57 N.W. 787 | N.D. | 1893
The plaintiff has recovered judgment against the defendant upon certain interest coupons of bonds issued by the defendant. That judgment is assailed here on several grounds. We find it unnecessary to allude to them all. In our judgment the bonds are void upon their face. It is elementary that power to issue such municipal securities is derived wholly from statute. The statute may prescribe the conditions on which such power shall be exercised. It may also declare what terms shall be embodied in the bonds it authorizes to be issued. The donee of the power must take it burdened with all statutory requirements, as well with respect to the terms of the bonds to be issued as with
Plaintiff cannot derive any benefit from its claim that it is an innocent purchaser, because, under all the authorities, even bona fide purchasers of such securities are charged with knowledge of the terms of the statute under which the bonds are issued. Barnett v. Denison, 145 U. S. 136, 12 Sup. Ct. 819. In this case the terms of the statute informed the plaintiff that the bonds must be payable in not less than 10 years from their date, whereas upon their face they appeared to be, and were in fact, payable in less than 10 years from date. We were not cited to any case holding contrary to our ruling; but we have discovered an authority in the Federal Supreme Court which at first glance would appear to be in
It is urged that this specific point cannot be raised here, because it was not raised in the court below. This rule has no application where it appears that the objection could not have been obviated if made in the trial court. As plaintiff itself avers that the nominal date is also the date of execution and delivery, and therefore the actual date, there is no escape from the conclusion that the bonds are void. Nor is it true that the point was not raised below. The court, against the objection of the defendant, directed a verdict for the plaintiff. To this ruling of the court the defendant excepted. This ruling was erroneous. A verdict should have been directed for the defendant. This error