DELAND
v.
PLATTE COUNTY.
823
the promises are so far independent." 2 Pars. Cont. 189. By the contract which is the foundation of this suit Brusie granted to the defendant the sole and exclusive right to manufacture the patented iJprinkler, and the sole right to selt, except that Brusie could sell sprinklers manufactured by the defendant, paying it 25 per cent. profit upon the cost of such manufacture. The defendant promised to manufacture sprinklers of good material, to use its best -endeavors to introduce the same, to pay a royalty of $2 upon each machine sold, and not to l!lell below $15, unless the price was changed by joint agreement. Brusie, having manufactured and sold at reduced prices, calls upon the defendant to pay a royalty -of $2 upon every machine which it sold, and to recover damageiJ for Brusie's violation of the contract in a separate action. The contention of the plaintiff would have weight if Brusie's fulfillment of his part of the contract had not been vital to the ability 'Of the defendant to fulfill any part of its contract. The plaintiff bound the defendant not to sell at a less price than $15, unless the price should be changed by joint agreement. He thereby im· pliedly promised that the price imposed upon the defendant should be maintained, unless altered by joint consent. The defendant's ability to pay the royalty depended upon noncompetition by Brusie at reduced prices. He could not become, as he did, the defendant's active competitor, lower prices without consent, and still compel the defendant to sell at not less than $15, and pay a royalty of $2 per machine. This breach by Brusie of his undertakings, when found to be unjustifiable by any previous conduct of the defendant, relieved it from the obligation which it had assumed. There was no -error in the charge, and theiudgment of the circuit court is af· drmed. DELAND v. PLATTE COUNTY. (CIrcult Court, W. D. Missouri, St. Joseph DivisIon. November 5, 1390.) 1. COUNTY RAILWAY Am BONDS-AUTHORITY TO ISSUE.
Act Gen. Assem. Mo. Jan. 4, 1860, incorporating the Platte City & Des Moines llallroad Company. and providing in section 7, that if a majority of the taxable inhabitants of any strip of cOlmtry through which the road may pass vote upon themselves a tax in payment of their subscription to stock in the road, at an election ordered by the county court, the court shall levy a special tax, and cause the same, as fast as collected, to be paid to the treasurer of the company, does not authorize the county court to order the issue of county bonds in behalf of the taxable inhabitants of any strip of country which is a portion of a township in payment of such subscriptions. Ogden v. County of Daviess, 102 U. S. 634, followed. Act Mo. March 23, 1868, authorizing the county courts to make subscription to railroad stock, and issue bonds therefor on behalf of municipal townships, relates to municipal townships as such, and does not authorize the issue of bonds on behalf of a strip of country which is only a portion of a township. Ogden v. County of Daviess, 102 U. S. 634, followed.
SAME.
8.
SAME-RETROSPECTIVE LAWS.
The amendment of March 24, 1870, to Act Mo. March 23, 1868, providing that when, by the provisIon of a railroad charter, the taxable inhabitants of aportlon of a municipal township "have voted," or may hereafter vote,
824
FEDERAL REPORTER,
vol. 54.
to take stock, etc., the county court shall exercise the same power and peror townform the same duties in issuing bonds as in the case of a Bhlp, as to a vote by the inhabitants of a portion of a township had prior to the passage of the amendment, falls within the inhibition of Const. Mo. art. 1, § 28, declaring that "no .. · · law retrospective in its operation can be passed." And this act Is not rel1eved of its retrospective character by Const. Mo. 1865, art. 4, § 27, and 1875, art.. 4, § 53, excepting the state from the prohibition against legallzing by local or speclal laws the unor ot any authorized or invallu acts of any officer or agent of the countY or municipal authority.
4.
SAME-RECITALS OF RECORDS.
The requirements of a railroad charter that "a majority of the taxable inhabitants" of a strip through which the road may pass may vote to tax themselves in payment of sUbscriptl.ons to stock in the road isnotsatl.sfied by a record ot the county court levying such tax t4at "the taxable inhabitants aforesaid Yoted," etc., without other recital or finding that a majority voted in favor. A county railway aid bond reciting that it was issued "in pursuance of an election by the taxable inhabitants of Camden Point," does not estop the county, when the act authorizing the election in a part of a township lying between designated points, Camden Point being the voting place therein, required the assent of the majority of the taxable inhabitants.
IS.
SAME-'RECITALS-EsTOPPEL.
At Law. Action by Frederick N. Deland against the county of Platte to recover upon a county bond. Judgment for defendant. Statement by PHILIPS, District Judge. A. jury having been waived on stipulation of parties; this case .was submitted to the court, and from the record evidence and stipulations of counsel the court makes the following special finding of facts: Stipulations. "It Is hereby stipulated and mutually agreed upon by the parties to this case, bS and through their attorneys, Sanders & Bowers, for the plaintiff. and John W. Coots for the defendant, that this cause be submitted to the court for trial without the intervention of a jury, a jury being specially waived by the parties to this casa. "That the certified copy of the records of the county court of Platte countY in reference to the calling of the election, the vote held, and the issuing of the bonds and coupons in controversy in this case, signed. and certified to" under the seal of the court, by Jesse J. Blakeley, county clerk. at his office in Platte City, Mo., February 15, A. D. 1888, and hereto annexel1, is a true copy of the records of the defendant, the county of Platte, in all of its acts of record in reference to the preliminary steps as to the election, and the issue of the bonds anl1 coupons in in this case, and the subsequent payment of interest for a time thereon. "That the copies in the petition of the bonds and coupons involved in this case are true and correct copies of said bonds and coupons; and that the signature of the officials purporting to sign the same are the genuine signatures of T. W. Park, then clerk, and T. H. Talbott,. then presiding justice, of the county of Platte, Missouri. "That the statement hereto attached of the bonds and coupons involved in this case is correct, and the amount due the plaintilr (if anything) April 10, 1890, is $15,800, and his reasonable costs of suit. "Sanders & Bowers, for plaintur. "W.' P. Hall, for defendant." Copy of. records, Platte county, Mo., with reference to notl.ce of election and issue of bonds of Platte county, Mo.: "Saturl1ay, July 10th, 1869. "Be it remembered, that at the term of the county court,held at Platte City, Platte county, Missouri, on' Saturday, the 10th day ot.July, 1869, there weI'''
DELAND V. PLATTE COUNTY.
825
present as tollows, to wit: Hon. T. H. Talbott, president, Hons. Jacob Hamm and Henj. R. Morton, justices, ot sald court; Geo. W. Relt, sheriff; and Daniel P. Lewis, clerk." Book H, p.206. ",Adjourned Term, 1869. "State of ;.\1issouri, county of Platte-as.: In the county court of said coun· ty, on the 10th day of JulY,I869, the following, among other, proceedings were had, viz.: "Now, at this time come the president and directors of the Chicago and Southwestern Railway Company, and present their petition, which is In the words and fignres following, to wit: "'To the IIonol'able,theCnuntyCourt of Platte County,:Missouri: Theundersigned, president and directors of the Chicago and Southwestern Railway Company, a corporation organized under a special law of the state of l\fissouri, entitled ".An act to incorporate the Platte City and Fort Des Moines Railroad Company," approved January 4th, 1860, and by certain other acts of the general assembly of the state of Missouri amendatory thereof, respectfully make and present to your honors this, their petition, praying the court, under the seventh section of said act, that a vote may be taken in a strip of country through which said railway may pass, hereinafter mentioned and described, the same not exceeding ten miles on either side ot said road. That the inhabitants thereot are desirous ot taking fifty thousand dollars ot the stock in the said railway company, and of voting upon themselves a tax for the payment of the same, which said strip is as follows: . .. 'All that part of the municipal township of Greene, lying and being east ot the range line, between thirty-four and thirty-five; and the said railway company hereby agrees that said tax shall never be collected or paid, unless said railway is located and constructed so as to run within one mile of the town ot Camden Point. .. 'Respectfully submitted, F. H. Winston, " 'President. "'C. A. Perry, "'James N. Bums, "'James L. Davis, "'R. Edgerton, "'H. M. Allen, "'Benjamin Bonifant, "'N. P. Ogden, .. 'A. L. Perrin, .. 'Directors.' "And the county court, being tully advised in the premises, orders and adjUdges that the prayer be granted. And it is further ordered that an election in said strip be, and the same is hereby, ordered to be held at Camden Point, in Greene township, in Platte county, Missouri, on Tuesday, August 17th, 1869, and the manner ot holding said election shall be as tollows: All the taxable inhabitants ot said territory above described shall be entitled to vote by ballot, on which shall be written or printed the words or figures, 'In favor ot and assenting to the tax to secure the location and construction of the Chicago and Southwestern Railway through the strip ot land mentioned in petition,' or, 'Opposed to and dissenting from the tax to secure the location and construction ot the Chicago and Southwestern Railway through the strip ot land mentioned in the petition.' And said first-mentioned ballots shall be deemed and counted in favor of the tax, and said last-mentioned ballots shall be deemed and counted against such tax. It is further ordered that Elliott Miller, James S. Owens, and Miles Harrington be, and they are, appointed, judges of said election, to hold and make return thereot, according to law. And the sheriff is ordered to give notice thereot according to law." Book H, p. 244. "Monday, September 27th, 1869. "Court meets pursuant to adjournment. Present, Hon. 'l'. H. Talbott, president; Honorables Jacob HlI;mm and Benjamin Morton, justices; George W. Belt, sheriff; Daniel P. Lewis, clerk.
826
"And tbe following, among the proceedings.; :W:llre had, to wit: , ' "In ilia matter 01. the electtonheld at'Oamden Point, day of :August, 1869, in PurSUlUlce 01. an order of tbiscourt, made on the lOth day 01. July,1869,and the retunlS of the poll books and ballots, and the cert11lcates ot. tbej\l4ges f,UJd clerks of saidelectton. "NoW, at this. day came W1ll1am H. 'rhomas and W. SHtt, and file their motion to 'declare the vote taken at said election a nullity and of nonetrect." "Be It, remem:t1ered, that at all adjourned term of the county court held at Platte City, Mo., on the 4th day of October,A. D. 1869, there were present as follows, to wit: Hon. T. H. Talbott, president, Hon. Jacob Hamm and Benjamin R. Morton, justices, of said court; George W. Belt, sheriff; Daniel P. Lewis, clerk:'" Book H, p. 250. ' "Antllil,said court the following, among other, proceedings were had, to wit: "In the matter Of, the election held at Camden Point, in Greene township, on the l;:th nay of August, 1869, in relation to the subscription of $50,000 to the Chicago and Southwestern Railway Company. "Now,'at this day come the petitioners for said election, as well as Wm. H. Thomas and Wm. E. Stitt, by their respective attorneys, and the motion of said Thomas and Stitt, filed to herein do declare the said election a nullity and of none1'l'ect, being taken., Up and argued, the same is, sustained by the court. therefore considered by the court that the vote taken at Camden Point, on tlle 17th day of August, 1869, in pursuance of an order 01. this court, made 011 the 10th day of JUly, 1869, be and the same is, declared a nullity and of nonel'fect. And it is further ordered and considered by the court that the said petitioners for said election pay the costs of this proceeding, and that execution issue therefor." Book H, p. 474. "Be it reriIemllered, that at an adjourned term of the term of the county court, held at Platte City, Mo., on the 3rd day of October, 1870, there were present as follows, to wit: Hon. Thomas H. Talbott, presiding justice of said court; Hon.Jacob Hamm, justice of said court; George W. Belt, sheriff; DanielP. Lewis, clerk, by Ira Norris, deputy. "And in said court the following, among other, proceedings were had, to wit: "In the 'matter of the subscription of the taxpayers of a 'strip in Greene township,' made in July, 1869, to the Chicago and Southwestern Railway Company, the motion of the issuance of the bonds by the court is now here submitted to the court, which motion is taken under advisement until Wednesday, the 5th day of October, instant." Book H, p. 476. "And on Wednesday, the 5th day of October, the follOWing, among other, proceedings were had, to wit: "Court met pursuant to adjournment. Present, Hon. T. H. Talbott and Hon. Jacob Hamm and Benj. R. Morton, justices of said court; George W. Belt, sheritr; and Daniel P. Lewis, clerk: "In the matter of the motion made to this court on the third day of October, instant, for the issuance of the bonds of the county for the amOunt of the subscription made by the taxpayers within a 'strip in Greene township,' in the month of August, 1869, to the Chicago and Southwestern Railway Company, it is now here ordered that this cause be continued to the next term of this cO,urt." "Be it remembered, that at an adjourned term of the county court held at Platte City, Mo., on the 14th day of November, 1870, there were present as follows, to wit: Present, Hon. T. H. Talbott, president, Hon. Jacob Hamm and Benj. R. Morton, justices, of said court; George W. Belt, sheriff; and Daniel P. Lewis, clerk." Book H, p. 496. "At said court the following, among other, proceedings were had, to wit: . "In the matter of the motion of Joseph E. Merryman, made to this court on the third day of October, 1870, for the issuance of the bonds of the county for the amount of the subscription made by the taxpayers within a 'strip in Greene township,' in the month of August, 1869, to the Chicago and Southwestern Railway CompanY, it is,now here ordered by the court that the motion aforesaid be and the same is overruled by the court." Book H, pp. 592,593. . "Be it remembered, that at an ndjoUll1ed' term of" the county court of Platte county, held on the 14th day of February, 1871, there were present as
DELAND V. PLATTE-
827
follows, to wit: Hon. T. H. Talbott, presiding justice; Hon. John S. Brassfield and Jacob Hamm, justices; George W. Belt, sheri.tt; and T. W.Park, clerk. "And In said court the following, among other, proceedings were had, to wit: . "Whereas, the court, on the 10th day of July, A. D. 1869, made an order submitting toa vote of the taxable inhabitants of the 'strip of territory in Platte county' hereinafter mentioned and described a proposition to subscribe for fifty thousand dollars of the capital stock of the Chicago and Southwestern Railway Company; and .whereas, at an election held at Camden Point, in said strip, on the 17th day of August, 1869, by virtue of the provisions of an act to incorporate the Platte and Fort Des Moines Railroad Company, approved January 4, 1860, the taxable inhabitants aforesaid voted in favor of such subscription; and whereas, by an act of the general assembly of the state of Missouri, entitled 'An act to amend an act entitled "An act to facilitate the construction of the railroads in the state of Missouri,'" approved March 23, 1868, approved March 24, 1870, the court was authorized to issue bonds in payment of such subscription; and whereas, in consideration of the order and vote above recited, said railway company has located, constructed, and completed its railway through said strip of territory, and erected and completed a depot therefor within one mile of the town of Camden Point: Therefore, it is ordered by the court that fifty bonds of the county, each for one thousand dollars, be issued and delivered to said railway company, dated October 4, 1870, which bonds shall be executed by the presiding justice and the clerk 'hereof, attested by the seal of the court, due twenty years after date, at the American Exchange National Bank, in the city of New York, with forty semiannual coupons, each for fifty dollars, for interest accruing thereon, executed and payable in like manner as sald bonds. It is further expressly ordered and provided that the subscription bonds and coupons aforesaid are made and executed for and in behalf of the taxable inhabitants of all that part of the municipal township of Greene, in said county, lying east of the range line .between thirty-four and thirty-five. And the said bonds and coupons shall be paid by the taxable inhabitants exclusively, as provided by law, and none thereof shall ever be a charge on the county of Platte. And it is further ordered that the said Chicago and Southwestern Railway Company shall pay all expenses necessary for the transfering of the funds to New York, to pay the interest and bonds aforesaid. And the said company shall pay the expenses ot the execution of the bonds, and all costs attending the same." Book H, p.594. "Be it remembered, that at an adjourned term of the county court ot Platte county, Missouri, there were present as follows, on Friday, the 17th day of I!'ebruary, 1871: Hon. John S. Brassfield and Jacob Hamm, justices; George W. Belt, sheriff; T. W. Park. clerk. "At which said court, among others, the following proceedings were had, to wit: "Now, here comes T. W. Park, clerk, and files the receipt of James N. Burns, vice president ot the Chicago and Southwestern Railway Company, for fifty bonds issued in accordance with an order made by this court, on the 14th day of F'ebruary, 1871." Book H, p. 668. "Be it remembered, that at an adjourned term of the county court held at Platte City, Platte county, Missouri, on Wednesday, June 14th, 1871, there were present as follows, to wit: Hon. T. H. Talbott, president; Hons. John S. Brassfield and Jacob Hamm, justices; George W. Belt, sheriff; and T. W. Park, clerk. "At which said court the following, among other, proceedings were had, to wit: "Ordered by the GOurt, that the state and county tax be levied on the roadbed, ties, iron track, and buildings of the Chicago and Southwestern Railway Company, tor the use and benefit of the strip of country, in Greene township, in Platte county,-that wherein the inhabitants voted a subscription of fifty thousand dollars to said railway company; and when sald state and county taxes shall be collected, the same shall be applied to the payment, in the name of Platte county, tor said strip, and which said is bound to pay.
828
FEDERAL REPORTER)
And it 18 turther ordered, that sa.ld property be and the same 18 valued at thl' sum of two hundred dollarslUld fifty thousand dollars, and that a copy of order be certlfted to the collector, and to the proper ofticerof 8llid company. And it 18 further ordered. that the levy be fixed at the 8llme rate as is now fixed for the state and county purposes." Book H, p. 791. . "Be it remembered, that at an adjourned term of the county court of Platte county, Missouri, held at Platte City, Mo., on Monday, March 18th, 1872, there were present as follows, to wit: Hon. J. H. Talbott, president; Hons. Jacob Hamm and John S. Brassfield, justices; T. W. Park, clerk; and Geo. W: Belt, sherl.ff. "At which court the following, among other, proceedings were had, to wit: "In the matter of the subscription made by the taxpayers in the strip in Greene townShip, under an order of the county court, made on the 10th day of July, A. D. 1869. "Ordered by the court, that the sum of twenty-five hundred dollars realized out of and by virtue of an order made on the 14th day of June, 1871, be and the same is hereby ordered to be transferred to the American Exchange National Bank, in the city of New York, to pay the interest falling due on said bonds on the first day of April next, and that J. E. Merryman be appointed agent to settle the matter, and report to this court at the May term; it being understood that the payment is made under the law in relation to subscription of township, passed 24th March, A. D. 1870." Bool;: H, p. 847. "Be it remembered, that at an adjourned term of the county court of Platte county, held at Platte City, Mo., on Tuesday, the 4th day of June, A. D. 1872, there were present as follows, to wit: Hon. T. H. Talbott, president; and Hons. Jacob Hamm and John S. Brassfield, justices; T. W. Park, clerk; and George W. Belt, sheriff. "At which court,among others, the follOWing proceedings were had, to wit: "Ordered, that a tax of one half of one per cent. be levied upon everyone hUlidred dollars valuation of the real and personal property in the strip ot territory voting a subscription of bonds to the Chicago and Southwestern Railroad, for the purpose of paying the interest on said bonds, and that the clerk extend the same upon the tax books for 1872, in appropriate columns." Book L, p. 57. "Be it remembered, that at an adjourned term of the county court of Platte county, held at Platte City, Mo., Monday, February 10th, 1873, there were present as follows: Hon. John S. Brassfield, president; .Hons. Jacob Hamm and William E. Cunningham, justices; T. W. Park, clerk; and E. McD. Coffey, sherl.ff. ' "At which said court the following, among other, proceedings were had, towtt: "Ordered by the court that the payment of coupon No.1 on bonds of Greene township to the Chicago and Southwestern Railway Company be, and the same is hereby, refused." "Be it remembered, that at an adjourned term of the county court of Platte county, held at Platte City, on Monday, the 3rd day of March, 1873, there were present as follows, to wit: Hon. John S. Brassfield, president; Hons. Jacob Hamm and William E. Cunningham, justices; T. W. Park, clerk; and E. McD. Coffey, sheriff." Record L, pp. 84, 85. "At which said court, among others, the following proceedings were had, to wit: "It is hereby ordered that Stephen C. Woodson, county attorney, be and he is hereby required to take such action as may be necessary to collect the taxes paid into the state treasury by the Chicago and Southwestern Railway Company, assessed in said county of Platte for the year 1872, and pay the same into the county treasury, to the credit of the 'Greene Township Strip Fund,' and to this end the said attorney is authorized to proceed at once to Jefferson City. and make demand for said money, and he is also authorized to sign and receipt for, and in the name of Platte county, for any amount that may be paid him, in accordance with the above order." Book L, p. 86. "Be it remembered, that at an adjourned term of the county court of Platte county, Mo., held at Platte City, on Monday. the 24th day of March, 1873,
829
therp. were present u tollowa, to wit: Hon. John 8. Brassftell1, president: Hons. Jacob Hamm and Wm. E. CunnIngham, justices; T. W. Park, clerk; and E. McD. Colfey, sheriff. "At which said court the following, among other, proceedings were bad, to wit: "Now comes James N. Burns, and files motion to instruct the county treasurer to forward to New York a su1ticient sum of money to pay the Interest falling due April 1st, 1813, upon the bonds of Greene township to the Chicago and Southwestern Railroad Company, which motion is continued, and set for hearing to-morrow." Book L, pp. 89, 90. "And on Tuesday, tbe 25th day of March, the following, among other, proceedings were had, and entered of record, to wit: "In the matter of the motion of .James N. Burns, and the issue of bonds to the Chicago and Southwestern Railway Company by Platte county, for and on account of the taxpayers within the strip of country on both sides of the road in Greene township, it is ordered by the court, no member dissenting, that the treasurer of Platte county at once forward to tbe American Exchange National Bank, in the city of New York, the sum of twenty-five hundred dollars, to meet the Interest falling due on said bonds on the first day of April next, and the fund paid In on account of the tax of said railway company, and now in his hands, belonging to said strip or collected from tbe Chicago, Rock Island and Pacific Railway Company, in Platte county, for the year 1812." "State of Missouri, county of Platte-ss.: I, Jesse J. Blakeley, clerk of the county court, within and for the county and state aforesaid, do hereby certify that the foregoing is a full, true, and complete transcript of tbe proceedings In regard to the matter known as the issuance of the 'Greene Township Strip Bonds,' as full as the same appears of record in my office. [Seal.] "In testimonY·whereof, I have hereunto set my hand, and atlixed the seal of said,collrt. Dlime at office in Platte City, Mo., this, the 15th day of February, A. p. 1888. Jesse J. Blakeley, County Clerk." The following is a copy of the bonds Issued on said subscription: "Know all men by these presents, that the county of Platte, in the state of Missouri, acknowledges itself to owe and to be indebted to and promises to pay to bearer the sum of one thousand dollars, on the first day of October, one thousand eight hundred and ninety, for value received, at the National Exchange Bank, In the city and state of New York, with Interest thereon from the first day of Octobel', A. D. 1871, at the rate of ten per centum until paid, which Interest shall be due and payable semiannually on the first days of April and October each year, on the presentation of the proper Interest coupon,. as annexed hereto, at the said American Exchange Bank. This is one of fifty bonds, of like date, amount, and effect, numbered from one to fifty, both numbers inclusive, issued in pursuance of an election, by the taxable inhabitants of Camden Point, on the 11th day of August, A. D. 186'9, and for the payment of which, and the interest thereon, the county court of said county shall, from time to time, levy and cause to be collected, in the same manner as county tax, a special tax, which shall be levied on the real estate lying within the dIStrict so voting at said election." The coupons are in the following form: "Platte City, Mo., October 4, 1870. $50. "The county of Platte, In the state of Missouri, promises to pay bearer fifty 11011ars, for value received, at the American Exchange National Bank, In the city of New York, on the 1st day of April, A. D. 1880, being semiannual interest on bond No. - - , issued to the Chicago & Southwestern Railway Com· pany."
J. W. Coots and Hall & Pike, for defendant. PHILIPS, District Judge, (after stating the facts.) The bonds in question are predicated of section 7 of an act of the assembly of the .tate of Missouri, approved 4th January, 1860.
Sanders & Bowers, for plaintiff.
830
FEDERAL REPOB'nER, ViOl..
54. .. : J'tll.rwoa.,·d '. ',. .... . ' ....
"Upolll.the .presentatl,on: or,a petition of the and 'directors of said company to the county court of any county through which said road may be, located, praying' that a .vote may be taken in any ,strip of country through . whiclHt may pass, not t;e,'exceed ten miles.on either side·of sllidroad, that the illhabitlmts thereof al'edesirOUSl of ta.kiIlg stock in said.road, and of voting upont:hemselves'a tax fol' the payment of the same, it shall be the duty of said county court to order an election therein, and shall prescribe the time, place, and manner of holding said election; and if a majority of the taxable inhabitants shall determine in favor of the tax, it shall bathe duty of saim. court to levy and collect from them a special tax, which shall be kept separate fllomother' funds, and' appropriated to no other purposes, and as fast as collected shall cause the same to be paid to the treasurer of said company."
whic'ii 'seot1oii'
'Oity' israslolto*s:" .,,,.
J.,
"", \'
It is the settled law of this jurisdiction that the holder of municipal bOnds:is chargeable with notice of the provisions of the law authorizing their issue. If there was no law authorizing the issue of the bonds, the bonds are void; and a purchaser of such struments is bound to see to it that there is some law consistent with the recitations of· the bond pursuant to which it was issued. The bond in question recites that it was issued. "in pursuance of an electio:y,bY the taxable of Oamden Point, on the 17th aay of August, 18.69, and for the payment of, waich and the interest thereon the county court ()f said county shall from time as to time levy and cansl! to be collected, in the same county tax, a, special tax, which shall be levied on the real estate lying .withill the district so voting at such election." This recital, of course, referred the purchaser to the records and law authorizing the issue of this paper; and the plaintiff has pleaded' the acts of the legislature and the action of the county court aforesaid as the. basis of his right of action. It has been expressly decided in Ogden v. Oounty of Daviess, 102 U. S. 634, that said section 7 of the charter of the railroad court of Platte county to issue ·bonds did not authorize the for the payment of any subscription voted by the inhabitants of the "strip" of country. The court say: "The inhabitants were not even organized by themselves, much less made 1I. body politic, fOr any purpose. They could vote the tax, if called upon to do SO by the countycourt;bttt that was all. The effeetottheir vote was nothing more than to authorize the county court to levy, coHect, and pay over to thE' treasurer of the company the special tax had determined UpOll. The reQ)lirement of the law that the money, when collected, should be paid over to the the company, is entirely inconsistent with any idea that the obligations to be met in this. way were to be in the form of. negotiable paper afioaton the market liS commercial securities. Under the provisions of section 6 of tliecharter, counties, towns, lind cities were expressly authorizecl to issue bonds in payment of their subscriptions. The omission of any such power in section 7 is conclusive evidence thl;tt nothing of the kind was intended in case of 'strip' subscriptJ,ons. In this particular, the case is even stronger than that of Wells v. Supervisors, Id. 625;'"
Clearly, therefore,nnless these bonds can be referred to some other law for their vindication, this action must fail. Oounsel for complainant rely upon two acts of the legislature,-one adopted
831
March 23, 1868, act to facilitate the construction of railroads in the state of Missouri." This act authorized the CQunty court to make subscription to the capital stock of railroads, and issue bonds therefor on behalf of any municipal township ofa .county, when petitioned therefor, and after an election to be held in the said township, at which two thirds of the qualified voters .lIhould vote for such subscriptions. It was also expressly held in Ogden v. County of Daviess, supra, that this act related entirely to municipal townships, as such, and was no authority for issuing bonds on a subscription voted by a mere strip of country, or for any less subdivision of a county than the municipal townships as they existed. under the political subdivisions in our state government. But plaintiff contends that by an amendatory act of the sU}tute last aforesaid, approved March 24, 1870, the issue of the bonds was authorized. This amendment il!l as follows: "In all cases where, by the provIsions of the charter of lUly rallroad company organized under the laws of this state, the taxable inhabitants of a portion of a municipal township of any county in this state have voted, or may hereafter vote, to take stock in such railroad company, they are hereby declared entitled to and Shall have all the privileges, rights, and benefits in said act conferred upon counties or townships, and the county court of such county shall exercise the same powers and perform the same duties in issuing bonds, levying, collecting, and over the· taxes, which it is required to do in the case of a county or township under the provisions of saId act: provided, however, that no part of said township, outside the limits of the district voting, shall be taxed to pay any of the bonds or coupons so issued by the county court. This act shall take effect from its passage."
It will be oBserved that this provision relates to the instance of a vote already had, as well as to one that might thereafter be taken; it is the retroactive feature of this provision that plaintiff iIM>kesand relies upon. For it must be kept in mind that the subscription voted by the taxpayers of the strip was at an election held in 1869, and prior to the adoption of this amendatory statute of March 24, 1870. The contention of plliintiff is that said election was held in "a portion of a municipal township," and it is sought in argument to construe the decision in Ogden v. County of Daviess so as to give authority for this post mortem legislation. The chief justice, arguendo, does say: "It must be presumed that the amendment applied only to parts of townShips, separately, and not to the aggregation of townships or parts of townShips, which must necessarily be included in a strip of country twenty mUes wide, or less, along a railroad as it runs through a country. TIle bonds which this statute authorizes were to be issued on behalf of a portion of a township, not on behalf of 'a 'strip of country,' "
It is to be observed, however, that, while the court is reciting what the statutory amendment authorized. it does not say tq.at this statute would authorize the issue of bonds after an election held under the charter of the railroad in question. For the learned chief justice instantly proceeds to state: "Under the charter the taxable inhabItants of the strip were to take the stock, and they were to be taxed. We cannot, without a perversion of laDact of 1870 to this provision of this statute."
832
CounseUol"plamti1r asserts that this amendat,ory aetof187o'l$b:01l1d be applied in this case llS if. it were a plU't'of thee act of' 1868, and in existence' at the time of the election held in :the strip in 1869; and contends that the legislature could rlttifyand affirm. the exercise of any power by a muhicipaI corpora. tioB: which: it co1l1d originally confer; and we are' referred to the following authorities in support thereof: Anderson v. Township of Santa Anna;, 116 U. S. 356, 6 Sup. Ct. Rep. 413; Bolles v. Brimfield, 120 U. S. 759, 7 Sup. Ct. Rep. 736; Jonesboro City v. Cairo, etc., R. U. S. 192, 4 Sup. at. Rep. 67. These are cases arising on legislative acts in the state of lllinois, in which the principle is announced that, "unless there be a constitutional inhibition, a legislature has power, when it interferes with no vested right, to enact retrospective statutes to validate invalid contracts, or to ratify and confirm. any act it might have lawfully authorized in the first instance." That such statutes enacted subsequent to the occurrence of the act sought to be cured may obtain in some states whose constitutions do not interdict retrospective legislation, may be conceded to the plaintiff. But· the constitution of the state of Missouri, (section 28, art. 1, of the declaration of rights,) in force at the time of the issue of these bonds, declares that, "no ex post facto law, nor law impairing the obligation of conor retrospective in its operation, can be pasSed." The constitution of the state of illinois contains no such provision as the latter part of the foregoing clause. Under the constitution of Missouri, no law retrospective in its operation can be passed. What is a retrospective law? "This word," says Bouvier, "is usually applied to those acts of the legislature which are made to operate upon some subject, contract, or crime which existed .before the passage of the act; and they are, therefore, called 'retrospective laws.'" "A statute which takes away or impairs any vested right acquired under existing laws, or creates a new obligation, or imposes a new duty, or attaches a new disability, in respect to transactions of considerations already past, is to be deemed retrospective or retroactive." Sedg. St. CODst. Law, (2d Ed.) 160. This provision of the Missouri constitution has been construed and applied by the state supreme court, and is entitled to respect, and should be followed where a right, in pari materia, again comes under review. In Fowler v. City of St. Joseph, 37 Mo. 228, certain work was done for the city under an ordinance which provided for the collection of the bills by suit at law. After this work was done, the city, by a subsequent amendatory ordinance, provided that the cost of such improvement should be enforced by a special tax, levy, and sale. Under this amendatory ordinance the city proceeded by levy and seizure of property to collect the claim. The court held that when the contract was made and the work done the law in force did not make the amount apportioned to each property owner a lien on the property, but only created a personal liability, enforceable at law; it was therefore not competent by subsequent ordinance to create such lien, and provide for a different mode of collecting it, because it was retroactive in its operation. In Insurance Co. v. Flynn, 38 Mo. 483, the
DELAND V. PI,ATTE COUNTY.
833
legislature u:Q.dertook by an amendment' to the charter of the company to make the certificates signed by the president and secretary, attested by the corporate seal, that the party therein named is indebted to the company in the sum named, conclusive evidence of the fact, and made it retroactive as to the causes of action originating anterior thereto. The court, after quoting the text above cited from Sedgwick, said: "The right of the legislature to change the remedy and prescribe rules of evidence, If Its enactment does not create a new obligation, or attach a new disability retrospectively, is conceded: but It is not within the constitutional competency of the legislature to annul by statute any legal ground on which a previons action is founded, or to create a new bar by which such action may be defeated. No Dew ground for the support of an existing action ought to be created by legislative enactment, nor any l('ga! bar which goes to deprive a party of his defense."
The case of City of St. Louis v. Clements, 52 Mo. 133, is still more pertinent. The city charter authorized the construction of sewers, the dimensions of which were to be prescribed by ordinance of the council. The ordinance passed left the determination of this matter to the city engineer. This was held to be an unauthorized delegation of legislative discretion, and, therefore, no liability under the contract was created against the city. Subsequently the state legislature passed an act authorizing the city to reassess the sum unpaid to the adjacent real estate benefited by the improvement. This act was held to be unconstitutional, for the reason that it was retroactive in its operation. The court, after quoting from Sedgwick that it is competent for the legislature in given cases to enact laws having a retroactive effect, unless it comes within the purview of Bome express prohibition contained in the state constitution, say: "Here is a positive prohibition against the passage of any law which is retrospective in its operation. There is l(>ft fot" construction; we are only left to ascertain what is defined to be a retrospective law, and if the law under consideration comes within the definition, the constitution pronounces the judgment."
After stating the definition given above by Sedgwick, and showing that no legal liability was created against the city, unless by virtue of the after legislative enactment, the court further say:
"How, then, can we say that this act does not create a new right In favor of the contractor, and incur a new liability on the part of the defendant? · · · To my mind this law comes ('xactly within the definition to be given to a retrospective law."
Two of these decisions were made prior to the issue of the bonds in question, and the other almost contemporaneously with the issuance. So that the construction placed on this clause of the state constitution was established before the bonds went into market. If the act of March 24, 1870, at least, in so far as it undertook to authorize the county court to issue bonds upon a vote "of a portion of a municipal township," theretofore taken, is not retrospective legislation, it would be difficult to conceive of an act falling within the inhibition of the constitution. At the time the vote was taken by the inhabitants of the strip of country, there was no law, say the supreme court in Ogden v. County of Daviess, supra, authorizing the v.54F.no.5-53
834
county court of Platte county to issue such bonds predicated of such election. When this subsequentlegislation, therefore, is resorted to 88 authority for their validity, itcah only be made to apply by giving to it a retroactive effect, and the constitution says this cannot be Section 7 of the charter of the railroad .company, under which the election was held in 1869, did not contemplate the issue of bonds in payment of the debt thus voted. What the taxpayers voted for was that the county court might "levy and collect from them a special tax" to raise the requisite fund to liquidate the debt. They never did vote for the issue of bonds. There was no law in being at the time of the election authorizing or empowering the issue of bonds for such purpose. As said by Judge Dinon in Gause v. City of Clarksville, 5 Dill. 172: ''There is an obvious and essential d11rerence in incurring a debt, to be paid in the usual manner out of the revenue of the corporation derived from taxation, and the raising of money in advance by a pledge of credit, and the issue of coupon bonds payable at a long distant day, for sale in the market of the
.
The issue of the bonds in question materially altered the condition and right of the taxpayers from what they were at the time of mak· ing the contract for which they voted. The bonds issued bear 10 per cent. interest, payable semiannually at the city of New York, and are not payable until 1890; nearly 20 years after their issue. By this act of the county court the bonds were not redeemable, however much the taxpayers may have desired to take them up, for 20 years. They must during all these years pay interest thereon semiannually at the rate of 10 per cent. If this did not make a new contract, create a new liability for the debtors, after their vote, and in de"spite of what they voted for,. common sense is at fault. The taxpayers of the sci-called "strip" can well say to the demand of these bondholders: 1'In hoc foedere non veni." Attention is directed by counsel for plaintiff to section 27, art. 4, of the constitution of Hl65, which declares that "the general assem·· bly shall not pass any local or special law, legalizing, except as against the state, the unauthorized or invalid acts of any officer," and also to the enlargement of this provision in the constitution of 1875, (section 53, art. 4,) which declares that "the general assembly shall not pass any local or special law legalizing the unauthorized acts of any officer or agent of the state, or of any county Ol' municipal authority." It may be conceded that the above provision in the constitu· tion of 1865' does not cover the case at bar, and that the constitution of 1875 is prospective in this respect. But these provisions detract naught from the other positive prohibition against retrospective legislation. These additional limitations but illustrate the fact that it was the purpose of the framers of the fundamental law, by particularization, to throw every possible safeguard around the constituency against post mortemlegislation; and as far as possible, by going into details; to prevent both legislative and jUdicial depart. ments from construing away the plain and obvious scope of other more general declarations. It remains just as true to-day, as it luuo
country. The bonds may be issued. and sold for sixty-seven per cent. of their par value, and the corporation is bound."
DELAND .". PLATTE COUNTY.
835
since the adoption of the constitution of 1820, that no retroactive law can be passed by the legislature; which "creates a. new obligation, or imposes a new duty, or attaches a new disability in respect to transactions or considerations already past" And the provision of said section 53 in the constitution of 1875 has not added one atom of strength to the prohibition. It but emphasizes the popular view of the state policy. The case of Lynde v. County of Winnebago, 16 Wall. 6, which it is not too much to say carried the doctrine of implied power and agency to the utmost verge, is no authority for the action of the defendant county in issuing these bonds. In that case the power to borrow money to meet the tax voted did exist, under certain conditions. And the argument of the majority opinion proceeds upon the presumption that it could not reasonably have been within the contemplation of the legislature, or the county court, that, in providing for a necessary courthouse, "the erection should be delayed until a sum sufficient to pay for the structure had been realized from the tax authorized to be imposed, or that the work should proceed only pari passu with the progress of its collection from year to year." Whereas, as already shown, the act of the legislature of 1860 conferred no authority to borrow the money to meet the subscription under any circumstances; and it could not have been in the contemplation of the voters in 1869 that bonds should be issued without authority of law. Nor was the county undertaking to build the road, so as to raise any implication that it must have been within the intendment of the taxpayers, or of the county court, that the money was to be bol'rowed to instantly prosecute the work. The railroad company was to build the road, and the taxpayers of the strip merely voted, under section 7, to take stock in said road, and voted "upon themselves a tax for the payment of the same." To that "special tax," levied and collected by the court, "to be paid to the treasurer of said company," "as fast as collected," could the company alone look for the payment of such subscription. The case of Dodge v. County of Platte, 82 N. Y. 218, bears out with additional force of reason and authority the foregoing opinion. There also occurs to me a further objection of minor importance to this action. Under the charter of the railroad company it required "a majority of the taxable irihabitants" to vote for the subscrip· tion. The record of the county court only recites that "the taxable irihabitants aforesaid voted in favor of such subscription." It is not recited, nor found by the court, that a majority of the taxable inhabitants voted therefor, to say nothing of the constitutional provision of the state, then in force, which required a two-thirds vote of the qualified voters to authorize a subscription made outside of the provisions of the antecedent charter of 1860. The fact found by the county court does not necessarily imply that a majority of the taxable inhabitants voting at said election so voted. Does the recitation on the face of the bond cure this defect in the record? It recites that the bond was "issued in pursuance of an election by the taxable irihabitants of Camden Point." This might conclude the county from disputing that an election was had, but
836
the peculiarity of this recitation nes in the fact, not only that it fails to state either a majority or a two-thirdS vote, but that the election held was "by the taxable inhabitants of Camden Point," whereas the election petitioned for and held was for a part of the municipaJ township of Greene, lying between given points. Camden Point, as appears from the face of the record of the county court, was a town at which the election was held. No vote of the inhabitants of Camden Point could have authorized the subscription; and no authority has been shown by the plaintiff for the issue of these bonds, other than the election held under section 7 of the charter, which is limited to the taxable inhabitants of the strip of country - through which the railroad runs. When plaintiff resorts to the record of the county court to sustain his right, he must abide by what it shows. . It is hardly necessary to discuss the proposition advanced by counsel that the action of the county court has been ratified by any act done by it since the issue of the bonds. "He who may authorize in the beginning, may mtify in the end." Bank v. Gay, 63 Mo. 39. A ratification can only occur when the party ratifying possesses the power. to perform the act done. Marsh v. Fulton County, 10 Wall.
677.
tiff cannot recover.
On the facts of this case I declare the law to be that the plainJudgment accordingly. KElNEDY v. BENSON et aL (Circuit Court, C. D. Iowa, N. D. Mal'ch 30, 1893.)
DEOJIlIT-RIGHT TO DAMAGES--'-AsSIGNMENT.
A receiver ot a ranch company Rold property thereof to defendants, and took in payment certamshares of stock. In his report to the court, he cllarged himself with the stock as cash, the report was approved, and ho fully settled with the company OU that basis, and kept the stock. Afterwards he individually brought suit against defendant!' to recover damages for fraudulent representations made at the time of the sale as to the value of the stock. Held, that the cause of action was in the ranch company, and did not pass to plaintiff when he acquired the stock, and he could not maintain the action without showing an assignment to himself.
At Law. Action by James Kenedy against R. S. Benson and G. O. Hayes to recover damages for false representations as to certain shares of stock. On demulTer to the petition. Sustained. J. F. Duncombe, for plaintiff. E. P. Andrews, for defendants. SHlRA.S, District Judge. From the allegations In the substituted petition filed in this case it appears that on the 10th day of June, 1889, the plaintiff herein, James Kenedy, was appointed a receiver of the "T. X. Ranch" in the state of Texas, in a suit pending in the United StateB circuit court for the eastern district of Texas, and as such receiver he took possession of several thousand head of cattle and other persoJ:l.a1 property; that on the 16th day of Decem-
