Clark v. City of Janesville

10 Wis. 136 | Wis. | 1860

Lead Opinion

By the Court,

Paine, J.

This cas'e involves the validity of bonds issued by the city of Janesville in aid of a railroad. The question is justly deemed an important one, and has given rise to much discussion, both in court and out. It is supposed to involve not only private safety, but the public honor; and appeals have been made on the one hand to protect tax payers from impending ruin, and on the other to preserve the honor and good name of the state from the blight of repudiation. Appeals of this character can have no weight with a judicial tribunal. Not that courts cannot look beyond the letter of a law in interpreting it. Undoubtedly they must construe it, as all written instruments are construed, by the light of surrounding'circumstances. The existing condition of things, the evils to be remedied, the objects to be attained, may all be looked at, and frequently require to be looked at, with the closest scrutiny, and the clearest judgment, in order to determine what the law is. But beyond that, courts cannot go. They cannot turn aside from the conclusion to which such an examination leads them, either to avoid one evil consequence or another. It is the province of the judicial mind, like the compass, to declare the true direction of the law, without regard to whatever obstacles may lie in the way. It is for the legislative power, like the pilot, to make such changes as may be made to avoid these obstacles.

This action is brought upon the coupons. The bonds to which they were attached, as appears from the complaint, were issued in pursuance of an authority contained in the charter of the city of Janesville, by which the common council were empowered to submit the question to the voters; and if the vote was in favor of it, to issue the bonds in payment of its stock subscription to the railroad company.

The first objection taken relates to the regularity of the election. It is claimed that the complaint must show that every step was taken as required by law, preliminary to the issuing of the bonds. And it is then said that the notice of the election was not properly published, because it appears from the complaint that the ordinance which alone authorized the clerk to publish it, was first published in the same paper with the notice, and not being in force till it was published, could not have conferred any authority on the clerk to publish the notice. Conceding that it appears from the complaint, that both were published together, which I think does not necessarily appear, the objection is of too metaphysical a character to be established as a rule to govern the ordinary transactions of business. The ordinance authorized the clerk to publish the notice, and though it was not in force itself, until published, and though it was published at the same time with the notice, I have no doubt that its publication then rendered that of the notice legal and authorized. The authority to publish the notice existed simultaneously with its publication, and authorized it. And it would be proceeding upon too refined and technical principles, to hold such a publication unauthorized, because the ordinance was not yet operative when the clerk carried the papers to the printer.

But the true answer to this objection, and to all the others involving the regularity of the proceedings on the election, is that the city, after having issued the bonds, and after they have passed into the hands of bona fide purchasers for value, cannot defeat an action upon them by showing such irregularities. This was expressly decided in the recent case of The Commissioners of Knox County, Indiana, vs. Aspinwall et al., 21 How., U. S., 539. It was there held that statutes authorizing the issuing of such bonds are public statutes, and that purchasers are bound to know them, so far as to see that the authority existed; but that when they had found the authority, its exercise made dependent on an election held in pursuance of notice, they were not bound to inquire into the regularity of all the proceedings in the election. But the bonds being issued and purporting to be issued in pursuance of the law, they were entitled to presume that the preliminary steps had been taken. It was also held that the law itself made the board, who were to issue the bonds, judges of the fact whether the election had been properly held, and what was its result; and that their judgment upon these facts, though it might be reviewed in a direct proceeding before the execution of the power, yet it could not be reviewed after its execution, and the bonds had passed into the hands of bona fide holders, and certainly not in a collateral proceeding.

The case of the Royal British Bank vs. Turquand, 88 E. C. L., 325, referred to in this opinion, also fully establishes that the purchaser in such case, finding lawful authority to issue the bonds after certain preliminary steps, and finding the bonds issued, ought not to be held bound to inquire into the existence and regularity of those steps. I think this doctrine just and reasonable; and that this rule constitutes a proper limitation to the general rule that parties dealing with the officers of such corporations are bound to know that they have authority to act. This latter rule is undoubtedly necessary, for the proper protection -of those whom such officers represent; but it should not be carried so far as to destroy the safety and rights of those who, with good faith and due diligence, deal with such corporations, and I think this would be the result, if these bonds are invalidated for such reason. How could a purchaser inform himself with any certainty, whether every step in an election of this kind had been regular ? It extends through the several wards of a city. The records of what is done are frequently imperfectly made, and those that are made, are imperfectly preserved ; and sometimes no record at all is required. And where is he to stop ? The records, even though entirely regular, and showing everything done as required, are not conclusive. It is the majority of the legal votes that determines the question ; and this court has held, that in order to arrive at this, the parties may go behind the certificates, even when the right to the executive chair is in issue. Should the city then be allowed to defeat this action by showing that enough illegal votes were cast at the election to overbalance the majority ? I think the same principle that would sustain these objections, of irregularity in the notices, &c., would go to that extent. And such a rule would destroy all safety in dealing with corporations. It seems to be contrary both to law and justice, that they should be allowed to hunt up hidden irregularities in their own preliminary proceedings, to defeat obligations which they were authorized to issue, and for which others have parted with their property. The particular character of this transaction, and the question whether the stock subscribed for is now valuable or worthless, or whether the policy of subscribing was wise or foolish, can have no legitimate influence in determining the rule of law that should be established upon this point. The same rule that should be applied if the bonds had been issued to build its public buildings, and had been sold at a premium^ and the money used for the purpose, I would apply here. And I think in either case the city cannot defeat its obligation by showing irregularities in the election.

The effect of showing such irregularities in a direct proceeding by any person interested, to prevent the issuing of the bonds, is another question not presented here.

But it is objected that the R. R. company had no power or authority to receive this stock subscription by the city. The substance of this objection is, that this subscription by the city is not the kind authorized in the charter of the company, that the charter was still in force, unchanged, and that the charter of Janesville only authorized the city to subscribe, but contains no authority for the company to receive the subscription. This reasoning seems to me also of too refined and technical a character for practical purposes. I concede that the provisions of the company charter do not authorize it to receive subscriptions of this kind. But the power is clearly given by the charter of Janesville. It is a well settled principle, that a grant of power carries with it, as incidental, every thing necessary to its execution. Can it make any difference whether the thing necessary, implies an additional capacity in the one executing the grant, or in the one with whom, or the subject upon which it is to be executed ? I think not. It is a question simply at to the intent of the legislature. They grant the city power to subscribe for the stock of the company, and give its bonds in payment. Did- they intend that the company should have power to receive the subscription and issue the stock for the bonds ? No one would seriously assert the contrary. Have they then employed the necessary language to show this intent ? I think so, clearly, in granting the power to the city to give the bonds for the stock. • This carries with it, by irresistible implication, the power to the company to give the stock for the bonds, and it would have been an idle repetition to have said it should have the power.

Suppose a law authorizing the issue of bonds by the state and providing that the Governor might negotiate them by in-dorsement ; would it be necessary to say that they should be negotiable ? Suppose a license required for marriage. If a license says A may intermarry with B, is it also necessary to say that B may intermarry with A ? When these shall be held necessary, then I shall think that, under a law authorizing a city to subscribe for the stock of a railroad company and deliver its bonds in payment, the company has no authority to receive the subscription or the bonds, but not till then.

But the principle objection is, that the state itself cannot, under the constitution, authorize a city, town or county, to loan its credit in aid of a railroad. In support of this position, sections 3 and 10, Art. VIII, are relied on. The first is, “ The credit of the state shall never be given or loaned in aid of any individual, association or corporation.” And the last, “ The state shall never contract any debt for works of internal improvement, nor be a party in carrying on such works,” &c.

It is said that cities, counties and town, are parts of the state, constituting its political divisions, and that as such, they come within the spirit and intent of these prohibitions ; that for the state to authorize them to loan their credit in carrying on internal improvements, is to do indirectly what it cannot do directly; and that to sustain such a law, is to say that the state may grant to a part of itself, the power to do what the whole cannot, and that power may be derived from a source where it does not exist.

It is manifest that the whole question is, whether for a city, town or county, to loan its credit, is a loan of the credit of the state ? Whether, if either became a party in carrying on works of internal improvement, that makes the state a party to such work ? Clearly, they are not within the letter of the constitution. A city is not the state, neither is a town or county. The question then is, whether they are within the spirit of the provision? And it seems to me, beyond doubt, that they are not. On the contrary, these two sections, like nearly all in Art. VIII, relate exclusively to the state, as a whole, and were not designed to regulate or limit the powers of counties, cities, or towns. This seems obvious on the slightest inspection of its provisions. Perhaps the first section, declaring that " the rule of taxation shall be uniform,” might be held applicable to the taxing power delegated to these corporations. But I think there is no other section in the article that can have any application to them. Section 2 provides that “ no money shall be paid out of the treasury, except in pursuance of an appropriation by law.” But will it be said that this regulates the payment of money from the town, city or county treasury ?. No one would pretend it. Section 4 says, " the state shall never contract any public debt, except in the manner herein provided.” The manner therein provided is, that every debt shall be authorized by law, for some purpose distinctly specified, and shall be passed by a vote of the majority of the members elected, by ayes and noes. But cannot a county or a town contract a debt without going through this formality? No one will pretend the contrary. Yet is there not just as much ground to say that "the state,” as used in sec. 4, includes these lesser corporations, as to say it in regard to the other sections ?

Sec. 9 provides that "no scrip, certificate or other evidence of state debt whatsoever, shall be issued, except for such debts as are authorized by the sixth and seventh sections of this article.” Are county, town or city orders, evidences of a “ state debt,” and the issuing them a violation of this section ? It can hardly be necessary to give a serious answer to such a question. Yet I cannot see why the affirmative might not as well be asserted, as to sustain the construction attempted to be placed on sections 3 and 10. Other provisions of the instrument also show such a construction utterly untenable. Thus, while sec. 3 of this article prohibits the state from loan-its credit at all, yet section 3, of Art. IX, expressly recog.nizes the power of municipal corporations to loan their credit, and requires the legislature to properly restrict it.

The object of the prohibition in sec. 10, against the state contracting any debt for works of internal improvement, or being a party to carrying them on, does not require cities, counties and towns, to be included in the prohibition. The simple reason is, the object was only to prevent the state as a state,- from becoming a party to such works, and not to prohibit the works from being carried on. It was simply a question how they should be carried on. The history of other states had shown, that for the state itself to engage in these works, involved it in difficulty and embarrassment, and that the works could be better prosecuted by private enterprise, assisted by such cities, counties and towns, as were in the vicinity of the improvement, and interested in its completion. Hence the constitution prohibits the state to become a party to such works, or to loan its credit, but contains no prohibition of a similar character with respect to these local corporations ; and on the contrary, expressly recognizes their power to loan their credit, which must have contemplated their becoming parties in carrying on internal improvements, for it was for this purpose that this power in such corporations had been commonly exercised.

If this, then, is so; if the credit of a city is not the credit of a state, nor its debt a state debt, such acts are not liable to the objection of doing indirectly, what cannot be done directly. The thing that cannot be done directly, is to contract a state debt for works of internal improvement. If the legislature should attempt to authorize a city to contract a state debt for such works, that would be attempting to do indirectly what it could not do directly, as well as being a very great absurdity. But when it only allows it to contract a debt against itself, that is liable to neither objection. Nor is it liable to the logical objection of deriving power from a source where it does not exist The state may have power to grant a power, and at the same time not have power to execute it. This is clearly shown by reference to this very prohibition against its being a party in carrying on internal improvements. No one doubts that it may authorize a railroad company to build a railroad. But it could not build one itself. And is that deriving power from a source where it does not exist? Clearly not. Because the state has the power to grant the authority, and is prohibited only from being itself a party in its execution. The difficulty with this objection is, that it confounds the power of granting a right, with the power of being a party to its exercise; whereas the two are essentially distinct. This is illustrated by reference lo the king’s prerogative of granting offices. See Bacon’s Abridgment, Title “ Prerogative, E,” where it is said : “The king cannot execute any office relating to the administration of justice, although all such officers derive their authority from the crown, and although he hath such offices in him' to grant to others.”

But it is said that the object of these provisions was to protect the citizens from taxation for purpose of internal improvement. If that could be assumed, I see not how the law can be sustained, for its result might certainly defeat that object. But I see nothing in the .instrument, I know of nothing in the history of its adoption that I think could justify me in assuming such to have been its intention. Other states had been parties to such works, and the people had been subjected to the taxing power to carry them on. In other states, towns, cities, and counties had aided in such works, and their inhabitants had been subjected to the taxing power in consequence of it .These facts were well known and understood by the framers of our constitution, many of whom, if not all, had come from older states, where these things had existed. Now if they had intended to protect the people from the taxing power for internal improvements, why not say so ? • Why not say that no citizen should ever be taxed for such purpose ? Why not say not only that the state should not be a party in carrying on such works, but that counties, cities, and towns, should not be ? They knew that if the latter could he, the citizens might be taxed, and if the object was to prohibit such taxation, I cannot account for the entire failure, to use any language expressing if. This objection would also assume that the state might be a party to these works, if it could do so without a resort to the taxing power, which would be clearly untenable. I think therefore, when the constitution says the state shall not be a party in carrying on these works, it means simply that; and not that no citizen can ever be taxed to carry them on, which is a very different matter. The fact, also, before referred to, that the constitution expressly recognizes the power of municipal corporations to loan their credit, and the fact that these loans had commonly been made in aid of such works, and that if made, the citizens may, in consequence thereof, be taxed, seem to me to show, conclusively, that it was not the object of the instrument to prevent the possibility of taxation for such purposes.

But I think this whole objection is disposed of by the decision of this court in the case of The. State ex rel. Dean vs. The City of Madison, 7 Wis. Rep., 688. It involved the validity of bonds issued by that city for public purposes. And it was claimed to be a violation of sec. 6, Art. VIII., of the constitution, which prohibits the state from contracting debts to exceed one hundred thousand dollars. It was held that this provision related to the debts of the state as such, not to those of its towns, cities, &c. If it be said that to allow these corporations to engage in such works, and to tax their citizens therefor, may result in as great abuses and evils as for the state to do it. This may be conceded, but it does not change the argument. The answer is, that even though it be so, the language of the constitution does not include these evils in its prohibition. As to them, it refers it to the legislature to adopt such restrictions as may be necessary to prevent thém. In such restrictions, therefore, and in the wisdom and integrity of the people who act for themselves in administering the affairs of these corporations, is to be found the only remedy for such abuses. The constitution has not deprived them of the power.

- But it is further said, that the building of a railroad is not a municipal purpose; and that, therefore, this act is invalid within sec. 1 Art. XI., which is as follows: “ Corporations without banking powers or privileges, may be formed under general laws, but shall not be created by special act, except for municipal purposes, and in cases where, in the judgment of th_e legislature, the objects of the corporations cannot be attained under general laws.” This language is construed as a prohibition against investing a municipal corporation with authority for any purpose, except a municipal purpose. I do not so understand its object or effect. It seems obvious, on the face of the provision, that it is aimed at the evils of special legislation. The prohibition is against creating corporations by special act. From this prohibition certain kinds of corporations are excepted, among which are those for municipal purposes. The exception relates to the kind of corporations that may be created by special act, not to the purposes for which it is possible to invest a municipal corporation with authority. The question whether it is competent to give such a corporation, already in existence, authority for a purpose not strictly municipal, is not within the language of the clause, and obviously not within its scope or object. It is doubtful, also, whether this clause can, at best, be regarded as anything more than directory to the legislature, as it leaves the whole matter, after all, to its judgment.

Neither am I certain that I should not hold the aiding of a railroad to he a municipal purpose, if I deemed that question necessary to be determined. I am aware there is a conflict of authorities on the point But I think there is great force in the reasoning of those who hold that the general welfare, and commercial prosperity of cities, are so materially advanced by connecting themselves with one of these great arteries of trade and travel, as to make their construction a legitimate object of municipal enterprise. The fact whether the improvement extends beyond the limits of the corporation is sometimes made the test. But this is not entirely satisfactory to my mind. I can see no difference in principle, whether Milwaukee issue its bonds to build a harbor entirely within its own limits, but designed to open its marts to the commerce of the lakes, or whether Janes-ville, or any inland city, issue its bonds to build a railroad, extending beyond its limits, but designed to connect itself with that same commerce. The object is the same, the result on the prosperity of the city the same in both cases. But I shall not pursue this question, as I deem it unnecessary to a decision. I have thús referred to the objections to the validity of these bonds,with one exception; and were these the only objections, I should be prepared without any doubt on the subject, to affirm the judgment

But there is one other, which though not urged by the counsel for the city, was yet discussed at length by the counsel for the plaintiff, and which, it seems to me, is necessarily involved in the case. That is, whether the charter of the city of Janesville, which authorized the issuing of these bonds, is a general law within the provision of the constitution, that such laws shall not be in force until published and if so, whether it was in force when they were issued.

In the Iowa county seat case, decided at this term, 9 Wis. Rep., 279, we held that a law providing for submitting to the people of that county the question of a removal of the county seat, was a general law, within this provision of the constitution. And the decision was placed partly upon the general public interest in the question involved, and partly on the fact that the act incorporated into itself the provisions of the general election laws, whereby any inhabitant of the state going into that county and illegally voting at the election would have been liable to punishment. In that opinion reference was made to several decisions in regard to public statutes. And it was said that we had no doubt the words, “ general law,” as used in this clause of our constitution, were intended to include the same kind of laws as the words “ public acts,” used in the laws and decisions referred to. The counsel for the respondent did not deny that the charter of Janesville was a public act, and this could not well be denied. In addition to the important bearing that such a charter has upon the interests of all inhabitants of the city, it also organizes a new political division of the state; it delegates a portion of the legislative power, and authorizes the common council to enact ordinances, having the force of laws, by which all tlffe people of the state coming within their jurisdiction are to be governed, and are subjected to arrest, trial, and punishment. It provides for the collection of a portion of the state revenue, and incorporates into itself the general election laws, laws relating to the injury of bridges, &c., which apply as well to all the people of the state who should go there and violate them, as to those residing in the city; and the clear proceeds of the fines and penalties, collected under the ordinances of the city, or for violations of these general laws re-enacted in the charter itself, would go into the school fund, under the constitution, for the benefit of the whole state. It is indisputably a public act within all the authorities upon the subject. But the counsel for the respondent contends that there is a distinction between a public act and a general act; that all public acts are not general; and that the remark in the Iowa county case, that the words “ general law ” were designed to include all public acts, was too broad. There was nothing in the discussion in that case that suggested the distinction here claimed, and in such examination as I then gave it, no reason for it occurred to me; but if it exists, if that remark was too bro ad, and overlooked this distinction, I, for one, should not hesitate a moment so to declare.

But since the discussion of this case, I have carefully reexamined the question, and my opinion remains unchanged. I find that from the earliest times, the words “ public” and “general,” as applied to statutes, have been used as convertible terms. In Holland’s case, Coke, pt. IV, 75, the, question was whether the act involved was a public act, such as the court should take notice of. It is called “ a general law, throughout the case. In the notes referring to other cases on the same question, statutes are spoken of as “ public ” and “ private.” In Samuel vs. Evans, 2 T. R., 569, the act in question is said in the head note to be a “public act.” In the arguments of counsel, the decisions^rpon it are presented. Several of the judges had held it to be “ a general law;” others, “ a private law.” And throughout the case, the words general and public are used as synonymous. Chancellor Kent, in his commentaries, Vol. 1, 506, classifies all statutes as “ public or private;” and he says, “ the most comprehensive, if not the most precise definition in the English books is, that public acts relate to the kingdom at large.” This is the precise definition claimed by the counsel for a general law, and is inconsistent with the distinction he asserts ; for he was .compelled to concede, that acts may be public which do not act territorially thoughout the state, if they are of general importance in their effect upon the interests of the people. And if such acts may be said to “ relate to the kingdom at large,” they fully come up to the idea of a general law; and so Kent says on the next page; “ public statutes” are “ a part of the general law of the land,” &c. Again, in Stephen’s commentaries, vol. 1, p. 67, he classifies statutes as “ either public or private;” and he says, “ a public act is a universal rule, that regards the whole community” Both of these commentators evidently use the word public as synonymous with general.

So in Dwarris on Statutes, 629, it is said, “public acts relate to the kingdom at large;” and again, on 630, “ a general or public act, then, regards the whole community;” using the words as synonymous ; and also, “ a private act, if recognized by a public act, must afterwards be noticed by the courts as a general law.” In Sedgwick on Statutory Law, &c., p. 30, it is said the leading division of statutes is into “ public or general, and private or special.” And he then proceeds: “Public or general statutes are, in England, those which relate to the kingdom at large. In this country they are those that relate to or bind all within the jurisdiction of the lawmaking power, limited as that power may be in its territorial operation, or by constitutional restraints.” So in Bonvier’s Law Dictionary we find “ public” or “ general” statute defined. And this use of the word is in accordance with common understanding, and the definitions of standard lexicographers. Webster defines “general” as meaning, among other things, “ public,” “ common,” “ extensive, though not universal,” &c. So one definition of “ public” is “general.” But I will not quote further. I think I have already shown that the word general, as applied to statutes, has an established meaning, synonymous with the word- public \ and that is sufficient for my purpose.

But it undoubtedly has other meanings. It is used as con-tradistinguished from local, and then it would mean operating over the whole territory of the state, instead of in a particular locality. It is used, also, as contradistinguished from special, and then it means relating to all of a class, instead of to one, or a part of that class. It has been used in the former sense in carrying out a more accurate and detailed classification of statutes. This is referred to in Dwarris, p. 629, where it is said that, “ for convenience of citation," statutes have been further divided into “ public general acts, and public local acts,” &c. The word “ general,” here, is evidently used as the opposite to local, and the word public, used in connection with each, expresses the general character of the law, as distinguished from a private law.

Our own constitution furnishes an illustration of its use as the opposite to the word * special,” in article XI, where it is said that corporations may be formed under “ general, and not under special laws,” except municipal corporations, which may be formed by special acts. It was assumed as very clear by other counsel, in the argument of another case, that an act organizing a municipal corporation could not, in view of this provision, be a general law, within the meaning of section 21, art. VII. He said it could not be special and general also. But I think this by no means follows. On the contrary, it is demonstrable that an act may be special, that is, relate to one of a class, and at the same time general, that is, of such extensive and general interest as to be a public law. Suppose an act organizes a judicial circuit; it is a special act; it relates to a judicial circuit, but not to all. But it will not be disputed that it would be a public act; and if public, then in the sense hereinbefore shown, general.

The word general in Art. XI, §§ 1 and 4, is clearly used only as opposite to special, and without any design of indicating the public or private character of the law. The evil aimed at was special legislation, and the whole object and scope of the provision shows that the word general, as there used, was confined to its restricted meaning as the opposite of special.

The question then presents itself, in what sense was it used in sec. 21, Art. VII, where it is said, “no general law shall be in force until published?” It is not used here in connection with the word “ local” or “ special.” There is nothing in the context showing that it was used as contradistinguished from either. Among its various possible meanings, resort must be had to the object of the provision, to determine in what sense it was used. And the moment that is looked at, it seems to me to leave no room for doubt that it was used in its usual sense when applied alone to a statute, that is as synonymous with public. The object of the prohibition was the protection of the people, by preventing their rights and interests from being affected by laws which they had no means of knowing. But all are bound by, and are bound to take notice of public statutes. It was conceded on the argument, and could not well be denied that a large class of statutes are public, having the most important bearing upon the interests of large portions of the people, which are yet local in their immediate operation. If all these are excluded it is manifest that the object of this clause of the constitution is in a great measure defeated. And the people are liable to act blindly with reference to their most important interests, and to have their rights sacrificed by the operation of laws which they are bound to know, but have no means of knowing. Such a result is in conflict with the first duty which a state owes to its people. That the object of this' prohibition was to prevent it I have no doubt. The language used is not only capable of a construction which will accomplish the object, but such is in accordance with its usual meaning, when used alone, as it is here, and not in connection with other words which may give it a morfi restricted sense. The-question then is, shall it be construed in its usual meaning, and according to its obvious intent, or shall the court go beyond this provision and search out a more restricted sense in which the word is sometimes used, and upon that verbal pretext, limit its meaning here, so as to defeat half the object of the prohibition, for the sake of avoiding whatever consequences may result from its enforcement ? For one I must adhere to the former course whatever may be the result.

It was argued as though the whole distinction between public and private ácts was founded on a mere convenience in pleading, and as though acts were public because courts take notice of them. But the distinction rests upon a much more essential and important principle, and not only courts, but every body, are bound to take notice of them, because they are public acts. The fact that the legislature sometimes declares that a private act shall be deemed a public act and taken notice of by the courts, was supposed to have some bearing on the question. But I am unable to see it. Undoubtedly the legislature may, as a mere matter of convenience, provide that a private act shall, in some respects, be treated as a public act. But the constitution proceeds upon the essential characteristics of the acts themselves. And clearly, the legislature could hot, by merely changing the name of an act, take it out of or bring it within the constitutional provision contrary to its essential character. But as no such question is presented, I can see no bearing which the common practice of saying that á private act shall be deemed public, has upon the question at issue.

I am compelled, therefore, to hold that the charter of the city of Janesville was a general law within the meaning of this prohibition of the constitution, and that it could not be in force until published. But it was also held in the Iowa county seat case that the publication which is to give force to a general law, must be one made under some provision of law. Not that the precise manner or time should be observed, but that it must be done under the law and by authority. And this position has also been assailed. And it was contended that any publication, such as reasonably notified the people, should be held to make the law operative, even though entirely without authority. But I cannot assent to such a position. On the contrary, I repeat what I said in that case, that where the constitution requires provision to be made by law for the publication of all laws, and then immediately says that “ no general law shall be in force till published,” it seems to me the publication mentioned in the latter clause, is obviously the one required to be provided for in the first. And no other rule is practicable. Courts,and people are bound to take notice of general laws; and that upon which their operation depends, should be capable of being readily ascertained with the highest certainty. This can only be done by having it an authorized act, and the evidence of it preserved in pursuance of law.

It is said by counsel in his brief, that this charter was published in the newspapers at Janesville. But it is not pretended that there was any law authorizing it. And how is the court to know the fact ? Is it to inspect all the newspapers in the state to know whether some individual has caused laws to be published ? Is it to inquire whether they have been published in handbills, or in pamphlets ? Is it even to inspect the newspapers of other states, some of which are extensively circulated here, to see if our laws have been published in them ? And, even if they should be found printed in this way, how are the courts, or the people, to know that they are the laws ? They would not come through an authentic channel of information, and it could only be known after all, that they were laws, by resorting to such channel. But it seems to me too clear to admit of doubt, that the publication which is to make a law operative, must be authorized by law. And I think there is no weight in the suggestion that, under this rule, no general law could ever have got into operation, for the reason that, until the first law was published, there would be no law authorizing its publication. This is the same objection made to the validity of the ordinance before noticed, and the same remarks apply to it. If a general law is enacted, and itself prescribes the manner of its own publication, if published accordingly, I should have no hesitation in saying that the publication was in pursuance of law. The publication would give validity to the law, and the law would give authority to the publication.

The charter of the city of Janesville was published among the Private Laws of 1853. The certificate of the Secretary of State attached to the volume, as required by law, is dated on the 4th day of October of that year. And we have held, at the present term, that, in the absence of any suggestion to the contrary, we should take the date of that certificate as the time of the publication. There is no claim that this charter was published by authority before that.

The election was held upon the question of subscribing stock in July, and the bonds and coupons were issued on the first day of August in that year. It was all done, therefore, without any law authorizing it; and within all the authorities is invalid. In The commissioners of Knox County vs. Aspinwall, before cited, the Supreme court of the United States say: “ The act in pursuance of which the bonds were issued is a public statute of that state, and it is undoubtedly true that any person dealing in them is chargable with a knowledge of it; and as this board was acting under delegated authority, he must show that the authority has been properly conferred,” &c.

Here the authority fails, and the bonds were issued without law. And, for this reason, though regretting the necesity of deciding a case of so much importance upon such a ground, I think the demurrer should have been sustained, and that the judgment of the court below must be reversed, with costs.

Dixon, C. J. I fully concur with my brother Paine.

---

Dissenting Opinion

Cole, J.,

dissenting. The constitutional questions presented by this record are substantially the same as those involved in the case of Bushnell vs. The Town of Beloit;^* upon which I have expressed my views, in the opinion in that case. I have but little to add in the present case further than to observe that, to my mind, the argument in favor of the validity of the bonds mentioned in the complaint, and of the power of the legislature to authorize municipal corporations to make subscriptions to the capital stock of rail roads, in which the corporation may be interested, is greatly strengthened by the language used in section 3 of Article XI. of the constitution. By this section it is made the duty of the legislature to provide for the organization of cities and-incorporated villages, and to restrict their power of taxation, assessment, borrowing money, contracting debts, and loaning their credit, so as to prevent abuses; thus recognizing in the clearest manner that a power may be conferred upon these corporations to borrow money, contract debts, and loan their credit for some lawful purpose. And if the inquiry is made for what purpose municipal corporations have found it necessary to borrow money and loan their credit, it cannot be said that it has been to defray the ordinary expenses of the local government. These expenses are almost invariably met by direct taxation upon the property within the corporation; or at least it is from this source that the revenue is generally derived. When, therefore, municipal corporations have loaned their credit, it has been done for the purpose of aiding some individual association or corporation in constructing some works, or making some internal improvements, calculated directly or indirectly to benefit the city. It is for the accomplishment of objects of this character that municipal corporations have found it necessary to loan their credit and borrow money, and this was well understood by the framers of the constitution. And, since municipal corporations derived the power from the legislature to loan their credit for these purposes, the duty was enjoined upon the legislature in conferring the power so to restrict it as to prevent any abuse in its exercise. The power must be conferred in some degree before it could be restricted in any. But that it was not intended by the framers of the constitution to deprive the legislature of the power to authorize municipal corporations to aid in carrying on works of internal improvement, but to permit that authority to be granted, under such restrictions as to the legislature might seem proper, would seem to follow, in the clearest manner, from the language employed in this section. And in conferring upon the common council of Janesville power, by resolution, to authorize the mayor to subscribe stock for “ any rail road running to or passing through the city,” the legislature undoubtedly supposed that the limitations upon this power contained in the charter would effectually prevent any abuse in its exercise. The common council, in the first instance, had to submit to the legal voters of the city the question whether the city should take stock; giving at least ten days notice, in some newspaper published in the city, of the time and place of voting upon the question, stating the amount to be subscribed, &c. The election was to be by ballot, and if a majority of the votes cast upon the question was in favor of taking the stock, the common council, by a resolution which was required to be entered upon the city records, could authorize the mayor to subscribe for the city the amount of stock so voted to be taken. And as the concurrent action of the cjty authorities and people was necessary to authorize the subscription, it was but fair to suppose that no abuse would follow from conferring this power upon the corporation. The power to take the stock was subject to the will of the people directly affected by the indebtedness; and this was all the restriction the legislature deemed necessary to impose upon its exercise in the present instance. But the legislature must grant the power to municipal corporations to contract debts and to loan their credit before it could restrict or regulate the power conferred.

And without pursuing this line of remark further, I will only add, that it is apparent, as well from the clause of the constitution I am now considering as from the whole scope and spirit of that instrument, that the legislature were not inhibited from authorizing the authorities of the city of Janesville to make the subscription to the capital stock of the Rock River Valley Union Railroad, and to issue the bonds in controversy.

It was likewise insisted upon the part of the appellant, that the ordinance passed by the common council of the city, did not properly fix the place for submitting the question of taking stock to the legal voters of such city, and that due notice of the election was not given, &c. Upon an examination of the allegations of the complaint, I am not able to discover, but that the requirements of the charter in reference to holding the election, were substantially complied with, and the election appears to have been regularly and fairly conducted. At all events, if there were any irregularities in the proceedings preliminary to the issue of the bonds, I do not think any of those relied upon by counsel, are of such a character as ought to invalidate the bonds in question in the hands of an innocent holder for value. It is well known that bonds of this description are intended to be thrown into the market and sold, and it would be an inequitable rule to hold that they were void in the hands of a bona fide, purchaser, on account of some defect in the notice of election, or some slight irregularity in conducting the same. See Commissioners of the County of Knox vs. Aspinwal et al., 21 How. U. S., 539; Fisher vs. The Morris Canal Banking Company, 1 Stock, Ch. 667; Mechanics’ Bank vs. New York and New Haven Railroad, 3 Kernan, 599; The City of Bridgeport vs. The Housatonic Railroad Company, 15 Conn. 475.

These cases clearly show what character has been given to this class of securities, and how far courts have gone in excluding defenses, where the suit was not between the or-ginal parties, which was grounded upon some defect in the notice of, or some alleged irregularity in the issue of the bonds. It is true, that the right of the common council to authorize the mayor to subscribe the stock, depended entirely upon the fact that a majority of the legal votes cast at the election, should be in favor of the subscription, but it is not to be presumed that the city authorities did not proceed according to law in ascertaining the will of the people upon the subject, and did not comply with the provisions of the charter authorizing the election. The complaint in the present case sets forth, with great fullness, the prelimin.ary steps which were taken, and I cannot perceive but the city authorities substantially complied with the conditions to the grant of power to subscribe the stock.

The question was likewise made as to whether an action could be maintained upon the coupons described in the complaint, because the bonds to which they are attached are not drawn payable to bearer or order, but to the railroad company or its assignees. The bonds were assigned by the president of the company to-or bearer; and the coupons are made payable to the railroad company or bearer. These securities are of a peculiar character, designed to be thrown into the market for sale, to raise money upon, or to pass from hand to hand by delivery, and by common usage, are, in fact, so transferred. Though they may not be commercial paper, in the strict sense of the word, like bills of exchange, or promissory notes, yet they circulate in market much like those instruments, and are intended to answer much the same purpose. They can be transferred by delivery or assignment, so as to confer a complete title upon the holder, relieved from the equities existing at the time of the assignment, between the maker of the instrument and the assignor. Morris Canal and Banking Co. vs. Fisher; Mechanics’ Bank vs. New York and New Haven Railroad Co.; supra.

In the case of The Commissioners of Knox Co. vs. Aspinwall, the court decided that a suit could be maintained upon the coupons without the production of the bonds to which they had been attached.

Although this action is brought to recover the amount due upon the coupons set forth in the complaint, still it appears that the bonds to which the coupons in question are attached, belong to the respondents. And under the provisions of our code, § 15, which requires every action to be prosecuted in the name of the real party in interest, I cannot doubt but that the respondents, to whom the bonds and coupons belong, properly instituted this suit, and are entitled to recover the amount due upon the coupons. See Wookey vs. Pole, 4 B & Al. 1; Gorgier vs. Mierrile, 3 B. & C., 45; Lang vs. Smyth, 7 Bing., 284.

Neither do I see any force in the objection that the subscription by the city for the stock of -the company, was not made payable in installments, upon call, as required by section 6 of the charter of the railroad company. The city was, undoubtedly, authorized to make the subscription in the way it was made, and it would seem logically to follow from this fact,.that the company was authorized to receive such subscription. At all events, if the charter required any modification to enable the company to make the contract, such modification was made by the city charter, which is full and complete for all purposes. The City of Bridgeport vs. The Housatonic Railroad Company, 15 Conn., 475.

Some further objections are taken to the validity of the bonds mentioned in the complaint, but I only deem one of sufficient importance to be noticed, and that is, whether the charter of the city of Janesville is a general law, within the meaning of the constitution of this state. It appears that before there was any authorized publication of the charter, the city government of Janesville was organized, and the election was held, at which the electors voted in favor of the common council making the subscription to the railroad stock, and for issuing these bonds; and it is contended that as the charter was a general law, it was not in force until published, and the subscription and election were unauthorized and void for this reason. The majority of the court have adopted this view of the character of the city charter, holding it to be a general law, and not in force until published, and from their conclusions upon this point, I am compelled to dissent. Where the act, in pursuance of which the bonds are issued, is a public statute of a state, I have no doubt but that any person dealing in them is chargeable with knowledge of it, and must take notice, whether the authority to subscribe the stock has been conferred. In this case the common council were acting under the city charter, and if that was not in force, it follows, of course, that their power to act did not exist. It is obvious that the question is not whether an irregularity has intervened in the exercise of the power to subscribe the stock, but whether any power, in fact, existed to make the subscription.

Is, then, the charter of the city of Janesville a general law, within the meaning of section 21, of Article VII., of the constitution of this state ? That section reads as follows : “The legislature shall provide by law for the speedy publication of all statute laws, and of such judicial decisions made within the state, as may be deemed expedient. And no general law shall be in force until published.” The argument mainly turns upon the force which is given to the words “ general law,” as used in this section. The majority of the court consider that the word “ general,” here employed, should have the signification and meaning as is given to the word “ public,” by authorities, when speaking of the classification of statutes. It is not to be denied, that many authorities use the words “ general” and “public,” when applied to statutes, as being synonomous, and strictly convertible terms.

In the case of The State of Wisconsin, ex rel. Cothren vs. Lean, decided at the last term, 9 Wis., 279, where the question raised was whether the act of the legislature, providing for the removal of the county seat of Iowa county, from Mineral ¿Point to Dodgeville, in case a majority of the legal voters of the county voting upon the question, should be in favor of the removal, was a general statute, and we held that law to be a general law, and not in force until published. Although I concurred in the decision in that case, yet I had difficulty in arriving at the result reached by my brethren, and I am free to admit, that my doubts as to the correctness of that decision have been strengthened rather than removed by subsequent reflection upon the subject. It is by no means clear to my mind that the “ general law” spoken of in the provision of the constitution above cited, is not a law which affects all the citizens generally, and operates territorially over the whole state. The law providing for the removal of the county seat of Iowa county, or the charter of the city of Janesville, is unquestionably a public act, expressly made so by a clause declaring them to be such.

But a distinction is made, and to my mind may well exist, between public general acts, and public 'local acts. Smith, in his Commentaries upon Statute and Constitutional Law, § 797, p. 914, says: “In parliamentary language, another sort of distinction is also usual, and some acts are called public general acts, and often others, public local acts, such as church acts, canal acts, &c. These in their objects and oper-atións, are merely local, or limited, but they are, nevertheless, treated as public acts, either by virtue of a special clause, declaring them to be so, or because, although limited to a particular section, or locality, yet they affect the public at large, when acting within that section or locality, in reference to matter within the purview of the act. To this class may also be added some acts which, though public, are merely personal, such as acts of attainder, and patent acts, and all that class of acts which have for their object the security of the right of some particular individuals or class of persons, but which, in effect, are operative and of binding force upon all the citizens generally.” The distinction here pointed out is, to my mind, rational and proper, founded in the nature of things, and I think should be adopted. Particularly do I deem it applicable to the laws of this state, when we bear in mind the construction placed upon this clause of the constitution by the legislature, and the officers of the government, in the classification and publication of the statutes, since the organization of the state government. The legislature provided, § 2, sub-division 22, chap. 4, R. S., 1850, that all acts of incorporation shall be deemed public acts, and as such may be declared on, and given in evidence without especially pleading the same; and as a matter of fact, most of the acts passed by the legislature contain a clause declaring that they shall be deemed public acts.

Further, in conformity to law, the statutes have for some years been published in two volume; those of a general nature in one, and those of a local character in another. And although the latter class have mostly been declared to be public acts, still the understanding of the officers and people of the state has been that they were not general laws, which came within the provisions of the constitution. Hence cities and villages have been organized, officers elected, taxes levied, real estate purchased and conveyed, and other obligations incurred, before there was any authorized publication of the acts of incorporation. Now if all these statutes, which elementary writers and courts have declared to be public laws, are held to be general laws within the meaning of the constitutional provision, and were not in force until published in some authorized manner, it is difficult to foresee the confusion which will arise, or the serious consequences which will follow from such a construction.

But there is another clause of the constitution which has a very important bearing upon this question, and shows most conclusively to my mind, that the charter of the city of Janes-ville is not a general law, within the meaning of that instrument I refer to section 1, Art. XI, which reads as follows: “ Corporations without banking powers or privileges, may be formed under general laws, but shall not be created by special act, except for municipal purposes, and in cases where, in the judgment of the legislature, the objects of the corporation cannot be attained under general laws. All general laws or special acts, enacted under the provisions of this section, may be altered or repealed by the legislature at any time after their passage.” This is the whole provision, and it seems to me little more need be said to show that a charter of a city is not a general law, than to quote this language. The section declares, in substance, that corporations shall be formed under general laws, except those for municipal purposes, which may be created by special act. But what is understood by the language, a municipal corporation created by a special act ? What is the special act referred to ? Is it anything different from a city charter ? Does not the special act here referred to, mean those laws of incorporation granted by the legislature to villages and cities for police and governmental purposes ? Is not this the plain, obvious, universal understanding of the language ? These questions suggest their own answers. The framers of the constitution, then, evidently contemplated that municipal corporations would bé created by special act, in other words, by charters. General acts might be passed, applicable to all villages, and cities, like the general banking law, or plank road law, but it was doubtless supposed that there might be some details or some peculiar provisions which could not be well comprehended in a general law, and that special acts of incorporations would therefore become necessary. Hence the exception that charters or special acts of incorporation for municipal purposes might be passed, and those special acts are spoken of in this section, and placed in immediate connection with, and are used in direct contradistinction to the general laws mentioned in the same section. If a city charter is held to be a general law, then it is difficult to give this section any rational construction. I am not aware that there are peculiar provisions in the charter of the city of Janesville, which distinguish it from other city charters in this and other states. It is quite probable that it differs in some unimportant particulars, but the main, leading features of these city charters are the same. I have no doubt, but it is substantially such an act of incorporation as the framers of the constitution had in view when they speak of special acts in this section. It is the special act “ creating a corporation for municipal purposes,” which the legislature was authorized to pass.

Holding, therefore, that the charter is not a general law within the meaning of the constitution, the clause in reference to the publication of general laws does not apply to it. I have no doubt but that the organization of the city government of Janesville, and the election held under the charter, at which the people voted in favor of the common council making the subscription and issuing the bonds in controversy, were all regular and proper.

I therefore think the order of the circuit court, overruling the demurrer, should be affirmed. ..

* See this case below.