United States v. Indian Grave Drainage Dist.

• Decision Date: 23 March 1898
• Docket Number: 444.
• Citation: 85 F. 928
• Parties: UNITED STATES ex rel. COQUARD v. INDIAN GRAVE DRAINAGE DIST. et al.
• Court: U.S. Court of Appeals — Seventh Circuit

85 F. 928

UNITED STATES ex rel. COQUARD v. INDIAN GRAVE DRAINAGE DIST. et al.

No. 444.

United States Court of Appeals, Seventh Circuit.

March 23, 1898

The original petition in this case alleged the recovery by the relator, on April 24, 1892, of a judgment against the Indian Grave Drainage District for the sum of $10,709.73, based upon bonds and coupons from bonds issued by the commissioners of the district, the failure and neglect of the district to provide from time to time by taxation for the payment of interest as it became due on the bonds, the possession by the treasurer of the district of a sum of money exceeding $1,500 which had been in his hands for the past two years, and which ought by right to be turned over and applied to the payment of the relator's judgment. The prayer of the petition was that process be issued to the Indian Grave Drainage District, to Gerhard G. Arends, treasurer, and to L. H. A. Nickerson, H H. Cober, and Henry Misser, commissioners thereof returnable, etc.; that they be required to answer, and that upon final hearing a writ of peremptory mandamus be ordered, requiring the district, through its corporate authorities, to pay the said judgment with interest and costs, and, in case of insufficiency of funds in the treasury for the purpose, to cause a special tax to be levied, etc.; and that other proper relief by awarded.

A demurrer to this petition having been sustained, an amendment was added, which, after a general averment of the corporate character of the principal respondent, alleges, in substance, that there is now in the treasury of the district, $2,770 collected from the first and second assessments, of which $1,683 had been collected from the second assessment, and remained subject to the relator's rights in this proceeding; that the entire bonded indebtedness of the district, except that belonging to the relator, was represented by George Edmunds, as trustee, who had intervened in the cause; that the holders of such indebtedness, except the relator, had joined in a settlement and compromise, and had accepted new and other bonds in lieu of the first bonds issued to them,-- the new bonds being 'subservient to the judgment and bond holdings of relator'; and that, notwithstanding the written demand therefor made, as alleged in the original petition, the treasurer and commissioners had refused to pay the judgment of the relator, and no part of the same had been paid.

A second demurrer having been sustained, a second amendment was added, which is long and so involved in expression as to be difficult of comprehension; but, after first stating that the relator claims a share of all moneys now in the treasury of the district, proportionate to the amount of his share of the bonded indebtedness, it alleges that since July 1, 1886, continually from year to year, the commissioners and treasurer of the district had collected a large portion of the assessments, the amounts collected being unknown to the relator, but believed to be many thousand dollars, and to exceed the sum due him, but disregarding their duty to pay his demand, and contriving to hinder and defraud him of his proper share of the amounts collected, 'did pay unto the bond holdings of other bondholders a large proportion of the receipts collected by said district in coupons due by said district on the bonded indebtedness, in this wise, to wit. ' Here follow three successive statements, the first two of which seem to be summarized in the third, which is 'that the said district, through its officers, did accept interest coupons of all the outstanding indebtedness against said district (with the exception of your relator's coupons and holdings) in payment of taxes due from the land subject to taxation within said district, by reason of the bonded indebtedness created by said district, and whereby the said district, through its officers, agents, and servants, accepted such coupons from the bondholding and compromised indebtedness due from said district, in exclusion of the rights of your relator, and whereby the said other bondholders paid themselves an amount of money largely in excess of the amounts of their distributive share, and by means whereof the relator now complains that the commissioners and treasurer of said district have deprived said relator from participating or recovering the amount now in the treasury of his demand as hereinbefore set forth, when such taxes should have been paid in money of the United States. ' It is further averred 'that by reason of the premises all of the moneys now in the hands of the treasurer of said district belong to, and should of right be ordered to be paid unto, your relator,' and 'that there are no other bondholders entitled to the proceeds now in the hands of the treasurer of said district, for the reason that, with the exception of the relator, all other bondholders have by compromise and adjustment received all of the moneys lawfully due them, and that the moneys now in the hands of the treasurer of said district belong to, and of right should and ought to be paid to, the relator.'

George Edmunds, having been permitted to appear, answered, setting up facts on which, as trustee for all the bonds secured upon the first assessment, and for all secured by the second assessment, except those held by the relator, amounting to $20,500, and one for $500, held by a resident of Quincy, Ill., he claimed that the relator had received his pro rata share of the moneys collected, and that the sums in the hands of the treasurer should be paid over to him.

The drainage district and its officers answered, denying the sufficiency of the petition, and alleging, among other things, that the coupons entering into the judgment of the relator were from bonds charged against the second assessment, 'and were and became due for the years 1886, 1887, 1888, and 1889, and were and are a lien upon the installments of said second assessment, and the actual interest upon said second assessment, for those several years, respectively, as the bonds and coupons entering into that judgment, respectively, came due during those several years'; that of all moneys received from any source on account of the second assessment, up to the commencement of this proceeding, the relator had received his due proportion; that the only moneys remaining in the treasury of the district at the commencement of the action, being the moneys mentioned in the petition and amendments thereto, were collected on account of interest for the year 1892 and subsequent years, and are the pro rata part of such interest on the second assessment as belongs to other coupons of bonds represented by the intervener, George Edmunds; and that during no one of those years-- 1892 and later-- has any coupon or coupons of bonds of the district been paid or received upon any assessment, and all payments thereon have been in lawful money.

Trial by jury was waived by written agreement, and the court having made only a general finding, entered an order that the petition of the relator be dismissed, that the sums in the district treasurer's hands be paid to Edmunds as trustee, and that Coquard pay the costs. The assignment of errors contains the following specifications: (1) The circuit court admitted upon the trial improper evidence on the part of the defendant and intervening petitioner; that is to say, permitted defendant and intervening petitioner to prove that they had expended and paid out funds of said district to various parties without any authority of law. (2) The circuit court improperly refused to admit proper evidence, offered by petitioner, wherein petitioner attempted to prove that the defendants received large sums of money, and now in the hands of the treasurer of said district, which should be distributed and paid over to petitioner. (3) The circuit court erred in refusing to petitioner to prove that the defendants received and accepted from intervening petitioner coupons in discharge of and in payment of petitioner's indebtedness, to the exclusion of the rights of petitioner, as set up in said petition. (4) The circuit court improperly decided the issue in the case on the law and the evidence, and the petition herein should have been sustained, and the rights claimed by intervener in his petition should have been denied. (5) The decision of the circuit court herein made is contrary to the law and the evidence in the case. (6) the...