Page:Federal Reporter, 1st Series, Volume 8.djvu/661

 OEOBOE V. BAIjLS OOUMTT. 6e7 �George v. Ealls County, and another, Garnishee. �[Circuit Oourt, E. D. Missouri. September 24, 1881.) �1. AcT OF Fbbbtjabt 19,. 1875, of Missouei, Consthubd — Municipal Bonds— OgnstiiutionaIi Law— Infhinging THE Obugation of Contbacts. �A county levied and collected taxes for the purpose of paying interest on cer- tain bonds issued by it, and thereaf ter litigation arose as to their validity, and an act was passed by the state legislature authorizing the county court to loan the furid collected, but not spccifying the time for which loans might be made. A Idaii "ifeLS made ior ionr years to A. Bef ore the expiration of that time a bondholder reoovered final judgment against the county, execution was issued, and A. was served with a writ of garnishment. The garnishee answered that the debt from hpr to the county -was not due, and stated the f acts. It was hdd : (1) that said act oijly authorized the county court to invest the fund in ques- tion subject to call, or until the litigation was conoluded ; (2) that if construed to authorize loans for a longer period it would infringe the obligations of the county's contract with its bondholders, and be unconstitutional ; (3) that said fijnds, when paid into the county treasury, became trust funds for the pay- ment of interest upon said bonds, and that it was the duty of the county author- ities to apply them to that purpose as soon as the bonds were held valid ; (4) that A. should be presumed to have known the provisions of the statute under ■which the loan was made, and that the plaintiflE was entitled to judgment against her for the sum borrowed, and any interest thereon which might be unpaid. �Overall, Judson e Tutt, for plaintiff. �H. A. Cunningham, tor defendant. �MoCRARir, C. J. Execution was issued upon a judgraent rendered in this court on the iwenty-first day of October, 1878, in favor of tiie plaintiff and against Ealls county. Under that execution Nannie P. Mitcheli was served with prooess of garnishment. The garnisHee files an answer, from which it appears that on or about the twentieth day of June, 1880, ehe borrowed of the county of Ealls $400, pay- able foiir years after date, with interest at the rate of 6 per cent, per annum, and gave, in payment of such loan, a bond as follows: �"BOND FOR TIIE PAYMENT OF RAILROAD FUNDS. �"Know all men by these presents, that we, Nannie P. Mitcheli, as principal, and E. P. Rails and George E. Frazer, Jr., as securities, jointly and severally bind ourselves and oiir respective heirs, executors, and administrators to the county of Rails, state of Missouri, in the sum of four hundred dollars, to be paid to said county for the use and benefit of the St. Louis & Keokuk Rail- road interest fund of said county, to the payment whereof we jointly and sev- erally bind ourselves, our heirs, executors, and administrators firmly by these presents. Sealed with our seals and dated the twentieth dav of June, A. D. 1880. �" The conditions of this bond are that whereas the said Nannie P. Mitcheli, principal, has this day borrowed from said county the sum of four hundred dollars, belonging to the railroad interest f und of said county, which said sum ��� �