Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/321

 PART III.] ACTS BEYOND THE CORPORATE POWERS. [§ 332. § 332. The more recent decisions of the Supreme Court of the United States, either deciding new points or „. interpreting former decisions, place the following Recent de- limitations or conditions on the operation of recitals in municipal bonds as estoppels. First : the recital will not conclude the municipality when from the face of the bond or from some record with notice of which the holder is affected, it appears that the statute authorizing the issue has not been complied with. 1 Thus, where a statute directs the county com- missioners, when the electors shall have voted to issue bonds in aid of a railroad, to order the county clerk to make the sub- scription, and to cause the bonds to be issued in the name of the township, signed by the chairman of the board and attested by the clerk under the seal of the county, the signature of the clerk is essential to the valid execution of the bonds, even though he has no discretion to withhold it ; and the town will not be es- topped from disputing their validity by reason of recitals in the bonds to the effect that the terms of the statute have been com- plied with. 2 In another case, under the constitution and laws of Nebraska, a county had authority to issue bonds to the extent of ten per cent, of the assessed valuation of the property in the county. The bonds stated on their face that they were part of a series amounting in the aggregate to a specified sum, which exceeded ten per cent, of the assessed valuation of the property in the county, as any one could have ascertained by examining the assessment rolls on hie. It was held that the officers issuing the bonds had no authority to conclude the county by a recital in the bonds to the contrary of what could thus have been as- x Of course no recital will conclude the municipality where there was no authority to issue the bonds; for every one is bound to take notice of the rule that municipal corporations have no implied authority to issue negotiable bonds; and also every one is bound to take notice of the terms of the legislative authority under which the bonds purport to be is- sued. See §§ 319, 320. The Federal Supreme Court "has never intended to adjudge that mere recitals by the officers of a municipal corporation in bonds issued in aid of a railroad cor- poration precluded an inquiry, even where the rights of a bona fide holder were involved, as to the existence of legislative authority to issue them." Northern Bank v. Porter Township, HOLT. S. 608, 615, opinion of Court per Harlan, J. - Bisscll i Spring Valley Township. 110 U. S. 162. 301