Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1909-10-09
CITIES OF STATE INTERESTED
IN THE OUTCOME OF
LITIGATION.
DISPUTE FROM CLINTON
IN PROGRESS MANY YEARS
Action Commenced Against City to
Collect on Bonds Issued to Secure
Paving Certificates - Amount In
voIved Totals About $25,ooo-case Of
General Interest.
Special to Times-Republican.

Clinton, Oct. 9.-Not in many years
has there been q suit in the courts of
the country of so much interest and
vital importance to the citizens of
Clinton and the state at large as the
two that are now before the federal
court at Davenport, in which two
banks are endeavoring to hold the city
liable for the payment of special as
sessmeDt bonds issued in 1892
The story of the events which led
up to the fling of the two suits is a
long and interesting one. Involved
in the controversy is an amount ap-
proNimating $4,000, but the more
serious aspect of the case is that,
should the city lose. a precedent may
be established upon which similar &C
tons could be brought for the col
lection of similar bond issues, not only
from Clinton but from other cities of
the country. Should the city be de-
feated. when the cases come to trial,
it Will mean that the city council will
be compelled to levy special judg-
ment assessment or suffer some piece
of public property. such as the city
hall, TO be sold at public sale to sat-
isfy the judgment.
But the city officials are not so GER
tain that Clinton will come out sec
ond best in the controversy. Much,
1t is declared. however, hinges upon
whether or not il can be proven in
court that the hondholders instructed
the city clerk in the early nineties not
to certify the assessment in question.
Started in 1892.
The history of the cases begins
away back in 1892 or really In 1891,
when it was decided TO improve sew
eral sections of the city by paving
the streets. The contracts were let
and the work done and in 1892 special
Improvement assessment bonds were
sold by the city for the purpose OF
raising money with which to pay the
contractors. Certain Improvement
districts were created by ordinances
passed by the city council and involv-
ed in the controversy nov are FIVE
of those districts, viz:
Each district comprised portions OF
the locations named but not all of
involved. some of them having been
paid. Numerous bonds issued for
other districts in the city have also
been paid. the total amount Of I'M
paid bonds being about 5000 which
With interest and costs. swells te
about s25 GOO When these bonds
row held by the Vermont Savings
banks and the Montpelier Savings
i3tnk & Trust Company, both of Mont
lalier Vt. the two banks which have
brought suit against the city, are set
ted practically all of that particular
Improvement issue will have been
disposed of by the city and property
owners.
At the time the special improve
ment assessment was made property
values in Clinton. particularly in the
portions of the city occupied by the
districts now concerned in the con-
troversy, were exceedingly low. The
law. under which the assessment was
made, provided that the bondholders
could elect TO collect thru certificatior
by the city clerk to the county auditor
by suit or thru other channels of coll
lection. Some of the assessments We're
certified to the county auditor and
placed on the books of the county
treasurer for collection There the as
sessments remained for three years
unpaid, and the properties involved
were not sold.
Under the law when unpaid assess
ments remained uopn the books OF
I the county treasurer for three years
and the properties were not sold, the
/ county treasurer was privileged tc
sell the property for any percenta &c
] he could get. So in the course of time
a public sale was announced and the
properties against which the assess
nents were made were placed on sale
/ The returns We're extremely meager
some of the lots now selling for LOCO
being sold for Sc or 81. That discour-
aged the bondholders and it is claimed
they hastily instructed the city treas
urer and clerk not to certify any more
of the assessments to the county.
Suits Are Brought.
Then in 1901 or 1902 the next move
was made by the bondholders. Fol.
lowing a resolution, passed by the city
council. giving the bondholders the
right to sue in the name of the city
suits were brought in the Clinton
county district court against a mum
Der of the property owners These
actions were subsequently dismissed
by tie bondholders without prejudic,
to the bringing of another action
Nothing more was done until in 100