Montana Attorney General Opinion 16-74

Opinion No. 74. Schools-Abandoned School Districts --Contracts-Transportation. HELD: Where a school district is ordered abandoned and is attached to one or more contiguous districts, the contiguous district, or districts, is or are not liable to perform the execu- tory contracts for transportation en- tered into by an abandoned district which has been attached to its, or their, territory by the county superin- tendent of schools. Mr. John J. Cavan County Attorney Jordan, Montana March 30, 1935. We have received your letter of March 26, requesting the opinion of this office concerning Section 970, Revised Codes of Montana, 1921, as amended. Section 970, as amended by Chapter 84, Laws of Montana, 1931, provides for the abandonment of school dis- tricts under certain circumstances upon order of the county superintend- ent of schools. A district so aban- doned is then attached to a contigu- ous district or districts. According to your letter a school district which has been abandoned as provided above, prior to abandonment entered into certain transportation contracts, presumably pursuant to Section 1010, R. C. M. 1921, as amend- ed, and the question arises if such contracts are now a binding obliga- tion of the district to which the aban- doned district has been attached. Chapter 84, supra, provides: "When- ever a school district is ordered aban- doned and there is any indebtedness outstanding against the district rep- resented either by registered war- rants, or bonds, or both, and there is not sufficient money in the funds of the district to pay the same, all money in the funds of the district shall be set aside and applied in pay- ment of such indebtedness, and there shall be levied annually, in the man- ner provided by law, a tax against all property within thE' boundaries of such district, as the same existed when such indebtedness was incurred, sufficient to pay such indebtedness as it matures, with all interest becoming due thereon. "All funds of an abandoned district, after all the debts of the district have been paid, shall be placed in the gen- eral fund of the district or districts to which its territory is attached on order of the county superintendent * ::: * ." The unexecuted portion of a con- tract is not a debt of the abandoned district "represented either by regis- tered warrants, or bonds" under the above provision. (Barrington v. Pow- ell et al., 230 N. Y. 37, 128 N. E. 70 OPINIONS OF THE ATTORNEY GENERAL 910.) And although title to the school property may pass to the district to which the territory is attached (Vol. 14, Report and Official Opinions of Attorney General, p. 129), we do not think that the unexecuted portions of such contracts are a binding obliga- tion of such contiguous district. Offer, acceptance and mutuality of assent are essential elements of every contract. (Sections 7473, 7488, R. C. M. 1921; J. Neils Lumber Co. v. Farm- ers Lumber Co., 88 Mont. 392, 293 Pac. 288.) And while it is true that the legislature may exercise plenary pow- er over school districts, we find the following rule of law to be applicable: "Where a district is dissolved, abol- ished, or destroyed, and one or more new districts are created from the territory thereof, or its territory is annexed to one or more existing dis- tricts, the new or other district or districts, in the absence of contrary Rtatute become and are entitled to all the property and rights of the old dis- trict, and liable for all its existing debts and obligations, except where, by statute, the dissolved district is continued in existence for the pur- pose of paying its indebtedness, in which case the new district does not become liable therefor. " * *." (Un- derscoring ours) (56 C. J. 271-272.) We admit that the question is not free from some little doubt in our mind. (See Curtis v. Haynes Special School District, 193 S. W. 523; Bar- ringer v. Powell, supra; Abler v. School District of St. Joseph, 124 S. W. 564; Walker v. Bennett, 118 S. E. 779; Wilson v. School District No.4, 207 N. W. 810; 1 McQuillin on Munic- ipal Corporations, 2d ed., Section 330, and notes; 3 Williston on Contracts, Section 1960.) But none of these au- thorities are directly in point and all can be distinguished from the case before us. For the most part they involve bonded indebtednesses or con- tracts employing teachers, janitors, or other employees. Here we do not have the voluntary merger or consolidation of school dis- tricts, such as is provided for in Sec- tions 1020 to 1039, inclusive, R. C. M. 1921. Rather, under Chapter 84, supra, the county superintendent sim- ply orders the district abandoned and parcels out its territory to one or more contiguous districts and the or- der is effective regardless of the wishes of such contiguous districts. Now suppose that District A enters into a contract with X to transport all its pupils to a school in District B which is contiguous to the western boundary of District A. Then, sup- pose that thereafter the county su- perintendent orders District A to be abandoned and its territory attached to District C, contiguous to the east- ern boundary of District A, or to Dis- trict D, contiguous to the northern boundary, or to District E, contigu- ous to the southern boundary, or part of its territory attached to Districts C, D and E. Obviously X could not be required to transport pupils to all three districts in opposite directions under his contract to transport them west to B. Clearly the statute does not provide that Districts C, D and E, or any of them, must provide for the education of pupils residing in A territory and then pay X for trans- porting pupils to District B's school house,-services that are not ren- dered. For these reasons, then, it is our opinion that a contiguous district, or districts, is or are not liable to per- form the executory contracts for transportation entered into by an abandoned district which has been at- tached to its, or their, territory by the county superintendent of schools pursuant to Chapter 84, supra, and your opinion to the county superin- tendent is hereby confirmed. This construction of the statute does not render it invalid as an im- pairment of contracts "especially since persons contracting with a school district must be deemed to know that it may be altered or dis- solved." (56 C. J. 272.) (But see Fuller v. Consolidated Rural High School District No.1, 28 Pac. (2d) 750, and Special School District No. 60 v. Special School District No.2, 25 W. (2d) 443.)