State Ex Rel. Graham v. City of Olympia

Wright, J.

(dissenting) — The constitution (article 8, section 7) provides:

Credit not to Be Loaned. No county, city, town or other municipal corporation shall hereafter give any money, or property, or loan its money, or credit to or in aid of any individual, association, company or corporation, except for the necessary support of the poor and infirm, or become directly or indirectly the owner of any stock in or bonds of any association, company or corporation.

We are concerned with the question of whether or not *688the placing of the funds of respondent, City of Olympia, in financial institutions on time deposits and the placing of funds in savings and loan associations, is a violation of this provision.

The majority takes much time discussing the safety of the investment. The wisdom of the provision was a decision for the framers of the constitution. We cannot substitute our judgment for theirs.

If the constitutional language is clear and unambiguous, interpretation by the courts is improper; . . .

State ex rel. O’Connell v. Slavin, 75 Wn.2d 554, 557, 452 P.2d 943 (1969).

Furthermore, we cannot construe the constitution in such a way as may seem desirable, “. . . even though the circumstances may have so changed as to make a different rule seem desirable.” 6 R.C.L. 46. See also, State ex rel. Lemon v. Langlie, 45 Wn.2d 82, 273 P.2d 464 (1954); State ex rel. Banker v. Clausen, 142 Wash. 450, 253 P. 805 (1927); State ex rel. Munro v. Todd, 69 Wn.2d 209, 417 P.2d 955 (1966).

The constitution itself contains a clear direction in that article 1, section 29 provides:

The provisions of this Constitution are mandatory, unless by express words they are declared to be otherwise.

The language of the constitution is clear in prohibiting the loaning of public funds.

We decided the question of whether a time deposit is a “loan” in Aberdeen v. National Sur. Co., 151 Wash. 55, 275 P. 62, 65 A.L.R. 794 (1929), wherein we held such a transaction to be a loan and prohibited by the constitution.

No change has been made in the constitution in the 43 years since that decision. There is no reason to depart from the rule there laid down.

The other question is whether the placing of funds in a savings and loan association violates the portion of Const, art. 8, § 7, which says:

*689or become directly or indirectly the owner of any stock in or bonds of any association, company or corporation.

(Italics ours.)

RCW 33.20.010 provides in part:
Each member having savings or deposits in an association shall have a proportionate proprietary interest in its assets or net earnings subordinate to the claims of its other creditors.

RCW 33.20.110 provides:

An association shall not receive savings upon which a stipulated rate of dividend shall be payable. Except as otherwise expressly provided or authorized in this title, all savings shall share proportionately in all net earnings and all losses of the association.

Members have a vote as provided in RCW 33.20.010 and each member has at least one vote, and one additional vote for each $100 of stock owned.

It will thus be seen, whoever places funds in a savings and loan association has the incidents of the ownership of corporate stock. Such an investment of public funds is in violation of article 8, section 7.

I would reverse.

Stafford, J., concurs with Wright, J.