Case ID: nys_19/html/0944-01.html
Source: Caselaw Access Project
Author: {"author": "Barnard, P. J. Cullen, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

City of Poughkeepsie v. Quintard.
    
      (Supreme Court, General Term, Second Department.
    
    July 22, 1892.)
    City Charter—Statutory Construction—City Bonds.
    Laws 1889, c. 526, authorizes any city to sell new bonds, and retire the old ones as-the latter mature. Poughkeepsie city charter (Laws 1883, c. 523) prohibits the council from borrowing any money for the city except as therein provided, and provides that the “ council shall not create any pecuniary obligations * * * which shall not be payable in the current year, and which cannot be discharged from the income of the same year. ” Held, that the Poughkeepsie council may sell new bonds: to retire old ones, such exchange not creating any new obligation. Gulden, J.,. dissenting.
    Case submitted on agreed statement.
    Controversy between the city of Poughkeepsie and William J. Quintard, submitted on an agreed ease without action. Judgment for plaintiff.
    Argued before Barnard, P. J., and Dykman and Cullen, JJ.
    C. B. Herrick, for plaintiff. Clark c6 Sedgwick, for defendant.
   Barnard, P. J.

The right to exchange a new bond of the city for an old' one maturing is given plainly by chapter 526, Laws 1889, and the laws amended thereby. The act of 1889 went further than the preceding acts. In that legislature, permission was given to sell new bonds under very-guarded conditions, and to pay the old ones with the proceeds of the new. Neither the direct exchange nor the issue of the new bonds constitutes a creation of a liability under the city charter. Neither creates a new debt or obligation. As to the exchange, it is very plain that a substitution of one bond for another created no new liability. The application of money derived from a new bond to the payment of the old is the same thing, in the spirit of the act permitting cities to meet maturing loans by an exchange or sale of new bonds. Judgment for plaintiff upon submitted case, with costs.

Dykman, J., concurs.

Cullen, J.,

(dissenting.) This is a controversy without action submitted under the Code. The sole question involved is the power of the plaintiff te issue bonds, the proceeds of which are to be applied to the payment of water bonds maturing this year. Chapter 75, Laws 1878, as amended by Laws 1878, e. 317; Laws 1884, c. 244; Laws 1887, c. 282; and Laws 1889, c. 526,-authorize any village, city, town, or county, whenever any of its bonds mature or in anticipation thereof, to issue and sell new bonds at a rate of interest not exceeding 6 per cent., and also less than the rate of the bonds becoming due, to retire such bonds. The contingency on which the plaintiff has assumed to issue the bonds in controversy is exactly the one contemplated by this statute, and it is not denied that the plaintiff would have the necessary power to issue the bonds, except for the restricted provisions of the city charter. The charter provision on this subject now stands (Laws 1883, c. 523) as follows: “See. 125. The common council shall not have power to borrow, and is hereby expressly prohibited from borrowing, any money on account of the city, except as herein provided. The said council shall not create any pecuniary obligations whatever on the part of the city which shall not be payable in the current year, and which cannot be discharged from the income of the same year. ” This provision has been in the charter substantially in the same form since the incorporation of a city in 1854. The object for which the maturing bonds were originally issued was not authorized by the charter or its amendments. It was by a special act (chapter 333, Laws 1867) that the city was empowered to acquire a water supply, and to issue bonds therefor. But by the act of 1883 the water supply was brought under the charter provisions and under the charter restrictions. It is to be observed that, while power is given by this act to the water commissioners constituted thereby to acquire on behalf of the city lands and water, the authority to create debt therefor given by the original act is omitted. At the same time the debt thitherto contracted on this account is incorporated into the general debt of the city, because by section 223 the 5 per cent, on the amount of water stock levied annually as a tax is to be placed in the public debt fund. Therefore, after the amended charter of 1883, the water debt stood on the same footing and was subject to the same provisions of law as the other debts of the city. The question, then, arises whether the act of 1878 shall prevail over the charter provision governing the city of Poughkeepsie. Admitting that the amendment to that act subsequent to 1883 make it the later statute on the subject, still the rule is that a general act will not be construed to repeal or amend a prior special act, unless such intention is manifest. In re Evergreen, 47 N. Y. 216; In re Com’rs of Central Park,,50 N. Y. 497; Buffalo Cemetery v. Buffalo, 118 N. Y. 61, 22 N. E. Rep. 962.

It is contended, however, on behalf of the plaintiff, that the provision of the charter cited is no more than a statutory expression of the general rule of law that municipal corporations cannot borrow money without authority. We think the language used is too broad and comprehensive to be thus limited. But this is not the only charter provision on the subject. By section 93 it is made the duty of a common council to levy annually a tax sufficient to meet any installments of public debt maturing. It was thus not only directed that no debt should be incurred except as provided for in the charter, but also that all debt should be paid as it matured. To construe the act of 1878 as authorizing the plaintiff to issue these bonds would obliterate both these charter provisions. This, we think, the well-settled rules of statutory construction will not permit. It was the duty of the common council to raise the amount necessary to pay the maturing bonds by tax. We think that the bonds are not authorized by law, and there should be judgment for the defendant on submitted case, with costs.