Norton v. Town of Dyersburg
Decision Date | 23 April 1888 |
Citation | 8 S.Ct. 1111,127 U.S. 160,32 L.Ed. 85 |
Parties | NORTON v. TOWN OF DYERSBURG |
Court | U.S. Supreme Court |
This is an action at law, brought in the circuit court of the United States for the Western district of Tennessee, by Extein Norton, a citizen of New York, against the mayor and aldermen of the town of Dyersburg, a municipal corporation created by the state of Tennessee, to recover sundry sums of money as due for the principal of 36b onds, for $500 each, and 58 bonds for $250 each, and 62 bonds for $100 each, all due May 10, 1883, and on sundry coupons cut from such bonds, due at various times between the date of the bonds and their maturity. The bonds and coupons were in the following form:
$250.
'The mayor and aldermen of the town of Dyersburg, in the state of Tennessee, a corporation duly chartered by act of the general assembly of the state of Tennessee, by the qualified voters of said town, under the provisions of an act of legislature empowering them so to do, by this bond promise to pay to the bearer hereof, ten years after the date hereof, the sum of two hundred and fifty dollars, with interest at seven per centum per annum from this date, payable semi-annually, at the city hall in Dyersburg, on presentation of the coupons hereto attached, to aid in the construction of the Paducah & Memphis Railroad; upon the express condition, however, that the said railroad shall be constructed to the town of Dyersburg, Tenn., and have a depot of said railroad located within half a mile of the court-house in said town.
'In testimony whereof the mayor and aldermen of the town of Dyersburg, Tenn., have caused this bond and the coupons attached to be signed by the mayor of said town, and countersigned by the recorder, on this 10th day of May, 1873.
'[Seal, Mayor and Aldermen, Dyersburg, Tenn.]
'C. P. CLARK, Mayor.
'The mayor and aldermen of Dyersburg, Tenn., will pay the bearer on the ___ day of _____, 18__, eight dollars and seventy-five cents, being the semi-annual interest due on Paducah & Memphis Railroad bond No. ___.
'C. P. CLARK, Mayor.
'W. C. DOYLE, Recorder.'
The defendant pleaded nil debet and non est factum. The cause was tried by the court on the written waiver of a jury, and it found the issues of law and fact with the defendant, and rendered a judgment for it, to review which the plaintiff has brought a writ of error. There was an agreed statement of facts, which is embodied in a bill of exceptions, and there is a finding of facts and of conclusions of law also contained therein. From this the following facts appear: The plaintiff bought the bonds and coupons before maturity, for full value, and without any knowledge or notice of any defect, infirmity, equity, or condition against the liability of the town therefor, unless, as matter of law, the face of the bonds charges him with notice. The bonds and coupons were signed, sealed, and delivered by the properly authorized municipal officers of the defendant, but the want of authority so to do is controverted; the defendant insisting that no proper legislative or other authority existed for making the subscription and issuing the bonds that were made and issued, the plea of non est factum only going to that extent. The Mississippi River Railroad Company, to which, it is claimed, the subscription was originally authorized to be made by the defendant, was afterwards consolidated with and became a part of the Paducah & Memphis Railroad Company. That company mortgaged its properties and franchises, the mortgage was foreclosed, and the purchaser at the sale recorganized, under the statute of Tennessee, as the Chesapeake, Ohio & Southwestern Railroad Company, by which the road was built and finally completed on January 1, 1882, and is now operated as a railroad its entire length. The bed and track are now, and were at the date of the bringing of the suit, fully built and equipped and operated through the county of Dyer, in which county the town of Dyersburg is situated, and the last-named company had built a depot building within half a mile of the court-house in the town of Dyersburg before this action was brought. The proceedings of the board of mayor and aldermen of the town, relative to the subscription in controversy, are contained in a paper, Exhibit B to the stipulation, which is set forth in the margin.1
The question of the subscription referred to in the foregoing proceedings was left, under proper notices, to the decision of the qualified voters of the town of Dyersburg, and the subscription was carried by a vote largely in excess of the* requisite constitutional majority. At the date of the subscription the town was without railroad facilities, and the object of the subscription was to aid the building of the proposed line near the town. The railroad has been built, but no part of the subscription has been paid except the first installment of interest, which was paid. The bill of exceptions states as follows:
D. H. & W. K. Poston, for plaintiff in error.
[Argument of Counsel from pages 170-172 intentionally omitted] Sparrel Hill and T. B. Turley, for defendants in error.
It is insisted by the plaintiff in error that there was express legislative authority for the issue of these bonds. The first statute relied on is the act of the legislature of Tennessee approved January 23, 1871, (chapter 50, Acts 1870-71,) entitled 'An act to enforce article 2, § 29, of the constitution, to authorize the several counties and incorporated towns in this state to impose taxes for county and corporation purposes.' This statute has been fully considered by us in the case of Kelley v. Town of Milan, ante, 1101, (just dedecided,) and shown to have conferred no such authority. The act approved December 16, 1871, (chapter 122, Acts 1871,) entitled 'An act to legalize and authorize subscription by incorporated cities and towns for the benefit of railroad companies created by law,' applies only to cases where an incorporated town or city had subscribed to the capital stock of a railroad company prior to the passage of that act. The subscription in the present case was not made until May 10, 1873, the election having been held on July 6, 1872; and the entire act relates only to the validity and the legality of the subscription to stock, and in no manner touches the question of the issue of bonds.
It is also contended that express...
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