BANKS ‑- MUTUAL SAVINGS ‑- DEPOSITARY OF FUNDS FOR POLITICAL SUBDIVISION

BANKS ‑- MUTUAL SAVINGS ‑- DEPOSITARY OF FUNDS FOR POLITICAL SUBDIVISION.

Section 11, chapter 176, Laws of 1963 (RCW 32.12.100) qualifies mutual savings banks, under certain conditions, as depositaries of public funds for the political subdivisions of the state set forth therein.

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                                                               November 20, 1963

Honorable Cliff Yelle
State Auditor
Legislative Building
Olympia, Washington

                                                                                                                Cite as:  AGO 63-64 No. 71

Dear Sir:

            By letter previously acknowledged you have requested the opinion of this office on a question which, for convenience, we have divided into two parts, and paraphrase as follows:

            (1) Does chapter 176, Laws of 1963 (§ 11) qualify mutual savings banks as depositaries of public funds for the political subdivisions mentioned in the statute?

            (2) If the answer to question (1) is in the negative, does the statute permit investment of public funds in mutual savings banks?

            We will proceed to answer your questions in the analysis.

                                                                     ANALYSIS

            Section 11, chapter 176, Laws of 1963, reads as follows:

            "Any funds of the state and of any municipal corporation, taxing district, political subdivision, or political entity thereof, and any funds held in trust by or under the management of any of the above may be deposited in a mutual savings bank.

            "All the deposits must be fully insured by the federal deposit insurance corporation."

            As your letter indicates, the language of the statute suggests two  [[Orig. Op. Page 2]] possible meanings.  It permits the placing of public funds in mutual savings banks, either as deposits in a qualified depositary, or as investments.

            In a previous opinion of this office, AGO 57-58 No. 119, we concluded that a county treasurer could not legally deposit public funds in a mutual savings bank for two reasons:  (1) That the legislature had not qualified mutual savings banks as depositary banks because it did not permit them to accept deposits of public funds under the conditions required by the statute to qualify as depositary banks (cf. RCW 36.48.020, 32.12.020 and 32.08.150); (2) because any deposits on a time basis, as distinguished from deposits withdrawable on demand as a matter of right, were considered to be prohibited investments of public funds, contrary to Article VIII, § 7, of the State Constitution, as construed by the supreme court inAberdeen v. National Surety Co., 151 Wash. 55, 275 Pac. 62 (1929).  The supreme court's opinion still stands at the present time without qualification or change.  Therefore, the answer to your second question must be in the negative.

            As to your first question, we must conclude, accordingly that the statute (§ 11, chapter 176,supra) (a) attempts to permit an unconstitutional investment of public funds, or (b) permits deposits of public funds in mutual savings banks without permitting such banks to accept such deposits, or (c) impliedly amends the existing law to qualify mutual savings banks as depositaries of public funds under certain conditions.  The solution is to be found in alternative (c), in our opinion.

            It is an established principle that if there are two possible constructions to be given a statute, one of which will render it unconstitutional, and the other of which will render it constitutional, the latter construction will be followed.  Soundview Pulp Co. v. Taylor, 21 Wn.2d 261, 150 P.2d 839 (1944).  Thus, it cannot be presumed that the legislature intended to permit the type of deposit of public funds in mutual savings banks which was held to be unconstitutional by the supreme court in Aberdeen v. National Surety Co., supra.  Similarly, it must be presumed that the legislature was aware of the holding in that case.  See,In re Candell, 54 Wn.2d 276, 340 P.2d 173 (1959).  On the other hand, it cannot be presumed that the legislature expressly intended to allow deposits in mutual savings banks without permitting a corresponding acceptance by such banks.  The legislature is not presumed to have enacted a useless or meaningless statute.  Guinness v. State, 40 Wn.2d 677, 246 P.2d 433 (1952).

            The solution we have expressed in alternative (c) above seems to  [[Orig. Op. Page 3]] recognize a new indication of legislative intent in chapter 176, Laws of 1963,supra, to the effect that mutual savings banks may now accept deposits of public funds under certain conditions.  We emphasize certain qualifications because of both the holding in the Aberdeen case, supra, and the specific language of other statutes relating to public depositaries in general and mutual savings banks in particular, such as those noted in AGO 57-58 No. 119, supra.  Statutes relating to the same subject matter should be construed together, preserving the integrity of each, if possible.  State v. Houck, 32 Wn.2d 681, 203 P.2d 693 (1949); Lindsey v. Superior Court, 33 Wn.2d 94, 204 P.2d 482 (1949).  However, where a later special act is in some respects inconsistent with an earlier general act on the same subject, the later act will prevail and the inconsistent portions of the earlier act are superseded.  See,City of Airway Heights v. Schroeder, 53 Wn.2d 625, 335 P.2d 578 (1959).

            Thus, the intention of the legislature, evidenced by § 11, chapter 176, Laws of 1963,supra, can be fully effectuated and harmonized with the statutory provisions cited in AGO 57-58 No. 119, and other similar statutes as follows: (1) The law now qualifies mutual savings banks as depositaries of municipal funds, notwithstanding the apparently inconsistent provisions of earlier statutes on the subject of qualifications of such depositaries; (2) such funds must be accepted by the bank in each case subject to withdrawal on demand, similarly notwithstanding the inconsistent provisions of any previous statutes such as RCW 32.08.150,supra, or of any inconsistent depositary agreement executed under RCW 32.12.020, 32.12.040; (3) the definition of "check" used in RCW 36.48.020,supra (requiring that deposits of public funds be payable by check), has been impliedly expanded to include the "check" or transferable certificate used in connection with deposits in mutual savings banks under RCW 32.08.140 (2), overruling AGO 57-58 No. 119 [[to Cliff Yelle, State Auditor on September 13, 1957]]on that point.

            We trust the foregoing information will be of assistance to you.

Very truly yours,

JOHN J. O'CONNELL
Attorney General

ROBERT F. HAUTH
Assistant Attorney General