Case Name: Hubbard vs. The Town of Lyndon
Court: Wisconsin Supreme Court
Jurisdiction: Wisconsin
Decision Date: 1871-06
Citations: 28 Wis. 674
Docket Number: 
Parties: Hubbard vs. The Town of Lyndon.
Judges: 
Reporter: Wisconsin Reports
Volume: 28
Pages: 674–678

Head Matter:
Hubbard vs. The Town of Lyndon.
Bounty Tax — Town Obders — Evidence. (1,3) By whom order's on, bounty fund to be issued under eh. 14, Laws of 1865. (3,4) JSvidenae of mithority — Burden of proof.
1. Oh. 14, Laws of 1865, authorizes only the board of supervisors of a town to issue orders for the amount of a bounty tax which the town has voted.
3. Such an order, issued without authority of the board, though payable to bearer, and signed by the chairman and countersigned by the clerk, is .absolutely void, into whosesoever hands it may fall.
3. In an action upon a town bounty order regular in form, it was error to reject evidence for defendant that the order was issued upon a claim that had never been audited by the town board, such evidence tending to show that its issue was without authority of the board.
4. Whether plaintiff was bound in the first instance to show such authority affirmatively, is not here decided.
APPEAL from tbe Circuit Court for Sheboygan County.
Tbe defendant appealed from a judgment in favor of tbe plaintiff. Tbe case is stated in tbe opinion.
JB. Williams, for appellant,
argued that tbe authority of tbe town supervisors, under cb. 14, Laws of 1865, was special and particular, and they were required to act strictly on tbe conditions under wbicb it was given (19 Wis., 281) ; that tbe money raised by tbe bounty tax was only to be paid to those who might enlist and be credited to tbe town; and that under tbe general denial defendant bad a right to show (among other things) that tbe board of supervisors did not audit tbe claim and authorize tbe issue of tbe order, and that tbe order was not issued for tbe purpose of paying bounty to a person who enlisted and was credited to tbe town.
Bentley & Seaman, for respondent,
argued that while cb. 13, Laws of 1862, provided for tbe auditing of claims wbicb are tbe proper'subject of audit, cb. 14, Laws of 1865, provided for the issuing of orders as a security upon which to raise money, and no auditing of such an order was required in order to constitute it a valid security; that such orders were negotiable, and had all tbe incidents of negotiability except in such particulars as appeared on tbe face of tbe paper itself (Ciarle v. City of Des Moines, 6 Am. Law Keg., N. S., 146, and authorities there cited; Clark v. Janesville, 10 Wis., 166-67; Bushnell v. Beloit, id., 230; Rochester v. The Alfred Bank, 13 id., 432); and that tbe plaintiff, as a bona fide bolder of tbe order here in suit, was entitled to protection, provided tbe electors of tbe town bad voted a tax for bounties, under tbe law, before tbe order was issued, and provided tbe town authorities bad power under tbe law to issue such order.

Opinion:
Lyoh, J.
This action was brought to recover the amount of a town order, dated April 1st, 1865, drawn upon the treasurer of the defendant, the town of Lyndon, by the chairman of its board of supervisors, countersigned by its cleric, and made payable out of the bounty fund of the town to Charles Gr. Towsley or bearer. The complaint alleges that the town issued the order, that the plaintiff is the owner thereof, that the same had been duly presented to such treasurer for payment, and that payment thereof was refused.
The answer avers, among other things not necessary to be here stated, that the order was issued without authority. On the trial the plaintiff produced the order, and testified that it belonged to him; that he received it early in April, 1865; and that his impression was that he received it from the town cleric who countersigned it. The plaintiff also put in evidence the records of a town meeting of the electors of the town of Lyndon, held February 24th, 1865, which meeting voted a bounty tax of $4,400 upon the taxable property of the town. He also testified that he demanded payment of the order of the town treasurer, and that payment was refused on the ground that no bounty tax.had been levied.
The evidence fails entirely to show whether the plaintiff paid or the town received anything on account of the order ; whether it was issued to pay a bounty to some particular recruit, or to sell in the market to raise money with which to pay bounties generally; or whether it was issued by the authority of the board of supervisors of the town, or without such authority;
The defendant offered testimony to show that "the claim upon which the order was issued was never audited by the supervisors of the town of Lyndon." The court sustained an objection to such testimony, and directed a verdict for the plaintiff for the amount of the order. From the judgment entered upon such verdict the defendant has appealed to this court.
TRe. single question presented for our consideration is, whether tRe circuit court erred in rejecting tRe testimony tRus offered by tRe defendant. TRis bounty tax was voted under tRe act of 1865 (Gen. Laws of 1865, cR. 14), wRicR act autRorized tRe board of supervisors of tRe town, and tRat body alone, to issue town orders for tRe amount of tRe tax wRicR tRe town Rad voted. Tbe cliairman of tRat board and tRe town clerk Rad no power to issue tRe same until directed so to do by tRe board. "Without sucR direction tRe order in suit is absolutely void in tRe Rands of tRe plaintiff or of any other person. It is quite immaterial that it is payable to the bearer by its terms, and it would also be quite immaterial Rad the plaintiff proved affirmatively (which Re did not) that Re is a bona fide holder thereof for value, without notice that the board of supervisors of the town Rad never directed that it be issued. TRe order is, doubtless, clothed with some of the incidents of negotiability, but the idea that a town officer can, without authority, issue negotiable town orders, which, in the Rands of a bona fide holder, will bind the town, is not to be tolerated for a moment. Persons dealing in these instruments must ascertain for themselves whether they are issued by competent authority, and a purchaser of a town order takes it at his peril of the fact. If not issued by competent authority, the town is not liable. The law is well settled that the officers of a town, or bf any municipal corporation, cannot bind it, when they transcend their lawful powers. Clark v. Des Moines, 19 Iowa, 199; Clark v. Polk County, id., 248; and cases cited.
TRe testimony offered by the defendant and rejected by the court was to the effect, first, that the order in suit was issued in payment or on account of some claim against the town; and second, that it was issued without such claim Raving previously been audited by the town board of supervisors. This was substantially an offer to prove that such board Rad not autRorized or directed the order to be issued. At least such testimony would tend to show that the order was issued without competent authority. "We think that it should Rave been received.
We do not decide whether, in an action upon a town order, the burden of proof is upon the plaintiff to show that the order was issued by competent authority, or upon the town to show that it was not so issued. We only hold that when the town assumes the burden of proof, and offers testimony tending to show such want of authority, it is error to reject the testimony.
By the Court — The judgment of the circuit courtis reversed, and a new trial awarded.