City of San Antonio v. Lane

32 Tex. 405 | Tex. | 1869

Caldwell, J.

This suit is founded upon eight coupons for interest, attached to bonds, issued by the city of San Antonio in payment of stock in the San Antonio Bailroad Company. The ease of the City of San Antonio v. Enoch Jones, 28 Tex., 19, is, in all respects, similar to this. In that case the suit was upon coupons upon bonds, issued at the same time by the same municipal authority, and for stock in the same railroad company. We may add, that the bonds were issued by virtue of authority conferred by one and the same act of the Legislature, and by one and the same municipal ordinance. The two suits are identical, differing only in plaintiffs. If the same parties were before us on the record, we should have no hesitation in affirming the judgment, on the ground that a judgment in favor of a bondholder upon certain municipal bonds, part of a larger issue, against the same city issuing them, is conclusive on a question of the validity of the issue on a suit brought by the same creditor against the same city on other bonds, another part of the same issue, the parties being identical, and all objections taken by tlie city in the second suit having been open to be taken by it in the former one. (7 Wall, 619.)

Inasmuch, however, as the learned counsel who represents the city insists with great earnestness upon the unconstitutionality of the law under which these bonds -were issued, and presents some points (not in the record) not passed upon in the former suit, we will proceed to notice them in the order presented.

It will be borne in mind we have no statement of facts. Pure questions of law, arising upon the pleadings, are before ns.

It is assumed as well settled that the Legislature may authorize municipal corporations to subscribe for stock in railroad companies, and to provide for the payment of such subscriptions, in such manner as may be acceptable to the corporation ; provided, it be not repugnant to the constitution.

In the case of The City v. Jones, Judge Moore refers to numerous authorities at once controlling and decisive on this point. We refer to another list. (Abb. Dig. Law Corps., title, Municipal Corporations, p. 802.)

Conceding that this general power is lodged in the Legislature, it is still insisted on that the 12th section of the act incorporating the railroad company is invalid, because it comes within the prohibition of § 24, Art. 7, of the constitution. It is the 12th section which authorizes the subscription. Art. 7, § 24, of the constitution, provides that every law * * * shall embrace but one object, and that object shall be expressed by its title.

The object of the act incorporating the railroad company, was to build a road, promoting alike the general good and the special interests of the city. The ultimate end or object of the act being the completion of a road, no lawful means or assistance in aid of this object, we apprehend, can be variant from the expressed object in the title.

The grant of power here has for its object the building of a road. A grant of power draws with it all necessary lawful means for the due execution of the object of the grant. IIow, then, can these lawful means (this municipal subscription) in aid of the object, be said to vary from or conflict with the object? We are of opinion that when an act of the Legislature expresses in its title the object of the act, the title embraces and expresses any lawful means to achieve the object, thus fulfilling the constitutional injunction, that every law shall embrace but one object, and that shall be expressed in its title.

Cannon v. Hemphill, 7 Tex., 208, is relied on in support of the unconstitutionality of section 12 of the act. The act under review in that case was entitled “ an act to regulate proceedings in the District Court.” It was sought to make it apply to proceedings in the Supreme Court. The “jurisdiction” of the two courts is different. The object of the act being to regulate proceedings in one jurisdiction, and that jurisdiction expressed in the title, can not, we apprehend, be tortured into an object to regulate proceedings in another and different jurisdiction, not expressed in the title.

The view we have taken of the constitutionality of the 12th section, is fully sustained in Tadlock v. Echols, 20 Texas, 792. So also in Chiles v. Drake, 2 Met., (Ky.) 146. The object of the act in this latter case was the redress of injuries arising from the neglect or misconduct of railroad companies and others.

It was held that the object in view was to provide a remedy for certain injuries, and the fact that a remedy was furnished for such injuries, against natural as well as artificial persons, does not impart to it the character of a law which embraces various and distinct subjects. Redress of injuries is the object, and none other is embraced in the act, nor does it contain any provision that does not relate to that subject.

Assuming that the constitutionality of the act in all its parts would be upheld, the learned counsel for the city insists that the corporate authorities of the city transcended their delegated powers, in issuing the bonds and coupons without having obtained the assent of the required number of corporate electors in the manner prescribed by section 12 of the act. This, if true, is of no moment to a bona fide holder.

It is well settled, indeed it may be regarded as no longer an open question, that bonds on coupons of this character are negotiable paper, transferable on delivery. A bona fide holder for a valuable consideration can not be held responsible for the misconduct or default of the parties issuing them. Such bona fide holder may well presume that every condition precedent to the issuance of the bonds and coupons, have been complied with. (1 Wall, 203, 385 ; 27 Ill., 474; 24 How., 287; Abb. Dig., Law Corps., 127, and authorities there collated.)

True, these coupons have not the form and character of negotiable instruments according to the law merchant; nevertheless, they are regarded as transferable in the same manner and with like effect. (2 Met., Ky., 56 ; 10 Wis., 136.) The bona fide holder, discovering nothing to excite suspicion, and coming into possession in due course of trade, may enforce payment, notwithstanding they may not be valid as between the original parties. (Id. Abb. Dig., Law Corp., 127.) "Where a corporation has power, under any circumstances, to issue negotiable securities, the bona fide holder has a right to presume they were issued under the circumstances which gave the requisite authority, and they are no more liable to be impeached for any infirmity in the hands of such holder than any other commercial paper.” (Gelpeke vs. City of Dubuque, 1 Wall, 203.)

If there be fraud, irregularity, or non-compliance with the rules laid down by the authority which sanctions the issue, the corporation may be restrained by injunction from issuing the bonds by any party in interest, (27 Ill., 305; 3 Clark, 311; 1 Wall, 385); but it is too late, after the bonds have fallen into innocent hands, to institute inquiries as to the qualifications of corporate electors, their number, or the day on which the election was held. (24 How., 287 ; 24 Ill., 75; 1 Wall, 197.)

All that can be required of the Iona fide holder, is a knowledge of the law authorizing the issue. (33 Mo., 440; 29 Conn., 124; 1 Wall, 385; 25 Ill., 317.)

The case of Henderson v. Railroad Co., 17 Texas, 560, is cited and relied on as controlling and decisive of this. We are unable to trace the analogy.

.. The object of the suit in Henderson v. Hailroad Co., was to cancel certain deeds. The deeds were executed by appellant to Jones, in trust, to be conveyed in fee to appellee, upon the happening of certain conditions precedent, expressed in the deeds. Jones, it was alleged, in fraud of appellant’s rights, and without the conditions precedent having happened or being complied with, conveyed the land to the railroad company. This was litigation between original parties. Ho intervening purchaser, without notice, stood between the contending parties.

The legal propositions we have been discussing are dedueible from elementary principles, and are expounded and administered by the most exalted tribunals in the land. They are the doctrines of justice and truth, and may be summed up in the universally admitted maxim, that no man shall be permitted to avail himself of his own wrong. They are as applicable to artificial as to natural persons. The city of San Antonio, with - all her corporate powers and privileges, when a suitor at the bar of public justice, has no immunities not accorded to the humblest citizen who may dwell within her limits.

Numerous authorities are arrayed in support of the doctrine that corporations are restricted to the mode authorized for the execution of a granted power, and are not permitted to extend the grant beyond the letter and spirit of the act of incorporation. This is sound law. It is the general rule, but, obviously, the law has no application to the facts.

The rule of construction contended for as applicable to this case, so far from being strict, would be latitudinarian. It would be an inversion of the strict rule of construction, and confer on corporate bodies privileges injurious to the public, and in derogation of natural justice. If a slight departure from duty on the part of the corporators exercising the functions of the corporation, from the mode authorized to found a credit, would enable a corporation, after having thrown its obligations on the market, to retain the benefit and refuse the payment—to repudiate the whole transaction—how else could such a rule of construction be characterized than as a legalized system, alike destructive to corporate faith and the public morals ?

To the objection that the verdict is contrary to law, in that it awards compound interest, we merely reply in the language of the Supreme Court of the United States : “ Bonds and coupons like these, by universal commercial usage and consent, have all the qualities of commercial paper. If the plaintiffs recover in this case, they will be entitled to the amount specified in the coupons, with interest” thereon. (Gelpeke v. Dubuque, 1 Wall, 175.) The case quoted from is in every material point identical with the one before us.

The petition alleges that the plaintiff below came into possession of the coupons as a bona fide holder, long before maturity, and for a valuable consideration, without notice. This averment must have escaped the notice of the pleader, else the further exception of a failure to prove a consideration would not have been presented. A contract made by a corporation is presumed to be on sufficient consideration, until it otherwise appears. (Abb. Dig., L. C., 210.)

The remaining question relates to the charges given and those refused. The charges refused were based upon the hypothesis of the unconstitutionality of the law; and secondly, that the city could not he held responsible without proof that the bonds were issued in exact compliance with the mode indicated by the act authorizing the issue. From the foregoing it will be seen there was no error in refusing them. The charge given and excepted to was: “ You will find for the plaintiff.”

“ The judge shall not, in any case, civil or criminal, charge or comment on the weight of evidence.” (Art. 1469, Paschal’s Dig.) In Reynolds v. Williams, 1 Tex., 313, it was held, to charge the jury to “ find for the defendant,” was wrong. That this ruling was too rigid, is abundantly attested by the subsequent and repeated decisions of this court: decisions which were concurred in by the eminent and lamented judge who delivered the first. This opinion has not been overruled in terms, but certainly the severity of the rule has been greatly relaxed.

When there is no evidence competent to support a material issue, it is not error to charge the jury to find for the plaintiff’. The rule can not apply unless there be evidence to weigh. (5 Tex., 152.) If there be any evidence, is a question for the judge. Its sufficiency rests with the jury. In 10 Tex., 116, it was held not to be error to charge for the plaintiff) when the jury could come to no other conclusion. In 17 Tex., 63, Judge Hemphill said: “ We have repeatedly held, that where evidence was all on one side, and sufficient to support the verdict, it is no invasion of the province of the jury for the court to instruct them to find such a verdict. When the question is purely one of law, the court may instruct the jury what verdict to render, because that verdict is a “ mere matter of form.” (20 Tex., 299.)

The doctrine here laid down is in’'harmony with the general current of decisions throughout the Union. Public and corporate faith, is upheld aud enforced, individual right is vindicated and sustained. In one State a different rule prevails. It stands out in unenviable solitude.” If a State court shall erect an altar, and decree the sacrifice of law and justice, let not the officiating priests be found in our tribunals.

Judgment affirmed.