Case Name: Henry H. Adams, County Treasurer, Resp't, v. The East River Savings Institution, App'lt
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1892-11-29
Citations: 49 N.Y. St. Rep. 61
Docket Number: 
Parties: Henry H. Adams, County Treasurer, Resp’t, v. The East River Savings Institution, App’lt.
Judges: 
Reporter: New York State Reporter
Volume: 49
Pages: 61–63

Head Matter:
Henry H. Adams, County Treasurer, Resp’t, v. The East River Savings Institution, App’lt.
(Court of Appeals,
Filed November 29, 1892.)
■Constitutional law—County bonds.
When a county containing a city of more than 100,000 inhabitants de"sires to create an additional debt, the ten per cent limit fixed by art. 8, § 11 of the state constitution is not reached until the county debt equals ten per centum of the valuation of all the real estate in the county, including the real estate in said city, but in ascertaining when the limitation is 0 reached in such a case, the debt of the city cannot be charged against the county any more than its proportionate share of the state debt or the debt of the several towns within its limits. Nor is the indebtedness of the county to be considered in determining whether the limitation in relation to the city has been reached.
Appeal from judgment of the supreme court, general term, •second department, granting judgment for plaintiff on submitted case.
Clarence F. Birdseye, for app’lt; Wm. C. De Witt and John B. Meyenborg, for resp’t
Affirming 47 St. Rep., 175.

Opinion:
O'Brien, J.
It appears from the record that on the 14th of April, 1892, the plaintiff, as county treasurer of the county of Xings, acting under the authority of a resolution of the board of supervisors of that county, and certain statutes then in force, offered for sale and invited bids for bonds of the county amounting in the aggregate to the sum of $620,000. Various persons and corporations thereupon made bids for the purchase of the bonds. The defendant bid the sum of $91,104 for $90,000 par value of the same, and its bid was duly accepted by the plaintiff. The defendant gave its check for the amount of the bid, but after-wards stopped the payment thereof and refused to complete its purchase, upon the ground that the bonds were void, having been issued without power, and in violation of the prohibition contained in art. 8, § 11, of the state constitution. It is conceded that if the bonds are valid that the defendant is bound to receive them and pay the sum bid therefor, otherwise not. Upon an agreed case submitted to the general term, it was held that the plaintiff had power to issue and sell the bonds, and that the portion of the is sue purchased by the defendant was a valid obligation, and that the plaintiff was entitled to judgment. We think that the judgment is correct and, as the reasons in support of the conclusion reached have been fully and clearly stated by the learned judge who gave the opinion at the general term, in which we fully concur, it is quite unnecessary for.us to enter upon any lengthy discussion of the question.
The provision of the constitution which, it is claimed, forbids the issue of the bonds in question went into effect on the 1st of January, 1885, and is as follows : " No county containing a city of over one hundred thousand inhabitants, or any such- city, shall be allowed to become indebted for any purpose or in any manner to an amount which, including existing indebtedness, shall exceed ten per centum of the assessed valuation of the real estate of such county or city subject to taxation, as it appeared by the assessment rolls of said county or city on the last assessment for state or county taxes prior to the incurring of ¡uch indebtedness; and all indebtedness in excess of such limitation, except such as may now exist, shall be absolutely void, except as herein otherwise provided. No such county or city whose present indebtedness exceeds ten per centum of the assessed valuation of its real estate subject to taxation shall be allowed to become indebted in any further amount until such indebtedness shall be reduced within such limit. This section shall not be 'construed to prevent the issuing of certificates of indebtedness or revenue bonds issued in anticipation of the collection of taxes for amounts actually contained, or to be contained, in the taxes for the year when such certificates or revenue bonds are issued and payable out of such taxes. Nor shall this section be construed to prevent the issue of bonds to provide for the supply of water, but the term of the bonds issued to provide for the supply of water shall not exceed twenty years, and a sinking fund shall be created on the issuing of .the said bonds for their redemption, by raising annually a sum which will produce an amount equal to the sum of the principal and interest of said bonds at their maturity." '
The territory embraced .within the county of Kings is the city of Brooklyn and four regularly organized towns. Ninety-six per cent of the total real estate of the bounty, according to the valuation next preceding the issue of the bonds in question, was within the corporate limits of the city of Brooklyn, and the other four per cent in the towns. The city has a large municipal debt of its own. The county as such has also 'a debt of several millions, and the towns in their corporate capacity have also created debts. The objection to the validity of the bonds in question is that they create a debt against the county which, when added to the debt existing at the time of the issue, makes an aggregate indebtedness of the county exceeding ten per centum of the assessed valuation of the real estate of the county subject to taxation, as appears by the assessment rolls of the county made at the last preceding assessment- for state and county taxes. The defendant, however, reaches and passes the ten per cent limit only by computing the municipal debt of the city of Brooklyn as part of the indebtedness of the county of Kings, and unless this proposition can be maintained the defendant's contention must fail, and the bonds purchased by the defendant are unquestionably valid. This provision of the constitution declares void all indebtedness •created in violation of the limitations therein prescribed, but these limitations must be taken and understood distributively and not collectively.
As thus understood-the limitation applies to two distinct cases. (1) A city containing over one hundred thousand inhabitants. (2) A county within which is a city containing that population. The prohibition is aimed at each of these organizations or political divisions of the state separately. When it is proposed to issue additional city bonds in a city of the class mentioned in the constitution there are two facts to be considered, first, the existing indebtedness of such city, and secondly, the valuation of the real •estate therein. The indebtedness of the county of which the city forms a part does not play any part in the process of determining when the limitation is applicable, as it is wholly immaterial. So also when a county, containing, as the county of Kings does, a •city of more than one hundred thousand inhabitants, desires to create an additional debt the ten percent, limitation is not reached until the county debt equals ten per centum of the valuation of all the real estate in the county including, of course, the real estate in the city which forms a part of the county; but in ascertaining when the limitation is reached in such a case the debt of the city cannot be charged against the county any more than its proportionate share of the state debt or the debt of the several towns within its limits. The power of the county or the city, as the case may be, is restricted only by the amount of its own debt, and for the purpose of creating a disability against the one or the ether the debts of both cannot be aggregated. The contention of the learned counsel for the defendant pushes the prohibition to a point not warranted by a fair consideration of the language used or the general purpose which the framers of the amendment intended to accomplish.
The judgment should be affirmed, with costs.
All concur.