And again: "It seems first of all necessary that the funds, permitted by section 11 to be raised for the legitimate, ordinary purposes of the government, should be preserved from invasion or diminution by any tax levied under section 12. Ex whether the court, in that departure from [ the first construction, meant to say section 12 should operate independently of section 11 not only as regards incurring debts for unusual expenditures, but for those of the annual routine as well; that is, whether under section 12 the people of a county might reperience demonstrates that the limitations of ject altogether the cash system of section 11 and vote debts for routine expenses up to 5 per cent. of the value of the taxable property of the county. While the court in none of these cases had occasion to determine gen- | erally the purpose for which an indebtedness might be incurred under section 12, in all of them the debts were created to provide for some kind of public service. The decisions in which this court sanctioned a tax levy in excess of the maximum prescribed in sec tion 11, when the tax was to pay a debt incurred under section 12, assumed that the section 11 are narrow enough even as applied to the general needs of the municipalities which 12 were not designed to cut down the annual that section governs. The provisions of section revenue intended for the ordinary wants of the local governments. But such a cutting down would be imperative, if the first alternative ruling, already discussed, were adopted." 128 Mo. loc. cit. 216, 220, 31 S. W. 760, 32 L. R. A. 157. (All italics mine.) Those expressions of this court when it abandoned the view that a tax levied to pay an indebtedness incurred under section 12 ordinary annual expenditures of the munici in section 11 plainly imply, and in effect must not transcend the rate limit provided pality are to be taken care of by taxes raised within the limits of section 11, and the ex- say, that the ordinary or local expenses of cess levy was permitted when voted accord- of within the limits of section 11, and that a county or municipality must be taken care ing to section 12, on the theory that ex-section 12 authorizes an indebtedness to be penditures for other than ordinary purposes incurred not to take care of those expenses, might become necessary, and the revenue but of new debts created for other purposes raised within the rates prescribed in section 11 be insufficient to meet them without the county or municipality. That section 11 than to carry along the ordinary affairs of intrenching on the funds required to defray was intended to limit the power of a public the usual running expenses of the municipal corporation to tax for usual and current purity. As stated, in every case so far decidposes was declared in Brooks v. Schultz, ed, the unusual expenditure was for a public 178 Mo. 222, 226, 77 S. W. 861, and in Evans utility, and the court declared that the mak- v. McFarland, 186 Mo. 703, 725, 85 S. W. 873, ers of the Constitution could not have intend- et seq. where the court in adverting to the ed either that municipalities should be decision in Lamar, etc., Co. v. Lamar, supra, denied the benefits of public utilities, or that said that, in the latter case: they must be paid for out of the rates provided in section 11, to the deprivation of means to pay the ordinary expenses of the particular public corporation. The minority opinion in the Lamar Case held that a municipality had two alternatives; i. e., to do without a desired public service, or pay for it out of taxes raised within the limits of section 11. The majority opinion held there was a third possible construction, "that is to say, may it not have been intended that the 'annual tax' authorized to be imposed, upon a vote, under section 12, should be levied and collected (within the limitations of that section) in addition to the annual rates for local pur poscs permitted (without any vote) by section 11?" And again, treating of the two sections, the opinion said: "This court, brushing away all contrary expositions, held, in effect, that section 11, article 10, of the Constitution, contemplated an annual rate of taxation for municipal purposes to be levied without a vote, of 50 cents on $100 of valuation, to be devoted under the cash system of the Constitution, to affording the municipality a means of subsistence, and that the tax contemplated by section 12 of article 10 of the Constitution is not a fixed charge on the reve nues derived by said 50-cent levy, but is in addition thereto." The opinions on this subject show the thought has never occurred to this court heresection 12, in order to discharge a debt pretofore that a debt might be created under viously incurred for the ordinary expenses of a city or county; and that, on the contrary, it was always in the minds of the judges, both those who agreed to the later construction of the. Constitution and those who adhered to the earlier one, that such a debt could be contracted only for some other purpose than taking care of delinquent warrants issued for current expenses of prior years, or judgments on them. And, as said before, so far no such indebtedness has been sancEarl, 87 Mo. 252. Compare Const. 1875, art. tioned except for some public service. I 9, § 19." do not say cases cannot arise in which it "One object was to limit the rates of taxation for raising the annual revenue required for local purposes; the other, to limit the power to incur indebtedness beyond the annual income and revenue provided for any one year. "Section 11 deals with rates of taxation for annual revenue which may be applied by the lo cal authorities to meet 'the ordinary and current expenses' of the local government. Book v. (218 S.W.) properly might be created for another pur-sistency that if a county has issued warrants pose, but only say that in my opinion it can- which it is unable to pay because it was not, under the Constitution, be contracted to disappointed in its collection of taxes and discharge warrants issued for the usual an- other anticipated income, nevertheless it may nual expenses, or judgments on them, when discharge those warrants out of the surplus the warrants are not paid because of a de revenues of a later year; for this policy ficiency of the expected income from taxes does not tend to pile up public debts, but and other sources of revenue. tends, rather, to induce economy of adminIt is true this court has held a county may istration, and thereby discharge debts which anticipate the revenues provided for a year, arise through failure to collect provided revthat warrants may be drawn within the enues in full. The contrary result will amount of the provided revenue, and, if happen if you say a county need not be warrants are not paid because of disap- confined to a surplus yielded by economical pointment in the amount of taxes received, methods of business, higher assessments, or, they are not void, but may be paid out of perchance, a growth of the taxable wealth any surplus remaining in the treasury in a of a county in paying off delinquent current succeeding year after the ordinary expenses expenses, but may vote and issue bonds for of such year have been defrayed; but the the purpose. This doctrine tends to frustrate latter must be paid first, a clear indication the policy of the Constitution to put public that every year must bear its own burdens affairs on a cash basis and prevent the acbefore it can take on those of a prior year, cumulation of debt. The admitted fact in thereby preventing debts from accumulating. the present case that the counties of the state Book v. Earl, 87 Mo. 246; Trask v. Living-owe nearly $2,000,000 for delinquent current ston Co., 210 Mo. 582, 594, 109 S. W. 656, expenses, together with the suggestion that, 37 L. R. A. (N. S.) 1045. This power of an- if Clark county succeeds in the present atticipation of the current revenues appears tempt to fund its said debt, other counties to have been confined by the Supreme Court likely will follow, shows what will be the reof Iowa, in construing a constitutional provi- sult if section 12 is construed to permit the sion like ours, to such revenues as were "ab- funding. With $2,000,000 of county debts solutely certain to be received by the collec- incurred for ordinary expenses, to say noth tion of taxes." French v. City of Burlington, ing of those of cities, towns, etc., put into the 42 Iowa, 614. And in Book v. Earl, 87 Mo. 252, form of interest-bearing securities, what will the court indicated the extent of the power be left of the "cash system" in public busito anticipate, and what was meant by the ness, so often asserted to have been the object "revenues provided," by saying the purpose of the Constitution? To permit a debt to be of the Constitution was to limit the "expendi- voted in advance to pay current expenditures, tures in any given year to the amount of because a deficiency of revenue is certain to revenue which such tax would bring into the occur in consequence of uncollected taxes treasury for that year; * the county (though such debt would be a new one and court might anticipate the revenue collected, therefore more within the letter of section and to be collected, for any given year, and 12) would enable a county to abolish totally contract debts for ordinary current expenses, the cash system of public business, intended which would be binding on the county to the to be put into effect by the Constitution; extent of the revenues provided for that and the same mischief must follow, if a debt year, but not in excess of it." It is doubtful may be voted to make good a deficiency whether a sound construction of the Con- which has accrued from anticipating the revstitution will allow a county court to issue enues of previous years. In either event the warrants up to the full amount of the income maximum rates prescribed in section 11 the county will collect if all the taxes levied could be nullified. The foregoing consideraare paid, in view of the well-known fact that tions make it patent to my mind that heretoreceipt in full of levies rarely is realized. fore the discharge of warrants issued or Be that as it may, there is an essential differ- judgments rendered on account of current ence in principle between holding that a war-expenditures was not regarded by this court rant drawn against the revenues provided for as a purpose for which a county may bea year may be paid out of the surplus rev- come indebted under section 12, and that to enues of a succeeding year and holding that so hold would be an unsound construction an indebtedness may be created and bonds of the Constitution. issued to take up an aggregate of debts in- The weight of authority supports the prop curred for ordinary expenses. The principal osition that the proposed bonds, issued to purpose of the sections of the Constitution fund prior contractual obligations, would not with which we are dealing, as has been de- constitute, becoming indebted within the clared repeatedly, is to prevent the accumula- meaning of section 12; in other words, tion of public debts, to establish the cash sys- would not be the creation of a new indebtedtem and abolish the credit system in public ness, when the transaction is regarded from affairs, and to restrain improvident manage the standpoint of what are the elements of a ment. It may be argued with some con- new debt. In one sense the bonds may be regarded as a new debt, but not in the con-, cepted the minority opinion. Veatch v. City stitutional sense. Said section has reference of Moscow, 18 Idaho, 313, 109 Pac. 722, 21 to becoming indebted in a substantial sense, Ann. Cas. 1332. In the New York Court of and so as to increase the financial obliga- Appeals the point was presented of whether tions of the county or city. That bonds is- or not bonds, issued under a refunding act sued by a public corporation to fund a float- which might either be used to discharge a ing obligation or to refund old bonds do prior issue or sold and the proceeds used to not constitute a new indebtedness in the cancel the prior ones, were valid, in view meaning of such constitutional limitations of a statutory provision against the city is the doctrine accepted by the standard text-borrowing money. The new bonds were held writers upon the reasoning and decisions of not to amount to a borrowing and increasing the courts. Abbott, Public Securities, § 209, of the debt of the city within the statute, the p. 431; 5 McQuillin, Mun. Corp. § 2770, p. court saying that, if sold for the purpose of 4798. The author first cited said: raising money to pay old bonds, the effect was not different from what it would have been if they had been exchanged. The suit was one for specific performance to compel the purchaser of the new bonds to take them, he defending on the ground that they were invalid. Poughkeepsie v. Quintard, 136 N. Y. 275, 32 N. E. 764. The Supreme Court of Oklahoma, in passing upon the legality of bonds issued to take up warrants and other forms of floating debts of that state and of the territory of Oklahoma, had occasion to decide whether the new bonds created a new debt, for, if they did, they were void, as the question had not been submitted to a popular vote. The opinion said: "The objection that through the issue of renewal or refunding bonds a new debt is created has been repeatedly decided by the courts as not well taken, for the reason that the proceeds of such bonds are used, not for the purpose of adding to the indebtedness or the obligations of the corporation, but of paying outstanding ones, which, immediately upon the exchange or payment, become canceled and extinguished and incapable of enforcement as corporate obligations; the only legal indebtedness existing against the public corporation as a result of the process being the new refunding or renewal bonds. Bonds issued to fund a valid indebtedness neither create any debt nor increase the debt, but merely change the form of the indebtedness." Abbott, loc. cit. 431, 432. It is true the Supreme Court of the United States, in an opinion dissented from by three of the Judges and decided the other way on the circuit (Cummins v. Township of Doon [C. C.] 42 Fed. 664), took a distinction between refunding bonds issued to be exchanged for outstanding bonds and those issued to be sold and the proceeds devoted to paying the prior bonds, holding that in the former case an indebtedness was not created within the meaning of such a constitutional provision as section 12; whereas, in the latter case it was; because, in the interval be tween the issue of new bonds and the application of the proceeds to pay the old ones, there was an increase of the indebtedness of the public corporation; a doctrine that hinders needlessly the power of a municipality to refund its debts. It is said in a treatise cited above that the decision has been so distinguished and criticized in respect of the point in question that its authority has been much modified, if not entirely destroyed. Abbott, Pub. Secur. p. 435. The case has not been approved generally; one court remarking that the distinction taken "seems to be more nice than real, and, in view of the vigorous dissent that was accorded the opinion, we may be permitted to doubt whether it will ever be made again." City of Huron v. Sav. Bank, 86 Fed. 279, C. A. 42, 49 L. R. A. 534. In another case the decision was declared to be the source of all the trouble in dealing with the question in hand, and the opinion declared the courts of the states had almost uniformly refused to follow it, and instead had ac "It has frequently been held that, where bonds have been issued for the express purpose of liquidating an outstanding indebtedness, such bonds neither created nor increased the public debt, but simply changed its form." In re Mennefee, State Treas., 22 Okl. 365, 374, 97 Pac. 1014, 1018. The point arose for decision in Indiana, as to the validity of a proposed bond issue, sion which prohibited public corporations and that, too, under a constitutional provito "become indebted in any manner or for any purpose to an amount in the aggregate taxable property within such corporation, exceeding 2 per cent. on the value of the to be ascertained by the last assessment for debt, or the substitution of new evidences of a pre-existing debt, is not in any legal or proper sense the creation of a new indebtedness." Powell v. City of Madison, 107 Ind. 106, 8 N. E. 31. In dealing with the proposition, the Supreme Court of California said that A "Merely to fund or refund an existing debt is not to incur an indebtedness or liability.' bond is not an indebtedness or liability—it is 30 C.debtedness; and a mere change in form of the only the evidence or representative of an inevidence of indebtedness is not the creation of a new indebtedness within the meaning of the Constitution." The court then proceeded to examine and reject the case of Doon Twp. v. Cummins, (218 S.W.) 661(1)-CITY CHARTER PROVISIONS CONFER POLICE POWER 142 U. S. 366, 12 Sup. Ct. 222, 35 L. Ed. 1044, | stage of the proceeding, even after conviction saying the correct rule was stated in the and judgment, where it appears that petitioner dissenting opinion. Los Angeles v. Teed, 112 is legally restrained of his liberty for violation Cal. 319, 327, 44 Pac. 580. There are other of such law, even though it be on a charge of a misdemeanor punishable only by fine. authorities of like tenor, including 5 McQuillin, Mun. Corp. § 2770; 1 Dillon, Mun. Corp. 2. MUNICIPAL CORPORATIONS 379; Hirt v. City of Erie, 200 Pa. 223, 49 Atl. 796; Hotchkiss v. Marion, 12 Mont. 218, 29 Pac. 821, followed in Palmer v. City of Helena, 19 Mont. 61, 47 Pac. 209; Ewert v. Mallery, 16 S. D. 151, 91 N. W. 479; Hamilton County v. Sav. Bank, 157 Fed. 19, 84 C. C. A. 523; Morris v. Taylor, 31 Or. 62, 49 Pac. 660. It seems to me this is the doctrine of both the majority and the minority opinions in State ex rel. v. Neosho, 203 Mo. 40, p. 95, 101 S. W. 99, of the majority opinion by implication and of the minority one by express statement. It will be observed the question has been presented to the courts in this phase: That bonds intended to be issued to fund a floating debt or refund prior bonds would increase the total indebtedness of the public corporation beyond the constitutional limit, in deal'ing with which proposition the courts, if not uniformly, yet nearly so, have held the constitutional limitation would not be exceeded because the new bonds would not constitute a new debt; therefore would not increase the indebtedness. But the principle of the decisions is that such a funding or refunding of bonds is not a "becoming indebted" on the part of a municipality or county, for the reason that it is already indebted, and is simply changing the evidence or form of the indebtedness. City Charter of St. Louis, art. 1, § 1, cls. 14, 23, 25, and 26, giving the city the right to establish, locate, dedicate, and supervise the highways of the city, and clause 33, giving city authority to do all things expedient for promoting and maintaining the comfort, education, morals, police, government, health, welfare, trade, commerce, or manufacture of the city or its inhabitants, have their origin in the police power of the state and authorize the city not only to establish and improve its streets, but which they may be used, subject only to the to prescribe the terms and conditions upon Constitution and laws of the state under Const. art. 9, § 23. 120-PENAL 3. MUNICIPAL CORPORATIONS A prosecution for violation of ordinance prohibiting certain acts and prescribing the penalty for violation thereof, while technically a civil proceeding, will upon conviction authorize the imposition of a penalty, and in thus far it partakes of the nature of a criminal action, and the ordinance on which it is based is subject to the same rules of construction as a criminal statute. 4. MUNICIPAL CORPORATIONS 120-RULE AS ΤΟ If the issue of bonds is not a new debt, when to hold it is would stand in the way of the issue as being an infringement of the Constitution, it is difficult to perceive how it can be a new debt, when to so hold will sanction the issue as constitutional. But regardless of the technical distinctions taken in this connection, the essential fact is that section 12, and similar limitations, were not adopted with reference to refunding debts, but with reference to incurring them. For the foregoing reasons, I respectfully dissent from the majority opinion herein. Ex parte LERNER. (No. 21641.) CONSTRUCTION STATED. OF PENAL ORDINANCES NANCE TO BE GENERAL IN ITS TERMS AND A penal ordinance must be general in its City ordinance, prohibiting solicitation of prospective purchaser while such purchaser is on street or sidewalk in front of the place of business of a competitor of the soliciting per (Supreme Court of Missouri, in Banc, Jan. 26, son, but which does not prohibit the general 1920.) 1. HABEAS CORPUS 32-CONSTITUTIONALITY OF LAW UNDER WHICH RELATOR HELD SUBJECT TO ATTACK. personal solicitation of persons for business purposes upon the streets and sidewalks, held void, being special in its terms and local in its application, in violation of Const. art. 4, § 53, cl. 32. 7. MUNICIPAL CORPORATIONS 589-ORDI NANCE AS TO SOLICITATION OF PERSON UPON The constitutionality of the law for violation of which petitioner in habeas corpus was imprisoned is open to attack on habeas corpus proceeding, since an unconstitutional law is no law and its validity is open to attack as deter- The authority for the enactment of ordiminative of the question of jurisdiction at any nances relating to solicitation of prospective For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes purchasers upon the sidewalk must arise from place of business, for the purpose of examining the exercise of the police power. 8. MUNICIPAL CORPORATIONS CISE OF POLICE POWER FOR PRESERVATION OF CITIZENS DELEGATED TO CITY. or purchasing similar goods, wares or merchandise, shall be deemed guilty of a misdemeanor, 590-EXER- and upon conviction thereof shall be fined not less than ten dollars nor more than one hundred dollars. Provided, however, that nothing herein shall be construed as prohibiting licensed peddlers acting within the scope of their license, nor members of bona fide organizations doing lawful picket duty, nor as prohibiting any one, whether as principal or agent, from soliciting trade upon the street or sidewalk in front of his own place of business." Ordinance 30332, approved April 11, 1919. The state has delegated to cities the police power to be exercised in the preservation of the health, safety, welfare, and comfort of their citi zens. 9. MUNICIPAL CORPORATIONS 589-WHATEVER IS CONTRARY TO PUBLIC POLICY OR PUB LIC INTEREST IS SUBJECT TO POLICE POWER. Whatever is contrary to public policy or is inimical to the public interest is subject to the police power. WALKER, C. J. The writ of habeas corpus issued herein was directed to the marshal of the city of St. Louis commanding him to have the body of the petitioner before this court to be dealt with as might be determined. The production of the body of the petitioner being waived, the return of the respondent, the marshal, discloses that he holds the petitioner to answer a charge of having violated an ordinance of the city of St. Louis which is alleged by the petitioner to be invalid. The body of said ordinance, with which we are alone concerned, is as follows: "Any person who shall accost another person on a street or sidewalk in front of any store, house or place of business in the city of St. Louis, and solicit such other person to purchase any goods, wares or merchandise of a like nature as those kept for sale within said store, house or place of business at another store, house, or place of business, or shall solicit such other person to enter such other store, house or [1] I. It was formerly ruled by this court that one held under process issued by a court having jurisdiction of the person and the offense, and where the person was in the custody of the proper officer, habeas corpus would not lie to test the constitutionality of the law under which the restraint was claimed to be authorized. This limitation upon the court's action first found expression in the early case of In re Harris, 47 Mo. 164, which was affirmed in the Boenninghausen Case, 91 Mo. 301, 1 S. W. 761. The latter ruling, however, overlooked an earlier case in the same volume, of In re Marmaduke, 91 Mo. 228, 4 S. W. 91, 60 Am. Rep. 250, which held that the court was not so limited in habeas corpus proceedings and which overruled without reference thereto the Harris Case. In Ex parte Smith, 135 Mo. 223, 36 S. W. 628, 33 L. R. A. 606, 58 Am. St. Rep. 576, the rule as declared in the Marmaduke Case was expressly approved and has since been uniformly followed. Flukes, 157 Mo. loc. cit. 127, 57 S. W. 545, 51 L. R. A. 176, 80 Am. St. Rep. 619; Ex parte Neet, 157 Mo. loc. cit. 533, 57 S. W. 1025, 80 Am. St. Rep. 638, and cases cited; Ex parte Lucas, 160 Mo. 218, 61 S. W. 218. A cogent reason for this later ruling rests in the fact that an unconstitutional law is no law, and its validity is therefore open to attack as determinative of the question of jurisdiction at any stage of a proceeding, In re even in a criminal case after conviction and judgment; the controlling requisite in the application of the rule being that the record disclose that the petitioner is illegally restrained of his liberty regardless of the stage of the proceedings or nature of the charge, although it may be but a misdemeanor punishable only by a fine. See the Smith, Neet, and Lucas Cases, supra, and others in which the restraint was upon charges for misde meanors punishable as stated. The rule therefore may be regarded as settled in this jurisdiction that if a person is deprived of his liberty for any act not in contravention of an existing law, or if the act under which he is held is unconstitutional, habeas corpus is the proper remedy to restore to him his freedom. Ex parte Neet, supra, and cases cited. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes |