Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/323

 PART III.] ACTS BEYOND THE CORPORATE POWERS. [§ 332. Matthews said, giving the opinion of the court in Dixon County v. Field : " Where the validity of the bonds depends on an estoppel claimed to arise upon the recital of the instrument, the question being as to the existence of power to issue them, it is necessary to establish that the officers executing the bonds had lawful authority to make the recitals and to make them conclusive. The very ground of the estoppel is that the recitals are the official statements of those to whom the law refers the public for authentic and final information on the subject." 1 Thirdly : the recital or fact to be conclusive on the munici- pality must be the act of municipal officers empowered to cer- tify to it, or to take final action in the matter, and not the act of some outside tribunal before whom the municipality has had no opportunity of appearing ; or at least the fact or recital must be based on the action of such municipal officers. Thus, a statute provided that the holder of certain municipal bonds mio-ht have them registered in the office of the auditor of state, whose duty it should then be to notify the town officers issuing them, who in their turn should record the fact of the auditor's registration ; and the bonds should thereafter be considered registered bonds. The mere registration by the auditor, with- out further steps, was held ineffectual and not to estop the town. 2 Giving the opinion of the court, Justice Matthews said : " If complete and conclusive effect were, on the contrary, given to the ex parte record of the auditor of state, as is claimed for it, the obvious design and just purpose of the statute would be not secured, but subverted ; and municipal corporations might be subjected to liability for bonds purporting to be is- sued by them, which, in fact and in law, were not their ob- ligations, by virtue of a proceeding of which they had no notice, resulting in an adjudication which they had no opportunity of contesting. A construction of the statute that necessarily leads to that conclusion is not warranted by its terms, and would be repugnant to fundamental principles of common right. If the registration of bonds issued under the act itself is to have the force of an adjudication by the auditor, the preliminary record Town of Springport v. Teutonia Sav- ings Bank, 75 N. Y. 397; S. C, 84 N. Y.403; Craig v. Town of Andes, 93 N. Y. 405. 1 111 U. S. 83, 94. 2 Bissell v. Spring Valley Town- ship, 110 U. S. 162. 303