County of Clay v. Society for Savings

104 U.S. 579 (____)

COUNTY OF CLAY
v.
SOCIETY FOR SAVINGS.

Supreme Court of United States.

Mr. W.J. Henry for the plaintiff in error.

Mr. David T. Littler for the defendant in error.

MR. JUSTICE WOODS, after stating the facts, delivered the opinion of the court.

Two classes of bonds are sued on, namely, the subscription bonds and the donation bonds. The defences set up against each class will be separately considered.

The findings of the court and the sections of the act of 1849, recited in the preceding statement of facts, furnish ample ground for the judgment in favor of the defendant in error upon the subscription bonds held by it.

The plaintiff in error, however, insists that there is no evidence or finding that the thirty days' notice of the election required by the statute had been given, or that a majority of the legal voters, taking as a standard the number of votes thrown at the last general election for county officers, voted in favor of the proposition to subscribe stock and issue the bonds of the county to pay for it.

There are three conclusive answers to this contention.

First, the bonds recite that they were issued under and pursuant to the orders of the board of supervisors of Clay County, as authorized by virtue of the laws of the State of Illinois. The act of Nov. 6, 1849, authorized the judges of the county court to issue the bonds only in case a majority of the voters of the county, taking as a standard the number of votes thrown at the next preceding general election, should vote in favor of the proposition to subscribe to the stock of some designated railroad company, and pay for it by the issue of county bonds. The ultimate decision of the question whether such a vote had been cast was, therefore, left with the judges of the county court. The recital of the bonds, that they were issued pursuant to the orders of the board, the successor of the county court, as authorized by virtue of the laws of the State of Illinois, is equivalent to a declaration by the board, upon the face of the bond, that the election had been held and had resulted so as to authorize the lawful issuing of the bonds. When the bonds are in the hands of a bona fide holder this recital is conclusive and binding upon the municipality. Town of Coloma v. Eaves, 92 U.S. 484; Marcy v. Township of Oswego, id. 637.

The second answer is, that if the county had, under the law, authority to issue bonds, and did issue them, and they went into circulation and came to the hands of a bona fide holder, he was not, in a suit upon them, required to aver or prove the performance of any of the requisites necessary to give them validity. The want of such performance is a matter of defence, and the burden of proof is upon the county to establish it. Lincoln v. Iron Company, 103 U.S. 412. In this case the county offered no evidence in any degree tending to show that the conditions precedent upon the performance of which the issue was authorized had not been complied with. It cannot, therefore, assume that the conditions were not performed, and insist on non-performance as a defence.

The third answer is, that sect. 12 of the act of Feb. 24, 1869, amendatory of the act to incorporate the Illinois Southeastern Railway Company, which was indorsed on the bonds, expressly provided that when payment to the capital stock of the company should be made in the bonds of counties or townships, under any act authorizing such subscription, all such bonds issued by the proper authorities and appearing regular on their face should, in the hands of a bona fide holder, be deemed and taken in all courts, and elsewhere, as prima facie evidence of the regularity of everything required by the several acts in relation to the issuing of said bonds, or by any other act to be done preliminary to their issue and negotiation.

As no proof has been submitted of any irregularity in the issuing of the bonds, this section of the law is conclusive against the existence of any.

It is next insisted by plaintiff in error that the general statute of Nov. 6, 1849, so far as it concerned the Illinois Southeastern Railway Company, was repealed by sect. 7 of the act to incorporate that company. That section authorized the county court of any county, or the board of supervisors (when the county had adopted township organization), to donate to said company, as a bonus or inducement towards the building of said railroad or its branches, any sum not exceeding $100,000, and to issue to the company its bonds in satisfaction of said donation; provided, that no donation of a greater sum than $50,000 should be made until the question of such larger donation should have been submitted to the vote of the legal voters of the county, and a majority thereof should have voted in favor of such donation. The contention is that it was not the purpose of the legislature in these enactments to permit a county to purchase or subscribe to the capital stock of a railroad company and also make a donation to the same company.

There is not a word in the charter of the Illinois Southeastern Railway Company which expressly excludes it from the benefits of the general railroad subscription law of Nov. 6, 1849. Nor is there the slightest repugnancy between the provisions of the two acts. The latter, being a general law, authorized any city or county in the State to purchase or subscribe to the capital stock of any railroad company anywhere in the State; the former, being an act to incorporate a private corporation, authorized any county through which the railroad of the company or any of its branches might pass, to make a donation to the company as a bonus or inducement towards the building of the railroad or its branches. There is no ground whatever for the contention that the general law was repealed or modified, in any respect, by the act incorporating the Illinois Southeastern Railway Company. There is no repugnancy or inconsistency between them. A statute can be repealed only by an express provision of a subsequent law or by necessary implication. To repeal a statute by implication, there must be such a positive repugnancy between the provisions of the new law and the old that they cannot stand together or be consistently reconciled. McCool v. Smith, 1 Black, 459; Wood v. United States, 16 Pet. 342.

We are of opinion, therefore, that the act incorporating the Illinois Southeastern Railway Company does not repeal or modify the general law of Nov. 6, 1849.

The plaintiff in error further insists that sect. 10 of an act approved Feb. 24, 1869, amendatory of the charter of the Illinois Southeastern Railway Company, had the effect to repeal, not only sect. 7 of the charter of the company, but also the general law of Nov. 6, 1849, so far as it concerned the company.

This section provides "that any village, city, county, or township along or near the route of said railway or its branches, or that are in anywise interested therein, may, in their corporate capacity, subscribe to the stock of said company, or make donations to said company to aid in constructing and equipping said railway," provided the same shall be voted for at an election called by the clerk of the village, city, county, or township, upon the written request of twenty legal voters thereof, and upon thirty days' notice.

Conceding that this section is a substitute for sect. 7 of the original charter, it cannot be held to repeal the general law, for the reasons already stated in reference to sect. 7 of the original charter; namely, that there is no direct appeal, and there is no repugnancy between the two acts which would make a repeal by implication.

The subscription bonds sued on were, according to the findings of the court, issued in substantial conformity, not only with the general act of Nov. 6, 1849, but also with the amendatory act of 1869, so that, conceding that the latter act is applicable to the issuing of the bonds in question, they are valid in the hands of a bona fide holder. When these bonds were issued there was ample authority for their issue under the laws of the State of Illinois. The recital that they were issued in conformity with the laws of the State, as already shown, is binding on the county, when the suit is brought on the bonds by a bona fide holder, and concludes the county from setting up any irregularities in their issue, if any existed. We are of opinion, therefore, that the suit upon the subscription bonds was well maintained.

The objections to the bonds known and designated as donation bonds have nothing substantial in them. The bonds refer on their face to the laws which authorized their issue, and recite that they were issued in pursuance of authority granted thereby. They carry an indorsement made by the clerk of the county court, by its order and under its seal, that all the conditions upon which they were to become a binding obligation of the county have been complied with, and printed on every one of them is a copy of sect. 12 of the act of Feb. 24, 1869, amendatory of the charter of the company, which makes the fact of the negotiation of them in payment of a donation to it prima facie evidence of the regularity of their issue when in the hands of a bona fide holder. There is no proof or offer of proof that they were not issued in conformity with the requirements of law.

The plaintiff in error argues, however, as conclusive against their validity, that they were not issued until after Aug. 8, 1870, the date upon which the present Constitution of Illinois went into effect, which by the second additional section declared that no municipal corporation should ever make donation to any railroad or private corporation.

The findings of the court show that the people of Clay County, on April 22, 1868, voted in favor of a proposition to donate $50,000 to the Illinois Southeastern Railway Company, provided the railroad of said company should be located on a certain line specifically described, and provided the bonds issued in payment of such donation should not be payable until the railway had been completed the whole length of the line, from Shawneetown, on the Ohio River, to the Chicago Branch of the Illinois Central Railroad, and the cars running thereon; that on the first Monday of November, 1868, the board of supervisors of the county, by resolution duly passed, directed its president to make the donation aforesaid upon the books of the railway company, in accordance with the condition of said vote, and that before the first day of November, 1869, the railway company had located its line of road, as required by the conditions upon which the donation was to be made, and had "graded, bridged, and tied ten miles thereof."

We think it may be fairly deduced from the findings of the court below that, on Nov. 1, 1869, the president of the board of supervisors subscribed upon the books of the railway company as directed by the board of supervisors the donation of $50,000, which the county had voted, and the brief of counsel for plaintiff in error distinctly admits that such is the proper construction of the findings.

These transactions made a contract between the county and the railway company to the effect that in consideration that the railway company should construct its road upon the line designated, and complete it and have the cars running thereon between the points mentioned, the county would deliver its bonds to the railway company in satisfaction of its donation. This contract had been partly performed by the railway company before the Constitution of 1870 went into effect. The adoption of the Constitution could not annul or impair it. The county was bound notwithstanding the provision of the Constitution of 1870. Town of Concord v. Savings Bank, 92 U.S. 625.

And when, as appears by the findings of the court, the railway company had, on Jan. 1, 1871, fully completed its road according to the terms upon which the donation was to be made, it was entitled in law under its contract to the bonds of the county in satisfaction of the donation.

There was, therefore, authority to issue these bonds upon the conditions prescribed. The court found that the defendant in error was a bona fide holder, and that the railroad company had complied with all the conditions upon which the bonds were to be issued to it. Upon this state of facts the attempt of the plaintiff in error to avoid its liability upon these bonds seems a hopeless undertaking.

Other defences are set up against a recovery in this case. Plaintiff in error alleges that the authority to donate $50,000 to the railway company was expressly conferred upon the board of supervisors without any vote or precedent condition whatever, and the authority being conferred upon the board could not be by it "delegated to the people to be voted upon at a popular election." It further alleges that the bonds are not negotiable, and it insists that the authority of the board of supervisors, under the original charter of the railway company, to make the donation, was repealed by the amendatory act of Feb. 24, 1869.

These defences do not in our judgment merit reply.

The plaintiff in error has received in consideration for the issue of each series of bonds everything for which it bargained. They were regularly issued, and have been registered under the Statute of Illinois with the auditor of public accounts, upon the strength of a certificate under oath made by a supervisor of the county pursuant to law, to the effect that all the preliminary conditions to the issue of the bonds required by law had been complied with. The record shows that taxes had been levied to pay interest, and that interest had been paid on the subscription bonds for eleven years, and on the donation bonds for nine years. This fact would of itself cure mere irregularities in the issuing of the bonds when they were sued on by a bona fide holder for value. Supervisors v. Schenck, 5 Wall. 772. Under these circumstances, when a suit is brought on them by such a holder, as found to be the case here, some substantial defence must be set up by the county before it can escape its liability. Such defences as are relied on in this case will not avail.

Judgment affirmed.