Bates Co Missouri v. Winters

• Citation: 5 S.Ct. 157,28 L.Ed. 744,112 U.S. 325
• Parties: BATES CO., MISSOURI, v. WINTERS and another
• Decision Date: 24 November 1884
• Court: United States Supreme Court

112 U.S. 325

5 S.Ct. 157

28 L.Ed. 744

BATES CO., MISSOURI, v. WINTERS and another.

November 24, 1884.

G. G. Vest and John R. Shepley, for plaintiff in error.

T. K. Skinker and J. B. Henderson, for defendants in error.

WAITE, C. J.

This case was before this court at the October term, 1877, and is reported as County of Bates v. Winters, 97 U. S. 83. It came up then on a special finding of facts, and the judgment below was reversed because it did not appear that the county court had actually subscribed to the capital stock of the Lexington, Chillicothe & Gulf Railroad Company before the consolidation. Instead, however, of directing a judgment to be entered in favor of the county on those findings, as would have been the proper practice in the absence of any showing to the contrary, (City of Fort Scott v. Hickman, ante, 56,) a new trial, 'according to the views expressed in the opinion,' was ordered. We must presume that this was done for sufficient reasons. In the findings then presented the order of the county court for the subscription, and the appointment of Betz to make the subscription on the books of the company, are set forth substantially as in those which are now before us. The same is true of what was done by Betz, at the meeting of the directors of the company, when he presented the copy of the record of the proceedings of the county court, and the directors refused to allow him to withdraw his papers. His presence at the latter meeting was also stated, as well as his final report to the county court, and the action of the court thereon. The ground of the reversal is apparent from the following extract from the opinion of the court, (page 90,) which was delivered by Mr. Justice HUNT: 'The county court did not intend their action, in June, 1870, to be final, and did not understand that a subscription was thereby completed. Their vote was a declaration that the power to subscribe should be exercised, and was an authority to their agent to perfect a contract with the railroad company on the conditions set forth. No acceptance was made by the railroad company, no notice of acceptance was given, nor was there any act or fact which afforded a pretext for saying that the railroad company was bound by the contract of subscription. While it refused to allow the agent to withdraw his evidence of authority, it said nothing and did nothing to indicate that the minds of the parties had met upon the terms of a subscription. The county court was precise and particular in requiring those conditions to be copied in full on the books of the company, as the conditions on which the subscriptions were made; and there could be no mutual contract until the railroad company assented, on its part, to those conditions.'

In considering what was necessary to complete a valid subscription, the cases of Nugent v. Supervisors, 19 Wall. 241, and County of Moultrie v. Savings Bank, 92 U. S. 631, were cited, and the rule upon that subject, as recognized in those cases, was in all respects approved. That rule may be stated thus: An actual manual subscription on the books of a railroad company is not indispensably necessary to bind a municipality as a subscriber to the capital stock. If the body or agency having authority to make such a subscription passes an ordinance or resolution to the effect that it does thereby, in the name and on behalf of the municipality, subscribe a specified amount of stock, and presents a copy of that ordinance or resolution to the company for acceptance as a subscription, and the company does, in fact, accept, and notifies the municipality, or its proper agent, to that effect, the contract of subscription is complete, and binds the parties according to its terms. From the findings in this case on the new trial it appears that the county court passed an order 'that the sum of ninety thousand dollars be, and the same is hereby, subscribed to the capital stock of the Lexington, Chillicothe & Gulf Railroad Company in the name and in behalf of Mount Pleasant township, * * * subject to and in pursuance of all the terms, restrictions, conditions, and limitations of the petition of the tax-pay- ers and residents;' and it at the same time authorized and directed Betz, who was the agent of the county to represent its interests in the company, to make the subscription on the stockbooks of the company, and in making the subscription to have copied in full the orders of the court of the fifth of April, 1870, as the conditions on which the same was made. As was very properly...