102 U.S. 294 (1880), City Of Louisiana v. Wood
|Citation:||102 U.S. 294, 26 L.Ed. 153|
|Party Name:||LOUISIANA v. WOOD.|
|Case Date:||November 29, 1880|
|Court:||United States Supreme Court|
ERROR to the Circuit Court of the United States for the Eastern District of Missouri.
Upon the facts found by the court below this case is as follows:----
The city of Louisiana, Missouri, had authority in law to borrow money, at any rate of interest not exceeding ten per cent per annum, and to provide for the payment of its debts. On the 8th of January, 1867, an ordinance was passed by the city council creating the office of 'city fund commissioner.' It was made the duty of this officer to sell the bonds of the city for the purpose of funding or paying the indebtedness of the city, and apply the proceeds to the purchase of outstanding warrants and bonds past due, or not having more than three years to run. By this ordinance he was limited in his sales to a price not less than ninety-five cents on the dollar of the par value of five-year bonds, and ninety cents for those running ten years. On the 1st of March, 1871, the fund commissioner reported to the city council that the bonded indebtedness of the city was about $150,000, bearing interest mostly at the rate of ten per cent per annum, and that about $100,000 would mature that year, and in the years 1872, 1873, 1874, and 1875. Upon this report an ordinance was passed authorizing the commissioner 'to negotiate the bonds of the city for purpose of raising money to liquidate the city debt, for a period not exceeding fifteen years, and at a rate of discount not exceeding fifteen per cent.'
On the 28th of March, 1872, the General Assembly of that State passed 'An Act to provide for the registration of bonds issued by counties, cities, and incorporated towns,' sects. 4 and 11 of which are as follows:----
'SECT. 4. Before any bond hereafter issued by any county, city, or incorporated town, for any purpose whatever, shall obtain validity or be negotiated, such bond shall first be presented to the State auditor, who shall register the same in a book or books provided for that purpose, in the same manner as the State bonds are now registered, and who shall certify by indorsement on such bond that all the conditions of the laws have been complied with in its issue, if that be the case; and, also, that the conditions of the contract under which they were ordered to be issued have also been complied with, and the evidence of that fact shall be filed and preserved by the auditor; but such certificate shall be prima facie evidence only of the facts therein stated, and shall not preclude or prohibit any person from showing or proving the contrary in any suit or proceeding to test or determine the validity of such bonds, or the power of any court, city or town council, or board of trustees or other authority, to issue such bonds; and the remedy of injunction shall also lie at the instance of any tax-payer of the respective county, city, or incorporated town, to prevent the registration of any bonds alleged to be illegally issued or founded under any of the provisions of this act.'
'SECT. 11. Any county, city, or town that desires to place its outstanding indebtedness, under the provisions of this act, may do so by funding the same, and issuing new bonds in lieu of the present ones, upon such terms and bearing such interest, with such length of time to run, as may be agreed upon between the county, city, or town and the holders of its bonds: Provided, however, that the contract for fundings, with the terms of the same, shall be assented to by a majority of the qualified voters of such county, city, or town, at a general or special election held therefor, and at least thirty days' public notice of the same shall be published in every paper in the county, city, or town, and when there are none, then by four printed handbills put up in the most public places in every voting precinct in such county, city, or town.'
Other sections make special provision for the assessment and collection of taxes to pay the principal and interest of all bonds registered in accordance with the act.
On the 16th of July, 1872, after this act went into effect, the city, for the purpose of raising money to pay its interest-bearing debts and the expenses of its government, caused to be executed by its proper officers, and sealed with its corporate seal, twenty-one bonds, payable to...
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