Board of Education of City of Huron, S.D. v. National Life Ins. Co. of Montpelier, Vt., 1,118

• Decision Date: 03 April 1899
• Docket Number: 1,119,,1,118,1,132.
• Citation: 94 F. 324
• Parties: BOARD OF EDUCATION OF CITY OF HURON, S.D., v. NATIONAL LIFE INS. CO. OF MONTPELIER, VT. SAME v. PEASLEE. SAME v. MONADNOCK SAV. BANK OF EAST JAFFREY, N.H.
• Court: U.S. Court of Appeals — Eighth Circuit

94 F. 324

BOARD OF EDUCATION OF CITY OF HURON, S.D., v. NATIONAL LIFE INS. CO. OF MONTPELIER, VT. SAME v. PEASLEE. SAME v. MONADNOCK SAV. BANK OF EAST JAFFREY, N.H.

Nos. 1,118, 1,119,, 1,132.

United States Court of Appeals, Eighth Circuit.

April 3, 1899

John L Pyle (Henry C. Hinckley and H. S. Mouser, on brief), for plaintiff in error.

A. B Kittredge (N. T. Guernsey, on brief in case No. 1,118), for defendants in error.

Before CALDWELL, SANBORN, and THAYER, Circuit Judges.

THAYER Circuit Judge.

These are suits which were brought separately by three different holders of coupons detached from municipal bonds which were issued by the board of education of the city of Huron, in the state of South Dakota, the plaintiff in error, hereafter termed the 'board of education.' The bonds from which the coupons were detached are of the same issue as those that were involved in the case of National Life Ins. Co. of Montpelier v. Board of Education of City of Huron (decided by this court at May term, 1894) 27 U.S.App. 244, 10 C.C.A. 637, and 62 F. 778 and for a full statement of the facts attending the issuance of the bonds, and the law under which the board of education acted, we refer to our statement and opinion in the former case. The National Life Insurance Company, Robert J. Peaslee, as assignee of the New Hampshire Trust Company, and the Monadnock Savings Bank of East Jaffrey, the defendants in error, who were the plaintiffs below in the respective cases, are confessedly bona fide holders of the coupons on account of which they respectively sue, having bought the bonds from which they were detached, in good faith, for value, and prior to maturity. To the complaints which were filed in the three cases the board of education filed answers, which were in substance the same, wherein it pleaded the same defenses, that were adjudged insufficient by this court in the former suit. Id. Demurrers to the several answers were interposed by the respective plaintiffs, which were sustained, and final judgments were thereupon entered in favor of the plaintiffs below.

It is unnecessary to discuss any of the questions which were considered and decided on the former occasion, and we shall refrain from doing so, as we have no doubt that the conclusions then announced were right, and as the facts pleaded in the present case in no wise change the point of view from which any of the questions formerly considered were decided. It is claimed however, on the present occasion, and the point must be regarded as new, that the board of education is not a separate and independent corporation, but a mere adjunct or department of the corporation known as the 'City of Huron,' and that in view of such fact all of the city indebtedness, as well as the indebtedness of the board of education, should be taken into account in determining whether the bonds in question, which aggregated altogether $60,000, being 120 bonds of the denomination of $500 each, when issued, increased the corporate indebtedness beyond the limit allowed by law. This contention we regard however, as untenable. The board of education appears to have been organized under and in accordance with chapter 47 of the laws of the then territory of Dakota for the year 1887. This act appears in the Compiled Laws of Dakota of 1887, the most material provisions being found in sections 1808, 1810-1818, 1820, and 1824 of the Compiled Laws. Without setting out these sections in haec verba, it will suffice to pay that section 1808 provided that all cities thereafter organized under the general law for the incorporation of cities, to which class the city of Huron belongs, should be governed by the provisions of the act; that section 1810 provided that territory outside of the boundaries of any organized city or town, but adjacent thereto, might be attached to the city or town for school purposes upon application to the board of education of such city by a majority of the electors of the adjacent territory; that section 1811 declared, in substance, that the organization effected in pursuance of the provisions of the act should be a 'body corporate,' and should possess the usual powers of a corporation for public purposes, under the name of the board of education of the city or town to which it appertained, and in that name might sue or be sued, and be capable of contracting and being contracted with, and of holding and conveying such real and personal estate as might come into its possession by will or otherwise, or that might be purchased under the provisions of the act. Section 1812 of the act provided, in substance, that the respective boards of education might require the city or town to which they appertained to convey to the board all school property within the limits of such city or town. Section 1814 provided, in substance, that the members of the board should be entitled to elect as many members of the board as it had members in the city council, but that no member of the board of education should be a member of the city council, and that no member of the board of education should be a trustee of a town or village to which the board to which he was elected appertained, and that each board of education should have power to fill any vacancy which might occur in its body. Sections 1816 and 1817 provided, in substance, that the board of education should have power to elect its own officers, except the treasurer, and to make its own rules and regulations, and that at a regular meeting of each board, to be held in May of each year, each board should organize by the election of a president and vice president from among its own members, who should hold office for one year until their successors were elected and qualified, and that each board should also elect a clerk, who should hold his office during the pleasure of the board. Section 1818 made it the duty of the president to preside at all meetings of the board, to appoint all committees, and to sign all warrants for money ordered by the board to be drawn upon the treasurer for school moneys. Section 1820 made it the duty of the clerk to keep an accurate journal of the proceedings of the board, to take charge of its books and documents, and countersign all warrants for money which were drawn on the treasurer by order of the board. Section 1824 empowered the board of education to levy a tax for the support of the schools of the corporation for the...