Mather v. City and County of San Francisco

• Decision Date: 03 March 1902
• Docket Number: 739.
• Citation: 115 F. 37
• Parties: MATHER v. CITY AND COUNTY OF SAN FRANCISCO.
• Court: U.S. Court of Appeals — Ninth Circuit

115 F. 37

MATHER v. CITY AND COUNTY OF SAN FRANCISCO.

No. 739.

United States Court of Appeals, Ninth Circuit.

March 3, 1902

Joseph W. Mather, the plaintiff in error, brought an action against the city and county of San Francisco, the defendant in error to enforce the payment of certain bonds which were issued and sold under the provisions of an act of the legislature of the state of California. St. 1875-76, p. 433. The complaint alleges: That on January 1, 1877, the defendant in error executed the bonds which are the subject of the action for the sum of $1,000 each, and for each bond 40 coupons for the semiannual payment of the interest thereon, payable on the 1st day of July and the 1st day of January of each year, and that the plaintiff, for a valuable consideration, purchased the bonds in good faith, and now holds the same. That the form of the bonds is as follows:

'United States of America, State of California,

'City and County of San Francisco.

'1,000 . . . 1,000.

'Dupont Street Bond.

'The City and County of San Francisco, State of California;

'Will pay to . . ., or the holder hereof, the sum of one thousand dollars, gold coin of the United States of America, twenty years from the date hereof, with interest thereon in like gold coin at the rate of seven percent. per annum, payable half-yearly on the first day of July and the first day of January of each year upon interest coupons hereto attached. Principal and interest payable at the office of the treasurer of said city and county of San Francisco. This bond is issued under the provisions of an act of the legislature of the state of California entitled 'An act to authorize the widening of Dupont street in the city of San Francisco,' approved March 23d, 1876, and is to be paid out of the fund that may be raised by taxation as therein provided, and may be redeemed at any time before its maturity, as is provided in said act. And this bond is further issued and taken by the holder hereof under the conditions expressed in section twenty-two (22) of said act, which is as follows: 'Section 22. The completion of the work described in this act shall be deemed absolute acceptance by the owners of all lands affected by this act and by their successors in interest of the lien created by this act upon the several lots so affected, and it shall operate as an absolute waiver of all claim in the future upon the city and county of San Francisco for any part of the debt created by the bonds authorized to be issued by this act and their successors in interest. This shall be regarded as a contract between said owners and the holders of said bonds and said city and county, and this provision shall be stated on the face of the bonds.'

'In witness whereof, the mayor, the auditor, and the city and county surveyor of said city and county of San Francisco, constituting the board of Dupont street commissioners, have respectively signed these presents, and caused to be affixed hereto the official seal of said city and county of San Francisco as of the first day of January, 1877.

'A. J. Bryant,

'Mayor of the City and County of San Francisco, and President of the Board of Dupont Street Commissioners.

'Geo. F. Maynard,

'Auditor of the City and County of San Francisco, and a Member of Said Board.

'Wm. P. Humphreys,

'City and County Surveyor of the City and County of San Francisco, and a Member of Said Board.

That each of the said coupons thereon, excepting as to the number of the coupon and of the bond and date of payment thereof, was and is in the words and figures following, to wit:

'Thirty Five . . . Dupont Street Bond . . . Coupon No.

$35 . . .

'The Treasurer of the City and County of San Francisco will pay bearer at his office thirty five dollars., U.S. gold coin, on Bond No. --, six months' interest.

A. J. Bryant,

'Mayor of the City and County of San Francisco, and President Board Dupont Street Commissioners.'

The complaint alleged that the bonds and the interest coupons thereto attached were executed, issued, and disposed of by said defendant in error under the provisions of and for the purpose required by the act aforesaid, which was an act entitled 'An act to authorize the widening of Dupont street, approved March 23, 1876. ' St. 1875-76, p. 433. That in and by said act provision was made for a sinking fund for the payment of said bonds by means of the collection from certain real property in said city and county, in said act described, of taxes in and by said act required to be assessed and levied thereon and collected therefrom in the manner and time specified by said act; said taxes to constitute a fund in control of the treasurer of the defendant in error for the redemption of said bonds in the manner provided by said act. That the said act further provided that there should be levied, assessed, and collected upon the lands mentioned in the act a tax sufficient to pay the interest on said bonds as the same should mature, which said tax was to be paid to the treasurer of the defendant in error, and constitute a part of the Dupont street fund, and to be paid out by said treasurer in the payment of the coupons attached to the said bonds as they should become due. The complaint further alleged that the plaintiff in error demanded the payment of his bonds and interest coupons from the treasurer of the defendant in error, and that, although the said interest coupons are past due and payable, the treasurer has not paid the same, except the coupons numbered from 1 to 4, inclusive, and that the bonds and the coupons from number 5 [115 F. 39] to 40 still remain unpaid and unredeemed, and that there never was collected by the defendant in error, or by its officers, or paid to its treasurer, under the provisions of the act or otherwise, a sum sufficient to meet the interest on the full amount of said bonds. The relief prayed for is that plaintiff in error have the amount due him upon his bonds and coupons ascertained and paid, and that he have judgment against the defendant in error therefor, 'said judgment to be paid only from the fund and in the manner provided by said act of March 23, 1876, or by the enforcement of the lien, if any, thereby created against the lands referred to in the act, and not from the general funds or other property of the defendant in error. ' The defendant in error demurred to the complaint upon various grounds, those principally relied upon being that the action is barred by the statute of limitations of the state of California; that there is a defect of parties defendant, in that neither the owners of the land therein referred to as subject to taxation to raise money for the payment of the bonds and coupons nor the tax collector and treasurer of the defendant in error are made parties defendant, and for the reason that it appears affirmatively upon the face of the complaint that the defendant in error is not liable upon the bonds. The circuit court sustained the demurrer upon all of these grounds, and thereupon the complaint was dismissed, and judgment was rendered for the defendant in error for its costs.

Page, McCutchen, Harding & Knight, for plaintiff in error.

Franklin K. Lane and George W. Lane (Naphtaly, Freidenrich & Ackerman and E. F. Preston, of counsel) for defendant in error.

Before GILBERT and ROSS, Circuit Judges, and HAWLEY, District Judge.

GILBERT Circuit Judge, after stating the case as above, .

The question of the right of the plaintiff in error to prosecute the suit against the defendant in error, as and for the purposes set forth in the bill depends upon the principles involved in the discussion of the cases of Jordan v. Cass Co., 3 Dill. 185, Fed. Cas. No. 7,517; Cass Co. v. Johnston, 95 U.S. 360, 24 L.Ed. 416; and Davenport v. Dodge Co., 105 U.S. 237, 26 L.Ed. 1018. In Jordan v. Cass Co. the bonds had been issued by the county court of the county in the name of the county, but on behalf of a township. Although the suit was brought against the county, it was not contended that the bonds were the proper debt or obligation of the county, or that payment could be enforced against the property of the county or against the taxpayers thereof in the county at large. The bonds recited that they were authorized by a two-thirds vote of the township. The question was whether the bondholder could for any purpose maintain an action on the bonds against the county in whose name the bonds were made. The court said of the bonds:

'It is clear that they imposed no obligation on the county, and equally clear that the real or ultimate liability is on the taxable property within the township. But how, and against whom, is this liability to be enforced and made available?'

The court then referred to the fact that the legislature had provided the mode of raising the means for paying the bonds by the collection of taxes, and that it had enjoined upon the county court the duty of levying such tax, which duty, the court remarked, might be enforced by mandamus; but, since the federal court had no original jurisdiction in mandamus, the plaintiff could have no remedy in that court unless he was entitled to judgment. The court thereupon reached the conclusion that a holder of the bonds might recover a judgment thereon against the county in whose name they were issued, 'to be enforced, if necessary, not by an execution against the county, but by mandamus against the county court to compel it to levy upon the property in the township such taxes as the law has enjoined as a duty upon it. ' The court said:

'It seems clear when the legislature directed the bonds to issue in the name of the county that it meant to give the bonds additional legal value;' and added, 'There must have been a purpose in requiring the bonds...