Cauble v. City of Asheville , 301 N.C. 340 ( 1980 )

BRANCH, Chief Justice.

The sole issue presented for decision is whether article IX, section 7, of our Constitution requires that the clear proceeds of the monies paid to defendant for violations of its overtime parking ordinance be appropriated to Buncombe County for the maintenance of its public schools. The pertinent provision of the North Carolina Constitution provides as follows:

All moneys, stocks, bonds, and other property belonging to a county school fund, and the clear proceeds of all penalties and forfeitures and of all fines collected in the several counties for any breach of the penal laws of the State, shall belong to and remain in the several counties, and shall be faithfully appropriated and used exclusively for maintaining free public schools. [Emphasis supplied.]

Defendant contends that the ordinances involved here are not “penal laws of the State” and that any proceeds derived from violations of the ordinances are civil in nature and belong to the City.

Plaintiff concedes the general rule that penalties collected for violations of city ordinances are civil in nature. See School Directors v. City of Asheville, 137 N.C. 503, 50 S.E. 279 (1905); D. Lawrence, Local Government Finance in North Carolina 57 (1977). Plaintiff argues, however, that violations of town ordinances have been made criminal by virtue of G.S. 14-4 which provides:

Violation of local ordinances misdemeanor. — If any person shall violate an ordinance of a county, city, or town, he shall be guilty of a misdemeanor and shall be fined not more than fifty dollars ($50.00), or imprisoned for not more than thirty days.

Plaintiff’s contention is further buttressed by G.S. 160A-175(b) which provides that “[u]nless the council shall otherwise provide, violation of a city ordinance shall be a misdemeanor as provided by G.S. 14-4.”

Our cases admit of little doubt that the legislature in enacting G.S. 14-4 made criminal what would otherwise be civil penalties for violations of ordinances. State v. Barrett, 243 N.C. 686, 91 S.E. 2d 917 (1956); School Directors v. City of Asheville, supra; Board of Education v. Henderson, 126 N.C. 689, 36 S.E. 158 (1900). As we stated in Board of Education v. Henderson, supra.

[a municipal corporation] has no right to create criminal offenses. And this being so, it was found to be almost impossible to administer and enforce a proper police government in towns and cities by means of penalties alone. It therefore became necessary to make the violation of town ordinances a misdemeanor — a criminal offense — which was done by section 3820 (now G.S. 14-4) of The Code.

126 N.C. at 691, 36 S.E. at 159.

We therefore do not hestitate to reiterate and to reaffirm our holding in Henderson, supra, that,

all the fines ... collected upon prosecutions for violations of the criminal laws of the State, whether for violations of ... ordinances made criminal by [G.S. 14-4], or by other criminal statutes ... belong to the common school fund of the county. It is thus appropriated by the Constitution, and it can not be diverted or withheld from this fund without violating the Constitution. [Emphasis in original.]

126 N.C. at 692, 36 S.E. at 159.

Even so, defendant contends that the instant case is distinguishable from the case where the violation of a city ordinance has been prosecuted to judgment and a fine imposed. Here the disputed proceeds result from payments voluntarily made by violators upon citations for overtime parking. Depending upon the ordinance in effect, the offenders would pay the appropriate penalty to the Police Department or the Clerk at City Hall, or would deposit the money in a designated receptacle or mail the money to the City. Defendant thus argues that the sums received were not “fines” since they were not paid as a result of a criminal conviction. Defendant relies upon the following language from Henderson in support of its contention that the monies received here are civil penalties:

A “fine” is the sentence pronounced by the court of a violation of the criminal law of the State ... a “penalty” is the amount recovered — the penalty prescribed for a violation of the statute law of the State or the ordinance of a town. This penalty is recovered in a civil action of debt.

126 N.C. at 691, 36 S.E. at 159. Defendant therefore concludes that since the proceeds here were civil “penalties” and not “fines,” they properly belong to the municipality.

We agree that the case at bar differs from previous cases construing the constitutional mandate of article IX, section 7, since the sums here were voluntarily paid upon citations for violations. However, defendant’s reading of the language used by the Henderson Court to differentiate “fines” from “penalties” is unduly restrictive. The heart of that court’s distinction lies not in whether the monies are denominated “fines” or “penalties.” Indeed, we have often stated that the label attached to the money does not control. State v. Rumfelt, 241 N.C. 375, 85 S.E. 2d 398 (1955); School Directors v. City of Asheville, 128 N.C. 249, 38 S.E. 874 (1901). Neither does the heart of the distinction rest in whether there has been an actual criminal prosecution resulting in a “sentence pronounced by the court.” Board of Education v. Henderson, 126 N.C. at 691, 36 S.E. at 159. The crux of the distinction lies in the nature of the offense committed, and not in the method employed by the municipality to collect fines for commission of the offense. A “fine” is a “sum of money exacted of a person guilty of a misdemeanor, or a crime.” State v. Addington, 143 N.C. 683, 686, 57 S.E. 398, 399 (1907); State v. Rumfelt, supra. The constitution mandates that “all fines collected in the several counties for any breach of the penal laws of the State” be appropriated to the school fund. The inquiry addressed by the Henderson Court, then, was whether the monies in dispute were collected for violations of the criminal laws of the State or for violations of city ordinances. The Court determined that, since G.S. 14-4 makes violations of city ordinances misdemeanors, the sums in question were collected for breach of the State’s penal laws.

We hold that the same result must ensue here. The Ashe-ville Code makes it unlawful to park overtime. G.S. 14-4 specifically makes criminal the violation of a city ordinance, unless “the council shall provide otherwise” pursuant to G.S. 160A-175(b). Thus, where, as here, the ordinances do not provide otherwise, a person who violates the overtime parking ordinance also breaches the penal law of the State. See State v. Barrett, supra. Consequently, fines collected for overtime parking constitute fines collected for a breach of the penal laws of the State. We, therefore, hold that the clear proceeds of all penalties, forfeitures and fines collected for breaches of the ordinances in question remain in Buncombe County and be used exclusively for the maintenance of free public schools.

We note that the trial judge here ordered “that the Board of Education of the County of Buncombe have and recover of the Defendant City of Asheville an amount equal to the clear proceeds of all penalties, forfeitures, or fines collected for the violation of the parking ordinances.” [Emphasis added.] This was error. The correct procedure requires that the clear proceeds of the monies collected by the City shall be paid to the Buncombe County finance officer who shall disburse those funds in the same manner as is provided for the disbursement of penalties, fines and forfeitures collected for other breaches of the penal laws of the State. Upon receipt of these monies, the finance officer of Buncombe County must “forthwith determine what portion of the total is due to each administrative unit in the county and remit the appropriate portion of the amount to the finance officer of each administrative unit.” G.S. 115-100.35. [Emphasis added.]

The portion of the Court of Appeals decision affirming that part of Judge Bruce’s judgment which adjudged that only the Board of Education of the County of Buncombe should have the right to recover “the clear proceeds of all penalties, forfeitures or fines collected for the violation of the parking ordinances” is reversed; in all other respects, the decision is affirmed. This cause is remanded to the Court of Appeals for further remand to the Superior Court of Buncombe County for entry of judgment consistent with this opinion.

Reversed in part; Affirmed in part and Remanded.

Justice Brock did not participate in the consideration or decision of this case.