on an existing appropriation is purely ministerial and he is under no legal duty to examine into the legality of said appropriation, and in the absence of bad faith, is not personally liable to the county merely because the appropriation is later declared illegal by the courts. (Following rule of Board of Education v. Cloudman, 185 Okla. 400, 92 P.2d 837.)
3. SAME--Petition in Taxpayers' Action Held not to State Cause of Action Against Persons Receiving Warrants Issued Against Appropriations Later Adjudged Illegal.
A petition which merely alleges in effect that certain warrants were issued to certain persons for services rendered and supplies furnished to a county during the protest period for purposes enumerated in section 12315, O. S. 1931, 68 Okla. St. Ann. § 341, and that such warrants were issued against approved appropriations which were subsequently held to be illegal and invalid in another action, does not state a cause of action in favor of taxpayers against the persons receiving such warrants in a suit brought by them to recover on said warrants, and the trial court properly sustained a general demurrer to such petition. (Following rule of Board of Education v. Cloudman, 185 Okla. 400, 92 P.2d 837.)
4. SAME--Allegation in Petition in Taxpayers'Action Hold Insufficient to Show Bad Faith and Unlawful Conspiracy on Part of Defendants or That Judgment Rendered on Warrants Is Void.
An allegation that parties and their attorneys conspired and wrongfully withheld from the trial court, in a suit on county warrants, information to the effect that the courts had finally adjudicated the appropriations against which the warrants were issued to be unauthorized and illegal, when such adjudication was made after the services were performed, the supplies furnished and the warrants issued, is insufficient to show bad faith and an unlawful conspiracy, or that the judgment rendered therein is void. (Following rule of Board of Education v. Cloudman, 185 Okla. 400, 92 P.2d 837.)

Appeal from District Court, Oklahoma County; Lucius Babcock, Judge.

Action by the State on relation of Ellen Murphy and others, taxpayers, against members of the Board of County Commissioners of Oklahoma County and others, to recover money judgment for unauthorized expenditures of public funds of Oklahoma County. From order and judgment sustaining several demurrers on various grounds, the plaintiffs appeal. Affirmed.

B. M. Parmenter and Harlan Grimes, for plaintiffs in error.
Hayes, Richardson, Shartel, Gilliland & Jordan, for. defendant in error First National Bank & Trust Company of Oklahoma City.
Everest, McKenzie & Gibbens, for defendant in error Liberty National Bank of Oklahoma City.
Maurice M. Thomas, for defendants in error J. O. Crawford and National Surety Corporation.
Gordon Stater, for defendants in error Hartford Accident & Indemnity Company, New York Casualty Company, and Standard Surety & Casualty Company, sureties on the bond of County Treasurer, William F. Vahlberg.
Thurman & Thurman, for defendant in error Fidelity & Deposit Company of Maryland.
Lewis R. Morris, County Atty., and B. C. Logsdon, Asst. County Atty., for defendants in error Board of County Commissioners and William F. Vahlberg, County Treasurer.

WELCH, V. C. J.

¶1 This is an appeal from the order and judgment of the district court of Oklahoma county sustaining demurrers of the several defendants to the petition of the plaintiffs, and rendering judgment for defendants.

¶2 The suit is for the recovery of money judgment as a consequence of alleged unauthorized expenditures of public funds of Oklahoma county.

¶3 One of the grounds of demurrer sustained by the trial court Is that the petition does. not state a cause of action.

¶4 The petition reflects the following:

¶5 In due time taxpayers filed a protest with the Court of Tax Review protesting a taxlevy for financing appropriations made by the excise board of Oklahoma county for highway patrol purposes for the fiscal year 1931-32. The Court of Tax Review sustained the protest and canceled the appropriation 9mounting to some $33,900, and struck from the tax rolls the tax levy made for financing such appropriations.

¶6 Thereafter this court, upon appeal, affirmed such judgment. In re Protest of Chicago, R. I. & P. Ry. Co., 164 Okla. 239, 25 P.2d 690.

¶7 In the meantime warrants were issued by the defendants, board of county commissioners, against such appropriations in the total sum of approximately $33,000.

¶8 Certain of the said warrants were paid by various of the defendants, then county treasurer. The warrants were issued to many persons who are made parties defendant herein, and many of the warrants so issued were paid to them and for their benefit and many more of the warrants were purchased by the several banks, defendants, and reduced to judgment shortly after the aforesaid opinion of this court was handed down in the protest case. Such judgments in the approximate sum of $10,000 were promptly reduced and such banks, defendants, now hold the refunding bonds.

¶9 Others of the warrants were likewise reduced to judgment in the approximate sum of $8,000 by a bank not party defendant herein, which judgment was subsequently paid to the Bank Commissioner of the state.

¶10 Numerous points of law are argued in the extensive briefs filed by the several parties, and we are favored by citation of many authorities. We conclude, however, that the case is controlled by the recent case. of the Board of Education of Oklahoma City of Cloudman, 185 Okla. 400, 92 P.2d 837, decided since the filing of the briefs herein. The facts therein are in all material respects similar to the facts here, and the theory and conclusions of law therein announced are applicable and binding on the court here. It was concluded in that case that the issuing and paying officials of the school district, as well as the persons receiving the funds of the school district, were not liable, if the statute did not specifically prohibit the expenditure of funds for such purposes, and if the expenditure was made and received in good faith before the illegality of the expenditure was finally determined by the courts; and the fact that the expenditures are in excess of the income and revenue provided for the fiscal year does not change the rule. As was said in the, Cloudman Case, supra, we know of no express statute or previous final adjudication expressly prohibiting the particular expenditures here made.

¶11 The authour of this opinion dissented in the Cloudman Case, and still entertains the view that the rule in that ease is not sound, but nevertheless recognizes that the rule of that case in its full extent must be regarded as binding on the court in this case, and for that reason it must be and is followed here.

¶12 True, in this ease, the plaintiffs attempt to plead bad faith and conspiracy These allegations relate to the action of the county attorney, the county commissioners, and the several banks in the matter of obtaining the judgments after this court had finally adjudicated the tax protest case. It is alleged that they withheld from the trial court in the suits on the warrants the fact that the appropriations had been held to be illegal and that same had been canceled. However, it is shown by this petition that the services had been performed and the warrants issued before the appropriations were declared illegal by this court, and therefore under the theory of law adopted in the Cloudman Case, supra. such facts were immaterial and the warrants were not as a matter of law illegally issued.

¶13 In view of the above conclusion, other questions urged in the briefs are not herein determined.

¶14 The judgment is affirmed.