Court Opinion

ID: 5511701
Source: CourtListenerOpinion
Date Created: 2022-01-10 04:16:24.235818+00
Date Added: 2024-06-11T08:34:10.515078
License: Public Domain

P. Potter, J.
I think the judge at the special term was right in his construction of the act of June 11, 1873, chapter 720, that the offices of the commissioners were not vacated until they had neglected to file their bonds for ten days after notice of the provisions of that act, but I do not concur in the opinion that the subscription for stock by the commissioners is so absolute that it can be enforced in spite of the act of 1870 (chap. 507), and of the amendment of 1873, and that their subscription estops the commissioners from objecting to or questioning the intent to make an improper use by the railroad corporation of the funds to be raised by virtue of such subscription. The statute of 1870 does not limit the time for entering into the agreement between the commissioners with the railroad company, nor is it to be inferred that it can only be made before the subscription is made; but, on the contrary, the power given is expressed in general terms without limitations of time. Besides, the agreement to be made relates to the delivering of the bonds, that is, that the commissioners may enter into a contract or agreement limiting and defining the time when and the proportions in which such bonds or their proceeds shall be delivered, and the places where and the purposes for which the proceeds of such bonds shall be applied or used. The case does not show any unwillingness on the part of the commissioners to make the agreement in accordance with the provisions of the statute, and as they allege in accordance with the previous understanding, but a refusal to act at all and a refusal to deliver the bonds, without any agreement as to the application of the proceeds, or as to the times and proportions in which they shall be delivered. The railroad company claim and the special term held, that the subscribing for the bonds, *140without terms or conditions annexed or connected with the subscription, estopped the commissioners from objecting or questioning the use to be made of the proceeds, and from denying the right of the railroad company to demand an absolute delivery of the bonds. This we do not regard as the fair reading, spirit, intent, or even the letter of the statute. The statute seems to have been intended to prevent the fraudulent use or conversion as well as diversion of the funds to an object not intended by the town whose credit has thus been obtained.
The provision is useless if this plain intent can be evaded by such a technicality as that of holding that the commissioners have lost all power to exercise control over the bonds or the proceeds thereof, after a subscription therefor. No language of the statute demands such a construction. And justice and common equity demands that the exercise of a reasonable discretion be continued in the commissioners, until they can make such an agreement as shall protect their town against fraud or imposition in the use of its credit and funds. The order of the special term should be reversed.
Miller, P. J., and Parker, J., concurred.
Order reversed, and motion for mandamus denied.