Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1904-04-12
10 FIGHT PAYMENT
CITY is ENJoINED AGAINST PAY.
ING FIT. MADISON BONDS.
SLOAN GRANTS REST RAINING ORDER
F. M. Hunter and j. c. Mitchell, of
Firm Of Mitchell G. Hunter, Begin
SUIT Which May Save City $4,000
and Large Sum Of Interest.


and Large Sum of Interest.
Alleging that the bonds delivered to
the FIT. Madison and Des Moines Rail
way company by the city of Ottumwa
IN 1893 We're wholly invalid, illegal
and void, that their issue and delivery
were in no manner authorized by law
and that at the time they were issued
the contracted valid Indebtedness
against the city of Ottumwa was in
excess of 5 per cent of the total tax
able valuation Of the city, F. M. Hun
ter and ]. G. Mitchell of the firm of
Mitchell and Hunter were late Satur-
day afternoon granted an injunction
by Judge Robert Sloan temporarily
restraining the city of Ottumwa
through Mayor T. .H. Picker and the
aldermen from paying any part of the
interest or principal of these bonds.
John P. Swanson vs.. the city of OF
tumwa ct al. is the title Of the suit
and Thomas Lambert of Des Moines
a holder of one or more of the bonds
is named as one of the defendants in
the case.
To Be Made Permanent.
The petition upon which the temper.
airy Injunction was granted recites the
history of the issuance Of the bonds
and cites the primary fact that the
question of issuing the bonds was new
er placed before the voters of the city
and were in consequence never proper.
ly authorized and the secondary one
that at the time of the the issuance OF
the bonds the city. was above the stat.
uatory debt limit, as the grounds for
a permenent Injunction against any
further payment Of principal or inter.
est.
Bond History.
In brief the history of the bond
transaction is as follows: A company
organized and known as the TT. Madi.
son and Des Moines Railway =. com
pany, proposed to build railroad from
Fit. Madison to Ottumwa. !, The com.
pany asked that the city Of Ottumwa
donate to 1t sufficient ground for de.
pot, switch tracks, machine shops,
freight house and a round house.
A petition signed it is alleged, by a
majority of the freehold taxpayers of
the city Of Ottumwa was presented to
the city council. requesting the dona.
ton to the company of sufficient
amount of land. suitably located. 1t
asked also for the calling of special
election to vote on the proposition to
purchase the land for q sum not to
exceed $4,000.
The election swas called on August
II, 1890. The vote stood for the prop
osition 839, against the proposition
247. On February 20, 1893, the city
council passed an ordinance authoriz-
ing the issuance of thirty-four bonds
of the denomination of $1,000 each in
favor of the railroad company The
ordinance was vetoed by the mayor,
the late James r.. Burgess, but was
passed on the same evening over his
veto. The bonds were. made out, and
issued about June 8, 1898. i ~
A Different Proposition.
The proposition voted upon in the
special election had been the purchase
of the required amount Of land and
the donation of the land to the compa.
ny. Previous to the election the rail.
road company had contracted for a
number of city lots and pieces of land
in the vicinity of East Mill street, suit
able to its needs, and while the price
that it was to pay was said to be in
excess of $4,000 the company ex
pressed its willingness to accept s34,
900 in bonds to be used in the pur
chase of the land already contracted
for. Instead of purchasing land out
right and donating it to the company
as ordered by the vote Of the people
the council issued the bonds as stated
and donated them direct to the rail
road company.
The road was built and put in oper
alton according to agreement, but in a
short time the line was bought by the
Burlington and has since been operat
ed by that company. The new owners
used only the portion of the line from
Ft. Madison to Batavia, using theil
own tracks from that point into OF
tumwa. The depot on East Mill street
was abandoned, the track between OF
tumwa and Batavia was torn up ant
the new line practically passed out Of
existence so far as Ottumwa was con
cerned. 1t was but natural and just
that Ottumwa should feel sore and re
sent the payment of the interest ant
principal Of the bonds.
Ten of these thirty-four 1000 bonds
fell due in February of the presen
year. The city had no money will
which to make payment and the hold
ers of the bonds have since been clam
oring for their money.
LEGALITY Questioned.
Since the issuance of the bonds
there has always been more, or less
questioning as to their legality. Abou