Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1888-04-07


under the Act of 1858, whether tina
right Of action arises from the in
herent conditions of the bonds anC
coupons or from the Illegal acts O
the city or its officers between the
years 1868 and 1877, then this suit might
have been brought in February, 1877
Before that time the coupons, by theii
face, appear to have been due, and all the
illegal acts were done which the plaintiff
alleges gives him a right of action. even
though said right might not have existed
without those acts. But the plaintiff
seems to assume the position that suit
might be maintained for the interest on
coupons when it would not be lawful to
sue for the coupons themselves. The
plaintiff produces no authority or prece-
dent to support this position, and Judge
Thornton, in his supposititious case,
which seems to be the foundation ON which
he hopes to sustain this action, supposes a
case where an action is brought to recover
coupons and interest. He does not suggest
as possibility that an action could be
brought for interest on the coupons with
out suing for the coupons themselves. But
even supposing suit could be brought for
interest without suing on the coupons Ia
proposition we do not admit, interest was
due as often as once year, and there GER
tainly was no bar in the way of bringing
suits In 1877 for the interest which fell
between January, 1876, and January, 1877,
and SO on from year TO year. so that all
claims Tor interest that could have been
brought against the city by Mr.. Davis
must be that interest which fell due within
the last four years prior to the bringing of
this suit. That the Statute of Limitations
begins to run agains coupons from the day
they fell due was settled by the Supreme
Court of the United States in the case of
Clark v. Iowa City go Wall, p. 5S2)
The plaintiffs counsel cite this case TO
show that coupons when past due bear in
terest. That proposition we do not DENY.
In recent decisions it has been abundantly
settled that coupons, after due, do bear
interest, unless the law under which they
were issued contains some provision which
operates as an inhibition against this con-
struction of the instrument Formerly il
was doubted if coupons could be construed
as bearing interest, because this was in the
nature of compound interest, something
looked upon with horror by all Courts in
Christendom up to within about a half
century past.
But the plaintiff was not happy in his
citation in this case, nor is he correct in
his statement of what was decided in the
case. The plaintiff, in introducing this
case to the notice of the Court, says:
In Clark VS.. Iowa City go Wall, 5Ss), the ac-
ton begun in 1874 was to recover the amount
due on coupons which matured in 1860 with
Legal interest from date of maturity, the bonds
from which the coupons were cut having been
previously paid. The defense was first, the
statute OF limitations, and second, that il the
coupons were not barred no interest could be
allowed on them. The plea of the statute was
overruled and upon the question of interest.
From the statement of the case as we
find it in 20 Wall there does not seem to
have been any question at all as to
whether the coupons bore interest In the
Court below, the only defense made by the
defendent was the Statute of Limitations.
First, plea in the usual short form, and
secondly plea setting up the facts that
the plaintiff purchased the coupons in the
market after they had been severed from
the bonds, and that the bonds themselves
had been long since either paid or can.
celled, and the plea that under these cir.
cumstances they were barred In other
words, the defendant put in two pleas Of
the Statute of Limitations. The Statute Of
Limitations in the State of Iowa was ten
years on all written instruments or obliga-
lions TO pay money, either bonds or I'M
sealed instruments. These coupons had
been due more than ten years; the bond.
from which they had been detached had
dnn lncc hon, Tor,
judges in the Circuit Court differed as t
whether the coupons were or were moi
barred by the Statute of Limitations
Tbs proposition alone was certified to the
SUPPER Court:
Does the Statute of Limitations commence tC
run upon the coupons from their own maturity
res pectiyely, or does it commence upon tn,
Coupons only from the maturity of the bonds u
which said coupons belong?
The Supreme Court held that the statute
did begin to run from the date of the ma
turity of the coupons, and that the plain
titi's action was barred. Upon this poin
Judge Field, delivering the opinion Of tn,
Court, said:
Coupons, when severed from the bonds [,
which they were originally attached are il
legal effect equivalent TO separate bonds for tn,
different installmentS of interest The like nc
ton may be brought upon each of them WheI
they respectively become due, as upon the bono
itself when the principal natures: and to eacf
action-to that upon the bond and 10 each o
those upon the coupons-the same limitation
must upon principle apply. All Statutes o.
Limitation begin to run when the right of &c
ton IS complete, and it would be exceptiona
and Illogical 10 hold that the statute sleeps witt
respect 10 claims upon detached coupons, willis
a complete right of action upon such claims
exists in the holder. We answer, therefore. tn,
ri tial fhaf tns.G
which extends the same limitations to actions
on all written contracts, sealed or uusealed be
gan to run again the coupons in suit from thei
respective maturities, and accordingly affirm
the judgment.
The plaintiffs counsel were in error il
supposing that the defendants plea of tn,
Statute of Limitations was overruled :
it was sustained, and judgment for the de
PENDANT in the Court below and affirmed il
the Supreme Court. This opinion wa,
concurred in by all the Judges, excep
Justice Clifford who thought the coupon
would not be barred until ten years afte
the bonds from which they We're removed
were due. What Justice Field said abou
interest on the coupons was merely il
illustration of the general current of decis
ions about coupons. 1t had no connection
with the case before the Court. We hav,
been thus particular in examining thi
case because it settled one importan
point-that the Statute of Limitation
begins to run against coupons from tn
time they are due, just as against an,
other obligation, a point which we thinl
has never been questioned, but Away
recognized as settled law since this de
cisiop.
OF course we do not deem it necessar,
for us to say that we do not for a moment
suppose that the gentlemen on the othel
side made any intentional misstatement O
what was decided in this case but merely
in the hurry of preparing a brief, in which
they have cited great many authoritie
on this point of interest, were too mucl
hurried to examine all the cases critically
and were misled by the language in Judge
Fields opinion, and did not carefully ex
anime the reporters statement of tn,
case, which would have enlightened then
as to the real point decided.
So far we think we have satisfactorily
established these propositions:
Firstly analysis of the statute We
have shown that the coupons were only
nominally due in 1876, and not in fact du,
until there was money in the treasury tC
pay them, to wit, in 1887.
Seeond-The city was never liable t.
any suit or action ON these coupons. ever
if they were absolutely due in 1876, as W,
have shown both by the terms of the Law
under which these bonds were issued anC