County of Callaway v. Foster
| Decision Date | 01 October 1876 |
| Citation | 93 U.S. 567,23 L.Ed. 911 |
| Parties | COUNTY OF CALLAWAY v. FOSTER |
| Court | U.S. Supreme Court |
Argued by Mr. William M. Evarts for the plaintiff in error, and by Mr. J. D. Stevenson for the defendant in error.
This is one of the bond cases of which so many have been brought before this court within the last few years. The county of Callaway, in the State of Missouri, subscribed to the stock of a railroad to be built through the county, and issued its bonds to raise the money to make payment therefor. The road has been built, is in full operation upon the route selected by the county, and the county holds its stock.
The county court making the subscription paid the interest for two years upon the bonds, and a portion of the principal. Another county court has since been elected, which refuses to pay either principal or interest.
The plaintiff below, a citizen of the State of Kentucky, paid his money for a portion of these bonds, and brings the present suit to recover the amount. The court adjudged that the bonds must be paid. The county appeals to this court.
The bonds were issued under the act of the general assembly of Missouri, entitled 'An Act to incorporate the Louisiana and Missouri River Railroad Company, approved March 10, 1859' (see Acts Mo. 1858, p. 406), as amended by an act approved March 24, 1868 (Acts Mo. 1868, p. 97).
Sect. 29 provided that 'it shall be lawful for the county court of any county in which any part of the route of said railroad may be to subscribe to the stock of said company, and issue bonds of such county to raise funds to pay the stock thus subscribed.'
Sect. 22 of the amendatory act of March 24, 1868, is as follows:
On the 16th of January, 1868, the county court of Callaway County authorized a subscription of $500,000 to the capital stock of the said railroad company.
The record shows that on the same day,—to wit, on the sixteenth day of January, 1868,—Harris, the authorized agent, subscribed for the stock, and received the certificates therefor.
The following is a copy of one of the bonds issued by the county, with coupon attached, to raise the money to pay such subscription, and which is now held by the plaintiff below:——
'No. ___.] STATE OF MISSOURI. [$100.
'CALLAWAY COUNTY RAILROAD BOND.
'On the first day of January, A.D. 1873, the county of Callaway promises to pay to the Louisiana and Missouri River Railroad Company, or bearer, the sum of $100, to bear interest from date, at the rate of nine per cent per annum, payable semi-annually on the first day of January and July in each year, as per coupons attached hereto, and after maturity to bear the same rate of interest until paid, said principal sum and interest being payable at the Missouri Bond and Stock Board of St. Louis, in the City of St. Louis, Mo. This bond is issued by Callaway County, by authority of the act of the general assembly of the State of Missouri, approved March 10, 1859, as amended by an act approved March 24, 1868.
'Witness my hand, with the seal of said county affixed, this first day of January, 1869.
'[L. S.] GEO. BARTLEY,
'Presiding Justice of Callaway County Court.
'On the first day of January, 1873, Callaway County will pay to the bearer the sum of $4.50 at the Missouri Bond and Stock Board of St. Louis, Mo., interest on Railroad Bond No.___.
'GEO. BARTLEY,
'Presiding Justice of Callaway County Court.
W. H. BAILEY,
'Clerk of Callaway County Court.'
If this subscription was made by virtue of the act of March 10, 1859, before referred to, it is not contended that the bonds are invalid. This is understood to be conceded in the second point made in the brief of the plaintiff in error.
On the other hand, if the subscription depends solely for its validity upon the act of March 24, 1868, it is contended that the subscription was without the authority of law, and that the bonds issued in its fulfilment are void.
The distinction is this: On the 8th of March, 1859, a county might legally be empowered by the legislature of Missouri to make a subscription to railroad stock upon its own motion, and to issue bonds in fulfilment of the obligation. Before the 24th of March, 1868,—to wit, in July, 1865,—a constitutional provision was adopted, in these words: 'The general assembly shall not authorize any county, city, or town to become a stockholder in, or to loan its credit to, any company, association, or corporation, unless two-thirds of the qualified voters of such county, city, or town, at a regular or special election to be held therein, shall assent thereto.'
It is not pretended that the assent of the voters of Callaway County to the subscription in question was given.
The fact upon this branch of the case are, that the subscription to the railroad stock was authorized by the county court, and actually made by their agent before the act of March, 1868, was passed; that the certificates of stock in said company were issued to and received by the county at the time of making such subscription, but that the bonds of the county in question were not issued until a date after the passage of the latter act, to wit, in January, 1869,—and that the original charter was in several particulars altered by the amending act of 1868.
1. It has been held in many cases by the Supreme Court of Missouri, that the provision of the constitution of 1865, prohibiting loans or subscriptions for stock, except with the assent of the electors, in prospective, not retroactive; that the charter of a company which is in existence before the adoption of the constitutional provision is not affected by it, but the powers given by it remain as if no such constitution existed. State v. Macon County Court, 41 Mo. 453; Smith v. County, 9 Clark, 54 id. 58. Although put into execution by making the subscription or issuing the bonds after the adoption of the constitution, the power remains valid.
2. The constitution of 1865 contains, in connection with the provision already quoted, the following: 'All statute laws of the State now in force, not inconsistent with the constitution, shall continue in force until they shall expire by their own limitations, or be amended or repealed by the general assembly.' In State of Missouri v. Cape Girardeau & State Line Railroad, 48 Mo. 468, it was held, that the constitutional provision prohibiting special enactments did not extend to amendments of laws in force when it was adopted, but that additional power given to the Cape Girardeau Railroad, by the means of an amendment to its charter, was a lawful exercise of authority. The cases before cited show that the act we are considering is not inconsistent with the constitution, as it continued in force after its adoption as before.
It is difficult to discover any principle which can distinguish an amendment to the charter of the Louisiana and Missouri River Railroad Company, altering its terms and conditions within its original limits, and of the general nature and scope of its original charter, from the Cape Girardeau case. The case of State v. Saline Co., 51 Mo. 350, does not conflict with this principle.
3. The act of March, 1868, referred to in the Callaway County bonds, in connection with the act of March 10, 1859, was an amendment of the latter act.
It expressly declares itself to be an amendment of the first act. Its title is, 'An Act to amend an act entitled an act to incorporate the Louisiana and Missouri Railroad Company, by increasing the amount of the capital stock of the said company, defining more explicitly the power of the board of directors to fix the western terminus of said road, authorizing the location and construction of a branch road, and conferring upon said board the necessary powers to carry into effect the several objects contemplated by their charter, and also by striking out sects. 11, 18, 30, and 31 of said act.' Laws of Mo. 1868, p. 103.
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