42 N.J.L. 235 | N.J. | 1880
The opinion of the court was delivered by
There are two classes of bonds issued by the city of Elizabeth which are drawn in dispute in this case. The first class embraces those denominated “ consolidated improvement bonds;” the second, such as are styled “ funded assessment bonds.” As all the objections started with respect to the latter class apply to the former class, it becomes unnecessary to subject such objections to a separate criticism.
With regard, then, to the “consolidated improvement bonds
In the supplement of March 29th, 1871, above referred to, there is a direction that in all cases in which assessments for any improvements had been ratified by the common council and the same had not been paid, notice should be given in a newspaper, requiring the payment of such assessments, or bonds to be given securing the same. This act then contains this provision : “And the said city council shall have power to issue bonds for the renewal of bonds issued in contemplation of the payment of the above-mentioned assessments.” The bonds in this clause referred to, were the improvement bonds of the city of Elizabeth, that had been issued by force of the before-recited act of March 31st, 1864. The before-designated supplement of March 17th, 1871, merely regulates the issuance of these bonds in renewal, and styles them “ consolidated improvement bonds.”
These bonds now involved in this suit, and which were given in renewal of certain of the above-mentioned “ improvement bonds of the city of Elizabeth,” are questioned, in the first place, on the ground that the city had no authority to issue such improvement bonds. The ground on which this contention is put is, that such class of bonds could be put forth only in cases where the city council was authorized to
But granting these premises, it seems to me that the conclusion drawn from them, that the bonds in suit are likewise void, is a non seguitur. Suppose the improvement bonds were void, as it is claimed, does it follow that the bonds that were given in substitution for them are likewise nullities? It will be observed that if we assume that the city exceeded its power in borrowing the money represented in such improvement bonds, nevertheless the fact remains that the city had incurred honest debts in the laying out and improvement of its streets, and that the money so borrowed went to the payment of such honest debts. The municipality, therefore, was under a moral obligation to repay the money so borrowed, and the consequence is, that upon well-settled rules it was entirely competent for the legislature to convert such moral into legal obligations. When, therefore, by this act of 1871 the city was authorized to renew such bonds, and substitute in their place this class called “ consolidated improvement bonds,” such an authority was a validation of the original loan, and a recasting of it into a new form. I entertain no doubt that such new bonds corroborated by this legislative sanction, are in all respects valid and enforceable. The rule settled in the case of Rader v. Township of Union, 10 Vroom 519, is entirely pertinent and is quite decisive. In that case it was conceded that the contract then in question was palpably ultra vires, as it had been made by an ostensible corporate body which in point of law had no existence, but as the subject of such contract had enured to the benefit of the township of Union, the burthen of payment could by legislation be lawfully imposed on that township. I consider, therefore, that on the concession of the
But this assumption of the illegality of these improvement bonds is founded, as it seems to me, in a misconception of the act creating them. That act declares that the city may borrow money in anticipation of taxes, “ in all cases where the common council are authorized to make or levy an assessment, for any improvement heretofore made, or hereafter to be made, under the act to which this is a supplement.” In the charter here referred to, the city had been empowered to make assessments for improvements in certain cases, and it is to this class of cases to which this authority to borrow money points. Such reference had no regard to abstract questions as to the legal sufficiency of the provisions giving the power to make assessments. The legislature, beyond all doubt, thought such provisions entirely constitutional, and therefore they are referred to as carrying with them the authority imported by their terms. But it would be irrational in the extreme to suppose that it was the design in framing this supplement to make the authority to borrow these moneys dependent on the ultimate decision of the courts with respect to the power to assess the cost of improvements. The charter in terms ordained that certain assessments might be made, and it was in aid of this class of procedures that loans were authorized. Regarding it as a question of legislative intention, I have not been able to see how there can be any uncertainty or obscurity on the subject.
This objection cannot be allowed to prevail.
Nor have I found any greater legal substance in the second objection taken against the present cause of action by the counsel of the defendant, and which objection is, that admitting the legality of these improvement bonds, “ they were not a part of the city debt, payment of which could be enforced by general taxation, or out of any fund except the specific assessment in view of which they were issued.”
The conclusive answer to this objection is, that the obligation of the city, which is the foundation of the suit, is not thus
The last objection necessary to be considered is the exception that all these bonds that exceeded the limit imposed by the acts of 1871 and 1875 are void. It is contended that such limit was the assessments ratified and unpaid on March 29th, 1871, and that certain of these bonds exceed that limit. The legal principle on which this contention rests is, that the officers issuing these instruments are public agents acting under delegated authority expressed in a public statute, and that per
Besides this explicit declaration of the legal principle applicable in this class of cases, we have also.in the same case, the .still more explicit intimatiou of Mr. Justice Bradley, evincive of a disposition to disallow everything that had appeared in the previous cases that could not be brought within the limits of the foregoing definition. That distinguished jurist, with that comprehensive brevity that characterizes his opinions, in a few words explains his views respecting the theory that the mere execution of bonds by officers charged with the duty of ascertaining whether a condition precedent has been performed, is conclusive, and holding that in order to -exempt the bona fide holder from the duty of looking beyond
But at the same time, while to this extent I think it altogether an inadmissible construction, under the circumstances mentioned, to infer from one of these laws, framed in the usual way, an authority in the officer to annul by his contradictory statement the prescribed evidence of the fulfilment of the condition precedent, such inference is, in my judgment, in another class of cases entirely legitimate. I refer to those instances in which the authority of the agent is made to depend on a certain state of facts, whose existence or non-existence is exclusively or at least peculiarly within the knowledge of such
It will be observed that-this principle of construction embraces the case now under consideration. The facts upon which the question whether a given bond was in renewal of bonds which had been issued in contemplation of the assessments mentioned in the act of March 29th, 1871, were not ascertainable to any reasonable degree of certainty by any one who wras not an officer of the city, conversant with its affairs. Therefore the plaintiff in this case was not called upon to endeavor to look into the situation, but had the right to rely on the action of the municipal officers, who, by issuing the bonds, affirmed that the requisite condition of things existed.
The' objection cannot prevail.
It may also be well to remark that these bonds, even if admittedly in excess of the legal limit in the act referred to, would be valid on the last principle discussed and adopted in the case of Singer Manufacturing Co. v. City of Elizabeth, decided this present term.
The judgment must be affirmed.