99 F. 202 | 6th Cir. | 1900
(after stating the facts as above). The first question for our consideration in this case was made by demurrer to the declaration on the ground that the cause of action was barred by the statute of limitations. The cause of action in this cause is conceded to have accrued more than 6 and less than 10 years before the issuing of summons. By the law of Michigan (How. Ann. St. § 8718), actions of debt on contracts not under seal and of assumpsit must be brought within 6 years next after the cause of action accrues. By section 8719, all personal actions on any contract not limited by previous sections must be brought within-10 years. This applies
“In all cases arising upon contracts under seal or upon judgments when an action of covenant or debt may be maintained, an action of assumpsit may be brought and maintained, in the same manner, in all respects, as upon contracts without seal.”
It follows from the foregoing sections that in Michigan an action of assumpsit on a sealed instrument is barred in 6 years, while an action of covenant on the same cause of action is not barred for 10 years; the form, and not the cause, of action fixing the bar. Stewart v. Sprague, 71 Mich. 50, 38 N. W. 673.
The present action is in covenant. If it is properly brought in this form, then the bar of the statute is avoided. It is contended, however, that covenant will not lie on an unsealed instrument, and the bonds here sued upon were not sealed. The statute under which the instruments purport to have been issued provides for the issuing of bonds. A bond is a deed whereby the obligor obliges himself, his heirs, executors, and administrators, to pay a .certain sum of money to another at a day appointed. 1 Bl. Comm. 340. A deed is a writing sealed and delivered by the parties. 2 Bl. Comm. 295. The word “bond” imports a seal, and the word, when used in a sta tute authorizing the issue by a municipal corporation of written obligations negotiable in character, means specialties or writings under seal. Koshkonong v. Burton, 104 U. S. 668, 673, 26 L. Ed. 886. The officers issuing evidences of township indebtedness purporting to comply with the statute of 1867 must therefore be presumed to have intended to issue sealed instruments. They have not done so in this case. But section 7778 of Howell’s Annotated Statutes of Michigan, part of which has already been quoted, provides further iliat no bond, deed of conveyance, or other coniract in writing signed by any party, his agent or attorney, shall be deemed invalid for want of a seal or scroll affixed thereto by such party. In Jerome v. Ortman, 66 Mich. 668, 33 N. W. 759, it was held that an action of covenant in Michigan, as at common law, was an action upon a deed; that the purpose of the clause of section 7778, just quoted, was to permit parties intending to make a deed or specialty to have the writing signed by them, though without seal, treated in law as a deed or specialty; and therefore that covenant might be maintained thereon. See, also, McKinney v. Miller, 19 Mich. 142. We think the case at bar is within Jerome v. Ortman. The officers signing the instruments here in suit intended them to be bonds (i. e., deeds), for the statute so denominates the securities to be issued, and the instruments themselves bear the name “bond” on their face; and therefore they may be given effect as such, and will support an action of covenant. The circuit court was right in overruling the demurrer based on the statute of limitations.
The next questions arising in this case are those of evidence. The plaintiff’s counsel served notice upon the defendant to produce the township records covering the periods when the bonds in this case purport to have been authorized and issued. Two books are produced, one purporting to be the journal of the township board, and
. It is objected to the validity of the bonds issued by authority of the township meeting of August 23, 1871, that the meeting was a nullity, and that the vote was not a vote of the majority of the electors preset in favor of the issuing of bonds. It is said that the supreme court of Michigan, in Loomis v. Rogers Tp., 53 Mich. 135, 18 N. W. 596, so decided. From a careful examination of that case, we do not think that the consideration of the validity of the meeting or its effect was necessary to the decision. The proceeding there was in mandamus to compel the township board of Rogers to levy a tax to pay the relator’s bonds, which, like those in suit, purported to have been authorized by the township meeting of August 23, 1871. The issues , were framed and submitted to the jury, but they did not cover the issues made by the pleadings. The township had answered, averring, . among other things, that it had not received any money for the bonds, and that the relator was, not a bona fide holder, of them,, and had not paid value for them. The relator did. not request the submission, of
Objection is made, however, that the meetings were not properly called, in several particulars. We do not think it necessary to consider the defects urged by counsel in respect either of the meeting of June 28, 1871, or that of August 23, 1871, for the reason that we think the township is estopped, as against a bona fide purchaser, by the recitals in the bonds, by its payments of interest coupons, and by its retention of the money paid in good faith for the bonds, to set up any defects in the steps preliminary to the issue of the bonds.
There are other circumstances in this case, in addition to the recitals, which would 'support an estoppel. There are the receipt of the money, its use for the public purpose, and the payment of interest coupons for two years. Such circumstances, under the decision of the supreme court in the case of Supervisors v. Schenck, 5 Wall. 772-781, 18 L. Ed. 556, were held to estop the county from setting up the irregularity of the proceedings by which an election under the law authorizing the issue of bonds was held. See, also, State v. Trustees of Goshen Tp., 14 Ohio St. 569; State v. Van Horne, 7 Ohio St. 327; State v. Trustees of Union Tp., 8 Ohio St. 394.
But it is pressed upon the court that the plaintiff does not occupy the position of bona fide purchaser, because he became their owner after their maturity. It is conceded that the People’s Savings Bank purchased these bonds before their maturity, and paid full value for them, without knowledge of any defect in the proceedings resulting in their issue, but the contention is that one who acquires negotiable paper after its maturity from one who bought it in good faith before its maturity may not enjoy the same immunity from equitable and other defenses as his transferror. This contention cannot be sustained. The assignee of a bona fide purchaser before maturity takes the same rights as his assignor had, no matter when the assignment was made. No cases have been cited which sustain the position assumed by counsel. Reliance is had upon general language applicable only to a purchase after maturity from an original party to the contract, or from one who is not a bona fide purchaser, and has no rights as such. The exact question was before the court in Cromwell v. Sac Co., 96 U. S. 58, 24 L. Ed. 681. See, also, Scotland Co. v. Hill, 132 U. S. 116, 117, 10 Sup. Ct. 26, 33 L. Ed. 261; Wood v. Starling, 48 Mich. 592, 12 N. W. 866. The plaintiff, by bis counsel, produced the bonds, and thus arose the presumption that he was their owner. Dawson Town & Gas Co. v. Woodhull, 14 C. C. A. 464, 67 Fed. 451; Brigham v. Gurney, 1 Mich. 351. No evidence was introduced to show the contrary. The evidence conclusively showed that a prior owner had been a bona fide pui*chaser for value. The plaintiff, in becoming the owner of the bonds, acquired the benefit of the title of the intermediate bona fide purchaser, and it is immaterial how the title came to him, — whether by gift or otherwise.
These views lead to a reversal of the judgment for the township. The ease should have been submitted to a jury on the issue whether