County of Greene v. Daniel County of Pickens

ERROR to the Circuit Court of the United States for the Southern District of Alabama.

The first of these actions was brought by Richard C. Daniel against the county of Greene in the State of Alabama, to recover the amount of the principal and interest on certain coupon bonds numbered from 51 to 100, each for five hundred dollars, issued by the county in payment of its subscription to the stock of the Selma, Marion, and Memphis Railroad Company. The bonds are signed by the judge of the Probate Court of the county as ex officio presiding officer of the court of county commissioners, and are payable at the office of said company in the city of Memphis, or at its agency in the city of New York. They bear date Jan. 1, 1877, and recite that they are 'issued under and pursuant to an order of the court of county commissioners of said Greene County, made under authority of the constitution of the State of Alabama and the laws of the legislature of the State of Alabama, authorized by a vote of the people of said county at a special election held for the purpose Sept. 14, 1867.' The coupons are payable semiannually on July 1 and January 1.

The county demurred to the complaint on the ground that it does not appear therefrom that the demand sued on was ever presented to the court of commissioners, as provided by the laws of the State. The demurrer was overruled. The county then pleaded five pleas. The first avers that the bonds and coupons were given in payment of the pretended subscription by the county to the stock of said said company, and that the only authority to subscribe to said stock and to issue said bonds and coupons is found in an act of the General Assembly of Alabama, approved Dec. 31, 1868, entitled 'An Act to authorize the several counties and towns and cities of the State of Alabama to subscribe to the stock of such railroads throughout the State as they may consider most conducive to their respective interests;' and that said pretended bonds and coupons being issued upon no other authority or proceedings taken by the commissioners' court of said county, are not the bonds and coupons of the said county. The second avers that the votes of the qualified electors of said county in favor of the subscription to said stock were induced and secured by certain false and fraudulent representations of the railroad company as to the expenditure of the proceeds to be derived by it from said bonds and coupons. The third, fourth, and fifth aver that the plaintiff acquired them from the company with a knowledge of the foregoing facts, and that he is therefore not a bona fide holder.

A demurrer to the defendant's pleas was sustained, and judgment rendered in favor of the plaintiff. The county sued out this writ of error. The material part of the proceedings of the court of county commissioners referred to in the defendant's pleas are as follows:--

'COURT OF COUNTY COMMISSIONERS, AUGUST TERM, 1869.

'THE STATE OF ALABAMA,

'Greene County:

'At a regular term of the commissioners' court, begun and held in and for the county and State aforesaid, at the court-house thereof in the town of Eutaw, on Monday, the ninth day of August, 1869,. . . the following proceedings were had:. ..

'Whereas the president and directors of the Selma, Marion, and Memphis Railroad Company have this day submitted to the commissioners' court of Greene County a proposition for a county subscription by said county of eighty thousand dollars to the capital stock of said railroad company, and made application to said court to order an election within sixty days from this date, to submit the said proposition of said railroad company to the qualified electors of said county for their acceptance or rejection in pursuance of the provisions of an act of the General Assembly of the State of Alabama, entitled 'An Act to authorize the several counties, towns, and cities of the State of Alabama to subscribe to the capital stock of such railroad through the State as they may consider most conducive to their interests,' approved Dec. 31, 1868, the said proposition being that said county shall subscribe ($80,000) eighty thousand dollars to the capital stock of said company at fifty dollars ($50) per share, to be paid in the bonds of said county, payable to said railroad company or bearer in sums of one thousand five hundred dollars each, and due ten and twenty years after date thereof, with interest coupons attached for interest on each of said bonds at the rate of eight per cent per annum, to be paid semi-annually.

'It is now therefore considered and ordered by the court that the said application be and the same is hereby granted. And it is further ordered by the court that such an election shall be held in the several precincts of said county as established by law, on Tuesday, the fourteenth day of September, 1869.'

'COURT OF COUNTY COMMISSIONERS, DECEMBER TERM, 1869.

'THE STATE OF ALABAMA,

'Greene County:

'At a court of county commissioners begun and held in and for Greene County aforesaid, at the court-house thereof in Eutaw, on the third Monday of December, A.D. one thousand eight hundred and sixty-nine, being the twentieth day of said month.

'Whereas an order was made by this court on the ninth day of August, 1869, by which the proposition in writing of the president and directors of the Selma, Marion, and Memphis Railroad Company, for a county subscription by the county of Greene of eighty thousand dollars to the capital stock of said railroad company, was submitted to the qualified electors of said county at an election held at the several precincts in said county on the fourteenth day of September, 1869, conducted by the same officers and in the same manner as provided by law for general elections in this State, after giving thirty days' notice thereof, as required by law; and whereas it appears to the court, from the returns of the sheriff of said county, that such election was held on the fourteenth day of September, 1869, in pursuance of the said order, and it also appearing to the court by the returns of said election made to the judge of the probate court of said county that the said election thus held resulted in favor of the said proposition and subscription to the capital stock of said company,. ..

'It is now ordered by the court that the said proposition and the returns of the said election be received and recorded on the minutes of this court.

'And it is further ordered that the proposition of the said company be, and the same is hereby, accepted, and the said court of county commissioners are hereby authorized and do make, in the name and for the said county of Greene, the said subscription of eighty thousand dollars to the capital stock of said company in the name set forth in said proposition; and it is further ordered by said court that the bonds of the said county of Greene, in the sums of five hundred dollars each, with interest coupons attached for semi-annual interest at the rate of eight per cent per annum, the said bonds payable to the said company or bearer at twenty years from date, and dated the first day of January, 1870, and due and payable the first day of January, 1890, at the office of the said company, or at their office or agency in the city of New York, when presented at the office of the said company or their agency, shall be issued and delivered to the said company, signed by the probate judge of said county, and that the said coupons thereto attached of twenty dollars each shall be signed by the said judge, payable in like manner on the first day of January and July of each year from and after the date of said bonds.'

The proposition referred to in the foregoing proceedings was as follows:--

'To the Honorable the Court of County Commissioners of Greene County in the State of Alabama:

'We, the president and a majority of the board of directors of the Selma, Marion, and Memphis Railroad Company, in pursuance of the provisions of an act of the legislature of the State of Alabama, entitled 'An Act to authorize the several counties and towns and cities of the State of Alabama to subscribe to the capital stock of such railroads throughout the State as they may consider most conducive to their respective interests,' approved Dec. 31, 1868, hereby propose to the said county of Greene, through your honorable body, under and by virtue of the said act of the legislature, to subscribe for and take eighty thousand dollars of the capital stock of said railroad company at fifty dollars per share, to be paid in the bonds of said county, payable to the said railroad company or bearer, said bonds to be so payable in the sum of one and five hundred thousand dollars each, and due ten and twenty years after the date thereof, and bearing interest at the rate of eight per cent per annum from date till paid, with interest coupons attached for interest on each of said bonds at the rate aforesaid, which interest is to be paid semi-annually, the amount of said interest and bonds to be payable as aforesaid at such time and place as may be agree upon between the said railroad company and the judge of probate of said county, as soon as may be after the acceptance of this proposition by the qualified electors of said county, at an election held for the purpose, under and by virtue of the provisions of the said act of the legislature of the State of Alabama.

'All of which is respectfully submitted to your honorable court for your action, and that of the qualified electors of Greene County, in the State of Alabama, thereon, and is signed by us at ___ in Perry County, in the State of Alabama, this the sixth day of August in the year 1869.

'SELMA, MARION,

'SELMA, MARION, & MEMPHIS RAILROAD CO.,

'By N. B. FORREST, Pres.'

The second suit was brought by Daniel against the County of Pickens, upon coupons attached to bonds issued by it for two hundred and fifty dollars, and payable to the same company as were the bonds in the other suit. The defence was the same in both cases. In the Greene County case the proposition of the railroad company, which was made June 14, 1869, was that the county should subscribe one hundred thousand dollars to the capital stock, and issue its bonds for one thousand dollars each in payment thereof. It was accordingly submitted to the qualified voters at an election held for that purpose, Aug. 3, 1869. The vote was in favor of the subscription.

An order of the court of county commissioners, passed August 16, after reciting the result of the vote and directing the subscription to be made, contains the following: 'With the consent of said company it is further ordered that fifty thousand dollars of subscription be paid for as aforesaid in bonds of the denomination of two hundred and fifty dollars each, and fifty thousand in bonds of the denomination of one thousand dollars each.' There was a judgment for the plaintiff. The county then sued out this writ of error.

The laws of Alabama bearing upon the cases are referred to in the opinion of the court.

Mr. John T. Morgan for the plaintiffs in error.

No counsel appeared for the defendant in error.

MR. CHIEF JUSTICE WAITE delivered the opinion of the court.