Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1907-03-04
City's Demurrer, Which Sought
to Non-suit Case, Is Overruled
By Judge Mcpherson
BASED ON clrrs CONTRACT
Judge Mcpherson overrules Motion Of
the City That Contract Was Void
Because il Was Illegal, and City
officials Had No Authority to Make
i.-c... new to Go 70 Trial.

The preliminary scrimmage in the
case of the Glucose Sugar Refining
Company vs. the city has ended I'D
versely to the city. The demurrers
filed by the city's attorneys to the pc
tition OF the glucose company, grow
| Ing out Of the contract made by .he
city and the glucose company to build
the sewage disposal plant, was over
ruled by Judge Smith Mcpherson in
the federal court, at Des Moines, be
fore whom 1t was argued short time
ago.
The decision is in favor of the gtu-
cose company, and defeats the effort
OF the city to have the case thrown out
of court on a demurrer. The city, in
it's demurrers, contended that the con-
tract was void because it was against
public policy, and because the offic srs
OF the city had no authority to enter
into the contract or to, borrow money
for the purpose of building the pktnt
when the money for that purpose was
repaid out of taxes collected by the city
for general municipal purposes. 1t was
void also becau1e clause &C." of the
contract, was one which might induce
the officers to place q lower valuation
on the glucose property than was the
true valuation. It was void because, it
was contract providing to reduce the
valuation of the property for general
taxation from $4,000 to 5000 without
reference to its actual valuation.
Judge McPhsrson's Ruling.
No denial Of facts, as set out In the
company's petition was, OF course,
made. Judge Mcpherson. in ruling on
the motion, dealt with the question OF
the power of the city to borrow money
on an agreement to repay. Judge Nc
Pherson comedies that the city had the
power to borrow the money, and that
the company Is not relieved from taxa
ton because OF the contract. He init
mates that while portions OF the con-
tract might not stand the test of.legal-
ity, that where such portion or portions
can be separated from the rest iof the
contract it does not tnvaltdate, the
whole contract.
History Of Case.
The case, which was filed over Il. year
ago, brings into prominence again the
effort of the city to provide a means
OF handling the glucose plants sewage,
that it might avoid suits which were
threatened by individuals and towns
living down the Iowa river, which was
polluted by the sewage.
The city entered into a contract with
the Glucose Sugar Refining Company,
by which it borrowed $4,000 to build
the plant. This amount was 10 be
repaid to the glucose company by a
refund of water rents and by a re-
9duction in the taxable value 1f the
company's plant, such refunds 10 be
credited from year to year on the loan
which was drawing s per cent inter
est.
However, when the sewage plant was
completed, the glucose compan!r had
ceased to operate. For time the re-
funds by means OF the reduced taxes
were made, then the taxable value was
raised and the city refused to longer
refund because the glucose waaI not
operating. The glucose company then
brought suit to collect the balance Of
the original loan, which had not been
paid, amounting to about $1S,50ll.