Independent School-Dist of Ackley v. Hall

This was a suit to recover principal and interest claimed to be due the defendant in error, on negotiable bonds issued by the plaintiff in error.

By an act of the general assembly of the state of Iowa, approved April 6, 1868, it is provided that independent school-districts shall have power and authority to borrow money, for the purpose of erecting and completing school-houses, 'by issuing negotiable bonds of the independent district, to run any period not exceeding ten years, drawing a rate of interest not exceeding ten per centum, which interest may be paid semi-annually; which indebtedness shall be binding and obligatory on the independent school-district for the use of which said loan shall have been made.' The act prescribes the mode in which the school-board shall submit to the voters of the district the question of issuing bonds, and declares that 'if a majority of the votes cast on that question be in favor of such loan, then said school-board shall issue bonds to the amount voted, * * * due not more than ten years after date, and payable, at the pleasure of the district, at any time before due, which said bonds shall be given in the name of the independent district issuing them, and shall be signed by the president of the board and delivered to the treasurer, taking his receipt therefor, who shall negotiate said bonds at not less than their par value, and countersign the same when negotiated.' With those statutes in force there was issued, in the name of the plaintiff in error, (defendant below,) certain instruments in the following form:

'No. 1.   $500.00.

'INDEPENDENT SCHOOL-DISTRICT, ACKLEY, HARDIN COUNTY, IOWA.

'The Independent School-district of Ackley, Hardin county,     Iowa, promises to pay to Foster Brothers, or order, at the      Hardin County Bank, at Eldora, Iowa, on the first day of May,      1872, five hundred dollars, for value received, with interest      at the rate of ten per cent. per annum, said interest payable     semi-annually, on the first day of May and November in each      year thereafter, at the Hardin County Bank, at Eldora, on the      presentation and surrender of the interest coupons hereto      attached.

'This bond is issued by the board of school directors by     authority of an election of the voters of said      school-district, held on the twenty-third day of August,      1869, in conformity with the provisions of chapter 98, acts      Twelfth General Assembly of the state of Iowa.

'In testimony whereof, the said Independent School-district,     by the board of directors thereof, have caused the same to be signed by the president and secretary, this first day of      November, 1869.

[Signed]

'W. H. ROBERTS,

'President of the Board of Directors.

'S. S. LOCKWOOD,

'Secretary of the Board of Directors.

[Countersigned] 'F. EGGERT, Treasurer School-district.'

To each was attached coupons in the following form:

'Treasurer of Independent School-district, Ackley, Hardin     county, Iowa, will pay the holder hereof, on the first day of      November, 1874, at the Hardin County Bank, at Eldora, Iowa,      twenty-five dollars, for interest due on school-house bond      No. 8.

[Signed]

'W. H. ROBERTS, President.

'S. S. LOCKWOOD, Secretary.'

The defendant in error, (plaintiff below,) who is averred to be a citizen of New York, became the holder of eight of these obligations, with interest coupons attached, each one being indorsed in blank by Foster Bros., the original payees. This suit was brought to recover the amount due thereon, without any averment in the pleadings as to the citizenship of the payees. The district made defense upon various grounds. The case was tried by the court without the intervention of a jury, and there was a general finding for the plaintiff, upon which a judgment was entered against the district. To that finding and judgment the defendant excepted, (but without preserving, by bill of exceptions, the evidence upon which the court acted), and brought this writ of error.

Galusha Parsons and John F. Duncombe, for plaintiff in error.

[Argument of Counsel from pages 137-138 intentionally omitted]

C. C. Nourse and B. F. Kauffman, for defendant in error.

Mr. Justice Harlan delivered the opinion of the court. He recited the facts as above stated, and continued: