Lawrence Lewis.

American and English corporation cases : a collection of all corporation cases, both private and municipal (excepting railway cases), decided in the courts of last resort in the United States, England, and Canada [1883-1894] online

. (page 66 of 73)
Online LibraryLawrence LewisAmerican and English corporation cases : a collection of all corporation cases, both private and municipal (excepting railway cases), decided in the courts of last resort in the United States, England, and Canada [1883-1894] → online text (page 66 of 73)
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binding law, and nowhere has it, even by implication, been
declared contrary to the New England law of the land, or
the fourteenth amendment. Riggs v. Johnson County, 6
Wall. 191 ; Supervisor v. Rogers, 7 Id. 180; Barkley v. Levee
Commissioners, 93 U. S. 265.

The statute in question must be held to be constitutional^
and unaffected by the fourteenth amendment.

Judgment for the defendant in each case.

Peters, C. J., Walton, Danforth, Libbey and Foster^
JJ., concurred.

Enforcement of Judgments against MuNiciPALrrv by Execution
ON Inhabitants. — In Horner v, Coffey, 25 Miss. 434, a town was incor-
porated with the usual powers of contracting, suing and being sued, and
levying taxes. A judgment was recovered against the corporation, on
which execution was returned nulla bona. The corporation refused ta
levy a tax to pay the judgment, and thereupon the creditor issued another
execution, and levied upon the private property of the inhabitants. The
court restrained the proceedings, holding that in the absence of express
provision private property could not be taken for corporate debts. The
same doctrines are held in Alabama. Miller v, McWilliams, 50 Ala. 427.
There the court observes : *• The authority that contracts the debt should
attend to its liquidation. After the amount of the liability is fixed by
judgment against the corporation, and execution issued on such judgment
is returned * no property found,* then it becomes the duty of the corpo-
rate government to levy and collect such a tax as may be necessary to dis-
charge the judgment thus existing. If they fail to do this, mandamus is
the proper remedy."

The following cases will show that the decision in the principal case is
well-settled law in New England : Beardsley v. Smith, 16 Conn. 368 ;
Burs V, Botsford, 3 Day (Conn.) 159; Hawkes v. Kennebec, 7 Mass. 461 ;
Chase v, Merrimack Bank, 19 Pick. (Mass.) 564 ; Gaskill v. Dudley 6 Met.
(Mass.) 546; Riddle v. Proprietors on Merrimac River, 7 Mass. 187;
School District v. Wood. 13 Mass. 198; Brewer v. New Gloucester, 14
Mass. 216; Marsy z/. Clark, 17 Mass. 330; Merchants' Bank v. Cook, 4 Pick.
414 ; Hill V, Boston, 122 Mass. 349; Adams v, Wiscasset Bank, i Me. 361 ;
Fernald v, Lewis, 6 Me. 264; Baileyville v, Lowell, 20 Me. 178; Spencer
V, Brighton, 49 Me. 326 ; Hayford v, Everett, 68 Me. 507 ; Shurtleff v. Wis-
casset, 74 Me. 130.

In Hill V, Boston, 122 Mass. 349, the court observes: "By the common
law of Massachusetts and of other New England States, derived from im-
memorial usage, the estate of any inhabitant of a county, town, territorial
parish or school district, is liable to be taken on execution of a judgment
against the corporation. . . . In this Commonwealth, payment of such a
judgment has never been compelled hy mandamus against the corpora-
tion, as m other parts t>f the United States."



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636 TOWN OF ONTARIO V. HILL et oL



Town of Ontario

V.

Hill et al.

(Advance Case, New York. June ^ 1885./

Bonds issued by a town for the construction of a railroad under an act
authorizing the same, upon consent being obtained of a majority of the
taxpayers, are void unless such consent has actually been given. The
affidavits of the assessors certifying that such consent had been obtained,
and upon which the bonds were authorized to be issued, are not conclusive
as against the town, and in an action brought upon the bonds the town
may show that consent of a majority of the taxpayers had not been given.

But no action will lie on behalf of the town against the commissioners
for damages sustained by the wrongful issuing of the bonds. The verified
certificate of the assessors, made in conformity with the act, is a justifica-
tion of and protection to the commissioners, acting in good faith, in issu-
ing the bonds.

This action was brought against the defendants to recover
damages sustained by the plaintiff by reason of their official
misconduct as railroad commissioners, in issuing the bonds of
the town of Ontario to the amount of $85,000 in aid of the
construction of " The Lake Ontario Shore Railroad," under
chapter 241 of the Laws of 1869. The defendants were ap-
pointed commissioners December 24, 1870. In May, 1871, they
subscribed for $85,000 of the stock of the road at par, and
agreed to pay therefor in the bonds of the town. In Septem-
ber, 1 87 1, they issued $51,000 of the bonds, and $34,000 there-
of on or before July, 1873. Prior to the commencement of the
action suits had been brought in the United States court in
favor of holders of bonds issued by the commissioners, against
the town of Ontario, and judgment recovered thereon, and
collected of the town, which judgments, with interest thereon
to the time of the trial of this action, amounted to $17,710.05,

The second section of the act of 1869 makes it lawful for
commissioners appointed under the first section to borrow
money on the credit of the town, city, or village, not exceed-
ing twenty per cent of the assessed valuation of its property
according to the last assessment-roll and to execute bonds
therefor, but subject to the condition and piohibition that no



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TOWN OF ONTARIO V. HILL et al. 637

debt shall be contracted or bonds issued, until the written
consent "shall first have been obtained of persons owriing^
more than one half of the taxable property assessed and ap-
pearing upon the last assessment-roll of such town, incorpo-
rated village, or city, and a majority of the taxpayers as ap-
pears by such assessment-rolls respectively, and which fact
shall be proved by the affidavits of the assessors, or a majority
of them, of such towns," etc., and it is made the duty of the
assessors to make such affidavits. The section further pro-
vides that when the consent shall have been obtained, the affi-
davit, consent and a copy of the assessment-roll shall be filed,
and that the same shall be evidence of the facts therein con-
tained and certified in any court of the State, and before any
judge or justice thereof. Prior to August 30, 1870, the de-
fendants, acting as citizens, and having at that time no official
relation to the town, procured consents to the bonding of the
town and presented them on that day to the board of asses-
sors, and the assessors thereupon made the affidavit provided
for in section 2 of the act, and the affidavit, consent and as-
sessment-rolls were filed as provided therein.

In August, 1 871, after the defendants had been appointed
commissioners and after they had subscribed to the stock of
the railroad, but before they had issued the bonds, an action
was brought by two taxpayers of the town, on behalf of
themselves and others against these defendants as railroad
commissioners, and other parties, to restrain the issuing of
the bonds, and in the complaint which was sworn to, it was
charged that a sufficient number of consents had not been ob-
tained. In September, 1871, the suit was withdrawn as the
result of an arrangement between the plaintiffs therein and
the railroad company to reduce the town subscription to the
stock from $107,000, as originally contemplated, to $85,000.
The question whether the requisite number of consents to is-
suing the bonds had been obtained was litigated on the trial
of the present action. It was substantially conceded that the
requisite amount of property was represented by the con-
senters. But upon an analysis being made of the contents of
the assessment-roll, and the consents, and after a minute
and careful examination instituted by witnesses, and after
going through a process of addition and subtraction in respect
to the names on the assessment-roll, and a deduction from the



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638 TOWN OF ONTARIO V. HILL et al.

consents of names improperly there, it was made to appear
that a few less than a majority of the taxpayers had signed
the consents. The official misconduct charged in the com-
plaint is, in substance, that the commissioners issued the bonds,
knowing that the majority of taxpayers had not consented,
and that they procured the assessor to make the affidavit by
false representations that the consents contained such major-
ity. The trial judge directed a verdict for the plaintiff for
$17,710.35. and refused to submit the question as to the good
faith of the defendants. Other facts appear in the opinion.

W. F. Cogswell for appellant

Chas, H. Roys for respondent.

Andrews, J. — The question of the invalidity of town bonds
issued under circumstances similar to those in this case
is not an open one in this State. The evidence, upon a care-
ful analysis, discloses that, although the signatures to the con-
sent exceed in number one half of the names on the assessment-
roll, nevertheless when they are sifted, and only such names
are counted as were legally entitled to be reckoned, there are
of qualified signers something less than a majority of those
whose names are upon the assessment-roll of 1869. There

was a failure, therefore, to comply with the funda-
S^SS'^iSra: mental condition of the bonding acts, that a
Tiw^or BOKDBD ceTtam proportion of taxpayers, as specified in

the particular act, should consent to the bond-
ing before a debt should be created or bonds be issued.
The act of 1869 does not substitute the affidavit of the asses-
sors, therein provided for, in place of the fact of consent, or
make it conclusive evidence of the performance of the condi-
tion. The town bonding acts have usually contained some
provision for a verification of the fact of consent by the affi-
davit of assessors or other persons.

The act, chapter 375 of the Laws of 1852, which came under
the consideration of this court in Starin v. Town of Genoa,
23 N. Y. 440, requires that the supervisor and commissioners

who, under that act, were charged with the

AUTHORTTXES AS - r i • • aI ^

1^FT^^^% duty of obtaining the consent, or some one or
coS??SMv«ji!S more of them, should make an affidavit, to be
™*^*"* attached to the consent and to be filed, to the
effect that the persons assenting comprised two thirds of the



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TOWN OF ONTARIO V. HILL et al. 639

resident taxpayers on the previous assessment-roll, but there
was no provision making the affidavit evidence. The court
held that in an action on this bond the affidavit was not com-
petent evidence of the fact certified, and that the plaintiff was
bound to prove affirmatively by competent common-law evi-
dence that the required number of taxpayers had consented.

The act of 1869, under which the bonds in this case were
issued, is broader than the act of 1852, considered in the
Starin Case. It declares that the fact that the requisite con-
sent had been obtained, should be proved by the affidavit of
the assessors, and that the affidavit, consent and a copy of the
assessment-roll should be filed, and they are made evidence in
any court, or before any judge, of the facts therein contained.

A similar provision in the act, chapter 398 of the Laws of
1866, was construed by this court. Cagwin v. Town of Han-
cock, 84 N. Y. 532. The action in that case was brought
against the town to recover the amount of interest coupons
on town bonds issued under the act, which the plaintifi" had
purchased for full value from a holder of bonds, who was also
a purchaser for value. The action was defended on the
ground that the requisite number of taxpayers had not con-
sented to the bonding, and the trial court sustained the de-
fence. The judgnient was reversed by the general term on
the ground that the affidavit of the assessor made in conform-
ity with the terms of the act, before the bonds were issued,
was conclusive of the fact therein stated, in favor of a bona
fide holder of the securities. This court reversed the judg-
ment of the general term and affirmed the judgment of the
trial court on the ground that by the true construction of the
act the affidavit was made prima facie evidence only of the
fact certified, and that the defendant was not precluded there-
by from showing that in truth and fact the requisite consent
had not been obtained, and further that there could be no bona
fide holding of bonds issued without consent in fact, which
would preclude the town from contesting their validity.

These cases, considered in connection with the proof in this
case, establish the proposition that the bonds issued by the de-
fendants never had a legal inception, and were void. The
town could have successfully defended against them in the
courts of the State, and it would be no answer to the defence
that the bonds were held by purchasers for value without



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640 TOWN OF ONTARIO V. HILL et al.

actual notice of the defect in the authority of the commis-
sioners. The town has been compelled to pay a portion of
the bonds, pursuant to judgments obtained in the courts of the
United States, in opposition to the rule and principle estab-
lished in the courts of this State. But conceding, as we must
upon the evidence, that the bonds were issued by the defend-
ants without authority, in the sense that they were issued
without the requisite consent having in fact been obtained, so
as to make them valid obligations of the town, it does not fol-
low that the defendants, in issuing the bonds, were guilty of
official misconduct. The second section of the act of 1869 pre-
scribes a rule of conduct and judgment for the government of
the commissioners in determining the question whether the
requisite consent of taxpayers, in number and in respect of
property, has been obtained, so as to justify them in perform-
ing the executive and ministerial act of executing and deliv-
ering the bonds. They, of course, are bound to act in good
f^ith and without fraud, but so acting, the verified certificate
of the assessors, made in conformity with the act, is a com-
plete justification of and protection to them in issuing the
bonds, whatever the abstract truth may be, and whether or not
the requisite majority of taxpayers have consented. The ac-
is incapable of any other reasonable construction. The com-
missioners are authorized to issue the bonds upon the consent
of the majority of taxpayers, representing a majority of the
taxable property appearing on the assessment-roll. But they
are not charged with the duty of procuring the consent or of
ascertaining the fact of consent by inquiry, or the examination
of witnesses, or from a comparison of the assessment with the
consent.

The second section prohibits commissioners from contract
ing any debt, unless the specified consent shall first have been
obtained, and then follows the clause, " and which fact shall
be proved by the affidavits of the assessors," etc., thus plainly
making the affidavits the evidence upon which the commis-
sioners are to act in determining whether the requisite con-
sent has been given. The affidavit protects the commissioners
acting in good faith, because the legislature manifestly so in-
tended. It does not protect the bondholders, because the
assessors and commissioners are mere agencies to bind the
town on the precedent condition of actual consent, the per-



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TOWN OF ONTARIO V. HILL et al. 64I

formance of which purchasers must ascertain at their peril,
and while the affidavit of the assessors and the act of the com-
missioners afford some assurance of the regularity and validity
of the proceedings, they are, as to third persons, the asser-
tions of special public agents, which do not bind the town.

The town is not, however, remediless in case the assessors,
contrary to the fact, certify that the requi- j^^ ^^ ^^^^
site consent has been obtained, or, in case the ^i^SolSu SI
commissioners, acting upon the certificate, issue "■^^^^•
the bonds. The proceedings may be reviewed on cer-
tiarari, People, ex reL Yawger, v. Allen, 52 N. Y. 538;
People, ex rel, Haines, v. Smith, 45 Id. yy2 ; the town may
bring an equitable action to cancel the bonds and restrain
their transfer. Town of Spring^ort v. Teutonia Sav. Bank, 75
Id. 397 ; s. c, 84 Id. 403 ; or it may await the bringing of an
action to enforce the bonds and defend on the ground of their
invalidity. Starin v. Town of Genoa, and Cagwin v. Town
of Hancock, supra.

The trial court directed a verdict for the plaintiff for the
amount of the judgments recovered and col-
lected of the town, with interest, and refused ^^^0'/"^^
to submit the question of the good faith of ''^^*
the defendants to the jury. We are of opinion that this
direction was erroneous. If there was any evidence of
bad faith on the part of the defendants in issuing the bonds,
it was, to say the least, far from being conclusive. The
defendants testified that they believed that the requisite num-
ber of taxpayers had consented, and issued the bonds in good
faith, relying upon the affidavit of the assessors. It is claimed
that they had notice from the complainant in the action
brought by Gales and others in 1871, that the majority had
not consented. It is true that this was charged in the com-
plaint in that action, but the plaintiffs discontinued the action
soon after its commencement upon a settlement between the
plaintiffs and the railroad company, which assumed that
bonds to some amount had been authorized, and the issue of
consent or non-consent was not tried. The defendants were
not bound to accept the statement of the plaintiffs in that
action, as against the affidavits of the assessors. So also the
fact that a paper purporting to be a revocation of consent on
the part of certain taxpayers was, in 1870, served on one of

9 Cor. Gas. — 41



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642 MORSE V. CITY OF WORCESTER.

the persons who was subsequently appointed a commissioner,
did not tend to show fraud on the part of the commissioner
in acting upon the certificate of the assessors.

The general course of adjudication in this State up to 1873
was adverse to the right of a consenting taxpayer aSterward
to revoke or withdraw his consent In re Town of Greene,
38 How. 515; People, ex reL Hoag, v. Peck, 4 Lans. 528;
People, ex rel. Say re, v. Franklin, 5 Id. 129. The contrary
rule was first declared in People, ex rel. Irwin, v. Sawyer, 52
N. Y. 296, decided in 1873.

The claim that the defendants induced the assessors to
make the affidavit, by the false representation that a majority
had consented, was controverted on the trial. The affidavit
was made before the defendants had been appointed commis-
sioners, and if what took place at that time tended to show
that their subsequent action as commissioners was not in good
faith, it was a matter for the jury.

The same is true in respect to the claim that the defendants
knew that the affidavit was made without an actual compari-
son by the assessors of the consent with the assessment-roll,
and if this was known to them, it would not establish that
they knew the affidavit was false.

We are of opinion that the plaintiff failed to maintain his
action on the merits, and that the verdict was improperly
directed. This conclusion renders it unnecessary to consider
the other questions in the case.

The order of the general term should be affirmed, and judg*
ment absolute entered for the defendants on the stipulation.

All concur.



Morse

V.

City of Worcester.

(Advance Case, Massachusetts, June 29, 1885.)

When the legblature authorizes a city or town to construct sewers, or to
use a natural stream as a sewer, it is not to be assumed that it intends that
it may be done in such a way as to create a nuisance, unless this is the nec-
essary result of the powers granted ; and if it is practicable to do the work



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MORSE V. CITY OF WORCESTER. 643

authorized without creating a nuisance, it is to be presumed that the leg-
islature intended it should be done so. This, however, does not im-
ply the duty of the city to adopt an extensive S5rstem of purification inde-
pendent of the construction of the sewers, or require the taking of large
tracts of land not authorized by statute for that purpose.

Bill in equity praying that the defendant may be required
to abate a nuisance, caused by the emptying its sewers into
Mill brook, and adopt reasonable and proper precautions and
methods for the purification of the waters discharged from
Mill brook ipto Blackstone river. The defendant demurred
to the bill. The case was heard by a single justice and re-
served for the consideration of the full court upon the bill and
demurrer.

R. M. Morse^ Jr,y and /. Hopkins for plaintiff.
E, R. Hoar and F. P. Goulding for defendant.

Morton, C. J. — The statute of 1867, chap. 106, authorized
the city of Worcester to fix the boundaries of several brooks,
named therein, one of which is Mill brook, an actual stream
emptying into the Blackstone river, and to alter, change,
widen, straighten, and deepen the channels of said brooks and
remove obstructions therefrom, and to use and appropriate
such brooks, cover them, frame, and inclose them, pacts.

in retaining walls, so far as they shall adjudge necessary for
purposes of sewerage, drainage, and the public health. The
bill alleges that the city, acting under this statute, has
changed, widened, and deepened the channel of Mill brook
and now uses it for the purpose of the sewerage and drainage
of the city, having constructed a great number of sewers and
drains emptying into it ; that the whole sewage of the city is
discharged into it and through it into the Blackstone river ;
that a nuisance is thereby created, by which the plaintiff, who
is the owner of a mill-site on the Blackstone river, is greatly
injured ; that the city could and should have so constructed
said sewers and drains, and should have so properly purified
the sewage passing through them, as not to create a nui-
sance ; and that it ** carelessly, negligently, and unnecessarily
so constructed said sewers and drains, and carelessly, negli-
gently, and unnecessarily so destroyed the waters therefrom,
and so negligently omitted to take reasonable and proper pre*



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644 MORSE V. CITY OF WORCESTER.

cautions an(l methods in the construction of said sewers and
drains and purification of said waters/' that the nuisance com-
plained of is created.

The defendant demurs to the bill and, therefore, for the
purposes of this hearing, we must take all the facts alleged to
be true. The question of the rights and duties of the city in
the use of Mill brook as a sewer has been before this court in
several previous cases. Merrifield v. Worcester, no Mass*
216; Washburn & Moen Manufacturing Co. v. Worcester,
116 Id. 458.

When the legislature authorized a city or town to construct
sewers, or to use a natural stream as a sewer, it is not to be
assumed that it intends to authorize the city or town so to
8XWKK8 TO n construct its sewers, or so to use the stream, as to
5SSLicSr™°'" create a nuisance, unless this is the necessary re-
sult of the powers granted. On the contrary, if it is practi-
cable to do the work authorized without creating a nuisance,
it is to be presugied that the legislature intended that it
should be so done. This principle has been recognized and
applied in many cases. Haskell v. New Bedford, 108 Mass.
208 ; Bray ton v. Fall River, 113 Id. 218 ; Boston Rolling Mills
V. Cambridge, 117 Id. 396; Stainton v. Metropolitan Board
of Works, 23 Beav. 225 ; Mersey Docks Trustees v. Gibbs^
L. R., I H. of L. 93 ; Atty.-Gen. v. Colney Hatch Lunatic
Asylum, L. R., 4 Ch. 147 ; Atty.-Gen. v. Leeds Corporation,
L. R., 5 Ch. 583.

The English cases we have cited were decided under stat-
utes differing from ours, but they are instructive for their
statements and discussions of the general principles applying
in such cases, irrespective of the particular provisions of their
statutes. In the case at bar, the legislature authorized the
city of Worcester to use Mill brook as a sewer ; by necessary
implication the statute authorized it to empty its sewage into
Blackstone river, but we cannot presume that it was the in-
tention of the legislature to exempt the city from the obliga-
tion to use due care in the construction and management of
its works, so as not to cause any unnecessary, injurious con-
sequences to the rights of others. If it is practicable to use
any methods of constructing the sewer, and, as a part of the
construction, of purifying the sewer at its mouth, at an ex-
pense which is reasonable, having regard to the nature of the



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MORSE V. CITY OF WORCESTER. 645



Online LibraryLawrence LewisAmerican and English corporation cases : a collection of all corporation cases, both private and municipal (excepting railway cases), decided in the courts of last resort in the United States, England, and Canada [1883-1894] → online text (page 66 of 73)