Rees v. City of Watertown

• Decision Date: 01 October 1873
• Citation: 86 U.S. 107,22 L.Ed. 72,19 Wall. 107
• Parties: REES v. CITY OF WATERTOWN
• Court: U.S. Supreme Court

86 U.S. 107

22 L.Ed. 72

19 Wall. 107

REES v. CITY OF WATERTOWN.

October Term, 1873

APPEAL from the Circuit Court for the Western District of Wisconsin; the case being thus:

Rees, a citizen of Illinois, being owner of certain bonds issued under authority of an act of the legislature of the State of Wisconsin, by the city of Watertown, in that State, to the Watertown and Madison Railroad Company, and by the company sold for its benefit, brought suit in the Circuit Court of the United States for the District of Wisconsin, against the city, and, in 1867, recovered two judgments for about $10,000.

In the summer of 1868 he issued executions upon the two judgments thus obtained, which were returned wholly unsatisfied.

In November of the same year he procured from the United States Circuit Court a peremptory writ of mandamus, directing the city of Watertown to levy and collect a tax upon the taxable property of the city, to pay the said judgments; but before the writ could be served, a majority of the members of the city council resigned their offices. This fact was returned by the marshal, and proceedings upon the mandamus thereupon ceased.

In May, 1869, another board of aldermen having been elected, Rees procured another writ of mandamus to be issued, which writ was served on all of the aldermen except one Holger, who was sick at the time of the service upon the others. No steps were taken to compely with the requisition of the writ. An order to show cause why the aldermen should not be punished for contempt, in not complying with its requirements, was obtained, and before its return day six of the aldermen resigned their offices, leaving in office but one more than a quorum, of whom the said Holger, upon whom the writ had not been served, was one. Various proceedings were had and various excuses made, the whole resulting in an order that the aldermen should at once levy and collect the tax; but before the order could be served on Holger, he resigned his office, and again the board was left without a quorum. Nothing was accomplished by their effort in aid of the plaintiff, but fines were imposed upon the recusant aldermen, which were ordered to be applied in discharge of the costs of the proceedings.

In October, 1870, the plaintiff obtained a third writ of mandamus, which resulted as the former ones had done, and by the same means, on the part of the officers of the city. A special election was ordered to be held to fill the vacancies of the aldermen so resigning, but no votes were cast, except three in one ward, and the person for whom they were cast refused to qualify. The general truth of these facts was not denied. No part of the debt was ever paid.

In this state of things, the district of Wisconsin having been divided into an eastern and a western district, and the city of Watertown being in the latter, Rees brought suit in the latter district on his judgments obtained in the general district before the division, and got a new judgment upon them for $11,066.

He now filed a bill in the said western district, setting forth the above facts, the general truth of which was not denied; that the debt due to him had never been paid, and that, with an accumulation of fourteen years' interest, the same remained unpaid, and that all his efforts to obtain satisfaction of his judgments had failed. All this was equally undenied.

The bill set forth also certain acts of the legislature of Wisconsin, which, it was alleged, were intended to aid the defendant in evading the payment of its debts, and which, it seemed sufficiently plain, had had that effect, whatever might have been the intent of the legislature passing them.

The bill alleging that the corporate authorities were trustees for the benefit of the creditors of the city, and that the property of the citizens was a trust fund for the payment of its debts, and that it was the duty of the court to lay hold of such property and cause it to be justly applied, now prayed that the court would subject the taxable property of the city to the payment of the judgments. It asked specifically that a decree might be made, subjecting the taxable property of the citizens to the payment of the complainant's judgments, and that the marshal of the district might be empowered to seize and sell so much of it as might be necessary, and to pay over to him the proceeds of such sale.

The answer (or the argument made in the brief upon it) set up, among other things, 'that the city of Watertown contained a population of but 7553 inhabitants; that the value of its property was assessed at but little over a million of dollars; that the debt of the city is $750,000; that it was impossible for the city to pay this debt; that it was expected and provided that the railroad company would pay the bonds in question; that the city had compromised and settled a portion of its debt; that it had levied the taxes necessary to effect such compromise; and that it was ready to compromise all outstanding bonds and judgments at as high a rate as can be collected of the people of Watertown; that there was no law to compel the retention of the office by aldermen to levy taxes; that the plaintiff took his chance of its being voluntarily done, and that not being voluntarily done there was no violation of law.'

By the charter of the city of Watertown¹ it was thus enacted:

'Nor shall any real or personal property of any inhabitant of said city, or any individual or corporation, be levied upon or sold by virtue of any execution issued to satisfy or collect any debt, obligation, or contract of said city.'

The case was tried in June, 1872, before two judges, holding the Circuit Court, upon these questions:

'1. Whether, when the principal and interest on the bonds were unpaid, as well as the judgment, and there being no property on which to levy an execution, the plaintiff was confined to a remedy at law by mandamus or otherwise, to enforce the payment of his judgment recovered in this court.

'2. Whether it was competent for the court, as a court of equity, on the failure of the officers of the city of Watertown to levy the tax as required by law, referred to in the bill, through their neglect, refusal, absence, or resignation, to appoint the marshal of the court to levy and collect the tax to pay the judgment.

'3. Whether it was competent for the court, as a court of equity, to subject the taxable property situate within the corporate limits of the city of Watertown, in any way, to an assessment in order to pay the judgment of this court referred to in the bill of complaint.'

The judges were divided in opinion upon them and the bill was dismissed.

The case was now here on certificate of division and appeal, the error assigned being that the court dismissed the bill, when it ought to have given the relief prayed for.

Messrs. H. W. and D. W. Tenney (with whom was Mr. S. U. Pinney), for the creditor appellant:

The theory of the bill is that the complainant having established a clear legal right at law, and having demonstrated that he has no remedy there, it is the duty of a court of equity to devise and enforce an effectual remedy. This must be done through its own officers, because there are no others in existence capable of doing it.

The opposite theory is that the court can only command existing city officers to execute existing State tax laws, and if there are no such officers, the end of judicial power is reached.

We assert the right of the Federal court to take possession of a city, and sell it in its own way, without regard to State laws of State officers. And on the other side, the position is that the Federal court is powerless in this case to execute its judgments, except through instrumentalities provided by another sovereign; and that, these being withdrawn, the city may safely and effectually repudiate its debt.

That we have established a clear legal right will be admitted. Equally admitted will it be that, in good faith, through several years, we have tried with diligence, but in vain, every resource of the law, and that now and for a long time past there are no officers in existence capable of executing the command of the court to levy a tax, and that the city has no property subject to execution. What is our remedy at law, if we have one? Any further attempt at law would not only be fruitless to us, but would bring the court of law which sought to give it into ridicule.

Then comes the important question whether, all legal remedies failing, the court of chancery can give us a remedy? This involves the original and ultimate powers of the court. Story says:²

'Perhaps the most general, if not the most precise description of a court of equity, in the English and American sense, is, that it has jurisdiction in cases of rights recognized and protected by the municipal jurisprudence, where a plain, adequate, and complete remedy cannot be had in the courts of common law.'

Now, a proceeding at law, which, after having been tried and retried, once, twice, and again, is found to be wholly worthless, cannot be called 'an adequate and complete remedy.'

Looking through the specific enumeration of the cases in which equity acts, we find nothing substantially limiting the broad statement made by Story, or taking our case out of it. The very ground of the jurisdiction of equity is that there is a legal right and no legal remedy, and by necessity the jurisdiction must be coextensive with the reason. Finding that the general words and the reason of the law cover our case, and finding no limitation thereon, we may stop and ask our opponents to show where any limitation has been made, and why it should be made, to prevent the court from giving us redress in this case, as it does in others upon the same reason. Here is legal right and no legal remedy. If that ever gives jurisdiction, why not in this case? If the court generally takes jurisdiction on that ground, what is there to make this an...