Northern Nat Bank of Toledo, Ohio v. Trustees of Porter Township

• Decision Date: 03 March 1884
• Citation: 4 S.Ct. 254,110 U.S. 608,28 L.Ed. 258
• Parties: NORTHERN NAT. BANK OF TOLEDO, OHIO, v. TRUSTEES OF PORTER TOWNSHIP, in Delaware County, Ohio. 1
• Court: U.S. Supreme Court

110 U.S. 608

4 S.Ct. 254

28 L.Ed. 258

NORTHERN NAT. BANK OF TOLEDO, OHIO, v. TRUSTEES OF PORTER TOWNSHIP, in Delaware County, Ohio.¹

March 3, 1884.

J. D. Brannan and

E. W. Kittredge, for plaintiff in error.

Wm. M. Ramsey, for defendant in error.

HARLAN, J.

On the fifteenth day of April, 1851, the commissioners of Delaware county, Ohio, passed an order submitting to the voters of that county, at a special election to be held on the seventeenth day of June thereafter, a proposition to subscribe the sum of $50,000 to the capital stock of the Springfield & Mansfield Railroad Company, a corporation created under the laws of that state, and whose name was subsequently changed to that of the Springfield, Mt. Vernon & Pittsburgh Railroad Company. This proposition was approved by the electors, and subsequently, August 4, 1851, the county commissioners made a subscription of the amount voted, payable in bonds of the county. On December 6, 1851, the commissioners signed the requisite number of bonds, payable to the railroad company, and deposited them with the auditor for delivery when the road was located and a contract made for its construction through the county. It having been claimed that these bonds were defectively executed, others were signed by the commissioners on the twenty-seventh day of December, 1852, to be retained by the auditor until those first signed were returned, which being done that officer was directed to deliver the new bonds to the company, or to some person authorized to receive them.

After the vote in favor of a county subscription of $50,000, and two days before the formal subscription in its behalf by the county commissioners, that is, on the second day of August, 1851, the trustees of Porter township, in Delaware county, passed an order submitting to the voters of that township, at a special election to be held on the thirtieth day of August thereafter, a proposition for a subscription of not exceeding $10,000 and not less than $8,000 to the capital stock of the same company, payable in township bonds, upon the condition that the road should be permanently located and established through that township. The proposition was approved by the voters, and subsequently, on May 6, 1853, township bonds for the amount voted, with interest coupons attached, were issued. They were made payable to the railroad company or its assignees, and were in the customary form of negotiable municipal bonds. Each one recited that it was 'issued in part payment of a subscription of one hundred and sixty shares of fifty dollars each to the capital stock of the said Springfield, Mt. Vernon & Pittsburgh Railroad Company, made by the said township of Porter in pursuance of the provisions of the several acts of the general assembly of the state of Ohio, and of a vote of the qualified electors of said township of Porter taken in pursuance thereof.'

This action involves the liability of the township upon these bonds. The judgment below necessarily proceeded upon the ground that they were void for want of legal authority in the township to issue them. In behalf of the plaintiff in error, the present holder of the bonds, it is claimed that there was statutory authority for their issue, and that, apart from any question of such authority, the township is estopped by their recitals, and by numerous payments of annual interest, from disputing its liability. Whether the township had legal authority to execute them, is the first question to be considered.

By the first section of an act of the general assembly of Ohio, passed February 28, 1846, it is provided that whenever county commissioners should thereafter be authorized to subscribe to the capital stock of any railroad company incorporated in that state, it shall be their duty 'to give at least twenty days' notice * * * to the qualified voters of said county to vote at the next annual election to be held in the several townships * * * in said county, for or against the subscription as aforesaid; and if a majority of the electors aforesaid, voting at said election for or against a subscription as aforesaid, shall be in favor of the same, such authorized subscription may be made, but not otherwise.' 1 S. & C. note, 275.

By the charter of the Springfield & Mansfield Railroad Company, granted March 21, 1850, it is provided that 'the county commissioners of any county through which said railroad may be located, shall be, and they are hereby, authorized to subscribe to the capital stock of said company any sum not exceeding $50,000,' and for the payment thereof power was given to borrow money, lay and collect taxes, etc.; further, that 'if the county commissioners of any county through which said road shall pass, shall not be authorized by the vote of said county to subscribe stock to said road, the trustees of any township through which said road may be stock of said company any sum not exceeding to subscribe any sum of money not exceeding fifty thousand dollars to the capital stock of said company, and provide for the payment of said stock in the same manner that county commissioners aforesaid are authorized: provided, that the total amount which may be subscribed to the capital stock of said company by any county, and the townships therein, on the line of said road, shall not exceed one hundred thousand dollars;' still further, that 'no subscription shall be made by the county commissioners of any county, or the trustees of any township through which said road may be located, until a vote of the qualified voters of such county or township has been declared in favor of such subscription, in the manner pointed out in the mode of proceeding when county commissioners may be authorized by law to subscribe to the capital stock of railroads, turnpike roads, or other incorporated companies in this state, passed February 28, 1846.' 48 Ohio Laws, 294; Act March 21, 1850, §§ 4, 5, 6. But by an act passed March 25, 1851, county commissioners of the several counties through or into which the Springfield & Mansfield Railroad shall be located, were authorized to cause the question of subscription provided for in the act of March 21, 1850, 'to be submitted to the qualified voters of their respective counties, at a special election, to be by them called for that purpose, at any time thereafter, having first given twenty days' previous notice;' further, that 'if the commissioners of any of the counties aforesaid shall not be authorized by the vote as aforesaid to subscribe to the capital stock of said company on behalf of their respective counties, then, and in that case trustees provided for in the same act incorporating said railroad company shall be submitted to the people of the respective townships, at a special election, to be called as provided for in the first section of this act,'—such elections to be conducted in all respects in the same manner provided for in the charter of the company, except as modified by the said act of March 25, 1851.

The authority of Porter township to issue the bonds in question must be derived from the provisions of these acts of assembly. If not found in them, it must be adjudged that no such authority existed.

The fundamental proposition advanced in behalf of plaintiff is that, immediately upon the passage of the act of March 21, 1850, Porter township was vested with power to make a subscription to the stock of the company; that the non-authorization of the commissioners, by a vote of the electors, to make a county subscription was only a condition precedent to the exercise of that power; consequently, that the township is estopped by the recitals in the bonds and its acquiescence for a series of years, as evidenced by payments of interest, to rely upon the non-fulfillment of that condition. In this construction of the acts in question we are unable to concur. It is entirely clear, we think, that the township was without power to make a subscription until the time arrived when it could be properly said that the county, as such, had not been authorized by a vote of the electors to make a subscription. We do not mean to say that the right of townships on the line of the road to make subscriptions could be indefinitely postponed by the mere neglect or failure of the county commissioners to submit the question of subscription to a popular vote. That construction, the supreme court of Ohio correctly said in Shoemaker v. Goshen Tp. 14 Ohio St. 580, 'would defeat the manifest intention of the statute, which contemplates and authorizes the submission of the question to townships when subscription on behalf of the county is refused.' Such refusal would undoubtedly exist whenever the electors, upon a submission of the question, expressed their disapproval of a county subscription. But, within any just interpretation of the words of the statutes, the power of townships to act would come into existence not only by a direct refusal of the commissioners to submit the question of subscription to popular vote, but upon their failure within a reasonable time to call an election for that purpose. Shoemaker v. Goshen Tp., supra.

The first annual election in townships after the passage of the act of March 21, 1850,—which...