The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1898-11-12

Judge Purnel Decides That Oxford
Must Pay the Bonds.

Must Fay the BONDS.
Judge T. II. purnell fled his opinion
in the Oxford bond ease late yesterday
evening with the clerk OF the United
States Circuit court. 1t declares the
bonds valid and "A mandamus will be
issued, compelling the town commission
ers TO levy taxes TO pay the claim in
volved.
This is an important decision, as il re-
verses the decision of the Supreme
Court of North Carolina at the Zebra
airy term 1895, t116 y. c.. BAD which
declared the bonds invalid on a techni
cality in the passage of the bill authoIi.-
ing their issue.
The decision is very full one. cover
ing eleven typewriter pages, and cites
several important cases and opin.pn,
bearing upon the position taken.
The case grew ont of a compromis
suit in the State courts. and was sub
mitted and argued before Ills honor on
an agreed statement of facts.
The Bank OF Richmond is the holder
of $4,000 of bonds issued by the Town
Commissioners of Oxford 10: the con
struction of the Oxford ana Coast Line
Railroad, which they claim TO have
given value received.
The Town COMMISSIONS = of Oxford
refused to pay the bonds on the ground
that the act authorizing their issue was
not properly entered on the journal of
the House. There is no claim that
there was any fraud in the election
which the town held to decide whether
these bonds should be issued or not, nor
in the manner of the issue of the bonds
by the Commissioners. The ground of
contest was that all the formalties were
not complied with in the passage of the
bill authoriziE the election
THE DECISION.
The facts agreed present the follow
ing cases: The town of Oxford was 2
duly chartered municipai corporation
under the laws Of North Carolina. au-
thorized to sue and be sued, cite, rs
1.-The Board of Commissioners of Ok
ford" In 1891 the Gencr.,, Assembly
Of North Carolina passed m Act to III
corporate the Oxford and Coast Line
Railroad Company. which act passed
the Senate in compliance with the re-
lurements of the Constitution, but in
the House, it appears by he Journa
the bill passed its second and thirG
reading ON the same day and the ayes
and nays were not entered on the Jour.
nal on either reading. This admission
is made with the right reserved to The
plaintiff of objecting thereto, unless
that the court should decide such inn
peaching testimony is admissible under
thn tc,f1 of m
election was held under the act. taboat
which nom question was raised II
which majority of the qualified vo-
tiers voted for Il corporation subscrip-
ton of forty thousand dollars of the
capital stock of the railroad company
and bonds to that amount were duly
issued In 1892, suit was brought by til
railroad company asking for Il manda-
mus against the Commissioners of the
town of Oxford. commanding that body
to levy taxes to pay interest coupons
of said bonds. This suit was compro-
missed and a consent Judgment entered
at the July term. 1892, of the Superior
court of Granville county. Under the
compromise and consent Judgment the
Board of Commissioners issued twenty
bonds of the denomination of one thou
sand dollars each. lin lieu of the forty
thousand dollar bonds issued in 1891 }
setting out the acts of the Legislature,
the litigation and the Judgment and de
cree. These bonds were delivered ia
the officers of the railroad company III
August, 1892, and sixteen sold i'll Rich
mond, Va. to the plaintiff for value
September. 1892. The case has been be
fore the Supreme court of North Caro-
lima, 116 y. c., 500, and 40 \. c., 214
and after the opinion in the latter case
as reported, was certified to by the Su
perior court of Granville county, tn.
plaintiff took Il non-suit.
This cause was heard on agreed facts
and rs presented involves two questions
First, how far the decision of State
court binds the Federal court to mum
cipal bonds. held by nonresident
purchaser for value; and second, wheth
er municipal corporation acting by its
corporate officers can be estopped, to SCI
up the inyalidity of such bonds. by {
consent judgment of court of compe
tent jurisdiction.