Court Opinion

ID: 6961094
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:45:41.910861+00
Date Added: 2024-06-11T16:08:26.523096
License: Public Domain

Mr. Justice Mulkey delivered the opinion of the Court: The various objections to the tax sought to be enjoined in this case may be grouped together under two general heads, namely, such as question the validity of the bonds themselves, and those which merely question the right of the auditor to levy the tax under the provisions of the act of April 16, 1869. The bonds in question having been issued after the present constitution went into effect, the burden of showing they were issued in compliance with a vote of the people of the town, had prior to the adoption of the present constitution, in pursuance of some law then providing therefor, rests upon those affirming their validity. Jackson County v. Brush et al. 77 Ill. 59; The People ex rel. v. Jackson County, 92 id. 441. The bonds prima facie are, invalid,—hence, without such proof, the tax in question would clearly appear to have been levied without authority of law, and should therefore be enjoined. Keeping this in view, we will now proceed to consider such as we regard the most important objections to the validity of the tax in question, in the order above indicated. The bonds in question were issued in pursuance of a vote of the people of the township at an election held in the township on the 10th day of December, 1869, under the provisions of the charter of the Bloomington and Ohio River Railroad Company. Sections 8, 9, 10, 11 and 19 of the company’s charter are the only ones that have any material bearing upon the matter in hand, and are as follows: “Sec. 8. The several counties, cities, villages, incorporated towns, and the several townships in counties having township organization, through or near which the said road shall be located, are hereby authorized to raise money by a tax to be levied upon all the real and personal property in the said several counties, cities, villages, incorporated towns and townships, and to subscribe the same to the capital stock of said corporation hereby created, for the purpose of aiding in the construction and completion of said road. And the said several counties, cities, villages, incorporated towns and townships, as aforesaid, are further authorized to issue bonds drawing interest at the rate of ten per cent per annum; which said bonds shall be negotiable and payable in the city of Rew York in not less than one nor more than ten years after the date of the same: Provided, that no subscription shall be made, or no tax shall be levied, until the same shall be voted for as hereinafter provided. “Sec. 9. Whenever twenty-five voters of any such county, city, village, town or township shall make a Avritten application to the county clerk of such county, or twenty-five voters of any such city, incorporated village or town or township shall make such application to the clerk thereof requiring an election by the legal ‘voters of such county, city, village or town or township to determine whether such subscription shall be made, and such tax levied, specifying in such application the amount, such clerk shall file such application in his office and immediately give the notice as required by law, for an election to be held by the legal voters of such county, city, village or íoavii or township at the usual place of holding elections, such notice to be given at least thirty days prior to the day of holding such election; and such election shall be held and conducted in all respects, and the returns thereof made, as in case of annual elections. , “Sec. 10. If the majority of voters voting at such election shall be in favor of such subscription and tax for the payment thereof, then such county, city, incorporated village, or town or township, by its proper corporate authority, shall levy such tax and subscribe to such corporation the amount thereof, to be determined or voted for at any such election, and shall issue to said corporation their bonds, for such amount, drawing ten per cent interest per annum, and payable in not less than one nor more than ten years. The said bonds,when issued, are to be irrevocable, and negotiable and payable as in section 8, as aforesaid. “Sec. 11. If any county, city, village or township shall subscribe to said capital stock, under the provisions of this Act, and shall issue their bonds, said bonds shall be in full payment of their subscriptions; and the supervisors of said townships, or county court of such county, and the corporate authority of such city, village or town, shall annually appoint some suitable person to represent and vote upon the stock so subscribed and levied as aforesaid. “Sec. 19. The several counties, cities, villages, incorporated towns, and the several towns or townships in counties having township .organization through or near which said railroad shall be located, are hereby empowered to make donations, and to issue bonds for the same in the manner herein-before provided to said railroad, for the construction and completion of the'same.” The chief difficulty in this case has been encountered in our efforts to arrive at a satisfactory construction of these several sections of the company’s charter. It will be perceived that all these sections, except the 19th, have exclusive reference to subscriptions, yet as donations are required by the 19th section to be made in the same manner subscriptions are, it is important to ascertain the true construction of those sections which have exclusive reference to subscriptions. Counsel seem to substantially agree that the act contemplates two classes of subscriptions—one where the entire amount of the subscription is to be raised in money by immediate taxation, and to be paid in cash at the time the subscription is made; and the other where the payment is to be made in bonds. While there are certain expressions to be found in some of the sections, particularly the 8th, which, if taken in a literal sense in the order in which they occur, would perhaps justify this conclusion, yet upon a careful consideration of all the provisions of the act bearing upon the question, Ave are unable to concur in the conclusion reached by counsel. We are inclined to the opinion that these sections of the charter having exclusive reference to subscriptions Avhen considered as a whole, only contemplate and provide for subscriptions payable in the first instance in bonds, and to be ultimately discharged by the levy of a tax for that purpose. It is difficult to see how the 10th section can be reconciled with any other view. It declares in substance that if a majority of the voters voting at such election shall be in favor of such subscription and tax for the payment thereof, it shall be the duty of the corporation to levy the tax, make the subscription, and issue to the company bonds for the amount thereof. The expression, “such subscription and tax for the payment thereof,” evidently refers to the same subscription and tax mentioned in the 8th and 9th sections, for it could refer to nothing else. And it must be conceded that the subscription thus referred to is, by the 10th section, made payable in bonds to be ultimately discharged by taxation. The substance of these sections, stated in a few words, as we understand them, seems to be this: The 8th section is a simple grant of power to make subscriptions, issue bonds, and levy the requisite tax to pay them, upon a vote authorizing the same. The 9th section prescribes the manner of calling and holding the election. The 10th section requires the corporate authorities, upon an affirmative vote, to issue the bonds, make the subscription, and levy the necessary tax to pay the same. The 11th section declares that where a subscription has been made, the bonds delivered in pursuance thereof shall be deemed full payment for the purpose of giving the municipality the right to vote upon its stock ás other stockholders. In stating what we regard as the substance and effect of these sections of the charter, of course we do not pretend to give the language or follow the order of the various provisions contained in them. But whether the construction we are-inclined to give to these sections, with respect to whether one or two kinds of subscriptions are provided, we do not deem very material. It is claimed by appellants that where it is proposed to. subscribe to the capital stock of the company under the provisions of these sections, the application to the clerk to call an election must require a vote not only upon the question of subscription to the stock, but also upon the question of levying a tax to pay the same; that these are distinct, though dependent, propositions, and unless the application requires both to be submitted at the election, the clerk is not authorized to call one at all. In like manner it is claimed that if it is desired to make a donation of bonds, the application must require an election called to determine both-' the question of donating the bonds, and also of levying a tax to pay them; otherwise the call of the election will be unwarranted, and the election itself, and all proceedings under it, void. The legislature evidently did not, in either case, intend to subject the tax-payers of these municipalities to the burden which the levy and collection of the required tax would impose without their assent clearly expressed through an election properly called and held for that purpose. Yet in determining whether this assent has been given in the case before us we must look to the substance rather than the form of the legislative provisions we have been considering, and the action which has been taken under them. It is conceded that at the election under which the bonds in question were issued, no formal proposition with reference to the levy of a tax for their payment was submitted or voted upon, nor was there anything in the application requiring it. The application to the clerk required him “to call an election in said Township of Prairie to determine the wishes of the legal voters of the township in reference to said township’s donating forty thousand dollars in its bonds to aid in the construction of the Bloomington and Ohio River Railroad.” An election was called in pursuance of the application, at which the above proposition was submitted and voted upon by the legal voters of the township —ninety votes being cast for donation, and none against it. The bonds were accordingly issued, and they are now outstanding in the hands of innocent holders, and it is objected they are void, for the reason no formal proposition authorizing the levy of a tax was submitted or voted upon at the same time the bonds themselves were voted. Whatever may be the rule with respect to subscriptions, it is clear that so far as donations are concerned there is no express provision of the act that required the proposition in question to be submitted or voted upon. The conclusion that the act required it is only reached by a process of reasoning or by a mere inference. The act clearly empowered the township to make the donation of its bonds upon a vote authorizing it; and inasmuch as the same power which authorized the issuing and donation of these bonds also imposed the obligation of paying them, and this could only be done by the exercise of the taxing power, we are of opinion it is but just and reasonable to hold that the people of the township, by voting the donation of the bonds, impliedly voted for the levy of the requisite tax to pay them whenever it should be required for that purpose, and this, we think, was all the act required. We do not understand that the act contemplates the immediate levy of a gross sum of money sufficient to pay the bonds; but, on the contrary, it was intended that a tax should be levied from time to time to meet the interest and principal of the bonds as the same respectively matured. It is also objected that the election was not conducted by the proper officials, and that the notice of the election is not sufficient; that the proofs show that there were but three notices posted up in the township, whereas the law required five; and also, at least one insertion of the notice in a newspaper published in the township. This objection is based upon the hypothesis that the election should have been conducted as if held at a special town meeting, and that the notice required by the 9th section of the company’s charter is the same as that required for special town meetings. By the term “annual meetings,” as there used, we do not understand the legislature meant town meetings; but are of opinion that it is used in the sense of “general elections,” and was so intended, and if so, the notice under the general election law was sufficient, and so we regard it. It is further objected that the proofs of the election, returns, etc., are insufficient; that they were only provable by record evidence, and that no such evidence was produced. We do not think this objection is well taken. The evidence respecting the calling and holding the election and the returns was competent, and satisfactorily shows that everything was done substantially as required by law. It is further urged that the bonds were not executed by the “corporate authorities,” as required by the act under which they were issued. While the expression, corporate authorities, does not ordinarily in its application to townships signify the supervisor and town clerk, yet we have no doubt of its being used in that sense in the act in question. Upon the whole, we are of opinion that the bonds in question were properly issued, and that they are binding obligations upon the township. It remains, therefore, only to inquire whether they were entitled to be registered under the act of the 16th of April, 1869. If so, the tax in question was properly levied by the auditor; otherwise, it was not, and should have been enjoined. Before railroad aid bonds can be properly registered under the above act, it must appear that they were issued in pursuance of a vote of a majority of the legal voters living in the municipality issuing them. When once registered, the presumption is they were rightfully registered, and the burden of establishing the contrary rests upon the party affirming it. It is well settled by the decisions of this court that where a majority of those voting at an election of the kind vote in favor of subscription or donation, as the case may be, for the purposes of registration it will be presumed that such majority so voting is a majority of all the legal voters living in the municipality at the time of the election ; and where, in such case, the authorities, acting upon such presumption, have admitted the bonds to registration, and the municipality issuing them has, as in this case, treated them as properly registered by paying previous taxes levied by the auditor for the liquidation of accruing interest, and the bonds thus registered have passed into the hands of innocent holders, nothing but the clearest and most satisfactory proof will authorize a court to enjoin the collection of a tax levied by the auditor on account of such bonds, on the alleged ground that the majority voting for such subscription or donation was not a majority of the legal voters. In this case, as already observed, there were ninety votes cast in favor of donation, and none against it. With a view of overcoming the presumption that the electors casting these ninety votes were a majority of all the legal voters in the township at the time of the election, several witnesses 'were introduced on behalf of appellants, who testified that they had carefully gone over the poll books of the general election of 1868, in that township, and that it appeared from them that 193 votes were cast at that time, and that in the opinion of the witnesses the population of the township had been on the increase ever since. Moreover, that witnesses knew of a number of legal voters in the township at the time of the election in 1868 who did not vote, which, if added to the number voting would make two hundred or over at that time; and in the opinion of witnesses there were fully two hundred legal voters in the township at the time of voting upon the question of donation on the 10th of December, 1869. This is the substance of all the evidence bearing on the question ; and it may all be true, and yet it falls far short of establishing the proposition for which it is offered. Unless the election at the time furnishes the test, how is it to be determined ? Surely, the presumption arising from the vote actually cast can not be overcome by mere opinions of witnesses. PTor does it necessarily follow because there were two hundred voters in the township in 1868 there must therefore have been that number in it in 1869. The rule laid down by this court in Melvin et al. v. Lisenby et al. 72 Ill. 63, is conclusive upon this question. In that case the register for the election at which the subscription was voted, contained 3267 names, which had been placed on the list as legal voters, and which was more than double the number of votes cast for subscription, nevertheless it was held, inasmuch as a majority of those voting at the election had voted in favor of subscription, the presumption arising therefrom could not be overcome by the registry list, and the registration of the bonds in that case was sustained. In this connection, see also People ex rel. v. Warfield, 20 Ill. 159. It is also claimed that the bonds in question were never delivered to the Bloomington and Ohio River Railroad Company, but were delivered to the Chicago and Paducah Railroad Company. The facts are that these bonds, as voted, are payable to the former company. . They were handed over by the agents of the township to P. B. Shumway, who, at the time, was secretary of the latter company. Shumway, in the receipt executed for them, professes to act on behalf of the Bloomington and Ohio River Railroad Company as well as his own company, and there is nothing in the record to show he was not authorized to do so. But even if it were admitted there was an improper delivery of them, by means of which they passed into the hands of innocent holders, we are not prepared to hold that the bonds would be void in their hands. There was ample authority for issuing them; they were executed in the proper form, and made payable to the proper party, and there was nothing pertaining to them or could have been ascertained from the record that would have indicated they had been delivered to one not entitled to receive them, and certainly, under such circumstances, it would be great injustice to the present owners to hold them invalid. Upon the whole we are of opinion that the decree of the circuit court is right, and it is therefore affirmed. Decree affirmed. Scott, J: I do not concur in this opinion.