Paving District No. 5 v. Fernandez

Smith, J. This appeal is a continuation of a controversy between appellee Fernandez, a citizen and taxpayer of Paving District No. 5 of Fort Smith, and that district, reported in 142 Ark. 21. As appears from the statement of facts in that case, Fernandez brought suit to compel the commissioners of the district to account for and to distribute among the property owners of the district a surplus remaining in the hands of the commissioners after completing the improvement and discharging the indebtedness of the district. Upon motion of Fernandez the court appointed a receiver to wind up the affairs of the district and to execute the orders of the court in that behalf. We held there that there was neither necessity nor authority for that action and reversed the decree on that account, as, in our opinion, the commissioners, as such, were amenable to the orders of the court. Upon the remand of the cause the court below entered an elaborate decree winding up the affairs of the district. Among other things it was there required that the commissioners should file a final report showing in detail the condition of the district’s finances. The decree provided for notice to be given to the property owners that the fund was about to be disbursed, to the end that any property owner who so desired might be specially heard. The decree provided that all the costs in the case should be paid out of the fund, and that the net balance should be distributed among the persons who had paid the last assessment, the direction in that respect being that the commissioners “will fix it at such sum whose ratio to the original sum paid in by him shall be in the exact ratio of said last named sum to the whole net surplus to be distributed.” This net surplus to be distributed will probably exceed $20,000 after all costs have been paid, and while it grew out of the last assessment paid by the property owners the excess exists because of a reduction in the interest on the bonded indebtedness accomplished by the commissioners. The first objection made to the decree is that the court charges all the costs of the litigation against the fund to be distributed. The opinion and decree on the former appeal is the law of the case, and in the mandate which went down to the court below it was “ordered and decreed that said appellants (the paving district) recover of appellee all their costs in this court expended, and have execution therefor.” In the decree of the court below pronounced upon this mandate it was ‘ ‘ ordered that all costs incurred by the plaintiff (Fernandez) in this court, and in the Supreme Court, including the costs by the Supreme Court adjudged against him in favor of defendants on appeal, be taxed against the said fund, and it i‘s ordered that the same be by the commissioners paid therefrom. ’ ’ This suit was brought by Fernandez for the benefit of himself and of all other property owners in the district, and it was, therefore, proper for the court to charge the costs of the litigation against the fund recovered except insofar as.the court had decreed otherwise on the former appeal, and as appears from the mandate quoted from the above costs of the appeal were adjudged against Fernandez. To enforce that portion of the mandate the present appeal has been necessary, and the costs of this appeal will, therefore, be also assessed against Fernandez. We permit the costs of the litigation, except that of the appeals to this court, to be recovered, because this was a proper suit to be brought by a taxpayer, but, inasmuch as the. first appeal was necessary to displace the receiver who had been erroneously appointed on motion of Fernandez,we assessed the costs of that appeal against him. Costs in equity are apportioned according to what the court regards as the applicable equitable principle. Penix v. Pumphrey, 125 Ark. 337. It is next insisted that the court’s order of distribution was prematurely made, for the reason that certain delinquent assessments remain uncollected, and it is urged that a final adjustment of all the equities of the case can not be made until these delinquent assessments have been collected. As appears from the former opinion, an audit of the affairs of the district was made and the report of the auditor was filed April 9,1917. At that time the taxes on a large number of lots were delinquent, and the delinquency extended over the last five annual assessments. It affirmatively appears that the major portion of these taxes have since been collected by foreclosure proceedings. The court considered the advisability of postponing the distribution of the fund until all the delinquent taxes had been collected, but in the decree rendered the court found the fact to be that the cost of collecting such assessments as remained unpaid would practically equal the sum collected and would add so small a sum to the amount to be distributed that further delay was not advisable. In view of the fact that more than three years have elapsed since the filing of this audit showing the delinquent assessments, we can not say that the court abused its discretion in ordering the distribution at this time. Moreover, the decree reflects the purpose of the court to retain control of the case until all equities have been adjusted. The commissioners of the appellant district do not question the correctness of the decree in ordering the surplus paid over to the property owners who paid the last assessment; and we agree that this was the proper order to have made; but the commissioners do question the jurisdiction of the court over them to make that order. This question was disposed of on the former appeal, as we there said it was unnecessary for the court to appoint a receiver to distribute this surplus, as the court had the right to direct the commissioners, as such, to take that action. These commissioners also say that the court below has by its decree deprived them of the authority to collect delinquent assessments and to otherwise manage the affairs of the district as they would in duty be bound to do but for the pendency of this suit, and that the decree is circumscribing their power and authority. We find nothing in the decree which supports this contention. The decree specifically directed the commissioners to proceed with the collection of the delinquent assessments; but such direction was unnecessary. The opinion and decree of this court on the former appeal discharged the receivership and restored the management of the affairs of the district to the commissioners, and the decree of the court below on this appeal does not undertake to interfere with the control of the commissioners except insofar as it is necessary to direct the distribution of this surplus, and this the court has the right to do as we held on the former appeal. The brief filed on behalf of the commissioners concludes with the question, ‘ ‘ To whom shall this money 'be refunded?” In a general way the decree appealed from answers that question by directing the refund to be made to the persons who paid the last assessment, as there was no surplus until the collection of that assessment was made. It is probable that some property owners have paid their delinquent assessments since the rendition of the decree here appealed from; but the decree requires the commissioners to submit a full and final report, thereby manifesting a purpose to take care of such equities as may arise up to the time of the actual distribution of the fund, and if some case presenting special equities should arise we must presume that proper orders will be made in regard thereto. The decree of the court is therefore affirmed, as modified. Mr. Justice Humbhreys not participating.