The Evansville daily journal. [volume] (Evansville, Ia. [i.e. Ind.]) 1848-1862, 1858-12-21
An Important Decision.

A case has recently been decided in the
U. S. Circuit Court, lor the Indiana District,
which involves some points in which our
city has an interest The action was in the
name of Geo. p. Blssell & Co, against the
city of Jacksonville, for interest due on the
city's bonds issued to the Fort Wayne and
Southern Railroad. The following is the
history of the case, and a statement of the
points made on the trial, taken from the
New Albany Ledger:
The cities of Indiana were prohibited by
their charter from contracting debts, except
on the petition of three-fourths of their legal
voters. The common council of Jefferson
vile supposed this authorized them, on such
petition, to subscribe for stock to build a
railroad. Petitions were accordingly pre-
sented, praying them to subscribe for $780,
900 of stock in the Fort Wayne and South
ern Railroad Company, and to issue city
bonds in payment. The common council
decided that three-fourths of the voters had
so petitioned, and they made the subscrip-
ton. Just then, the Supreme Court of the
State decided, in the case of another city,
that the power to contract debts was for
municipal purposes only, and that the com
mon council could not incur one to build
railroad. This was in effect deciding the
Jacksonville subscription to be void. The
common council then applied to the Legisla-
ture and an act was passed authorizing
| Cities which had subscribed for railroad
| stock on the petition of three-fourths of the
voters, to confirm and ratify the subscrip-
| ton, and enacting that on such ratification.
| the subscription and the bonds to be issued
therefor should be valid. Thereupon the
common council passed resolutions to ratify
the subscription, and to issue 200 city bonds,
of 81 900 each, payable one half in twenty
four and the other half in thirty-fve years,
in the city of New York, with semi-annual
interest. The bonds were issued according
ly, and the plaintiffs became the owners OF
thirty of them; and the first two in
stalments of interest being due and unpaid
sued the city to recover it.
The defense set up for the city was that
three-fourths of the legal voters had not pc
titioned for the subscription of the stock
and issue of the bonds. To this the plain
tiffs objected, that it was not competent fol-
the city to make such defence, because thu
Common Council had declared on their min
utes that three-fourths of the voters had S,
petitioned, and the defendant was stoppe,
from alleging or proving the contrary
and because the bonds had been issued with
, out objection at the time, and had gone int,
the hands of innocent holders, who woul,
be defrauded if such defence were per
mitted to be made and could be proved
These questions were fully argued by tn
counsel, at the Nov. term, 1857, and agai
at the May term, 1858, and taken under ad
visement. At the present Nov. term, 1855
Judge Huntington, after having consulte
: with Judge Mclean, decided it was com
# petent for the city to make the proposed dc
fence; that the power to subscribe for sue
stock and issue such bonds was a special on
= given to a non-judieial tribunal, and ever
II substantial requisite of the statute must
strictly complied with or the subscriptio
:. and the bonds would be void
A jury was then sworn to try the que
ton, whether three-fourths had so petition
D ed; and after hearing the evidence, arg
OF ments of counsel, and charge of the coul
Or they returned verdict for the defendant
The result of the case is, that as a matter
at fact three-fourths of the voters did not
lie petition and that therefore, as matter
le law, the bonds are void into whosoevel
ed hands they might come.