Request By:
Honorable Frances Jones Mills
Secretary of State
Capitol Building
Frankfort, Kentucky 40601
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Walter C. Herdman, Assistant Deputy Attorney General
This is in response to your letter of January 11 in which you relate the following facts and question:
"The town of Allensville, a city of the sixth class in Todd County, has notified our office that it wishes to become inactive as of January 1, 1982. The town Board resigned on September 7, 1981, effective January 1, 1982. As they explained it, they 'have simply run out of funds and people willing to take the responsibility of government for no pay.'
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Allensville, in short, went out of business January 1, 1982. However, the town officials did not want to take the final step of actual dissolution of the charter in hopes that sometime in the future willing administrators could be found. Should this occur, they wanted the option of merely reactivating the old corporation without having to go through the formal process of reincorporating the town.
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The question is this: Can a legally incorporated city in Kentucky become officially inactive without going through the formal process otlined in KRS 81.094 and KRS 81.096 for the dissolution of incorporation?"
Once a municipality is incorporated it remains so until its charter is forfeited in a legal proceeding in circuit court pursuant to the dissolution procedure now outlined in KRS 81.094 to 81.096. We refer you to the case of
Hill v. Anderson, 122 Ky. 87, 90 S.W. 1071 (1906) in which the Court stated, and we quote:
"A municipal corporation is not dissolved by the failure to elect officers or to exercise the corporate powers."
In this case the Court held that the city of Weston was not dissolved and the county judge properly appointed trustees, notwithstanding the fact that the town had not exercised corporate functions for 17 years and had not elected officers during this period.
Again in the case of
Sizemore v. Commonwealth, 285 Ky., 142, 147 S.W.2d 56 (1941) the Court pointed out that the town of Hyden had not lost its corporate charter by its failure to exercise its corporate powers for a long period of time and could only do so by proceeding under KRS 82.010 and 82.020 [now KRS 81.094 to KRS 81.096].
As the case law above indicates and under the related facts, the City of Allensville is presently inactive but not dissolved, and it remains inactive until it is dissolved pursuant to KRS 81.094 to 81.096. As a consequence, the city can at any time in the future reactivate itself by appointing and electing city officials as provided by law. The city continues, of course, to be responsible for any indebtedness or any contractual obligations that it may presently have. The Office of Secretary of State has no responsibilies under the factual situation presented. Its sole responsibility is to receive and keep on file copies of circuit court judgments dissolving cities pursuant to said statutes.