Irwin Borough School District v. North Huntingdon Township School District

Opinion by Mr. Justice Horace .Stern, ■ The controlling question . in this proceeding is whether school districts, in establishing a joint school, may legally provide that their agreement for that purpose shall remain in force for only a designated period of years. On February 6, 1915 the School District of the Borough of Irwin and the School District of the Township of North Huntingdon, being contiguous school districts in the County, of Westmoreland, entered into an agreement, approved by a majority, vote of the directors of each district, to establish and maintain a joint high school to be. located on a site partly in the Borough and partly in the Township and to be known as .“Norwin High School”. The cost of acquiring the land .and erecting and equipping the building was to be shared by the *80 districts equally and the title vested in them in the same proportion; the expense of maintaining the school was to be borne in proportion to the relative yearly attendance of pupils from each district. The twelfth paragraph of the agreement was as follows: “This agreement shall be and remain in force for a period of thirty years from the date of the execution thereof, but the same may be cancelled and the said High School discontinued at any time by the majority vote of the directors of each of the said districts. In case of such cancellation the property in North Huntingdon Township shall be taken by the School District of North Huntingdon Township, and the property in Irwin Borough shall be taken by the School District of Irwin Borough, and settlement made by the district so taking with the other district upon a valuation which the districts, parties hereto, may agree upon within ninety days after the cancellation of this agreement; or in the event of their being unable to agree within ninety days, as aforesaid, on a valuation of the said property, then the same shall be exposed to public sale after public notice for thirty days, and sold to the highest bidder. The proceeds of such sale shall be divided between the districts in the same proportions as they contributed to the original cost.” The land was purchased and the high school building erected. In 1936 the districts joined in the erection of an additional building. In 1944 the main portion of the original building was destroyed by fire; the proceeds of the insurance policies were divided equally between the districts. At a joint meeting of the two school boards on February 12,1945 the Borough School Board proposed, and the meeting unanimously adopted, a resolution “that the present contract be continued to July 1, 1946, and thereafter from year to year until the joint board can agree upon a building program that will provide ample facilities for .the education of all high school students *81 of both districts, at which time a term contract should be executed. Either board shall have the right to terminate the year to year contract by giving ninety days written notice of its intention so to do prior to the beginning of the next contract year.” The attempt to agree upon a building program proving unsuccessful, at a meeting of the Township School Board on February 12, 1946, that board adopted a resolution “That the agreement between the North Hunt-ingdon Township School District and Irwin Borough School District be terminated effective as of July 1st, 1946.” A copy of this resolution was duly sent to the Borough School Board. At a joint meeting of the two boards held June 4,1946 all the members of the Borough School Board voted in favor of a resolution that Norwin High School “be not discontinued”, but a majority of the members of the Township School Board voted against it. At a joint meeting of the two boards on July 12, 1946, the Borough School Board declared “that the action taken by the Township Board to dissolve Norwin did not constitute ■ a dissolution, but in view of the position of the North Huntingdon Board that it did constitute a dissolution, it would be impractical to attempt joint operation of Norwin at the present time. The Irwin Board will therefore establish its own high school, reserving the right to maintain that the Norwin contract is still in effect.” Thereafter the Borough School District conducted its own high school in its junior high school building, while the Township School District maintained its high school in what remained of the joint school buildings following the fire. Both of these schools operated through the school year 1946-47 and are now operating through the current school year, and each district has received accredited standing for its high school from the Department of Education of the Commonwealth. *82 The Borough School Board haying raised' a question as to the right of the Township School Board to give notice of termination of the joint operation of Norwin High School as of July 1, 1946 on the ground that such termination could not, in any event, be effected until July-1, 1947, the Township School Board, by way of precaution, adopted a new resolution on March 24,1947 declaring a termination as of July 1, 1947 and sent a copy thereof to the Borough School Board. The Directors of the Borough School District, asserting that the status of the Norwin High School was undetermined, the welfare of the pupils prejudiced, and the status of the contracts of the teachers uncertain, filed a petition for a declaratory judgment to determine whether the agreement between the districts for the joint operation of the school had been legally terminated, and, if so; what the procedure should be for disposing of the assets jointly owned. The court decreed that the provision that the agreement should remain in force for a prescribed period of thirty years was illegal and in violation of section 1808. of the School Code of May 18, 1911, P. L. 309, and that Norwin High School must continue under the control and management of the joint board unless and until the cancellation of the agreement be approved by a majority vote of the school directors of each district. The Township School District appeals from that decree. There- is nothing in the School Code of 1911 which, either. expressly or impliedly, forbids school districts from establishing a joint school for a limited, specified period. On the contrary, all the provisions of Article XVIII of. the Code indicate that the boards of school directors were to have full latitude in arranging all the terms and conditions of the joinder. Section 1801 provides that the cost of constructing, equipping and maintaining such a school should be paid by the districts “in such manner and in such proportion as they may agree upon.” Section 1802 provides that title to the real estate *83 should be held in the name of one or more of the districts as they may agree. 'Section 1803 provides that no such school should be established unless the districts first entered into a written agreement “that such proposed joint school ". . . shall be established and maintained by the several districts, in such manner and proportion, and upon such terms as the several districts may then agree upon.” Certainly the permission" to fix by agreement the terms upon which a "joint school should be established and maintained includes the right to determine by such agreement the period of its duration. It is true that section 1808 provides that the school districts establishing a joint school may at any time by a majority vote of the school directors of their respéctive districts discontinue the school, but such method of discontinuance is permissive, not mandatory or exclusive, and is preserved in the present agreement by a provision in practically the same language as the statute, the term of thirty years being designated merely as the maximum period that the agreement should continue.. Indeed it would seem to be a wise policy of the law to permit school districts to agree on .the maintenance of a joint school for only a limited or experimental period since a district might be reluctant to enter into an agreement which it must suffer to exist in perpetuity unless the other district should be willing at some future time to consent to a cancellation; changes of population or other circumstances might make it advantageous to the one and correspondingly disadvantageous to the other district to discontinue the school, with a resulting impasse detrimental to the best interests "of all concerned. It may be pointed out that' an agréement for a designated period is, after all, nothing but an advance consent by both parties to "the discontinuance of the school at the end of that period, nor does this encroach upon the freedom of' action of future boards since the latter would have the power, at the end of the period named in the agreement, to continue the joint school if the boards of both districts should so desire. *84 The Borough School District contends — and with justification — that the notice of termination given by the Township School Board on February 12, 1946 was ineffective because, according to the phraseology of the resolution of February 12, 1945, there could not be any termination until July 1, 1947. The resolution provided for the continuation of the thirty year agreement until July 1, 1946, and “thereafter from year to year. . . . Either board shall have the right to terminate the year to year contract by giving ninety days written notice of its intention so to do prior to the beginning of the next contract year.” Under this provision the “year to year contract” began July 1,1946, and — giving the word “terminate” its ordinary meaning — the parties could scarcely have meant that it should be subject to “termination” before it had begun. But the Township Board gave a second notice on March 24, 1947 declaring a termination as of July 1, 1947, and certainly to that notice there can be no valid objection. The right to terminate was not dependent upon a failure to agree on a building program; it was absolute and unconditional except for the obligation to give the required notice. We hold, therefore, (1) that both the agreement of February 6, 1915 and the resolution of February 12, 1945 were legal in all respects and (2) that the contractual relationship between these two school districts was terminated and the joint school discontinued as of July 1,1947. The agreement wisely provided for an amicable settlement in. regard to the disposition of the joint property, and, since the parties were,, in good faith, uncertain as to, the validity of the attempted cancellation of the agreement, they should now have the benefit of the ninety day period therein stipulated in which to negotiate a settlement as to the property .jointly owned by them and to adjust all the other problems arising from the liquidation of the joint project; if, unfortunately, they fail to achieve harmony within that period, then, as the agree *85 ment provides, there must be a public sale of the property, the proceeds, in accordance with the provisions of the agreement and section 1808 of the School Code, to be divided between the districts in the proportions in which they contributed to the original cost. Decree reversed, and record remanded with direction to enter a decree in accordance with this opinion. Costs to be divided between the parties.