Attn: Matt Kitzi Director of Corporations and Counsel to theBusiness Services Division
Re: Birmingham Drainage District
Dear Mr. Kitzi: I am in receipt of your correspondence dated July 8, 2005 concerning the above referenced dead Missouri public corporation.Your letter appears to indicate you failed to check the document or the law when you stated, "It appears that the Order entered November 18, 1970, was filed with our office pursuant to Sections 242.040 and 242.070 RSMo."
Your records show the document was not certified by the 1970 court or transmitted by the Clerk of the court as required by:
RSMo 242.040.3. Within sixty days after the said district has been declared a corporation by the court, the clerk thereof shall transmit to the secretary of state a certified copy of the findings and decree of the court incorporating said district, and the same shall be filed in the office of the secretary of state in the same manner as articles of incorporation are now required to be filed under the general law concerning corporations.
Your records show the district expired December 22, 1963. Yet, contrary to state law, the 1970 document indicates the court appeared to order the reorganization of the dead district under 242.080: 242.080 -Reorganized districts--articles of association.
2. The owners of a majority of acreage of any existing drainage district may make and sign articles of association in which shall be stated:
242.120. When an existing drainage district has been reorganized under sections 242.010 to 242.690
Surely, the Secretary of State is aware that when a corporate charter expires due to term limitations, the corporation ceases to exist. The Kansas City Appeals Court has ruled: " We, therefore, conclude in the case at bar that Levee District No. Two of Howard County, Missouri, ceased to exist as a public corporation on January 11, 1960, by reason of the limitation contained in its articles of association that it exist for a period of 50 years. It follows that from and after such date, there was no levee district and the action of those who continued the functions of such district was without any statutory authority. As a consequence, the holding of meetings of property owners within the district, the election of officers, the levying and collection of levee district taxes and the expenditure of monies derived therefrom were without legal authority." "the life of the district could not be extended because there was no district in existence whose life could be continued"
"It is pointed out in 2 McQuillin, Municipal Corporations, Third Edition (1966 Revised Volume), Section 8.15, page 577, that in the absence of any statutory provision (and none exists in Missouri), a court of equity will administer the affairs of a defunct corporation for the benefit of its creditors and stockholders. Here, the landowners stand in the same position as the stockholders of a private corporation".(Watts vs Gross 408 S.W. 2d, 223)
Based on the statues you quote, it would appear that the Secretary of State should not have reinstated the Birmingham Drainage District charter and should have referred this breach of public trust to the Attorney General.
The taxpayers of Vrooman Acres, Randolph and Birmingham would expect no less from you office.
James W. Bynum PO Box 682 Smithville, Mo. 64089 (816) 699-3975