Lee County v. Rogers
| Decision Date | 01 December 1868 |
| Citation | 74 U.S. 181,19 L.Ed. 160,7 Wall. 181 |
| Parties | LEE COUNTY v. ROGERS |
| Court | U.S. Supreme Court |
In error to the Northern Circuit Court of Illinois.
Rogers brought suit against Lee County, Iowa, upon the coupons of certain bonds signed by one Boyles, county judge, issued by the county under the county seal, to a certain railroad company named.1
The defences, as appearing on answer and amended answer, were:
1. That the bonds were issued and executed by Boyles, county judge, &c., 'without any authority of law, having been issued for the purpose of subscribing on behalf of this defendant to the stock of certain railroad corporations, which the defendant had no power or authority to do,' and that they were 'utterly null and void from the beginning.'
2. That a bill had been filed by McMillan and others, taxpayers of Lee County, against Boyles, the county judge, &c., on the 1st October, 1856, in a State court, before any bonds were issued, and that he was enjoined, on account of irregularities in preliminary proceedings, at the December Term, 1856, against issuing the bonds; that soon afterwards, in January, 1857, the legislature passed an act confirming and legalizing these proceedings; that a second bill was filed, by the same parties, on the 26th February, 1859, a year after this act of the legislature, for the purpose of having both the act, and also the bonds, which, in the meantime, had been issued, declared void, and that on the 22d June, 1858, a decree was rendered, declaring both the act and the bonds valid and binding; that a third bill was filed, which was a bill of review of the previous case, on the 28th July, 1860, two years after the previous decree, and that on the 18th October, 1862, a decree was rendered declaring the act of the legislature, and bonds, void and of no effect.
The defence meant to be set up by this second head was, of course, that of lis pendens.
The defendant demurred, and the court below sustaining the demurrer, the case was now brought here by the county.
It was submitted by Mr. McCrary, on elaborate briefs of his own, and of Messrs. Semple and Casey; and by Messrs. Dick and Grant, on similar briefs of theirs.
The defence is placed, by the learned counsel for the defendant, in his brief, upon two grounds:- 1. That the county is not liable, on the bonds or coupons, for the reason there was no power in the county to subscribe for the stock, to the railroad company, or to issue the bonds; that they are void, as against the constitution and laws of the State.
2. That prior to the date of the bonds and coupons, certain suits were instituted, in the District Court of Lee County, impeaching the validity of the bonds, if issued, and charging that they would constitute no indebtedness against the county, and claiming that the county judge, who was the fiscal agent of the county, should be enjoined from issuing the bonds; that an injunction was granted, and that the bonds were issued, lite pendente, and put on the market, with full notice of the pendency of the suit; that this suit was continuously and successfully prosecuted, and the courts of the State had adjudged the bonds to be null and void, and the collection of the same perpetually enjoined.
I. As to the power or authority of the county to subscribe for railroad stock, and to issue bonds therefor.
Much the largest portion of the brief of the counsel is devoted to a very able discussion of this question. But, after the decision of this court in the case of Gelpcke v. The City of Dubuque,2 and the series of cases following it, we must decline a re-examination of the question. We regret the difference of opinion on the subject of these bonds, between this court and the courts of the State of Iowa; but it involves a principle and rule of property, in our opinion, so just, and so essential to the protection of the rights of the bon a fide holder of this class of securities, that, however much we may respect the judgment of those differing from us, we cannot give up our own. That difference, as we understand it, consists in this: This court held, in Gelpcke v. The City of Dubuque, that bonds, issued by counties, cities, or towns, in Iowa, to railroad companies, for stock in said companies, and which said bodies, at the time the bonds were issued, were held, by the settled adjudications of the highest courts of the State, to possess full power, under its constitution and laws, to issue the same, are ever after valid and binding upon the body issuing them, in the hands of a bon a fide holder. Since these bonds were issued, and in the hands of bon a fide holders for value, the courts of Iowa have reversed their previous decisions, and now hold that these bodies possess no such power under the constitution and laws of the State, and hence they are void, even in the hands of the bon a fide holder. The learned and elaborate argument of the counsel for the plaintiff in error, in this case, is devoted to the support of these more recent decisions, and the earnestness and care with which he has discussed the question, Which series of cases shall prevail? leave no doubt of the sincerity of his conviction. But, for the reasons stated, we must respectfully decline following him.
II. The second ground of defence involves the question of notice to the plaintiff below, or, in other words, the effect of the lis pendens, as claimed by the counsel. In order to examine this branch of the defence, understandingly, it will be necessary to recur, for a few moments, to the facts as they appear in the answer.
The first suit, by McMillen and others v. Boyles County Judge, was commenced by petition or bill, October, 1856, and terminated in a decree to enjoin the defendant, December Term thereafter.
The opinion of the Supreme Court, in this case, is in the record.3 The court held, the election, by the voters in the county, under the direction of the county judge, to have been irregular in several particulars, as not being in conformity to the act providing for a submission of the question of subscribing for the stock and issuing the bonds. At this time it does not appear that any stock had been subscribed for or bonds issued. The question was presented, in this case, and pressed by counsel for the petitioner, whether or not the county possessed competent power to issue the bonds under the constitution and laws of the State?
Judge Stockton, who delivered the opinion, as it respects this question, observed, ...
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