Hayes v. Holly Springs

• Decision Date: 30 March 1885
• Citation: 29 L.Ed. 81,114 U.S. 120,5 S.Ct. 785
• Parties: HAYES v. Mayor and Aldermen of the City of HOLLY SPRINGS
• Court: U.S. Supreme Court

114 U.S. 120

5 S.Ct. 785

29 L.Ed. 81

HAYES v. Mayor and Aldermen of the City of HOLLY SPRINGS.

March 30, 1885.

H. T. Ellett, for plaintiff in error.

W. S. Featherston and Ed. M. Watson, for defendants in error.

BLATCHFORD, J.

This is a suit at law brought by J. Addison Hayes, in the district court of the United States for the Northern district of Mississippi, against the mayor and aldermen of the city of Holly Springs, to recover the sum of $8,560, as due on 568 coupons, cut from 43 bonds, for the payment of $16,250, purporting to be issued by the city of Holly Springs, in the state of Mississippi, the bonds and coupons being owned by the plaintiff. Each bond is in the following form:

'State of Mississippi, City of Holly Springs. Bond. Issued in payment of stock of the Selma, Marion & Memphis Railroad Co. No. ___, $ _____. Fifteen years.

'Know all men by these presents that the city of Holly Springs, Marshall county, in the state of Mississippi, acknowledges itself indebted and firmly bound to the Selma, Marion & Memphis Railroad Company, in the sum of _____ dollars, which sum the city of Holly Springs promises to pay to the Selma, Marion & Memphis Railroad Company, or bearer, at the Holly Springs Savings & Insurance Company, Holly Springs, Mississippi, on the first day of January, A. D. one thousand eight hundred and eighty-seven, together with the interest thereon from the first day of January, A. D. one thousand eight hundred and seventy-two, at the rate of eight per cent. per annum, which interest shall be payable semi-annually, on the presentation and delivery of the attached interest coupons, at the office of the said Holly Springs Savings & Insurance Company.

This bond is issued under and in pursuance to an order of the board of mayor and aldermen of the city of Holly Springs, Marshall county, state of Mississippi, made under authority of the constitution of the state of Mississippi and the laws of the legislature of the state of Mississippi, and authorized by a vote of the people of the said city of Holly Springs at a special election held for the purpose.

[Corporate seal.] 'In testimony whereof, the said city of Holly Springs has executed this bond by the mayor of said city, under the order of said city's board of mayor and aldermen, signing his name thereto, and by the treasurer of said city, under the order thereof, attesting the same, and affixing thereto the said seal of the said city of Holly Springs.

'This done at the city of Holly Springs, Marshall county, state of Mississippi, this first day of January, A. D. 1872.

'HENRY A. COOPER, Mayor of the City of Holly Springs.

'LEWIS BEEHLER, Treasurer of the City of Holly Springs.'

The questions in the case arise on a demurrer to the declaration, the facts alleged in which are as follows:

The defendant is a municipal corporation created by the legislature of the state of Mississippi. By the constitution of Mississippi, adopted December 1, 1869, and still in force, it is provided as follows, by article 12, § 14: 'The legislature shall not authorize any county, city, or town to become a stockholder in, or to lend its credit to, any company, association, or corporation, unless two-thirds of the qualified voters of such county, city, or town, at a special election, or regular election, to be held therein, shall assent thereto.' In the fall of 1871 the inhabitants of the city of Holly Springs were desirous that the city should subscribe for stock in the Selma, Marion & Memphis Railroad Company, whose road was to be constructed through or near the city. The mayor and aldermen, in conformity to the wishes of the inhabitants, on the ___ day of _____, 1871, ordered a special election to be held, in pursuance of the constitution, on the thirtieth day of December, 1871, to ascertain whether two-thirds of the qualified voters of the city would assent to a subscription by it to $75,000 of the capital stock of said company, and to issue the bonds of the city in payment of the subscription, 'having to run' to the first of January, 1887, and bearing interest at 8 per cent. per annum, payable semi-annually. Due notice was given of the election, and it was held on the thirtieth of December, 1871, under the direction and supervision of the mayor and aldermen; and, at the election, largely more than two-thirds of all the qualified voters of the city voted in favor of the subscription and the issuing of the bonds, and assented thereto, and thereby authorized and directed the mayor and aldermen to make the subscription, and to issue and deliver the bonds. After the election, to-wit, on the first of January, 1872, the defendant, in purs ance of the vote, subscribed for $75,000 of the capital stock of the company, and agreed and undertook to issue its bonds in payment thereof as soon as the same could be prepared, and received the regular and proper certificates therefor, which it still holds and has never surrendered, or offered to surrender. By an act of the legislature of Mississippi, approved March 16, 1872, (Laws 1872, c. 75, p. 313,) entitled 'An act to facilitate the construction of the Selma, Marion & Memphis Railroad,' it was provided (section 4) 'that all subscriptions to the capital stock of the said Selma, Marion & Memphis Railroad company, made by any county, city, or town in this state, which were not made in violation of the constitution Railroad Company, made by any county, ratified, and confirmed.' By another act of that legislature, approved April 19, 1872, (Laws 1872, c. 102, p. 120,) it was provided (section 1) 'that any county through which any railroad will pass, incorporated city or town along the line of any railroad, or contiguous thereto, may subscribe to the capital stock of said company in any sum;' and (section 2) 'that no such subscription shall be made until the question has been submitted to the legal voters of such county or counties, city or cities, incorporated town or towns, in which the subscription is proposed to be made;' and (section 3) that if it...