Source: http://supreme.nolo.com/us/139/684/case.html
Timestamp: 2019-04-20 08:21:43+00:00

Document:
States for the District of Nebraska, to set aside a decree of the same court for fraud.
Facts stated which supported the defenses of the statute of limitations and of laches.
This is a bill in equity, filed on the 9th of June, 1883, in the Circuit Court of the United States for the District of Nebraska, by the County of Boone, a municipal corporation of the State of Nebraska against the Burlington and Missouri River Railroad Company in Nebraska, a Nebraska corporation, and Horatio H. Hunnewell, a citizen of Massachusetts.
plaintiff and all the stockholders of the company, who numbered over one thousand, were citizens of the United States other than Nebraska, and that the defendants were citizens of Nebraska. Its prayer was for a decree that the taxes were illegal and void, for an injunction restraining the treasurer from enforcing them and from selling any of the land, and restraining the company from paying the taxes; for a decree ordering the treasurer and the board to cancel the taxes and the record thereof on the books of the county, and for general relief. The gravamen of the Hunnewell bill was that the taxes were all of them illegal and void for reasons set forth in the bill, and that the plaintiff was, and had been for more than four years, the owner and holder of 2,316 shares of the stock of the company, and had requested its board of directors to take efficient measures to protect it from said illegal taxes, which request the board of directors refused, and the company was about to pay the taxes.
"And now comes as well the said plaintiff, by his attorney, as the said defendants, by their attorneys, and thereupon this action comes on for trial before the court upon the issues joined between the parties, on consideration whereof the court doth find the issue in favor of the plaintiff, and doth find that the taxes set forth in said petition of plaintiff are void, as in said petition the said plaintiff has alleged. It is therefore ordered and adjudged that an injunction be, and the same is hereby, allowed as prayed for in said petition of plaintiff, and the same is hereby made perpetual, and that the said defendants, the county commissioners and the treasurer of said county, or their successors, are hereby perpetually enjoined from collecting, or in any way attempting to collect, or in any way intermeddling with, the taxes set forth in said petition, and that the successors in office of the said defendants be, and the same are hereby, perpetually enjoined from collecting or in any way intermeddling with said taxes, and it is further considered that the said plaintiff recover against the said defendants his cost in and about this suit in this behalf expended, taxed to be _____ dollars. "
"Memorandum of an agreement made by and between the Burlington and Missouri River Railroad Company in Nebraska, first party, and the County of Boone, Nebraska, by its commissioners, of the second part, and the Nebraska Land and Livestock Company, of the third part. Whereas, parties of the first and third parts have this day entered into an agreement and bonds for the performance of certain obligations conditional on the absolute release by the second party of all illegal taxes levied upon the lands of the first and third parties in the County of Boone for the years 1873 and 1877, inclusive, now therefore the party of the second part hereby agrees, by its commissioners and by its authorized attorney, M. H. Sessions, to enter into the necessary stipulation, and to have decree of court entered up in the Circuit Court of the United States for the District of Nebraska eradicating the whole of the taxes now charged against the lands of the first and third parties for the above years, all of said taxes having been examined and agreed upon as being illegal and void. "
The bill avers that there was no consideration for the agreement; that the commissioners acted as individuals, and not as a board; that their action had no binding or valid effect, and that the pretended consideration for the agreement was the executing at the same time of two documents, for whose execution there was no warrant in law, and the commissioners had no authority to become parties thereto. One of these documents was dated January 30, 1878, and recited a contract made July 17, 1877, between the County of Boone, through its commissioners, and Adam Smith, wherein Smith agreed to purchase certain lands of the railroad company and pay all legal taxes thereon for the year 1878 and thereafter, and to make certain improvements in the county, in consideration of which the commissioners agreed at some future day to take the necessary legal steps for the wiping out of all the illegal taxes claimed to be due upon the lands of the company for the years from 1873 to 1877, both inclusive. It further recited that Smith was prepared to enter into the necessary obligations for the payment promptly thereafter of the legal taxes; that the commissioners had that day taken the necessary legal action to wipe out all the illegal taxes claimed to be due for those five years, and that Smith had transferred his rights to the Nebraska Land and Livestock Company, which had assumed all his duties and obligations. By that document, the latter company bound itself to pay all legal taxes for the years 1878 to 1882, inclusive, which might be levied upon the lands purchased by it from the railroad company in Boone County, and bound itself also to pay all taxes which might be levied upon the lands of the railroad company in Nebraska for the years 1878 to 1882, inclusive, if the railroad company failed to pay them. By the other document, the railroad company bound itself to pay all legal taxes for the years 1878 to 1882, inclusive, upon all its lands in Boone County which had not been absolutely sold and deeded to the Nebraska Land and Livestock Company or to other parties.
"That whereas the taxes on the lands of the B. and M. R. Co. in Nebraska, in Boone County, both state and county and school taxes, are unpaid for the years 1873, 1874, 175, 1876, and 1877, and whereas, the said company dispute the legality of said taxes, and it is necessary to test their legality, therefore, be it resolved that the board employ M. H. Sessions as its attorney to defend any suit that may be brought against the county or to bring any suit he may deem best to test the legality of said taxes, and if he deem that any of said taxes are illegal, he may make such compromise in the matter with the said company as he may deem best for the interest of the county in the premises, and the said M. H. Sessions is hereby authorized to enter an appearance for the County of Boone, Nebraska, in any suit which may be brought by the said Burlington and Missouri River Railroad in Nebraska, or by any stockholder thereof, and to take action as directed by said commissioners, and to waive issuance and service of a subpoena in the case."
and Smith to be paid by them; that in all he did, pretending to act as attorney and counsel for the county, he had acted for the company and its interest, in pursuance of such arrangement; that Hunnewell was a party to such fraudulent arrangements, and in pursuance thereof the suit was commenced in a collusive and fraudulent manner; that Sessions brought the bill to Omaha, with the stipulation and a decree all prepared for entry, and filed the same, paying the fees therefor on behalf of the railroad company and Hunnewell; that the decree was null and void; that the railroad company was the real plaintiff, and, fraudulently conspiring with the board of county commissioners and with Sessions, caused the bill to be brought in the name of Hunnewell for the sole purpose of obtaining jurisdiction for the bill in the court in which it was filed, all the other parties thereto being citizens of Nebraska. The bill waives an answer on oath, and prays that the decree of March 8, 1878, be set aside as fraudulent and void, and that the taxes be declared valid and subsisting liens on the real estate, and for general relief.
parties who knew nothing about the circumstances under which the decree was entered, and that the board of county commissioners, and each one of them, and the officers and taxpayers of the county, had full knowledge of all the circumstances under which the decree of March 8, 1878, was entered more than four years before this suit was brought. There was a replication to the answer, proofs were taken, and the circuit court, on a hearing, dismissed the bill for want of equity, on the ground of laches on the part of the plaintiff. From that decree the plaintiff has appealed to this Court.
The appellant contends (1) that the circuit court had no jurisdiction in the Hunnewell case; (2) that the taxes in question were valid; (3) that the proceedings to secure the decree cancelling the taxes were a fraud on the appellant, and an imposition on the court; (4) that if those proceedings were not void for fraud, they were void for want of legal authority in the board of county commissioners to stipulate that the decree be entered cancelling the taxes, and (5) that this suit is not barred by the statute of limitations or by laches.
We are of opinion that this suit was barred by the statute of limitations of the State of Nebraska and by laches, and that the bill was properly dismissed.
1, 1879. There is no allegation in the bill, nor is there any proof, that the board of county commissioners was under hostile control down to a period within four years of the filing of the bill; nor is there any averment in the bill as to the time when the alleged fraud was discovered. The decree was a matter of public record. It decreed that the taxes generally were void, meaning all of them, as alleged in the bill filed by Hunnewell, and it granted a perpetual injunction against the collection of all of the taxes. The parties who took part in the proceedings were accessible. Smith was then alive, and Sessions, who was examined as a witness in this case, could have been inquired of. Stearns v. Page, 7 How. 819; Moore v. Greene, 19 How. 69; Beaubein v. Beaubein, 23 How. 190; Badger v. Badger, 2 Wall. 87, 69 U. S. 95; Case of Broderick's Will, 21 Wall. 503, 88 U. S. 518; Brown v. County of Buena Vista, 95 U. S. 157; Wood v. Carpenter, 101 U. S. 135; Graham v. Boston, Hartford &c. Railroad, 118 U. S. 161; Kirby v. Lake Shore &c. Railroad, 120 U. S. 130; Societe Fonciere &c. v. Milliken, 135 U. S. 304; Norris v. Haggin, 136 U. S. 386, 136 U. S. 392; Mackall v. Casilear, 137 U. S. 556, 137 U. S. 566.
The appellant seeks to apply to the county and its officers in this case the established rule that laches will not be imputed to a government for a failure on the part of its officers to perform their duty. United States v. Kirkpatrick, 9 Wheat. 720; United States v. Van Zandt, 11 Wheat. 184; United States v. Nicholl, 12 Wheat. 505; Dox v. Postmaster General, 1 Pet. 325; Gaussen v. United States, 97 U. S. 584. But this doctrine is not extended to such a municipal corporation as the County of Boone. Metropolitan Railroad v. District of Columbia, 132 U. S. 1, 132 U. S. 11-12. The principle of ratification by laches or delay is as applicable to such a municipal corporation as it is to a private corporation or to an individual person. 1 Dillon on Municipal Corporations, 4th ed. § 548; Clark v. City of Washington, 12 Wheat. 40; School Directors v. Georges, 50 Mo. 194; City of Cincinnati v. Evans, 5 Ohio St. 594. The statute of limitations of Nebraska makes no exception in favor of such a municipal corporation as the County of Boone, and the doctrine of laches applies to it and to its board of county commissioners.
By the General Statutes of Nebraska of 1873, chapter 13, section 1, the county was made a body corporate, and it was provided by section 4 that suits by or against it should be brought by or against the board of County Commissioners of the county, and by other provisions power was conferred upon the board to levy and collect taxes. It therefore had authority to act for the county in respect to the collection of taxes. Indeed, that it its only authority for the bringing of the present suit, coupled with the provision found in section 93 of chapter 13 of the General Statutes of Nebraska of 1873, that the county commissioners are authorized to employ attorneys in any case, either civil or criminal, in which their county is interested when the cause is taken to the supreme court of the state or before any United States court, and are authorized to pay a reasonable compensation for such services.
MR. CHIEF JUSTICE FULLER did not sit in this case or take any part in its decision.

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