Atchison & Nebraska Railroad v. City of Troy

10 Kan. 513 | Kan. | 1872

The opinion of the court was delivered by

Kingman, C. J.:

The court below made an order temporarily restraining the trustees holding a contract between the plaintiffs in error and defendant in error from collecting the same, and the treasurer Tracy from making any payment on the same. The order also restrained the trustees from letting certain bonds of the city of Troy pass out of their hands. This order is brought to this court for review. It appears that the city of Troy subscribed $50,000 in stock to the Atchison & Nebraska railroad, and agreed to issue its bonds for the same amount in payment therefor. The bonds were to run thirty years, and to bear six-per-cent, interest, payable annually. Subsequently, on the 21st day of October 1870, the city of Troy issued bonds to the amount of $25,000, and placed them in the hands of trustees to be holden as security for a contract that day made between the city and the railway company, which stipulates among many other things, that if the city will pay $6,000 in certain defined payments, with ten-per-cent, interest thereon, then the bonds issued shall be delivered up by the trustees, and the bonds not issued shall not be required from the city. This contract had been assigned to James E. Joy before this litigation 'commenced. The motion was heard upon the petition and answers, which were verified, and upon affidavits. The only papers used by the plaintiffs were the petition and affidavit of Leon D. Noyes, city clerk of Troy. The petition averred that the city never authorized Tracy to make the subscription to the stock of the railway company;' that the city had no power to make such a subscription and bind the city for its payment; that the city had no power to make such subscription without the matter being first submitted to a vote of the electors of the city, after 30 days’ notice had been given, and that no notice was given, and no legal election was held. The affidavit of Noyes was, that he was clerk of the city of Troy, and as such clerk was the custodian of the books, papers, and records of the city, and that he had examined the books of said city and found no entry showing that any ordinance No. 48 ever passed the city council of said city, nor could the affiant find among the files and records of said office any evidence showing that any notice was given or attempted to be given to vote upon the proposition of subscribing stock and issuing bonds to the Atchison & Nebraska Railroad Co. The affidavits read oq the hearing of the motion by the defendants (plaintiffs in error,) showed with a convincing preponderance, that the ordinance was passed authorizing a submission of the question of taking stock and issuing bonds to a vote of the people; that such question was submitted to a vote of the people after more than thirty days’ notice thereof had been given; that a large majority of the voters had voted in favor of the proposition; that Tracy was fully authorized to make the subscription, and that the location of the depot was made in such substantial conformity with the ordinance of the city as to give entire satisfaction to the mayor and council as they manifested by solemnly ratifying the same. These facts were made so clear that it is not deemed desirable to state the evidence of them in detail. Whatever may be made to appear on a final trial, we cannot say, and do not wish to forestall. But the affidavits made out a clear prima fade case of all the steps having been taken that were required to authorize the issue of the bonds, if the city had the power; and that question as we understand it, has been decided in this court in favor of the power. We do not feel inclined however on this hearing to decide this question finally, because if there was no power to issue the^ftffids, and no power in the city authorities to bind the city to their payment, then no temporary injunction is necessary, for payment can never be enforced, no matter into whose hands the bonds may pass. As litigation is commenced, it may be proper, if no power exists to create the indebtedness, to close further litigation by a final injunction.

A simple point remains. The defendant in error claims that the city authorities had no power to make the agreement by which on the payment of $6,000 they were to be released from the payment of $25,000. Although no express power may.be found we are inclined to think the general power to manage the finances is sufficient to uphold such a transaction. It is not the creation of an indebtedness, but a change of it ,so advantageous that the surprise is that the defendant in error is willing to raise the question. Doubtless the owner of the agreement would be willing to have it held void, and consequently do.es not argue this point in his brief. We must hold that the temporary injunction was improvidently granted, and the casbfis remanded with instructions to vacate the •order.

All the Justices concurring.