Meeker & Co. v. Ashley, 56 Iowa 188

Meeker & Co. v. Ashley

56 Iowa 188 | Iowa | 1881

Seevers, J.

I. As to the taxes voted in Palo Alto township. The articles of incorporation of the railway company declare the object of the corporation to be, “ to acquire, construct, maintain and operate a railroad, commencing at a point hereafter to be determined upon in the southern or southeastern portion of the State of. Iowa; and running thence through the counties of Jasper, Story, and Hamilton, via Nevada and Webster city, in a northwesterly direction to the northern boundary line of the State of Iowa.”

The tax was voted on the 20th day of April, 1872, and the notice for the election submitted to the electors “ the question of aiding, by a tax of five per cent upon the assessed value of the taxable property of the said township, in the construction of the Iowa, Minnesota & North Pacific Eailway, the same being a line- of railway projected to .and from some point. in the southeastern part of Iowa through the counties of Jasper, Story, and Hamilton, by way of Newton, Nevada, and Webster City to the northern boundary of the State of Iowa.”

. roads :°comiltions of tax. On the day of the election and before there was “ circulated among the voters and was believed by many of the voters and influenced them in the course thev took, indiming them to vote for the tax,” a paper signed py j.pg presi<jent 0f the company, with the corporate seal attached, in which among others was the following provision : “ Eirst. Said tax shall be payable in three instalments, as’ follows, viz.: two-fifths of the amount oñ the first day of January, 1873, or when the road is ironed from theHes Moines Walley Eailroad to Newton and the cars running thereon; two-fifths of .the amount on the first day of October, 1873, and the balance .on the first day of March, 1874.” The fact that an election was about to be held for the purpose of voting taxes to aid in the construction of said railroad was recited in said papér/and therein the said company did “ agree with the said trustees for the use and the benefit of tax payers of said township that said tax shall be voted on-*190the basis of the following agreement.” Immediately following was the provision above quoted and set out. Below the signature of the president of the company, but atttached' to and forming a part of said paper, was the following: “The citizens will observe by the first section of the law passed by the legislature February 16, 1872, that'all contracts and conditions made by the railway company with the people must be strictly complied with.” Following this is the first section of the act approved February 16, 1872, printed in full. Laws of Fourteenth General Assembly, page 2.

The paper aforesaid “was issued by and with the consent of a majority of the Board of Directors ” of said company, “ and was circulated and used by some of the directors * * * to induce the citizens to vote the subsidy asked for, and with some it had that -effect, but there is nothing in the records of the directors’ meeting showing express authorization of such action. It was, however, believed the same was valid and binding on the company by both its officers and the voters, and both parties relied upon it. 4

We think it clearly appears from what has been stated the electors had the right to believe the company would complete and iron the road, in aid of the construction of which the tax was about to be voted, from the Des Moines Yalley Railroad to Newton. The only fair construction to be given to the paper signed by the president of the company is that the tax was voted on condition the road then being constructed was ironed as aforesaid and the cars run thereon. There were voters who so believed, and accordingly voted for the tax. This being so the company should not now be permitted to say there was no valid agreement to this effect. But we think the agreement is valid and binding on the company on the ground, in the absence of any showing to the contrary, that the president must be presumed to have had authority to make it, when done “ with the consent of a majority of the directors.” The fact that such consent has not l)een entered of record is immaterial. The articles of incoiv *191poration do not require that everything done by the directors in order to be binding on the company shall be entered ''of record. In fact there is no provision on the subject. The next question is whether such condition has been complied •with.

• What was at one time known as the Des Moines "Valley Eailroad passes through the town of Monroe, in said Jasper from which' point the .road in question has been constructed, northerly, in the direction of Newton. At the time the tax was -voted a railroad had been constructed by the Chicago, Newton &• South Western, Company from Newton “in a southerly direction to some coal banks in the direction of Monroe.” The length of this roa-d is about three and one-' half-miles, and the distance from Monroe to Newton is believed to be about seventeen miles. The Iowa, Minnesota and North Pacific Eailway Company -purchased the above mentioned road three and one-half miles in length, connected the road constructed by it therewith, and thus it Is claimed the-road-has been ironed and cars run thereon from the Des Moines Valley Eailroad to Newton.

Under the statute taxes cannot be voted to purchase a constructed railroad. Lamb v. Anderson, 54 Iowa, 190. The contention in the cited case was in relation to enforcing the collection of taxes voted in aid of this same railroad, and the point determined was that the collection of such taxes could not be enforced because of the purchase instead of construction of the three and one-half miles of railroad aforesaid. We do not think there is any distinction between the two cases, but there is the additional consideration in this case that the tax was voted on the condition the road then being constructed should be ironed and cars run thereon. This, condition cannot' be regarded as complied with by the purchase of a constructed road.

II. As to the Favrview township taxes. Previous to the election the railroad company made a contract' with the *192trustees of said township whereby the company agreed “ that ’ any and all taxes so voted in said township may remain, unpaid until the road bed of said railway is graded, tied and ironed from the town of Newton to the town of Monroe.”

The validity of this agreement is not denied, but it is insisted, as we understand, the company thereunder was only bound to construct its road in that township, and might well purchase a constructed road no part of which was in said township. What has been heretofore said applies with full force to the taxes of this township. The contract applies, we think, to the whole road between Monroe and'Newton. The road then being constructed was to be ironed. This has not been done, and therefore the collection of the tax cannot be ■ enforced. . In all the cases the judgments are

Affirmed.