First --The County Treasurer (the respondent), refuses to pay the warrants set forth in the petition, because the same constitute a fractional part of the floating or unfunded indebtedness of the County of San Diego; and the County Treasurer is forbidden by law from paying the same, or any part of said floating or unfunded indebtedness, except in conformity with the provisions of the Act of March 18, 1868, entitled an Act for the government of the County of San Diego. (Statutes 1867--'68, pp. 176 to 181.)
Second --The warrants set forth in the petition are county warrants (public indebtedness), and, in contemplation of law, stand on the same footing as if they were national or State indebtedness--the holder of such indebtedness is at the will and mercy of the sovereign power, as to time, manner and amount of payment; and the creditor can get his pay in such manner only as the sovereign power may provide for that purpose. The creditor takes with notice of all those infirmities, and if he does not get his money at the time it is promised, it does not lay in his mouth to complain.
Third --We insist that public indebtedness is not ex contractu, or within the purview or meaning of Article I, Section 10, Constitution of the United States, or of Article I, Section 16, of the Constitution of this State, and that the Act for the government of the County of San Diego, above cited, is not a law impairing the obligation of contracts, within the meaning of those sections.
Fourth --The authorities cited by petitioner's counsel, we maintain, are not in point. In the leading case cited by him (McCauley v. Brooks, 16 Cal. 12), the State had, in part at least, divested herself of her sovereign power; that is to say, the State, in a special manner, by appropriate legislation, empowered her agents to bind her by contract (private contract, we may say). Thus, the State, like an individual, became a party to a contract; she thereby adopted the law of contracts, and incurred all the liabilities consequent to a breach of her contract, the same as an individual in that case.
Finally, we insist that the law enunciated by this Court in Sharp v. Contra Costa County (34 Cal. 284), when applied to this case, must dispose of it in favor of the respondent, Estudillo.
JUDGES: Temple, J., delivered the opinion of the Court. Wallace, J., did not participate in the decision of this cause.
OPINION
TEMPLE, Judge
On the 18th of March, A. D. 1868, an Act was passed by the Legislature to provide for the government of the County of San Diego. Among other things, that Act provides for the funding of the funded indebtedness of the county, and creates a Board of Commissioners, whose duty it is to " carefully examine into the legality or illegality of all the unfunded indebtedness, accounts, warrants, vouchers, claims, or demands of every nature or character whatever, which now are or may remain outstanding against said county on the first day of April, 1868; and they shall audit and allow, or reject in whole or in part, any or all of said unfunded indebtedness, accounts, warrants," etc., " according, as in their judgment, the same shall appear to be a legal and just claim against the county, or otherwise," etc. " No such certificate of indebtedness, warrant, claim, demand, or other charge, shall be a legal and valid claim against said county, or be paid, until passed upon, audited and allowed by said Board." The Act then provides, that if the warrants are audited by them, they shall allow interest; provided, if only a portion due on the warrant is allowed by them, then interest shall be reckoned on that portion only.
The petitioner is the holder of certain warrants, issued by the Auditor of the county, and which had been duly presented to the Treasurer for payment, and indorsed " not paid for want of funds," prior to the passage of the Act. His claim, therefore, was a part of the recognized indebtedness of the county, authenticated and allowed as provided by law, and it was the duty of the Treasurer of the county to pay the warrants from the first moneys in the treasury properly applicable thereto. He had done all the existing laws required him to do.
It was not competent for the Legislature to pass an Act which would declare these claims invalid, nor could it authorize a commission to do so. Nor could the Legislature impose other and new conditions upon the creditors. (McCauley v. Brooks, 16 Cal. 11; People v. Bond, 10 Cal. 566.)
The warrants of the petitioner, therefore, if he had chosen to have them funded, would have been conclusive evidence that his claim was legal and just within the meaning of the Act. The petitioner elected, however, not to present his warrants, and they have never been funded. By the terms of the Act, unless so presented and allowed by the Commissioners, they are not valid and legal claims against the county, and cannot be paid.
This provision of the Act is repugnant to the Constitution. The creditor could not be compelled to accept another and an essentially different mode of payment from that provided by his contract--that is to say, by the laws existing at the time he became a creditor of the county. The authorities cited (McCauley v. Brooks, supra ) clearly establish that this restriction in the Constitution applies to contracts, to which the State is a party, as fully as to contracts between individuals. It is true, the State, by virtue of its sovereign power, may refuse to permit itself to be sued, or may omit to raise a revenue to pay its just debts, but it cannot annul contracts it has entered into, or deprive individuals of vested rights acquired under them. But if the revenue has been provided by law, and the money produced by it for the purpose of paying the debts the State has contracted to pay, the creditor, who by law is entitled to the money, has an interest in the fund, of which the Legislature cannot deprive him. (McCauley v. Brooks, supra ; Robinson v. Magee, 9 Cal. 81.)
In the ninth section of the Act referred to, the Legislature has provided what taxes may be imposed by the county for county purposes, and has distributed them to the various funds, and designated the purpose for which each fund shall be devoted. No provision is made for that class of indebtedness to which the claim of the petitioner belongs, except the funding provisions already referred to. No moneys are provided from which it can properly be paid. Unless there are funds in the treasury, therefore, which were raised under the previous law, and by that law were designated to pay his claim, petitioner has no remedy except to apply to the Legislature to provide the means of paying his debt. The respondent is but a ministerial officer, and can only pay out the moneys in his charge as directed by law; and if he has no funds which the law authorizes to be applied to the petitioner's debt, that fact will be sufficient answer to this application. The petitioner cannot be compelled to accept the bonds provided by the Funding Act; but, on the other hand, the county cannot raise the money for his payment unless authorized to do so by law; and the power of taxation the State may authorize or not as it pleases. The revenues raised for other purposes cannot be applied by respondent to pay his debt. (Hunsaker v. Borden, 5 Cal. 288; Emeric v. Gilman, 10 Cal. 404; Sharp v. Contra Costa County, 34 Cal. 284.)
By stipulation it is admitted that there was in the treasury of San Diego County, at the time the demand was made by the petitioner, the sum of $ 217.73, which was raised under the law as it stood before the passage of the above Act. It is shown, that petitioner's warrants are first in the order of payment of the outstanding, unfunded debt of that county, which existed prior to the Act in question. As we have seen, the petitioner had a right to be paid from these funds, of which the Legislature could not deprive him without his consent.
It is, therefore, ordered that a peremptory mandate issue, requiring the respondent to pay petitioner from the treasury of San Diego County, the said sum of $ 217.73, to be credited upon the warrants held by him in their proper order.