37 P. 277 | Idaho | 1894
Plaintiff is an organized county in the state of Idaho. Defendant is á banldng company, organized and incorporated under the laws of the territory of Utah, doing business at the town of Blackfoot, in the said state of Idaho. The county commissioners of Bannock county, for the purpose of funding the indebtedness of said county, determined to issue, and did issue, bonds of said county to the amount of $120,000, bearing date January 1, 1894. A copy of one of said bonds, all being of the same tenor and date, is as follows, to wit: “No. 1. $500.00. United States of America. State of Idaho, County of Bannock. Gold Funding Bond. Know all men by these presents, that the county of Bannock, in the state of Idaho, acknowledges itself to owe, and for value received hereby promises to pay, C. Bunting & Co., or bearer, on the first day of January, A. D. 1904, the sum of $500, with interest thereon at the rate of seven per cent per annum, payable semiannually, on the first day of January and July, as provided by law, and on the presentation and surrender of the annexed coupons as they severally become due. Both principal and interest are payable in gold coin of the United States of America, of the present standard of weight and fineness, at the office of the county treasurer of said county, in the town of Pocatello, Idaho, or at the Chase National Bank, New York City, state of New York, at the option of the holder hereof. This bond is one of a series of two hundred and sixty-four bonds of like tenor and date, numbered from 1 to 264, aggregating the sum of $120,000, issued for the purpose of funding the principal and interest of certain valid outstanding indebtedness of said county legally contracted subsequent to July 30, 1886, in pursuance of and in conformity with the provisions of an act of the
“Pocatello, Idaho, November 24, '"93.
“To the Honorable Board of County Commissioners, Bannock County, Idaho.
“Gentlemen: For the $120,000, Bannock county, Idaho, funding bonds, advertised for sale to-day, a copy of which notice we inclose herewith, we will pay you par and accrued interest for the entire issue,on the following terms, to wit: Said $120,000 bonds to be dated December 1, 1893, or January 1, 1894, and to be issued in denominations of $500 each, principal and in*161 tercst to be made payable in gold coin of the United States of America, of the present standard of weight and fineness, and to bear interest at the rate of seven per cent per annum; said interest to be paid semi-annually on the first day of January and the first day of July in each year, and both principal and interest to be made payable at the office of the county treasurer of the county of Bannock, or at Chase National Bank in the city of New York, state of New York,.at the option of the holder of the bonds; said bonds to be subject to our approval as to validity and legality. We herewith inclose our certified check on the First National Bank of Pocatello for $5,000, to meet the requirement of your notice.
“Bespeetfully,
“C. BUNTING & CO.”
On the twenty-fourth day of November, 1893, the above bid Avas accepted by the commissioners, who thereupon ordered that the bonds be executed, sold and delivered to the defendant. Said bonds were so engraved and executed and tendered and offered to the said defendant and a demand made for the payment therefor. Defendant refused to accept said bonds, and refused to pay the stipulated price therefor, or any part thereof. The plaintiff brings this suit to compel specific performance.
The defendant contends: 1. “The board of county commissioners were and are Avithout jurisdiction to issue such bonds.” —and quotes section 15, article 7, of the constitution in support thereof. This section provides that the legislature Rba.11 provide by laiv such a system of county finance as shall cause the business of the several counties to be conducted upon a cash basis. The framers of the constitution must of course have taken into consideration the condition of the several counties of the state financially at the time the constitutional convention was in session. • Many of said counties were largely indebted both in bonds and outstanding warrants. One of the methods clearly authorized by this section of the constitution for bringing the business of the counties to a cash basis was and is by issuing bonds for the purpose of taking up outstanding warrants and refunding bonds. This will more clearly appear
2. The respondent contends that the funding law does not contemplate warrant indebtedness. Section 3602 of the Revised Statutes of Idaho, as amended in the First Session Laws of State (page 200), reads as follows: “The board of county commissioners of any county may issue negotiable coupon bonds of their county for the purpose of paying, redeeming, funding or refunding the principal and interest of any of the following indebtedness of their county, when the same can be done to the profit and benefit of the county: 1. Any indebtedness contracted prior to July 30, 1886; 2. Any indebtedness contracted subsequent to July 30, 1886. And all bonds issued under the provisions of this act must show on their face for which of the foregoing classes of indebtedness they are issued. The board of county commissioners of the county may refund the said indebtedness at a rate of interest not to exceed seven per cent per annum.” It is clear from the reading of this see
It is again objected by the respondent that there was and could be no adequate provision by the board of commissioners for paying the interest on the bonds as they became due, and for constituting a sinking fund for their redemption at maturity, as required in section 3, article 8, of the constitution; but we think this requirement of the constitution is sufficiently met by section 3602 of the Bevised Statutes, which is as follows: “The board must cause to be levied annually upon all of the taxable property.of the county, in addition to other authorized-taxes, a sufficient sum to pay the interest on all bonds disposed of in pursuance of the provisions of this chapter, and must at; least one year before such bonds become due, and in time ta provide the means for their payment, cause to be levied a sufficient additional sum to pay said bonds as they become due ”
The next objection of the respondent is as follows: “The board of county commissioners were and are without jurisdiction to issue such bonds, because no question relating to the issue or sale of the bonds was ever submitted to a vote of the electors of the county.” The constitution (article 8, section 3) provides that “no county shall incur any indebtedness or liability in any manner or for any purpose exceeding in that year, the income and revenue provided for it for said year without, the assent of two-thirds of the qualified electors thereof voting-
The commissioners ordered, issued and advertised for sale, $120,000, in bonds bearing seven per cent interest. There was then in the treasury of said Bannock county, according to the stipulation in the case, the sum of $30,422.55, on the second Monday of January, 1894. No part of the revenue of 189‘3, amounting to $30,422.55, had been expended in the payment of the county indebtedness. The indebtedness at that time of the said county, outstanding and remaining unpaid, evidenced by warrants, was, as stated by the court, about the sum of $135,000. It is clear that if bonds to the amount of $120,000 were issued and sold, as provided by resolution and order of the board of commissioners, the indebtedness of the county upon the sale of the bonds would be more than doubled, without submitting the question as to the issue of the bonds to a vote of the people of the county, in direct violation of the constitution. It is true the board of commissioners, in their order, recite for what purpose the bonds are to be issued. The order is as follows, to wit: “The board, believing it to be to the best interest and to the profit and benefit of Bannock county that the outstanding indebtedness of said county should be funded by the issue and sale of negotiable coupon bonds of said county, for the purpose of paying, redeeming and funding the principal and interest of all indebtedness of said county contracted subsequent to the thirtieth day of June, 1886, ordered that notice of the intention to issue and negotiate such bonds and to invite bidders there
Respondent further claims that warrants numbered 224 to 413, inclusive, aggregating the sum of $94,929.65, issued to Bingham county in payment of indebtedness inherited from Bingham county, and apportioned under special act creating Bannock county; and warrants issued from Nos. 161 to 172, inclusive, and 452, 453, and 137, in 1894, aggregating $5,599.94, issued to recorder of Bingham county, as provided by said special act, in payment for transcribing records, are issued without authority, and in violation of subdivision 9, section 19, article 3, of the constitution. But the law creating Bannock county is specially authorized by sections 3 and 4, article 18, of the constitution; and, in the creation of such county, the legislature is authorized to make any provision necessary to the complete organization- of the county, not specifically prohibited by the constitution, and, in doing so, could provide for the apportionment of the indebtedness then resting upon the whole of Bingham, including that part now called “Bannock,” and could also provide for the payment fox transcribing the records, as this is one of the necessary expenses to the complete organization of the county.
The item $435.09, warrant No. 58, was issued to pay for a temporary jail. It is the duty of the commissioners to provide a place for the safekeeping of prisoners. A jail cannot ordinarily be hired, as buildings suitable for jail purposes are not erected by private parties. The above amount might very properly be expended, when necessary, for repairing a jail already built; and as it was paid for a temporary jail, and is certainly a small expense for such a purpose, we think it should be held to be an ordinary and necessary expense, and authorized by the constitution.
Objection is also made to warrant No. 138, for $4,000, issued for the purchase of a block of land in the town of Pocatello, as a site for courthouse. This is clearly not among the ordi