People ex rel. Frank v. Board of Supervisors

         I. The existing corporation, " The City and County of San Francisco," is not identical with the former " City of San Francisco," and the judgment rendered against the former corporation is not binding upon the present one.

         This is not a question involving a mere name. The name may be changed and the corporation remain the same. The name may remain the same and the corporation lose its identity. If this act had merely continued that one corporation, with greater or smaller territorial limits, or greater or lesser powers and capacities, we should not deny that the new or continued corporationwas perfectly identical with the old, or to use the language of the act, (sec. 4) " the former city corporation." Such were the cases cited by appellant, and the same principle is announced in Bellows v. President, etc., Hallowell Bank (2 Mason, C. C. R. 31); Rex v. Pasmore (3 Durn. & East, 241); Hopkins v. Swansea Corporation (5 Mees. & Welsby, 621); and does not need reiteration. Such also was the effect of the former acts reincorporating the City of San Francisco. (Laws 1851, chap. 84, p. 357; Laws 1855, chap. 197, p. 251.) In those instances, the identity of the corporation was continued and maintained.

         But in the case of the City of San Francisco under the Consolidation Act, there was effected, not merely the continuance of one corporation, but the continuance of two corporations, and not merely the continuance of two corporations, but the union of those two corporations into one. The City of Can Francisco did not cease to exist as a corporation, but it continued its existence under the absolute condition of uniting with it another artificial person and corporate entity, whose existence and personality were as complete and distinct as its own. The new corporation, therefore, presented in its very essence a quality which rendered an actual identity with the " former corporation" impossible; for it represented not only the former corporation but more, and twice as much, and that not merely of territory, capacity, or property, but of distinct corporate entity.

         By the act both of the corporations were declared to continue. Neither lost its identity, but that identity extended to only one-half of the new corporation; nor did either transmit any portion of its identity to the other. The only legal analogy to which the results of this union can be compared, as they are announced by the Legislature, is that of death and administration. The old city corporation, not only in name, but in form and essence, ceased to exist. It was continued sub modo under a new name, and in union with another corporation. The liabilities of the former corporations were declared to " survive" against the new dual corporation. All the property of the former corporations was transferred to the new corporation. The new corporation therefore became the administrator of the two " former" ones, liable for all their debts and entitled to all their assets. But as not onlyanother corporation was added to the " former corporation of the City of San Francisco," but also another and distinct body of corporators, it follows that this other corporation and new body of corporators, upon whom were thus thrown the liabilities of the former corporation of the City of San Francisco, had a right to contest those liabilities, so far as they had not become absolutely fixed by judgments already rendered, or audits already made, for two reasons: 1st, they had a right to the benefit of any excess of property conveyed to them above the liabilities imposed upon them; 2d, they had a right to protect themselves, if possible, against a deficiency of assets provided to meet those liabilities. How could this be done without the right to litigate pending suits not yet in judgment? And how could they be litigated, when the new corporation was not made a party to the record--only one-half of its constituent parts being represented in Court--and that when every law by which that half ever had the power to appear in Court at all, had been expressly repealed?

         II. The Consolidation Act respecting the preexisting liabilities of the City of San Francisco and those of the Countyof San Francisco, contains only a declaration of good faith towards the public creditor, but makes no specific provision for his benefit, and the Board of Supervisors have no power to pay him.

         Two existing corporations were to be amalgamated by the Consolidation Act, and two classes of persons were greatly interested in the consequences of this change. The first class was composed of the creditors of the two corporations, who inquired: " How are our claims to be paid?" To this the Legislature answers: " Provision shall be made from the revenues of the said City and County for the payment of the legal indebtedness of the former city corporation, and of the County of San Francisco." (Consolidation Act, sec. 4.)

         The other class was composed of the corporators of the County of San Francisco, living outside of the former City of San Francisco, who inquire in their turn: " Are we, who never contracted these heavy city debts, to pay them?" To this the Legislature answers in the same section: " You shall never be taxed heavier than you were last year."

         These two quieting declarations, so natural and so just, are now made the ground of an attempt to impose an immediate duty on the Board of Supervisors to make provision for the payment of these judgments. That this proposition is untenable appears in various ways:

         1. The declaration is in the future: " Provision shall be made," not " the legal indebtedness of the city and county shall be paid as hereinafter provided."

         2. No machinery is given by which such payment could be made, and no one mode indicated of the many by which provision could be made for it. Provision made? How? By payment in cash? By funded bonds? By receipt for taxes? By exchange for lands? By competition under sealed proposals? How?

         3. Section ninety-five of the Consolidation Act (Laws 1856, chap. 125, p. 172) expressly provides that " payments of demands on the treasury of said city and county, duly audited, may be made for the following objects, and none others; " and then follows the enumeration of fifteen objects for which such payments may be made, among which judgments against the city are not included.

         Nay more, by subdivisions 4, 5, 6, 7, 8, and 9 of that same section ninety-five, provision is made for the payment of the coupons and principal of the various then existing funded debts of the city and county, and by subdivisiontwelve for the payment of the then existing mortgage upon the City Hall. It seems, then, that neither the semi-annual interest upon the funded debts, nor the mortgage upon the City Hall could be paid out of the treasury, even after the declaration in section four, that provision should be made for their payment, without a further enumeration of each funded debt, and a specific provision for its payment. Why not? Because it was provided by the Consolidation Act that no payment could be made except " specifically authorized by this act." Laws 1856, chap. 125, p. 169, sec. 82, and by sec. 95, Laws 1856, p. 172 of the same act, no payments could be made except " for the following objects, and none others."

         4. Those having judgments or liabilities against the former City of San Francisco, their counsel and the Legislature with its appropriate committees, have thought it necessary, from time to time, to apply for the passage of various acts to enable the Board of Supervisors to pay such judgments or liabilities. This is a universal, concurrent, cotemporaneous exposition of great authority. Such acts were passed by the Legislature in the following instances: O'Donnell's judgment against" The City of San Francisco" (Laws 1858, 191); Hays' Claim (Laws 1858, 325, 326); Shattuck's Claim against the City of San Francisco (Laws 1860, 28); Hayes' Claim (Laws 1860, 143); Duane's Claim (Laws 1860, 144); Duane's Claim (Laws 1861, 218). Why pass these enabling acts if the treasury was already open for the payment of these claims?

         5. " Provision was made from the revenues of the said city and county for the payment of this legal indebtedness of the former city corporation," as provided by the Consolidation Act, for that act took effect on July 1st, 1856. By Laws of 1858, chap. 225, p. 183, provision was made for these liabilities by the passage of " An Act to provide for the Funding and Payment of the Outstanding Unfunded Claims against the City of San Francisco, and against the County of San Francisco, as they existed prior to the first day of July, A. D. 1856." The same act was reenacted so as to extend the time for presentation to a certain portion of the same claims by chap. 528, p. 598, Laws 1861; and finally, further " provisions" were made for this very class of claims now in suit, by chap. 244, p. 265, Laws 1862. Would the Legislature have " authorized" the present corporationto compromise its liabilities by the issue of funded bonds redeemable in futuro if the creditors had a right to instant provision for their payment?

         6. By the Consolidation Act (Laws 1856, chap. 125, p. 168, sec. 81, as amended by Laws 1857, chap. 224, p. 253, sec. 1) all lawful demands upon the treasury, except those payable out of the School Fund and the Surplus Fund, after having been duly audited, presented for payment, shall be received for taxes at one per cent. above their par value. Now these judgments, which by the defendants' return amount to $ 1,500,000, are clearly not payable out of the School Fund, nor out of the Surplus Fund. (Consolidation Act, sec. 95, subd. 15.) Can it be supposed that the Legislature, by such a provision as this, authorized $ 1,500,000 in judgment to be audited, thrown into the market, and received for the current taxes of a single fiscal year, at a rate above par--enough to swamp the revenues of three successive years, and to reduce the municipal government to absolute beggary?

         Against this vast accumulation of cotemporaneous construction is to be placed only the recent discovery of the relator, that he had a relief already withinhis reach, and that by the Consolidation Act (subd. 19, sec. 74) the Board of Supervisors have power " to provide by regulation, where it may be necessary, for carrying the provisions of this act into complete effect." But we are not pointed to any " provision of this act" which declares the duty of providing for the payment of these claims, while we do find that the legislative declaration of good faith has been carried out by other enactments, and the relator's learned counsel pass over with great neglect section ninety-five of the Consolidation Act, which absolutely prohibits the payment of these judgments out of the treasury.

         III. A mandamus will not issue against a public officer or corporation, except to compel the performance of a specific act clearly defined and enjoined by law, and which involves no discretion. (The People ex rel. v. The Mayor, etc., of the City of New York, 25 Wend. 680; Consolidation Act, secs. 68, 82, 84, 95; Statutes of 1857, 217.)

         Even if it were conceded that this Court could make an order directing the Supervisors to make provision for the payment of the relator's claim, this would be the extent of its power; it could not select themode or prescribe the means by which provision should be made. To do so would be a clear invasion of the legislative authority delegated by the State to the corporation of the City and County of San Francisco. If it be the duty of the corporation to provide means for the payment of such claims as the present, that duty exists equally whether judgment has been obtained on them or not. Claims to twenty times the amount of the present may now exist against the corporation, for the payment of which it is equally its duty to make provision. But how shall such provision be made? By what kind of tax? By what rate of taxation? What class of claims shall be first provided for? Shall such tax be levied at the same time with the usual city and county taxes, or at some other time? Suppose a question arises as to the sufficiency of a certain rate of taxation to pay all the old existing indebtedness of the city, who is to determine the point? If all these details are subject to judicial control and direction, the Supervisors are quoad hoc mere puppets of legislators, exercising no discretion, possessing no choice between different plans of action, but speaking and acting simply as the Courtdirects. It is impossible to conceive a more complete subversion of the legislative function. And yet this is the course which the Court must pursue, if it directs the Supervisors to raise by taxation the amount necessary to pay the relator's claim. The moment it enters upon the complicated question of ways and means all general directions are insufficient, on account of the wide discretion they necessarily leave to the officers of the corporation. It was within the power of the Legislature utterly to abolish the old corporation, and deprive creditors of all remedy except an application for legislative relief. But the greater power implies the less. If they could deprive suitors of all remedy, they could compel them to accept payment of their debts in such manner as the Board of Supervisors might determine. A discretion is committed to them in deciding how provision shall be made from the revenues of the city, and the exercise of this discretion being a legislative act cannot be controlled by the Court.

         It is in effect granting a high privilege to the creditor to declare that when he cannot collect his debt from a corporation, such corporation, acting in a legislative capacity, shall make provision for the payment of his debt. It is now asked that the Court shall go a step further, and usurping the legislative functions of the corporation, shall determine how such provision is to be made.

         In The People v. The Mayor, etc. (25 Wend. 685) the Court say: " The nature of the power (to make appropriations for the payment of debts, i. e., to 'make provision' for their payment) necessarily implies the exercise of discretion, however plain the duty may be; and where that exists in respect of the act complained of this remedy will not lie. If this corporation, like a State, were exempt from suits at law, perhaps no remedy would exist in behalf of the relator except an appeal to their sense of justice." (See also King v. Bristol Dock Co., 6 B. & C. 181.)

         Supposing the Court were to direct the Supervisors to make provision for the payment of the relator's claim out of the fund in the treasury, how could this be done without an interference with the legislative functions of the corporation? May there not be equally meritorious claims existing in favor of other parties against this fund? As no money can be drawn from the treasury except by ordinance, such a direction would be equivalent to a command to every Supervisor to vote for the ordinance, and to the Mayor to approve it. (Consolidation Act, sec. 68; The People v. Mayor, etc., 25 Wend. 685.) The relator would thus obtain a preference of payment out of this fund over all other creditors, though his claim might be no more meritorious than theirs.

         The whole question is one of legislative discretion on the part of the Board of Supervisors. Assuming, as we must in this case, that there are moneys in the treasury sufficient to pay the judgment held by the relator, (since it is so charged in his affidavit, and is not denied) what proceedings are necessary to get the money out of the treasury? An ordinance must be passed by the Board of Supervisors, presented to the Mayor for his approval; if disapproved, must be repassed by the Supervisors by an increased vote. Now, the question is, can a Court compel the Supervisors to pass such ordinance and the Mayor to approve it? Most clearly not, without the most palpable judicial usurpation. An ordinance is voted on by ayes and noes, and the vote of each member is recorded. The right and duty of voting necessarily implies a discretionas to how the vote shall be given, whether aye or no. Nor is it in the power of the Court to dictate how the vote is to be given. Yet in this case the effect of a decision for the relator would be to compel each Supervisor to vote for an ordinance to pay this judgment under penalty of imprisonment. Nor is this all; --should a majority defeat the ordinance, the innocent minority must be punished with the guilty majority.

         JUDGES: Field, C. J. delivered the opinion of the Court. Cope, J. and Norton, J. concurring.

         OPINION

          FIELD, Judge

         The Respondents filed a petition for rehearing, upon which Cope, C. J. * delivered the opinion of the Court.

         Norton, J. concurring.

         The petition for a rehearing in this case must be denied. The point suggested in it was fully considered when the case was decided. The provisions of the Consolidation Act in regard to the payment of the indebtedness of the city are mandatory and imperative, and the Supervisors have no discretion upon the subject. It is provided, in the first place, that the indebtedness of the city shall continue against the city and county, and in the second place that provision shall be made from the revenues for its payment. There is a general provision giving to the Supervisors the power to provide by regulation for carrying the act into complete effect. The idea that further legislation is contemplated has no foundation to rest on. The act declares in plain words that " provision shall be made," and the power to make it is conferred upon the Supervisors, and not reserved to the Legislature. The language is unambiguous, and the intention clear, and the duty enjoined is one which the Supervisors have no right to disregard, and cannot refuse to perform. They are the creatures of the act, and whatever the act requires of them they are bound to do; their duty is simply that of obedience. They must do what the act enjoins, and refrain from doing that which it prohibits, and their duty is no plainer or more imperative in the one case than in the other. The fact that the duty required of them involves the passage of an ordinance makes no difference; the duty itself is no less incumbent upon them because they must perform it in a particular way. It certainly cannot be that a duty positively enjoined may become a matter of discretion by reason of the character of the proceedings necessary to its proper discharge. There is a suggestion to that effect in the case of Lynch v. The Mayor, etc., of the City of New York (25 Wend. 680) but it is entirely unsupported by either principle or authority. The case was an application for a mandamus to compel the payment of the plaintiff's salary as a Judge, and the decision was put mainly upon the ground that the plaintiff had an adequate remedy by action. In a subsequent case between the same parties, the application was denied on that ground exclusively, the power of the Court to issue the writ and compel obedience to it being expressly affirmed. (2 Hill, 45.) It is true the Legislature had interposed, and directed the auditing and allowance of the salary, but the duty thus enjoined was regarded in the former case as existing under the law as it then stood. On the point in question, therefore, the latter case is an overruling authority, and there is, in our opinion, no doubt of its correctness. The present case differs from it in the fact that the application is based upon a judgment, and nothing remains but the duty of payment. This duty is cast upon the Supervisors, and the mode of discharging it clearly pointed out, and whatever is required for that purpose they must do. If an ordinance is required, they must pass it, and it is no answer to say that the passage of an ordinance is a legislative act implying discretion. There being no discretion as to the duty to be performed, there can be none as to the use of the means required in performing it. It is said that in passing an ordinance the assent of a majority of the Supervisors is necessary, and that there is no power in the Courts to compel them to give it. They act in such cases by vote, and the argument is that the right to vote includes the right to vote either for or against, according to the will of the voter. This argument, as applied to the case of an imperative duty, is manifestly erroneous, and we see nothing in it which is not met by what has already been said on the subject of discretion. In the absence of discretion as to the thing to be done, the Supervisors have no volition except to do it, and to assert the contrary is to assert that their will is superior to the law. We cannot dictate the action to be taken, but we can compel them to act, and their duty is too plain to be misconceived. It consists simply in making provision for the payment of the debt, in accordance with the mandate of the Legislature. The revenues are designated as the source of payment, and they must either appropriate the amount from moneys in the treasury, or levy a tax to obtain it.

         In support of these views, and in further elucidation of the subject generally, we propose to examine a few authorities. In the case of Thomas v. The Commissioners of Alleghany County (32 Penn. 218) a mandamus was issued to compel the Commissioners to make provision for the payment of the interest on certain bonds of the county. The bonds were given in pursuance of an Act of the Legislature authorizing the county to subscribe to the capital stock of the Pittsburg and Steubenville Railroad Company, and to borrow money to pay the amount of such subscription. The Commissioners were empowered to make provision for the principal and interest of the money so borrowed, as in other cases of loans to the county; and the Court held that the existence of the power created a corresponding duty which the Commissioners were bound to perform. The case of Hamilton v. The Select and Common Councils of the City of Pittsburg (34 Penn. 496) establishes the same principle, and the question of the remedy by mandamus is discussed in the opinion of the Court with much ability. The writ was asked to compel the two councils to make provision, by the assessment and collection of a tax, for the payment of the interest due on money borrowed by the city to pay a subscription to the stock of the Chartiers Valley Railroad Company. The act under which the money was borrowed vested in the city the power to make provision for the payment of the principal and interest by the assessment and collection of a tax, and a different act gave to the Select and Common Councils a general power to assess and collect taxes for the use of the city. It was objected on the argument that neither of these acts imposed a duty upon the Councils to assess and collect the tax, but the Court overruled the objection, and said: " It is absurd to argue that conferring such a power is imposing no duty. The Select and Common Councils are public agents, created to perform a public trust. One of the purposes of their creation is, that they may provide for the payment of the debts of the city. It is true the Act of 1853 only declares that the city shall have power to make provision for the payment of the principal and interest of the money borrowed, by the assessment and collection of a tax; but in a statute the word may means must or shall, in cases where the public interest or rights are concerned, and where the public or third persons have a claim de jure that the power shall be exercised. The duty of the city is therefore imperative to assess and collect the tax, and the power and corresponding duty are, by one of the acts referred to, devolved upon the Select and Common Councils." In Maddox v. Graham & Knox (2 Met. Ky. 56) the Common Council of the City of Maysville had been authorized and required to levy and collect a tax for a particular purpose, and at was held that mandamus was the proper remedy to compel performance of that duty. The Court, after stating the facts and citing a number of authorities, said: " We have had occasion to observe that the supreme law-making power of the State has given power to and imposed an obligation on the City Council to do a particular act, and that no specific remedy had been provided for non-performance. Certainly, according to the authorities cited, the Court will, in order to prevent a failure of justice, grant the writ to command the doing of the act enjoined by the statute." In Carroll v. The Board of Police (28 Miss. 38) a mandamus was awarded requiring the defendants to raise by taxation an amount sufficient for the payment of a claim which they had previously audited and allowed. On the question of remedy the Court said: " It has been argued on behalf of the defendants, that the relator had a full and complete remedy, either by bill in equity or by an action at law. This argument has already been incidentally met in considering other points made in the defense. The manner in which and the tribunal before which a claim against a county must be enforced are clearly defined by the statute. This tribunal has long since acted in regard to the claims now in controversy. They have been as definitely ascertained, and judgment directing their payment as clearly pronounced, as it is possible for any other Court, even if it had jurisdiction, to pronounce a judgment in the premises. There is no unsettled or open question as to the amount to be paid, but only whether the sum already adjudged shall be paid as directed by the order of the Board of Police. The question is, by what means shall this judgment be enforced? It has already been said that the Board of Police by their judgment tacitly agreed to provide the means, in the mode pointed out by law, with which to pay the warrants directed to be issued on the treasury of the county. Indeed, such was the nature and operation of the judgment itself. If a suit could be maintained at all at law, it would be against the members of the Board as individuals for failing to discharge their duty as public officers in levying the tax required by law to pay the debt of the county. This might be, to say the most, a very inadequate remedy to the creditor. He, in making his contract, trusted to the ability of the county to meet the engagement, and not to the individual responsibility of the members of the Board of Police. The county, by the contract, became his debtor, and it is to the party trusted that he has a right to look for payment. The Board of Police, as the public agents of the county, and as the officers of the law, undertook to do what was necessary and required of them by law, to compel the county to execute the contract. As public officers they have failed in discharging their duty in this respect. As public officers their action is still necessary to enable the creditor to get his rights, as adjudged and settled by the Board of Police, and the question is, whether there is any other remedy than that by mandamus which can accomplish this object. If there be any other, counsel have failed to point it out, and it is certainly unknown to the jurisprudence of this State. There is, therefore, no doubt as to the remedy."

         These cases are but examples of what has been said and done by the Courts generally on this subject, and there is no ground upon which the case at bar can be distinguished from them in respect to the remedy sought. In all of them, and in many more which might be cited, the writ was directed to municipal bodies similar in their organization to the Board of Supervisors, and it has never been doubted that such bodies were subject to the control of the Courts in respect to the duties enjoined upon them by law. The rule to be collected from the cases is, that where a statute gives power to or imposes an obligation on a particular person or body, to do a particular act or duty, and provides no specific legal remedy in case of nonperformance, the Court will, in order to prevent a failure of justice, grant the writ to command the doing of such act or duty. It is obvious that the case before us falls within this rule, for the statute not only gives the power, but expressly imposes the obligation, and the plaintiff has no other remedy, either under the statute or independent of it, by which he can obtain the benefit intended to be secured to him. The debt belongs to the class referred to in the statute, and the duty of providing for its payment is devolved upon the Supervisors, and the plaintiff has a right to demand that this duty shall be performed; the only and consequently the proper remedy to compel it being that by mandamus. We regard the case as a very plain one, and are entirely satisfied with the conclusion previously arrived at.