1 S.D. 216 | S.D. | 1890
This is an action (two cases consolidated) brought by the plaintiff against the county of Bon Homme, on a number of bonds and coupons alleged to have been issued by said county, bearing date the 1st day of July, A. D. 1878. The bonds and coupons are in the following, form, all being alike
“United States op America.
“Number 4. ' Dollars, 500.
“Dakota Territory, County of Bon Homme.
“The County of Bon Homme, in the Territory of Dakota, for value received, promises to pay to Alfred Sully, or order, at the office of the treasurer of said county, in Bon Homme, on the first day of July, 1888, or at any time before that date, at the pleasure of the county, the sum of five hundred doll ars, with interest at the rate of 10 per cent per annum, payable at the office of said treasurer, semi-annually, on the first day of January and July in each year, on presentation and surrender of the interest coupons hereto attached. This bond is issued by the board of county commissioners of said county, under the provisions of an act of the legislature of the Territory of Dakota, approved February 17, 1877, entitled ‘An act authorizing the county commissioners of Bon Homme county to fund the outstanding indebtedness of said county, dated 1st day of July, 1878.’ In testimony whereof the said county, by its board of county commissioners, has caused this bond to be signed by the chairman of the board, and attested by the clerk, with the county seal attached, this 1st day of July, 1878.
‘ ‘Chairman of the Board of County Commissioners.
Attest:-----,
[Seal of Bon Homme county. ] Clerk.
$5. The Treasurer of Bon Homme County, $5.
Dakota Territory,
Will pay the holder hereof, on the first day of January, 1879, at his office, in Bon Homme, five dollars, for interest on county bond No. —, issued under provisions of an acc of the legislature of the Territory of Dakota, approved February 17th, 1877.
“Chairman of the Board of County Commissioners.”
On the back of each bond was printed a copy of the act, the title of which is given in the bonds, and the sections that
“Section 1. That the outstanding indebtedness of the county of Bon Homme, Territory of Dakota, payable out of the taxes for ordinary county revenues, special bridge fund, and the sinking fund tax, shall be funded as hereinafter provided.
Sec. 2. That the county commissioners of the aforesaid county, on the passage of this act, shall have the authority and it is hereby made their duty, to provide that whenever warrants drawn upon the fund hereinbefore mentioned shall be presented to the county treasurer of said county, in sums of fiftv dollars and upwards, for the purpose of being funded, such warrants shall be taken up, the interest calculated thereon on the first day of July, 1878, and in lieu thereof and in payment of said warrants, that the bonds of said-county, in denominations of not less than fifty dollars, bearing date July 1, 1878, and with coupons for interest attached to said bonds, and payable as hereinafter mentioned, be issued to the holder of such warrants. ”
“Sec. 4. It shall be the duty of the county commissioners of said county to fund the outstanding indebtedness, as herein provided, to levy and collect annually a tax, in cash, sufficient to pay the interest on said bonds, and after five years they shall collect, in addition thereto, annually, a sinking fund bond tax sufficient to pay the principal of such bonds by the time they shall become due and payable; and with such sinking fund bond tax, as fast as the same is collected, they shall go into the market and buy up such bonds, and retire the same, and such interest tax and sinking fund bond tax shall not be used for any other purpose; provided, that no more than the par value shall be paid for said bonds.”
“Sec. 6. The county commissioners of said county shall, at the first session of the board after the passage of this act, make such provisions as shall be necessary and proper for '’■arrying out the provisions of this act, or as soon thereafter as it can reasonably be done; and such bonds shall be either printed or lithographed, with interest coupons thereto attached, and*222 shall be executed by the chairman of the board of commissioners for the county aforesaid, and shall be under the seal of the county, and attested by the clerk thereof, and shall be payable to the order of the persons respectively presenting such warrants.”
“Sec. 8. The county treasurer of Bon Homme county shall provide himself with a book, to be called the bond register, wherein he shall note the number of all bonds issued, the date when issued, the party to whom issued, and the' amount of the warrant or warrants, and the amount of interest thereon, for which-such bond was exchanged, and such other fact as he shall be required thereunto by the county commissioners; and such register shall, immediately after the 1st day of. October, 1878, be deposited with the county clerk, and shall remain in his office as a public record.”
“Sec. 13. The county commissioners shall annually cause to be levied and collected a tax not to exceed 25 per cent in excess of the estimated amount required for county purposes, and the surplus tax so levied and collected shall go to create a sinking fund to defray the extraordinary expense of said county.”
The complaints are in the usual form, and the answers, which are substantially the same, are, in substance, as follows: After denying each and every allegation of the complaint not specifically admitted, they proceed to allege, as matter of defense, that the board of county commissioners of said Bon Homme county never made any provision for funding the indebtedness of said county, in pursuance of the provisions of the act under which said bonds and coupons purport to be issued, and that, until the said board had provided for carrying into effect the said act, there was no authority or power conferred upon the chairman and clerk of said board to issue the bonds of the said county, sued upon in this action; that said board never authorized the issue of said bonds, or empowered the chairman and clerk of said board to sign the same on behalf of the county; that the bonds in suit purporting to be signed by the chairman and clerk of said board are not the bonds and coupons of said county; that the same were issued without con
The first question, therefore, to be determined by the court is, are the bonds, so signed by the chairman Young and the county clerk, in July, 1877, but bearing date July 1, 1878, without authority to issue them being conferred by the board of county commissioners, valid bonds of Bon Homme county, and binding upon that county? The first objection to the validity of these bonds is that they were signed and issued before the time they bear date, and that, at the time they bear date, A. M. Young, who signed them as chairman, was neither chairman nor member of the board of commissioners of Bon Homme county. The act under which these bonds were issued seems to contemplate the issuance of bonds to fund the outstanding warrants of the county in advance of the time they are to bear date. The second section provides “that the county commissioners of the aforesaid county, on the passage of this act, shall have the authority, and it is hereby made their duty, to provide that, whenever warrants drawn upon the fund hereinbefore mentioned shall be presented * * * such warrant shall be taken up, the interest calculated thereon to the 1st day of July, 1878, * * *” and bonds issued therefor to the holder of such warrants. And Section 6 provides; “The county commissioners * * * shall, at the first session of the board after the passage of this act, make such provisions as shall be necessary and proper for carrying out the provisions of this act, or as soon thereafter as it can reasonably be done. •x -x -x» ^ie ac£ was approved February 17, 1877, it is quite clear that the legislature intended to give the board power to proceed at once to fund these warrants, and that the date that they should bear was inserted in the act for the purpose of fixing a time up to which interest on the warrants should be calculated, and from which interest on the bonds should commence to run. At t:ie time these bonds were signed and issued, A. M. Young was, as shown by the commissioners’ record, the chairman of the board. We are of the opinion, therefore, that
The second objection to the validity of-these bonds is, that no action was ever taken by the commissioners in regard to the issuing of these bonds, and no px-ovision was ever made by them for funding the outstanding warrants of the county, as provided in said act, and that the plaintiff should have shown that such action by the commissioners was had, providing for the funding of the outstanding warrants of Bon Homme county, and authorizing the issuance of these bonds, to entitle the plaintiff to recover in this action. A county must have legislative authority to issue bunds, before its officers can bind it to the payment of bonds purporting to be issued on its account. The public can .act only through its authorized agents, and it is not bound until all who are required to participate in what is to be done have performed their respective duties. Anthony v. Jasper Co., 101 U. S. 693; Bank v. Bergen Co., 115 U. S. 384, 6 Sup. Ct. Rep. 88. The law under which the county of Bon Homme derived all its powers provided that the county commissioners should fund the outstanding indebtedness of Bon Homme county that should exist on the first day of July, 1878. The power of ohe board under the law was limited. It is not a case where there existed in the board a general power to issue negotiable securities of the county. It is a case where there was no power, except as specifically delegated by law for a particular purpose. All persons taking securities of public corporations having only special powers must see to it that the conditions prescribed for the exercise of the power existed. As an essential preliminary to protection as a bona ficle holder, authority to issue them must appear. Bank v. Bergen Co., supra; Marsh v. Fulton Co., 10 Wall. 676; Cagwin v. Town of Hancock, 84 N. Y. 532; Floyd, Acceptances, 7 Wall. 676. Every person purchasing such bonds is chargable with notice of that which the law requires him to know, and he is chargable with notice of what is contained on the face of the bonds he is deal
The learned counsel for respondent contends that the defendant is estopped from contesting the validity of these bonds by reason of the recitals therein contained. There are no recitals in these bonds of the existence of any facts that the chairman and clerk of the board were authorized to ascertain and determine. The effect of recitals made by a board, or by officers authorized to make them, is clearly stated by the court in Bank v. Bergen Co., supra: “There is a class of cases where recitals in obligations are held to supply such proof of compliance with the special authority delegated as to preclude the taking of any testimony on the subject, and estop the obligor
The plaintiff, not relying entirely upon the validity of the bonds in suit, introduced evidence tending to prove that the county, by the acts of its county commissioners,, treasurer, and other officers, had ratified the act of the chairman and clerk of
At the close of plaintiff’s testimony, the defendant moved the court to instruct the jury to return a verdict for defendant, for that it did not appear that the board of county commissioners of Bon Homme county ever authorized the chairman and clerk to execute the bonds in suit, and for the further rea-' son that the evidence of ratification introduced by the plaintiff is not sufficient to entitle the plaintiff to recover; which motion was denied. We think the learned court very properly denied the motion. The evidence of ratification introduced, uncontradicted, and for the purposes of the motion taken as true, was, in our opinion, sufficient to have warranted the jury in finding a verdict for the plaintiff. Defendant then called, as a witness,
We will consider these two offers together, as they were both made in pursuance of the same object, which was the introduction of evidence on the part of defendant to contradict the evidence of ratification given on the part of plaintiff, by showing that the acts of alleged ratification were not binding upon the county, , because the acts were done without the knowledge of the existence of the bonds in suit; or perhaps, more .properly, to rebut the presumption of knowledge that naturally arises from the acts themselves. The exclusion of this testimony must have been based by the learned court upon the theory that the acts of the commissioners, as shown by the records, constituted a full ratification, not open to rebuttal, of the acts of the officers issuing these bonds, and that the acts established an estoppel on the part of the county. In this we are of the opinion that the court was correct. It seems to be the established doctrine of the courts, state as well as national, that municipalities may, not only by recitals in bonds, but by acts of ratification, be estopped from setting up irregularities in the issuance of bonds, when they have passed into the hands of
The plaintiff proved on the trial that he purchased the bonds in suit — being a part of the July, 1877, issue — in 1880, and paid their full par value, and without notice of any irregularity in their issue, or of any defects in the same. Whatever exception the people of Bon Homme county might have taken to these bonds at the time they were issued, it is certain they took none, either as individuals or through their authorized agents, the county commissioners, until long after these bonds had passed into the hands of innocent purchasers for value.
The evidence sought to be introudced in this case, on the part of the defendant, was not, in our opinion, admissible, as it must necessarily have tended to contradict the record evidence