Page:Harvard Law Review Volume 5.djvu/182

166 1 66 HARVARD LAW REVIEW. eminent justice who here speaks for the court, render it all the more important that the bar should pass respectful criticism upon the doctrine advanced. This supposed legal difference, upon which Mr. Justice Lamar lays so much stress, was the subject of argument below. The views of the District Judge (Woods) are, in our judg- ment, so sound, and his reasoning so clearly and forcibly put, that we cannot do better than to quote as follows from his opinion: — " Having concluded that under the circumstances the town had the right to borrow, we come to the question whether or not the bonds in suit were issued in the lawful exercise of that power. The argument for the defense, as we have seen, turns upon the supposed difference between a power to issue bonds to a lender and a power to issue them for sale in the market. It is conceded, for the purpose of the argu- ment at least, that the power to borrow existed, and that from that an implied power arose to issue negotiable securities to the lender; but it is insisted that this differs essentially from a right to put the bonds of the town upon the market for sale. If there be a difference legally, in what does it consist? When a town would borrow money, how shall it find the lender? Manifestly, from the power to borrow and the im- plied power to give the ordinary forms of obligations arises the further implication of right to seek the lender; and in the absence of restric- tion in that respect, to seek him in whatever reasonable manner and place he may be found, whether in the banks, on the boards of trade, or elsewhere. And since, in any case, the town must act by an agent, I see no reason, except of policy not affecting the question of power, why it may not send its agent with bonds duly prepared for deliv- ery, to be disposed of to any who, upon the prescribed terms, will take them. In common parlance, and sometimes in the language of legislative enactment, this is called a sale ; but it is a misnomer. It is an issue or execution of the bond, and the purchaser (so called) is a lender in fact, since, strictly speaking, a person, or corporation, cannot sell his own obligation. Until delivered to the other party, it is not an obligation, and only when delivered, whether to the highest bidder in open market, or to the taker found in any other way and place, does it become effective and binding; and he who receives it and pays, or rather surrenders, his money for it is a lender, not distinguishable legally from one who takes a bond payable to him in his proper name. Wherefore, as it seems to me, the alleged distinction between the con- ceded power and the power exercised is not substantial; neither is it justified by the cases cited in support of it." ' 1 22 Federal Reporter, 594.