Hawley v. United States Fairbanks

• Decision Date: 07 May 1883
• Citation: 108 U.S. 543,2 S.Ct. 846,27 L.Ed. 820
• Parties: HAWLEY, County Clerk, etc., v. UNITED STATES ex rel. FAIRBANKS and others
• Court: U.S. Supreme Court

108 U.S. 543

2 S.Ct. 846

27 L.Ed. 820

HAWLEY, County Clerk, etc., v. UNITED STATES ex rel. FAIRBANKS and others.

May 7, 1883.

J. K. Edsall and John B. Hawley, for plaintiff in error.

Thos. S. McClelland, for defendant in error.

WAITE, C. J.

On the fifth of April, 1872, the town of Amboy, Lee county, Illinois, issued a series of bonds in payment of a subscription voted by the voters of the town to the capital stock of the Chicago & Rock River Railroad Company. Both the subscription and bonds were authorized by the charter of the railroad company, approved March 24, 1869.

Sections 12 and 13 of this charter, which alone need be considered, are as follows:

'Sec. 12. It shall be the duty of the clerk of any such city, town, or township, in which a vote shall be given in favor of subscription, within 10 days thereafter, to transmit to the county clerk of their counties a transcript or statement of the vote given, and the amount so voted to be subscribed, and the rate of interest to be paid: provided, that when elections shall be held and bonds issued, as aforesaid, it shall be the duty of the clerk of such town or township to file with the county clerk of their respective counties, within 10 days after the issuing of said bonds, certificates of the amount of bonds issued, and the rate of interest payable thereon, and number of each bond.'

'Sec. 13. It shall be the duty of the county clerk of said county, annually, after the execution and delivering of such bonds aforesaid, to compute and assess upon all the taxable property returned by the assessor of such city, town, or township, a sum sufficient to pay the interest and costs of collection and disbursements upon all bonds so issued by the respective cities, towns, or townships; which tax shall be extended upon the collector's books as other taxes are, and, when collected, shall be paid to the treasurer of the county; and such city, town, or township shall, when providing for the levying and collecting of other taxes, also assess upon the property of such city, town, or township any rate not exceeding 3 per cent. in any one year upon the assessment, to provide a fund for the redemption of the principal and interest of such bonds as or when they become due—said taxes to be levied and collected as other taxes are; but no tax shall be computed, assessed, or collected, or any interest paid, to be applied upon said bonds, unless such bonds have been executed and delivered.'

By an act of the general assembly of Illinois 'to fund and provide for paying the railroad debts of counties, townships, cities, and towns,' passed and in force April 16, 1869, the holders of that class of securities were authorized to register them in the office of the auditor of public accounts of the state. Sections 4 and 5 of that act are as follows:

'Sec. 4. When the bonds of any county, township, city, or town shall be so registered, the state auditor shall annually ascertain the amount of interest for the current year due and accrued and to accrue upon such bonds, and from the amount so ascertained he shall deduct the amount in the state treasury placed to the credit of such county, township, city or town, as herein provided and directed; and from the basis of the certificate of valuation of property heretofore provided to be transmitted to him, or, in case no such certificate shall be filed in his office, then, upon the basis of the total assessment of such county, township, city, or town for the year next preceding, he shall estimate and determine the rate per centum on the valuation of property within such county, township, city, or town requisite to meet and satisfy the amount of interest unprovided for, together with the ordinary cost to the state of collection and disbursement of the same, to be estimated by the auditor and treasurer, and shall make and transmit to the county clerk of such county, or to the proper officer or authority whose duty it is or shall be to prepare the estimates and books for the collection of state taxes in such county, township, city, or town, a certificate stating such estimated requisite per centum for such purpose, to be filed in his office, and the same per centum shall thereupon be deemed added to and a part of the per centum which is or may be levied or provided by law for purposes of state revenue, and shall be so treated by such clerk, officer, or authority in making such estimates and books for the collection of taxes; and the said tax shall be collected with the state revenue, and all laws relating to the state revenue shall apply thereto, except as herein otherwise provided.

'Sec. 5. The state shall be deemed the custodian only of the several taxes so collected and credited to such county, township, city, or town, and shall not be deemed in any manner liable on account of any such bonds; but the tax and fund so collected shall be deemed pledged and appropriated to the payment of the interest and principal of the registered bonds herein provided for, until fully satisfied.'

When the bonds of the town of Amboy were issued, the town clerk did not transmit to the county clerk the statement required by section 12 of the charter of the railroad company, but the president of the company caused them to be registered in the office of the auditor of public accounts in accordance with the provisions of the act of 1869. During the years 1872 and 1873 the auditor made the proper certificate under the registry law for the taxes to meet the interest for those years, and the taxes were extended by the county clerk in due form on the tax-collector's books, but before the collections were made certain tax-payers of the town obtained from the circuit court of Lee county an injunction against the county clerk, the county collector, and the town collector, restraining them from col- lecting the taxes that had already been assessed, and also restraining the same parties and the auditor of public accounts of the state from taking any steps for the levy or collection of any other taxes to pay either the principal or the interest of the bonds.

After this injunction was obtained, the relators, Fairbanks, Skinner, Thomas, and Wetmore, being severally holders and owners of certain of the bonds and coupons of the town, began separate suits against the town in the circuit court of the United States for the northern district of Illinois, to recover the amounts due them, respectively, on their coupons. These suits resulted in a judgment on the thirteenth of March, 1878, in favor of Fairbanks, for $2,449 damages and $36.12 costs; another, on the twenty-fourth of January, 1878, in favor of Skinner, for $2,018.50 damages and $47.10 costs; another, on the twenty-ninth of November, 1875, in favor of Thomas, for $866 damages and $43.90 costs; and two others in favor of Wetmore,—one on the seventeenth of December, 1875, for $3,836.14 and $50.40 costs, and the other, on the twentieth of June, 1876, for $1,058.33 damages and $31.50 costs.

These several judgments remain unpaid, and have all been duly audited and allowed by the auditing board of the town; but the town clerk, whose duty it is to certify to the county clerk, on or before the second Tuesday in August in each year, the amount of taxes to be levied and collected to pay the charges against the town for the current year, refused to certify the judgments, and kept himself concealed so as to avoid the process of the courts. The several plaintif...