Case Name: Mercer County Court v. Kentucky River Navigation Company; Garrard County Court v. Kentucky River Navigation Company
Court: Kentucky Court of Appeals
Jurisdiction: Kentucky
Decision Date: 1871-10-20
Citations: 8 Bush 300
Docket Number: 
Parties: Mercer County Court v. Kentucky River Navigation Company. Garrard County Court v. Kentucky River Navigation Company.
Judges: Judge Hardin does not concur in the substitution of this for the opinions of the court heretofore delivered by him, but for reasons in writing filed herewith adheres to those opinions.
Reporter: Kentucky Reports
Volume: 71
Pages: 300–326

Head Matter:
Cases 54, 55 — PETITIONS FOE MANDAMUS
October 20.
Mercer County Court v. Kentucky River Navigation Company. Garrard County Court v. Kentucky River Navigation Company.
APPEALS PROM MERCER AND GARRARD CIRCUIT COURTS.
1. Subscriptions oe stock in corporations by county courts must be made in substantial conformity to the mode prescribed in the law authorizing the subscription.
2. Invalid subscriptions oe stock in Kentucky Eiver Navigation Company.
The Mercer County Court, a majority of the justices being present, made an order “that the sum of seventy-five thousand dollars be directed to be subscribed,” and appointed a commissioner to subscribe the same in the Kentucky Eiver Navigation Company.
The Garrard County Court in like manner made an order “that the sum of one hundred thousand dollars shall-be subscribed on the part of Garrard County,” and appointed an agent to subscribe the same in said company.
In pursuance of said orders the subscription was made on the books of the company for and on behalf of each of said counties by its agent. Held that
The above orders and Subscriptions were not binding. They were proposals to subscribe stock, and did not amount to contracts of subscription. The county court had no authority to appoint a commissioner or agent to make the subscription.
3. County courts, under the law, act and can act only through their orders made of record.
4. The subscriptions were not binding in these cases unless the orders of the county court made of record, when a majority of the justices were present, amount of and within themselves, disconnected from any act done out of court by any one, or in court not of record, to a perfect and complete subscription of stock.
5. Upon its face the order shows in each of these cases that the contract of subscription was incomplete, and that it was intended to remain so until made perfect by the action out of court of an agent, whose appointment was unauthorized, and whose actions in the premises were necessarily void.
George R. McKee, ' A. Harding, . . . Thos. C. Bell, . . Durham & Jacobs, f James D. Hardin, W. E. Keller, . . For Appellants,
CITED
Constitution of Kentucky, section 36, article 2; section 3, article 13; section 33, article 4; section 14, article 13; section 37, article 2. Bill of Bights, section 14.
Act of March 1, 1865, incorporating the Kentucky Biver Navigation Company; act of February 16, 1869, 1 Session Acts, page 33.
Littell’s Statutes, 366. Hardin’s Reports, 258.
Revised Statutes, article 19, chapter 27. .
Civil Code, sections 366, 364.
Revised Statutes, see. 5, art. 12, chap. 27,1 Stanton, 322, 328.
Revised Statutes, section 1, article 12, chapter 26.
Myers’s Supplement, 693, 694.
Morehead & Brown’s Statutes, Act of 1796, pages 505, 506.
Williard’s Equity, 428, 429.
Angelí & Ames on Corporations, 323.
Constitutional Debates of Kentucky, page 1030. •
American Law Register, August, 1870, page 487.
Cooley on Constitutional Limitations, 589-592, 487-494.
2 Metcalfe, 378, Twedy v. Commonwealth.
2 Metcalfe, 322, Fry’s ex’r v. Lexington & Big Sandy Railroad Co.
3 Met. 142, Winchester & Mt. Sterling T. P. Co. v, Clark Co. Court.
3 New Hampshire, 321, Scott v. Wilson.
1 Story’s Equity, sections 192, 193.
3 Blackford, 193, Coxe v. State.
2 Metcalfe, 72, Maddox, &c. v. Graham & Knox.
2 Kent, 561. 5 Bush, 443. 1 Blackstone, 92, 127,128.
9 Dana, —, Lexington v. McQuillan’s heirs.
9 B. Monroe, 330, Oheany v. Hooser.
9 B. Monroe, 534, Talbot v. Dent.
1 Yerger, 452, Marr v. Euloe.
1 Pick. 180, Commonwealth v. Charleston.
5 Pick. 492, Kean v. Stetsen.
1 Halst. 1, Arnold v. Munday.
20 Ohio, 199, Washington Mut. Ins! Co. v. Reed & Brown.
15 B. Monroe, 491, City of Covington v. Southgate.
11 B. Monroe, 149, Justices of Clark Co. v. The Paris, Winchester and Kentucky River Turnpike Company.
8 Watts, 434, Bird v. Smith. ' '
6 Ship. 433, French v. Camp. 1 ■
1 Lansing, —, People v. Allen.
2 Metcalfe, 553, Mathus v. Shields.
2 Metcalfe, 350, Debo v. Hooper.
8 Iowa, 92, Warford v. Unger.
17 B. Monroe, 48, Lackey v. Richmond & Lancaster Turnpike Co.
18 Barbour, 284, Morgan v. King.
35 New York, 454, Morgan v. King.
17 B. Monroe, 223, Sharp’s executor v. Donovan.
16 Michigan, 269, Ryerson v. Utley.
10 Wisconsin, 258, Weeks y. City of Milwaukie.
13 B. Monroe, 22, Slack v. Maysville & Lexington Railroad Co.
George W. Dunlap, .■ . R. M. & W. O. Bradley, J. S. Bronaugh,..... J. B. & P. B. Thompson, Jr., P. B. Thompson, Sr., . . . Gaither & Kyle, .... T. N. & D. W. Lindsey, . . John. L. Scott,.....„ For Appellee,
cited
Act of March 1, 1865, incorporating appellee, 2 Session Acts, 96. Civil Code, sections '526, 365, 367.
Constitution of Kentucky, secs. 34, 35, 36, 37, art. 2.
Constitution United States, sec. 10, art. 1; sec. 20, art. 13.
18 B. Monroe, 852, Anderson County Court v. Stone.
2 Metcalfe, 56, Maddox v. Graham.
5 Bush, 225, Shelby County Court v. Shelby Railroad Co.
9 Cranch, 88, Fletcher v. Peck.
4 Wheaton, 518, Dartmouth College v. Woodward.
1 Sumner, 276, Allan v. McKean.
9 Gill & Johnson, 365, University of Maryland v. Williams.
21 Pennsylvania, 164, Sharpless v. Philadelphia.
1 Bush, 505, Yance v. Yanarsdall.
5 Bush, 246, Ferguson, &c. v. Landram, &c.
50 Pennsylvania State Reports, 161, Spea v. Blainstille.
4 Metcalfe, 275, Green v. Goodwin.
Act of March 13, 1868. 2 Duvall, 243.
9 Cranch, 43. 1 J. J. Marshall, 283.
8 B. Monroe, 143. 14 B. Monroe, 432.
15B. Monroe, 678. 13 B. Monroe, 26.
12 B. Monroe, 147. 9 B. Monroe, 338.
9 B. Monroe, 530 11 B. Monroe, 153.
1 Lord Raymond, 384. 4 B. Monroe, 203.
6 B. Monroe, 601. 3 Hill, 219.
4 Kent, 282. 1 Dana, 14.
2 Metcalfe, 425. 2 Metcalfe, 298.
1Bush, 104. 6 Bush, 227.
15 B. Monroe, 235. 17B. Monroe, 51.
1 Hall, 121. 9 B. Monroe, 235.
16 B. Monroe, 361. 2 Mississippi, 169.
2 Metcalfe, 150. 1 Bush, 145.
8 B. Monroe, 651. 3 Starkie on Evidence, 1042.

Opinion:
JUDGE LINDSAY
delivered the opinion oe the court, Judge Hardin dissenting.
These two appeals were not heard together; but inasmuch as they involve substantially the same questions of fact, and must of necessity be settled by the application to each of the same principles of law, they will for convenience be considered together, and one opinion made to apply to both cases.
The ninth section of an act approved March 1, 1865, entitled "An act to incorporate the Kentucky River Navigation Company," provides "that the county courts of the several counties bordering on the Kentucky River, or interested in its navigation, may on the application of the corporation named in the first section, or of the directors -of said company after its organization, a majority of all the justices of the peace' being present, subscribe stock in said company, and levy a tax on all taxable property of said county sufficient to pay the whole amount of said subscription in three years from the time it was made, which tax shall be collected in all respects as taxes for state revenue are now collected."
Application was made to the Mercer County Court for a subscription to the capital stock of this company, and in response to such application this order was made:
"At a county court held for Mercer County at the courthouse at Harrodsburg, on Monday, the 2d day of September, 1867, present Chr. Chinn, presiding judge....... (and thirteen justices), an application being made by the Kentucky Biver Navigation Company to the court to subscribe stock to said company, and the same having been duly considered, and all the members of the court present save one are of opinion that it is the interest of this county that stock should be subscribed by them in-said company, and seven of the members present declared in favor of and voted for the following order, viz.: It' is ordered that the sum of ' seventy-five thousand (dollars) be directed to be subs'cribed, upon the conditions hereinafter named, as stock by this court in behalf of the county of Mercer in said company, payable in three equal installments, and that a levy be made in due time therefor, so that the first installment shall be collected and paid to said company in the year 1868. And Dr. Joseph A. Thompson is hereby appointed a commisioner to subscribe seven hundred and fifty shares of one hundred dollars each in stock in the Kentucky Biver Navigation Company, as above stated. But said commissioner is directed not to subscribe said stock, or any part thereof, until said company shall, by proper orders entered on the books, agree that no part of their subscription shall be mortgaged under the provisions of the tenth section of the act of the Kentucky Legislature incorporating said company, nor shall the county of Mercer be in any manner bound for the subscription herein decreed to be made until said company has accepted it upon the conditions herein set forth."
Afterward) on the 18th of March, 1868, at a county court held by the presiding judge alone, a paper, purporting to be an order of the president and board of directors for the Navi gation Company accepting the proposed subscription upon the terms indicated, was produced in court and spread upon its records.
The commissioner, Thompson, having determined that the resolution of the president and directors of the company was a compliance with the conditions imposed by the order of the county court under which he claimed authority to act, entered upon the books of the company a subscription of seven hundred and fifty shares of stock for and on behalf of the county of Mercer. Under this state of affairs a motion made by the Navigation Company to the effect that the county court should levy the necessary tax to pay the first annual installment due on account of this supposed subscription was overruled, and upon application therefor the circuit court awarded a writ of mandamus compelling the justices to levy such tax. This judgment can not be sustained unless the action of the county court, together with that of the com-' missioner, amounts in estimation of law to a complete and binding contract of subscription.
The act of the General Assembly incorporating the company imposed no obligation upon the County Court of Mercer to take any part of the proposed capital stock of the company. As to each one of the counties embraced by that charter, it was at most but an enabling act. Authority was conferred upon the various county courts, a majority of the justices of their respective counties being present, to do or not to do a certain act, and prescribing the consequences in case such contemplated act should be done. Such a statute has no "mandatory effect requiring immediate obedience, except so far as it regulates the time and manner of doing the [discretionary] act, and expressly or impliedly commands that the agent shall not be prevented from doing it according to the discretion allowed." (Slack v. Lexington and Maysville Railroad Company, 13 B. Monroe, 1.)
In enacting such a law the legislature determines peremptorily the manner of doing the discretionary act, and from the mode pointed out the agent has no authority to depart. As the law and its consequences may be oppressive or otherwise unacceptable to that portion of the community to be immediately affected, the legislature defers to such agents as it may see proper in its wisdom to select, whether the statute shall or shall not become a perfect law. (Ibid. 24.) The selected agent possesses no other or greater authority than such as is expressly conferred, and in order to bind his constituent must act within the scope of his delegated powers, and in substantial conformity to the mode prescribed by the statute authorizing him to act at all.
The act incorporating the Navigation Company delegated to the county courts of certain counties the power to determine whether or not the counties represented by those bodies should or should not become stockholders in the capital stock of the company. The functions of these courts under this act were in some measure legislative, inasmuch as upon their action was made to depend whether or not this provision of the act of incorporation, otherwise conditional, should as to the constituents respectively represented by them become absolute. To these bodies was committed the delicate and responsible duty of determining a question of taxation. In the discretion and integrity of the justices composing these courts the General Assembly reposed a high degree of confidence and trust, and clearly indicated that the persons possessing this confidence were expected and required, in the discharge of the delicate duty imposed upon them, to act in person, and not by or through a subagent or commissioner. While acting together as a county court, they were authorized for and on behalf of their respective counties to subscribe to the capital stock of the Navigation Company. County courts, under the law, act and can act only through their orders made of record. By such orders so made the courts and those for whom they are legally authorized to act are bound. By the act under consideration the authority conferred upon the justices composing the various county courts was purely personal. The General Assembly doubtless assumed that they, as the general financial agents of the tax-payers of the different counties, were proper persons to determine the important questions submitted to their action. A personal trust of such a character can not be delegated. (Lyon v. Jerome, 26 Wendell, 493 and 494.)
The law pointed out the mode by which these agents should have exercised their delegated powers, and the rule of procedure thus prescribed such agents could not disregard without rendering their action void. (Sedgwick's Statutory and Constitutional Law, 385; Agent State Prison v. Lathrop, 1 Michigan, 438; Hydes & Goose v. Joyes, 4 Bush, 464.)
The agent, Thompson, was appointed without authority of law, and his acts can not bind the tax-payers of Mercer County. Unless the orders of the county court made of record, when a majority of the justices were present, amount of and within themselves, disconnected from any act done out of court by any one, or in court and not of record, to a perfect and complete subscription of stock, the award of. the mandamus was erroneous. The action of the commissioner in entering in the books of the company the contract of subscriptions can have no greater effect than if he had merely attached to such books copies of the orders of the court. Those orders constitute the only basis of obligation upon the part of the court or of the county, and the only foundation for any remedy for their enforcement. (Justices Clark County v. Paris, Winchester & Kentucky River Turnpike Company, 11 B. Monroe, 146.)
The order made at the only term at which a majority of the justices were present goes no further than to direct that in the future, when certain specified conditions shall have been acceded to by the Navigation Company, a subscription of stock shall be made. It was not intended that the act of the court in making this order should be regarded or treated by any one as a subscription. Upon the contrary, the commissioner was prohibited from subscribing the seventy-five thousand dollars of stock, or any part thereof, until the company had, by proper orders entered upon their books, indicated their acceptance of the terms imposed. Upon its face the order shows that the contract of subscription was incomplete, and that it was intended to remain so until made perfect by the action out of court of an agent whose appointment was unauthorized, and whose actions in the premises were necessarily void.
The order when legally constimed is nothing more than a proposal to subscribe the amount of stock named .upon the conditions fixed. Its acceptance may have imposed a moral obligation upon the justices participating in making it to carry out in good faith their agreement to subscribe; but if they can be proceeded against for the violation of such agreement by writ of mandamus (a legal proposition which will scarcely be insisted upon), it must be to compel them to make the subscription, and not to levy a tax to pay a subscription which thus far, acting as a county court, they have not made. The company did not understand the order in question as anything more than a mere proposition upon the part of the county court, and in their resolution accepting the conditions annexed to the proposal it is termed " an order of the County Court of Mercer County, made at the September court, 1867, proposing to subscribe to the capital stock of this company ; " and they rely for the relief sought not upon the order alone, but upon the subscription made in pursuance thereto by the commissioner, Thompson.
If the acts of Thompson had been reported to and approved by the county court when properly constituted, and the order of the directory of the company recognized as a substantial compliance with the terms of the proposition to subscribe, a subscription of stock might possibly be implied; but the report of Thompson was made, if at all, and the order of the directory spread of record, at a term of the court when none of the justices were present. As the county judge sitting as a county court had no authority under the law to take any action in the premises, his orders are entitled to no consideration whatever.
The action of the Garrard County Court, althoúgh substantially the same with that of Mercer, is evidenced by an order more definite in its character, and which upon a casual inspection might be regarded as containing the essence and substance of a subscription of stock to the amount of one hundred thousand dollars, independent of any future action by the court itself, or by any other agency. The order recites the fact that an application for a subscription of stock had been made by the company and duly considered by the court (a majority of the justices being present), and it is ordered and adjudged that the " sum of one hundred thousand dollars shall be subscribed on the part of Garrard County to the capital stock of the Kentucky River Navigation Company; and William H. Wherritt is hereby appointed the agent of the court, and is directed to subscribe one thousand shares of stock of one hundred dollars each on the books of said company, payable in three annual installments, and report his acts to this court. This subscription is made upon the contingency that the said company obtain subscriptions of stock sufficient to extend slack-water navigation above or to the mouth of Paint Lick Creek, the boundary line of Garrard County, including the aforesaid subscription."
In the order the term "this subscription" is once used, and it concludes by speaking of the " aforesaid subscription," both of which expressions, would seem to indicate that the order itself was intended to operate as a subscription. But this conclusion is rebutted by the fact that the court adjudges that one hundred thousand dollars "shall be subscribed." The word "shall" clearly refers to the future, and convoys the idea that the subscription of stock is not then, but is thereafter, to be made.
Again, instead of stating in the order that the court thereby subscribed the amount of stock named, which would have evidenced a perfect and enforceable obligation imposed by the court upon itself, a commissioner was appointed, who was directed, out of court and at some future time, to make the subscription for and on behalf of the court; and when he should have performed this duty to report his action in the matter back to his principal.
Carefully considered, this order amounts to no more than an offer or pledge to subscribe stock, if it is even susceptible of that construction. It evidences the fact that the county court, after due consideration, had arrived at the conclusion that it was to the interest of Garrard County that the subscription should be made, and that it had determined to take such action, and therefore that a power of attorney was given to its commissioner authorizing him to carry such determination into effect. This conclusion is fortified by the fact that the order is so interpreted by the officers and attorneys of the Navigation Company.
In the petition for the mandamus it is alleged that the County Court of Garrard County, "by proper and legal orders then made, ordered and adjudged that the sum of one hundred thousand dollars should be subscribed on the part of Garrard County to the capital stock of the Kentucky Biver Navigation Company; and further ordered that William Wherritt be appointed agent of the court, and directed to subscribe one thousand shares of stoclc . on the books of said company ;" and further, that " said Wherritt, agent as aforesaid, and in obedience to the order aforesaid, did subscribe on the boohs of said company," etc.
Nor reasons already given the acts of Wherritt must be regarded as of no binding effect; and as he made no report of liis acts to the county court, and as his attempted subscription was neither approved nor ratified by that. body, the rights of the parties litigant must be determined by the legal effect of the order under which he claimed authority to act. This order a majority of this court regards as wholly insufficient to establish, in and of itself, a contract of subscription absolute and complete. In the absence of such an obligation upon the part of the court, the circuit judge should not have awarded the mandamus compelling the levy of the proposed tax.
These conclusions render it unnecessary that we should consider and decide the constitutional questions presented by counsel in the argument of the two appeals. Wherefore the members of the court concurring herein forbear to express an opinion as to the constitutionality of the tax authorized to be imposed by the ninth section of the act incorporating the Navigation Company.
Nor the reasons indicated it is considered that the judgments in the two causes under consideration be reversed, and that they be remanded with instructions in each case to dismiss the petitions of the appellee.
Judge Hardin does not concur in the substitution of this for the opinions of the court heretofore delivered by him, but for reasons in writing filed herewith adheres to those opinions.