97 F. 145 | 8th Cir. | 1899
Lead Opinion
The defendant in error, Henry Percy Chilton, was the innocent purchaser, for value, of certain bonds and coupons issued by the plaintiff in error, the township of Grattan. The coupons were not paid when they became due, and he brought this action to recover upon them. The township interposed various defenses, and the case was tried by the court below upon an agreed statement of facts, and a judgment was rendered against the plaintiff in error. The opinion of the circuit court upon which this judgment rests may be found in 82 Fed. 873.
Counsel for the plaintiff in error insist that the judgment is erroneous: (1) Because the board of supervisors of the county of Holt, which issued the bonds, had no power to do so, for the reason that the Nebraska & Western Railway, to aid in the construction of which the bonds were issued, was not built through the township of Grat •
1. The agreed facts on which the first position taken by counsel is based are these: Under the constitution and statutes of the state of Nebraska the board of supervisors of the county of Holt was empowered to issue the bonds of the township of Grattan to aid in the construction of a railroad upon a favorable vote of two-thirds of the electors of the township voting upon the question. Comp. St. Neb. 1897, c. 45, §§ 8518, 8519, p. 69(5. A proper petition for the submission of the question of the issue of the bonds to the vote of the electors was made, the proposition to issue them was submitted, and more than two-thirds of the electors voted in its favor. The petition for the election and the proposition for the issue of the bonds contained this clause:
•‘The proceeds of said bonds to be used in aid of the construction of a line of railroad passing into the county of Holt from the east, and through the said township to the city of O’Neill, in said county, such proceeds to be given to the Nebraska & Western Railway Company when it shall complete a line of said railroad, and have ears running thereon, to the city of O’Neill, on or before August 1, 1890.”
The railway was constructed from the east into the township of Grattan, a distance of about five miles, and it was completed to the city of O’Neill, which is situated within the township, and cars were running thereon, on or before August 1, 1890, hut it never was constructed to or across the western boundary of the township of Grattan. After it was completed to O’Neill, the board of county supervisors issued and delivered the bonds to the Nebraska & Western Railway Company. That company sold them on the market, and they were finally purchased for value by the defendant in error in the usual course of such commercial transactions. Each of the bonds contained this recital:
“This bond is issued for the purpose of aiding the Nebraska & Western Railway Company in the construction of a railroad through said Grattan township; said railroad to pass into the county of Holt from the east through the said Grattan township, and have cars running thereon to the city of O’Neill on or before August 1st, 1890, and is one of a series of thirty-six bonds of one thousand dollars each, and numbered from one to thirty-six, inclusive; and said bonds are issued under and by authority of the laws of the state of Nebraska found in chapter 45, on pages 540, 541, and 542, of the Compiled and Annotated Statutes of the State of Nebraska of the year 1889, and the other laws of the state of Nebraska in relation thereto.”
Upon these facts it is urged that the construction of the railroad through the township of Grattan was a condition precedent to the issue of the bonds, and that, since the condition was not complied with, the hoard of county supervisors had no power to issue them, and they are void in the hands of all classes of purchasers. But the hoard certified that these bonds were issued under and by authority of the statutes. If, under any circumstances, the hoard would have had authority to issue them, and the bonds would have
There is another conclusive answer to this contention of the plaintiff in error. It is that the construction of the railroad through the township of Grattan never was a condition precedent to the issue of the bonds. It is conceded that the statutes impose no such condition. The claim is that this condition was imposed by the clause in the proposition to issue the bonds, which has been quoted above. But a fair examination of that clause, however critical, will disclose •no limitation or prescription relative to the time of the issuance of the bonds. It relates exclusively to the disposition of their proceeds,
2. There is a statute of the stale of Nebraska which requires a railroad corporation to file for record in the office of the clerk of the county in which donations, bonds, or other valuables are to be voted in its aid a plat of the survey of its line of railroad through the county within two weeks previous to the election, and which then provides that “no bonds, and so forth, shall be valid in ca.se they are voted, unless said railroad corporation build their line of road within forty rods of their survey as filed in the county clerk’s office.” Oomp. St Neb. 1897, § 4023, p. 800. It is said that the judgment below was erroneous because the defendant in error failed to plead or prove that the railroad was constructed within 40 rods of its surveyed line. But the coupons were prima facie evidence of their own validity, and required no proof aliunde to sustain them. If they were void because the railroad was not constructed in accordance with the provisions of the statute we have quoted, that was an affirmative defense, which it was incumbent on the plaintiff in error to plead and to prove if it would avail itself thereof. Contracts of a municipal or quasi municipal corporation, formally executed by the officers authorized to do so by law, and not in themselves necessarily beyond the scope of their authority, will, in the absence of proof to the contrary, be presumed to be valid, and to have been made with due authority. If acts were required to bé done, or conditions were required to exist, before valid contracts could be made, the contracts themselves raise the presumption and present the evidence that such acts were performed and such conditions existed. Acts done or contracts made by a corporation which presuppose the existence of other acts or conditions in order to make them valid and legally operative are presumptive proof of the latter. City of Lincoln v. Sun Vapor Street Light Co., 19 U. S. App. 431, 438, 8 C. C. A. 253, 257, and 59 Fed. 756, 760; Barber Asphalt Pav. Co. v. City of Denver, 36 U. S. App. 499, 510, 19 C. C. A. 139, 144, and 72 Fed. 336, 341; Lincoln v. Iron Co., 103 U. S. 412, 416; President, etc., v. Dandridge, 12 Wheat. 64, 70; Omaha Bridge Cases, 10 U. S. App. 98, 189, 2 C. C. A. 174, 240, and 51 Fed. 309, 327, and cases there cited; Union Water Co. v. Murphy’s Flat Fluming Co., 22 Cal. 620, 629. The record discloses no plea, proof, fact, or finding relative to this defense, and it is not here for our consideration. The agreed statement of facts as it stands is ample to support the judgment, and the questions relative to the proximity of the surveyed line to the constructed line of the railroad were not presented to or considered by the court below.
Dissenting Opinion
I dissent from the language of the court as to the presumptions arising from, and the legal effect of, the issuance of municipal bonds. It states the doctrine on that subject much too broadly. Moreover, what is said on that subject is obiter, for we are all agreed that it conclusively appears from the statement of facts “that the construction of the railroad through the township of Grattan never was a condition precedent to the issue of the bonds.” That being so, why should the court go out of its way to say that, if the construction of the road through the township had been made a condition precedent to the exercise of the power to issue the bonds, and the road had not been constructed at all, the mere issuance of the bonds would estop the defendant from showing that fact?
