51 Mo. 483 | Mo. | 1873
delivered the opinion of the court.
This was a suit commenced before a justice of the peace in Clinton county. The action was founded on thirty interest coupons, for five dollars each, and purporting to be for six months interest due on the first day of January, 1871, on bonds issued or made by the town of Lathrop. The appellant recovered a judgment before the justice, from which an appeal was taken to the Clinton Circuit Court, when the plaintiff took a non-suit, and afterwards moved to set the same aside, The court overruled the motion and gave final judg
The action having been brought before a justice of the peace, there were no formal pleadings on either side.
Upon the trial in the Circuit Court, the plaintiff read in evidence, without objection, thirty coupons upon which the action was brought, and closed his case. The coupons were all of similar form and read as follows :
$5.00. The town of Lathrop, in the county of Clinton, State of Missouri, will pay the bearer five dollars on the first day of January, A. D. 1871, at the bank of America, in the city of New York, being shj months interest due on that day on bond No 236.
The coupons represented bonds numbered consecutively from No. 221 to No. 249, the remaining one being numbered 290.
It is agreed by the parties in this court that the bonds claimed to have been issued by the defendant are in the following form:
“Know all men by these presents that the town of Lathrop, in the county of Clinton, in the state of Missouri, acknowledges itself indebted and firmly bound to the St. Louis & St. Joseph Hailroad Company or bearer in the sum of one hundred dollars, payable on the first day of January, A. D. 1880, together with interest thereon from the first day of January, A. D. 1870, at the rate often per centum per annum, payable semiannually upon presentation and delivery of the coupons hereto attached, as they shall severally become due and payable, at the bank of America, in the city of New York. This bond is redeemable by said town at its option any time after five years from the date hereof, and is issued under and pursuant to an order of the board of trustees of the town of-Lathrop, aforesaid, made under authority of the constitution of the state of Missouri, and the laws of the general assembly of the state of Missouri, and authorized hy a vote of the people of said town at a special election held for that purpose. In testimony whereof,” &c., and signed by what purport to be the signatures of*489 the president and clerk of the board of trustees with the seal, of the town.
After the plaintiff’s evidence was closed the defendant proved by one of the trustees of the defendant that he had in court the records of the board of trustees of said town, with its charter. The charter was in the usual form of those of towns organized under the general laws of the state. The witness was then asked to read from the entries of said board of trustees their action at a meeting held on the 27th of October, 1869, by which it appeared that at said meeting an order was adopted ordering that said town subscribe to the capital stock of the St. Louis and St. Joseph Eailroad Company $40,000, for which bonds should be issued and delivered to said railroad company, as the road was completed as therein set forth, and other conditions to be complied with by said company; but as I do not deem said conditions material for the consideration of the case I omit them. But it was also, provided or conditioned by an order that two-tliirds of the qualified voters of said town vote in favor of such subscription at a special election, to be held on Saturday, the sixth day of November, 1869, at the office of J. O. Daniels, and all those voting in favor of said subscription should have on their ballots “railroad subscription, yes,” and those voting against it should have on their ballots “railroad subscription no !”
It was further ordered on motion that a special election be held on Saturday, November the 6th, 1869, for the purpose of voting on the above proposition, and also to elect a town trustee to fill a vacancy then existing. The witness then stated that an election was held on the 6th da}' of November, 1869. That there was no special registration of voters proceeding said election, to his knowledge, &c. On cross examination the plaintiff caused the witness to read from the record of the proceedings of the town of Lathrop the folio wing proceedings had on November 30th, 1869, and March 26th 1870:
“Laturor, Mo., Nov. 30, 1869.
“Board met at call of the president. Mr. Whiting, chief engineer of the St. Louis and St. Joseph Eailroad Company,*490 made propositions in behalf of said railroad company to locate the road through Lathrop and to cross the Kansas City and Cameron railroad in section 25, township 55, range 31. The following resolution was offered, and on motion was adopted.
“Resolved, That the board of trustees of the town of Lathrop accept the proposition of the St. Louis and St. Joseph' Bailroad Company to locate and build their road on section 25, township 55, range 31, so as to cross the Kansas City and Cameron railroad on section 25, township and range aforesaid, and establish and build their regular depot on the same. In consideration of the same we hereby authorize the president of the board of trustees of the town of Lathrop to have bonds printed immediately in accordance with the order voted on by the people of Lathrop on the sixth day of November, 1869, to the amount of forty thousand dollars (conferring with the president of the St. Louis and St. Joseph Bailroad Company as to the form of the bonds,) signing the same in blank, (to be dated when delivered to the said railroad company,) and deliver them to the officers of-Bank of St. Joseph as trustees to hold and deliver the same to the amount agreed upon to the St. Louis and St. Joseph Bailroad Company, whenever the conditions agreed upon by the parties are complied with on the part of said railroad company.”
“Lathrop, Mo., March 26, 1870.
“Board met at call of president. Members all present except P. H. Odell.
“Mr. George A. Patch made a motion that we issue to the St. Louis and St. Joseph Bailroad Company the bonds of Lathrop, with interest, to commence on the first day of July next; provided said railroad company complete the road by the first of July, A. D. 1870. Motion carried.”
These orders and records were regularly signed by the president and clerk.
The defendant introduced evidence which tended to prove that no registration of voters was made for any election to be held on the 6th day of November, 1869.
One witness stated that he lived in Lathrop during the year
That the debt was not paid, and the bonds were sold to one "Winslow Judson for three thousand nine hundred dollars; that he afterwards sold the coupons, upon which suit was brought to plaintiff for the full amount of five dollars each.
This was all of the evidence material to notice in the ease.
There were a number of points raised, and ably argued by the attorneys on either side, in this cause; but the material question is, had the town of Lathrop power to make the subscription of the stock to the railroad company and issue the bonds? I think it is admitted that the defendant had no such power, unless it was specially conferred on it by the Constitution and laws of this State, or by the consent of the qualified voters of the town under the provisions of the Constitution and laws of this State.
It is not necessary to examine the question whether the railroad company complied with its duties under the subscription of stock, in completing the road in the time named, or in erecting a depot at the place named, or any of these collateral facts. These are matters that need not concern the holder of a bond or coupon purchased for value and in good faith. If the power was conferred upon the truste.es of the town to take the stock and execute the bonds, any irregularity in the exercise of the power conferred, or in the conferring of the power by the people, could not be relied on to defeat the bonds in a collateral way; at least, when the bonds have passed into the hands of an innocent purchaser for value. But the important question in this case, as before stated, is, has the power ever been conferred on. the trustees of the town of Lathrop to execute these bonds and coupons ?
Section 14, of Article 11, of the Constitution of the State, provides that “ The General Assembly shall not authorize any county, city, or town to become a stockholder in, or to loan its credit to any company, association, or corporation unless two-thirds of the qualified voters of such county, city, or town at a regular or special election to be held .therein shall assent thereto.” This is a limitation upon the power of the General Assembly to confer the right or power upon counties and towns to take stock in the companies named.
“The purchaser was not bound to look further for evidence of a compliance with the conditions to the grant of power.” The case under consideration by the learned judge did not require any such general and sweeping proposition in favor of the validity of the bonds then in question; for in that ease an election was shown to have been held at which the votes had been regularly cast, and a sufficient number of given votes to confer the power.
The only objection to the validity of the bonds was that the sheriff had failed to give the notice required, but the election was fair and the people voted, by which the power was conferred, and the tribunal appointed by law had passpd upon the vote cast, and decided that the measure was carried. In such case it may be admitted that an innocent purchaser may presume that the notice had been given or that any other merely formal matter had been complied with. But the dictum of the judge seems to go further and hold that where one who professes to act as agent or by delegated authority shall falsely recite in an instrument which he attempts to execute, that the power is conferred, that in such case the principal is bound by the recital, however false it might be; or in other words, that an agent may not only bind his principal by his acts, recitals and admissions within the scope of his authority as given him by the principal, but that he may go further and prove the authority itself by such recitals. This cannot be the law, and the learned judge, I suppose, did not intend to be so understood. I might refer to a number of other cases in which similar expressions are made, but it will be found in all of them (or at least it is, so far as I have examined) that there had been an election held at which the people interested had voted on
“ This language is exceedingly bróad, and if it is construed as applicable only to the facts in the case it is sustained by numerous cases. But if it is intended to assert that a county or a city council, who have power under certain circumstances to make, contracts and issue bonds, may disregard these circumstances or conditions entirely, and then issue bonds pui1porting to be in pursuance of authority, which will be binding and against which no defense can be made, we dissent from it.
“In the Hannibal and St. Joseph Railroad Company vs. Marion County, 36 Mo., 294, we held that when a county, acting under authority which it supposed to be valid, subscribed to the stock of a railroad company in good faith, issued its coupon notes in payment of such subscription and for a series pf years voted the stock and paid its coupons, and such notes fell into the hands of innocent and bona fide purchasers, it was estopped from asserting that such notes were illegally issued ; and to the same purport see Barrett vs. Schuyler County, 44 Mo., 197.
“ The language used in the cases that where the bonds on their face import a compliance with the law under which they were issued,'the purchaser is not bound to look further, must be taken as used with respect to the facts in those cases. By an examination it will be seen that in every one of them the qualified voters had voted to confer the authority, and that some mere irregularity had existed as to the manner of giving the notice or casting up the vote. These irregularities could not be expected nor were they necessary to be known to the pur*496 chaser. The only matter in which they were concerned was, to know whether the power to issue the bonds existed. The taking and obtaining the majority vote in the case was the prerequisite — the essential thing which gave the investiture of authority and conferred jurisdiction. The court possessed no power except what it derived from law, and that was only to initiate the proceedings by which the power might be called forth. The real authority comes from the voters at the polls. If-they sanctioned the measure and authorized the expenditure, the court could then proceed and carry out their will; otherwise not. Till the votes were taken and a majority of them were cast in favor of the proposition, the court had no authority over the subject matter, and their action was a total nullity. A record which imports absolute verity may always be impeached for want of authority and jurisdiction in the court rendering it; and so may the acts of an agent who has acted without authority where there has been no express or implied ratification by the principal. ”
I believe it was agreed by the plaintiff’s attorney in the argument of the case that the law as laid down by the above case, in the opinion of Judge Wagner, was correct, and I have q.0 doubt that it is as liberal for the plaintiff as the law permits. Now if we apply the principle there annunciated to the case now under consideration, will the plaintiff be-entitled to recover? It is said that the real authority to the town trustees to act comes from the votes at the polls. The statute says that no subscription can be made, unless two-thirds of the qualified voters assent thereto at a general or special election. Now what kind of election must be shown ? and how must it be shown ? is the important question. Will it do to show an election in name, or must an election in fact authorized by law be shown when the assent of the qualified voters can be fairly obtained and with reasonable certainty? I think that a legal election, conducted substantially in the forms of law, is the only one at which the assent of the voters can be legally obtained, and the only one which will confer power on the county, city or town authorities to take stock in a railroad company or
In the case now being considered, it is shown by the evidence that no registration of the qualified voters of the town
I do riot say that it was absolutely necessary to the validity of the election that a special registration should have been made before the election, but this fact, with other’s, might show that the people, who only could confer the power on the trustees to subscribe the stock and issue the bonds hifd no opportunity to be heard on the subject.
It is said, however, that it devolves on the defendant to show a want of power in the trustees to issue the bonds, and not on the plaintiff to show that the power had been conferred ; that as there was no plea sworn to, denying the execution of the bonds and coupons, the execution of the bonds was admitted. This is not true in reference to bonds which only purport to have been issued by an agent. The defendant could in such case certainly show the want of authority in the agent to execute the bonds. The only effect of not pleading non est factum under oath in any case is, that in such case the plaintiff can read the instrument in evidence without proof of its execution. (Klein vs. Keyes, 17 Mo., 326.) I think in all cases where the bond or other instrument purports to have been issued by delegated power, and when it could not be issued without such delegation of power, it devolves on the plaintiff to show that the power has been conferred before he can recover, and that in a case like the present it should have been shown with reasonable certainty that the authority to issue the bonds had been conferred by an election authorized by law, and that the vote had been preserved by poll books or otherwise, by persons authorized to do so, and that the votes had at least been received and passed on by some persons authorized to pass upon them,- and decide whether the election had been carried or whether the voters had assented to the sub
It may be that on another trial of the cause the plaintiff can show that such an election was held and the result decided in favor of the issue of the bonds, in some manner known to the law, and by persons authorized to hold such elections and make such decision. In such case an innocent purchaser would be enabled to recover ; but as that is not now before us we need not decide how much evidence would be necessary. All that is said is that these facts must be shown with reasonable certainty, and as the case now stands we think the evidence is not sufficient; but that the evidence strongly tends to show that the election was only an election in name.
I have made no reference to the instructions given or refused in the case. I think that some of the instructions given on the part of the defendant improperly submitted questions of law to the jury; but as the plaintiff is out of court and as from the evidence we cannot say he ought to have recovered, we will leave him to bring his new action.
the judgment of non-suit rendered by the Clinton Circuit Court is affirmed.