Nathan Murphy v. James Utter

Messrs. This was an appeal by the loan commissioners of Arizona from a judgment of the supreme court of that territory rendered March 22, 1901, granting a peremptory writ of mandamus and commanding such loan commissioners, upon the tender by plaintiffs of $150,000 bonds of the county of Pima with coupons attached, described in the petition, to issue and deliver to the petitioners refunding bonds of the territory pursuant to certain acts of Congress.

The facts of the case are substantially as follows: By an act of the legislature of Arizona of February 21, 1883, the county of Pima in that territory was authorized to issue $200,000 of bonds in aid of the construction of the Arizona Narrow Gauge Railroad Company, to which company the bonds were made payable. The entire issue was declared to be void by this court in Lewis v. Pima County, 155 U.S. 54, 39 L. ed. 67, 15 Sup. Ct. Rep. 22. This decision was pronounced in October, 1894.

Prior to this decision, however, owing to doubts that were entertained as to the validity of bonds issued in aid of railroads, the legislature of Arizona in 1887 and Congress in 1890 passed certain acts authorizing the refunding of territorial bonds, which had been authorized by law, and, in compliance with a memorial submitted by the legislature of Arizona, Congress passed a further act in 1896 authorizing the refunding of all outstanding bonds of the territory, and its municipalities, which had been authorized by legislative enactments, and also confirming and validating the original bonds, which by the 1st section were authorized to be refunded.

Thereupon, and on December 31, 1896, James L. Utter and Elizabeth B. Voorhies filed the petition involved in this case for a writ of mandamus to compel the loan commissioners to issue refunding bonds in exchange for those originally issued by the county of Pima in aid of the Narrow Gauge Railroad Company. Defendants demurred to the petition, and for answer thereto averred that the bonds of Pima county, held by the petitioners, had been declared, both by the supreme court of the territory, and by this court, to be void, and therefore that the petition should be dismissed. They also interposed a plea of res judicata. The petition being denied by the supreme court of Arizona, the relators appealed to this court, which reversed the order of the supreme court of the territory, and remanded the case to that court for further proceedings. Utter v. Franklin, 172 U.S. 416, 43 L. ed. 498, 19 Sup. Ct. Rep. 183. This decision was made in January, 1899.

Thereupon, and on June 1, 1899, after the case was remanded to the supreme court of Arizona, respondents, by leave of the court, filed an amended return to the effect that the bonds and coupons sought to be refunded were not delivered by anyone authorized by Pima county to do so; that the county never acknowledged the validity of the bonds or paid interest thereon; that the railroad, the construction of which the legislature intended to promote by the issue of the bonds, was never constructed, equipped, or operated; that Pima county never received any consideration whatever for the bonds; that they had been declared void by this court; that petitioners were not innocent holders of them; that the bonds and coupons were not sold or exchanged in good faith, and in compliance with the act of the legislature by which they were authorized, and that they were not intended to be included, and were not included, in the act of Congress of 1896, or any act or memorial of the legislative assembly of the territory. The return also set up the statute of limitations; that the personnel of the loan commission had been wholly changed; that the act authorizing the employment of loan commissioners had been repealed and no longer existed, and numerous defenses which had not been made or set up in the original answer or return.

Petitioners thereupon moved to strike the amended return from the files on the ground that the same had been filed without leave of the court, and that under the decision of this court in Utter v. Franklin no new defenses could be considered. The supreme court of the territory, however, overruled the motion and permitted the amended return to be filed, to which ruling petitioners excepted. But, instead of applying to this court for a writ of mandamus to carry its mandate into effect, they proceeded with the case in the supreme court of the territory, and filed a reply to the amended return. A referee was appointed, testimony taken, and the supreme court of the territory made a finding of facts set out in the record, and awarded a peremptory writ of mandamus directing the refunding of the bonds. From this judgment defendants appealed to this court.

Meantime, however, Elizabeth B. Voorhies, one of the petitioners, had died, and her executors were ordered by this court to be substituted.

Rochester Ford, John G. Carlisle, and C. F. Ainsworth for appellants.

Messrs. John F. Dillon, Harry Hubbard, John M. Dilliam H. Barnes for appellees.

Mr. Justice Brown delivered the opinion of the court: