State v. State Board of Finance

The decisive question in this case is whether or not, under the terms of the trust created by chapter 812, 45 U.S. Statutes at Large, 70th Congress, First Session, p. 775, the state board of finance of the state of New Mexico can, out of the proceeds from the corpus of the trust, pay interest on the proposed issue of debentures.

The act of Congress granted certain lands in trust for the specific purposes enumerated in section 1 thereof, and further provided that such lands shall be leased and sold in such manner and under such limitations and restrictions as are provided in the enabling act: that the state of New Mexico, through its state board of finance, shall determine the amount of the claims of the beneficiaries and the manner of liquidating same.

The act does not contain any provision for the acceleration of payment of the calims of beneficiaries by means of the sale of debentures, nor does it include the payment of interest on said debentures among the specific purposes in the trust enumerated, nor authorize such payment *Page 403 out of the corpus of the trust or the proceeds derived from the lease and sale thereof.

It is not indispensable to the carrying out of the trust that payment be made to the counties and city by means of moneys derived from the sale of debentures which pledge the proceeds hereafter to be derived from the leasing and selling of the lands of the trust. Congress, as is evident from the language of the trust, contemplated that sufficient funds would, and could, be raised with which to reimburse the counties and city by the leasing and sale of the corpus of the trust, in the manner in said act provided. Had Congress any doubt as to this, it could easily have provided, and undoubtedly would so have done, for some method by which funds might more quickly be raised and made available to reimburse the counties and city. Certainly the trust could have been made as broad as Congress deemed necessary under all the circumstances. Especially is this true if, as the majority opinion states, Congress had abundant notice that the plan proposed was one which involved the raising of the whole of the necessary money upon debentures.

That the method prescribed in the trust could not at an early date be carried out to the extent of discharging same could not have been foreseen by Congress, but that does not destroy the trust nor prevent its being carried out in the future when conditions are more favorable and when the lands can be sold and the necessary funds raised in that manner. Nor does such fact authorize this court to enlarge and extend the trust beyond its specific terms so that interest may be paid on the debentures sought to be issued at the present time.

Trusts are to be strictly construed, and the specific purposes, conditions, and terms thereof may not be enlarged or extended unless the necessity therefor is clearly implied and intended by the language used. No such necessity, implication, or intendment is to be found in the language creating the trust. If debentures are not issued and interest thereon paid out of the proceeds derived from the body of the trust, nevertheless it can ultimately be carried out and discharged in accordance with its specific terms. *Page 404 The present call for the proposed issue of debentures is not a necessity but merely a matter of convenience to and accommodation of certain beneficiaries, an acceleration of payment to them.

The "manner of liquidating" is left to the discretion of the state board of finance, but only in so far as the manner adopted does not violate the terms of the trust and the clear and necessary intendment thereof. Such discretion cannot, however, be so exercised as to enlarge and extend the terms of the trust and thereby in effect create a new and different one. To hold that the proposed debentures may be issued and interest thereon paid out of the proceeds of the corpus of the trust is, in my opinion, an unauthorized and unjustifiable enlargement and extension thereof.

The position I take is not destructive of the trust but, on the contrary, the preservation of the integrity thereof. I therefore find it impossible to concur in the majority opinion, and I dissent.