Board of Ed. of Paulding Co. v. Gray , 203 Ga. 583 ( 1948 )

1. A petition which states a cause of action for any of the relief prayed should not be dismissed on general demurrer.

2. Where the county board of education, pursuant to an act of the General Assembly approved February 1, 1946 (Ga. L. 1946, p. 206), received from an abolished local school district funds which had been derived from a sale of bonds voted for the purpose of building, repairing, and equipping a schoolhouse in that district, it can lawfully use the funds for no other purpose.

No. 16164. APRIL 16, 1948. On November 25, 1947, T. J. Gray and S.C. Leggett, as Trustees of the Camp Ground Consolidated School District of Paulding County, together with Comer L. Williams and forty-one other patrons, residents, and taxpayers of said school district, filed suit against the Board of Education of Paulding County, Georgia, and the several members thereof, both in their official capacity and individually; Mrs. Joe Matthews as County School Superintendent of Paulding County, and individually; First National Bank of Dallas, Georgia; and Johnson-Lane-Space Company, a corporation. Their petition alleged: Camp Ground Consolidated School District in Paulding County, Georgia, at an election called for that purpose and held on May 26, 1945, voted an issue of bonds in the amount of $12,000 for the purpose of building, repairing, and equipping a schoolhouse in and for said district. The bonds were duly validated June 26, 1945. They were sold by the proper authorities of the local school district to Johnson-Lane-Space Company for $12,000 on August 14, 1945, and the proceeds were deposited with First National Bank of Dallas, Georgia. On March 6, 1946, T. J. Gray, then Treasurer of Camp Ground Consolidated School District, paid over to the Board of Education of Paulding County on demand made through the County School Superintendent the entire amount of the proceeds derived from a sale of its school bonds, the amount being $12,602.70. The County Board of Education had no right to demand and take over these funds and its action in so doing was illegal. A tax was levied in the school district for an amount sufficient to service the bonds, and the first two maturing bonds in the sum of $1000 each, together with the accrued interest, were paid in 1946 and 1947.

The petition further alleged that the citizens, residents, voters, and taxpayers of the old school district had continuously insisted that the County Board of Education use the money turned over to it for the purposes for which the bonds were voted, but the board, without any authority for so doing, had refused to use it for that purpose. It was further alleged that the Board of Education had through the First National Bank of Dallas illegally paid to Johnson-Lane-Space Company a sufficient amount of the funds to retire the remaining unpaid bonds, and that the bank now has the bonds in its possession. The action of the County Board of Education in attempting to retire the bonds in the way alleged, being without authority of law, should be declared null and void, and the court should by decree restore all of the parties to the status they occupied prior to any attempt to retire them by the illegal use of the proceeds derived from a sale thereof.

The petition prayed: that the defendants be enjoined from further efforts to retire the bonds, and all acts which had been done with that in view be declared null and void and of no force and effect; that the Board of Education be required to return all of the bond funds which it had illegally received to the proper school authorities of Camp Ground Consolidated School District to be by them used for the purposes for which the funds had been voted, and that judgment against the board for the full amount received from the local school trustees be rendered; that the Board of Education and its members in their official and individual capacities be enjoined from interfering with the local school district authorities in their efforts to use the bond money for the purposes for which it had been voted; and that the Board of Education be required to build a schoolhouse in said Camp Ground Consolidated School District with the funds arising from a sale of the bonds which the district had voted.

The court overruled a general demurrer, filed jointly by all of the defendants, which assailed the petition as failing to state a cause of action for any of the relief prayed. The exception here is to that judgment. 1. The court properly overruled the general demurrer. It has long been settled law in this State that a petition can not be dismissed on general demurrer if the plaintiff is entitled to recover anything for which he prays. Liberty Lumber Co. v. Silas, 181 Ga. 774 (184 S.E. 286); Charles v. Sterling Security BrokerageCo., 182 Ga. 480 (185 S.E. 807); Wrenn v. Montgomery,186 Ga. 618 (198 S.E. 709); Crisp County Lumber Co. v.Bridges, 187 Ga. 484 (5) (200 S.E. 777, 126 A.L.R. 333);Lyles v. Watson, 189 Ga. 768 (1) (7 S.E.2d 909); Day v. Parham, 192 Ga. 484 (4) (15 S.E.2d 714). The allegations of the petition in the instant case, admitted as they are by the demurrer to be true, are sufficient to show that the plaintiffs are entitled to some of the relief prayed.

2. In Wheeler v. Board of Trustees of Fargo SchoolDistrict, 200 Ga. 323 (37 S.E.2d 322), this court held that the right of a local school district to sell an issue of bonds which had been voted, validated, and issued for the purpose of building and equipping a schoolhouse in that district, was not destroyed or impaired by the subsequently adopted Constitution of 1945 or by an act of the General Assembly approved February 1, 1946 (Ga. L. 1946, p. 206). By the act of 1946, all local school districts in the several counties of this State, except independent school districts, were merged into one school district for each county, thereby substituting such consolidated county school district for the various old local school districts. Nelms v. Stephens County School District,201 Ga. 274 (39 S.E.2d 651). Section 20 of the act of 1946 provides: "The county board of education of each county shall succeed to and be vested with all of the rights, powers and duties formerly vested in the local or consolidated school district trustees with respect to the building and equipping of schoolhouses in the county, preparing tax digests and furnishing same to the tax collector of the county in the manner formerly provided by section 32-1113 of the Code of 1933." By other provisions of the act the trustees or their treasurer of the abolished local school districts are required to turn over to the county board of education of their respective county within thirty days from the effective date of the act (February 1, 1946) all books, records, vouchers, school funds, and other school property held by them. Section 21 of the act provides: "In any local or consolidated school district in any county where there is an outstanding bonded indebtedness created for the purpose of building schoolhouses, or equipping schoolhouses, the county board of education shall, upon the effective date of this act, become the trustee of all funds which shall have been or may be collected from taxes or received from other sources, for the purpose of retiring the principal and interest on said bonds, or for creating a sinking fund for said purpose. The county board of education is charged with the duty of disbursing said funds to the bondholders in accordance with the terms under which the bonds were issued, and the duty of constructing any buildings, acquiring any building sites, or any equipment for which the bonds were issued." No attack is here made upon the constitutionality of the statute which gave to the board of education the right to take over for the purpose of administration the funds in question, and consequently we hold that the petition failed to state any cause of action in the plaintiffs for the recovery of the funds in question for the use of the local school district which had voted the bonds; but as it appears from our statement of facts, the county board of education received from the trustees of the abolished school district in question the entire proceeds derived from a sale of the bonds which had been voted, validated, issued, and sold for the specific purpose of building, repairing, and equipping a schoolhouse in that area of Paulding County embraced within the limits of Camp Ground Consolidated School District. It is elementary, of course, that the trustees of the district, had it not been abolished, could not have lawfully used these funds for any other purpose. Neither the Constitution of 1945 nor any statute passed pursuant thereto purports to give the board of education, after receiving such funds, any right or authority to expend them for any purpose other than that for which they were voted. On the contrary, the plain provisions of the act under which the board has authority to take possession of these trust funds require it to expend them only for the purpose for which the bonds were voted. The allegations of the petition were sufficient to show that the board had refused to use the funds in question for the only purpose for which they could be legally expended and were attempting to use them for another purpose. Therefore it follows that the allegations of the petition were sufficient to state a cause of action for rescission of the board's action in attempting to pay off and retire the issue of bonds in question.

Judgment affirmed. All the Justices concur, except Wyatt, J.,who dissents, and Head, J., disqualified.