Smith v. Railroad Company
Decision Date | 01 October 1878 |
Citation | 99 U.S. 398,25 L.Ed. 437 |
Parties | SMITH v. RAILROAD COMPANY |
Court | U.S. Supreme Court |
APPEAL from the Circuit Court of the United States for the District of Kansas.
The facts are stated in the opinion of the court.
Mr. Thomas G. Frost for the appellant.
Mr. J. E. McKeighan, contra.
This case was decided by the court below upon demurrer to the amended bill of the appellant. The case made by that bill, so far as it is necessary to state it, may be embodied in a few words.
The appellant and Dunn, under the name of Smith & Co., on the 6th of June, 1871, contracted with a corporation then known as the Fort Scott and Allen County Railroad Company, afterwards the Fort Scott, Humboldt, and Western Railroad Company, to grade the line of its roadway, extending from Fort Scott, in Kansas, to Humboldt City, in the same State, and to build all the necessary bridges and culverts, and to complete the work by the 1st of July, 1872.
The railroad company, in consideration of the work to be done, agreed to pay and deliver to Smith & Co. certain municipal bonds, amounting, according to their face value, to $275,000; to wit, $125,000 in the bonds of Bourbon County, $25,000 in the bonds of Humboldt City, $75,000 in the bonds of Humboldt Township, $25,000 in the bonds of Salem Township, and $25,000 in the bonds of Elsmore Township. Dunn assigned his interest in the contract to Smith. The latter did all the work before the time specified. On the 6th of June, 1872, the railroad company passed a resolution accepting the work and acknowledging the fulfilment of the contract.
The bonds of Humboldt Township and Humboldt City, amounting together to $100,000, have been delivered to Smith pursuant to the contract. The bonds of Bourbon County and those of Salem Township and of Elsmore Township have not been delivered.
On the 24th of July, 1869, the commissioners of Bourbon County passed a resolution calling for an election on the 24th of August following, under a statute of Kansas, to decide the question whether the county should subscribe $150,000 to the capital stock of any railroad company then or thereafter organized to construct a railroad on the line specified in the contract of Smith & Co. The election was accordingly held at the time appointed. The result was in favor of the subscription. On the 13th, of October, 1870, the Fort Scott and Allen County Railroad Company was duly organized. On the 13th of October, 1871, the commissioners of Bourbon County passed a resolution authorizing Joseph L. Emert to subscribe for $150,000 of the stock. The subscription was made accordingly. The county from time to time voted upon the stock. The commissioners resolved to prepare, and in part to execute, the bonds as soon as the necessary lithographing could be finished. They promised Smith promptly to deliver them upon the completion of the work within the contract time They were present when the contract was entered into, and made the same promise to Smith & Co. But for their repeated assurances to this effect, and the reliance of both Smith and Dunn upon their good faith, the work would not have proceeded, and would not have been done.
The county bonds have not been issued, and new and burdensome terms have been imposed as conditions of that result. The railroad company is hopelessly insolvent. There is no remedy left to the appellant but to procure the bonds still in arrear. The prayer of the bill is that the railroad company be decreed to assign its claim for the bonds of Humboldt County to the complainant; that the county commissioners be decreed to issue them, and that process issue against the Fort Scott, Humboldt, and Western Railroad Company (formerly the Fort Scott and Allen County Railway Company), and against the county commissioners of Bourbon County and against...
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