Court Opinion

ID: 5443348
Source: CourtListenerOpinion
Date Created: 2022-01-08 18:06:39.957304+00
Date Added: 2024-06-11T08:32:05.629959
License: Public Domain

Paterson, J.
This is a special proceeding to compel the defendant, Hon. J. P. Dunn, controller, to draw a warrant in favor of plaintiff for the sum of $4,172.56 upon the Indian-war-bond fund for the payment of certain bonds, all of which are in the following form:—
“ No. 813. $1,000.
“ Bond of the state of California for war indebtedness, in conformity with an act authorizing the treasurer of *596state to issue bonds in payment of the expenses incurred in the suppression of Indian hostilities in certain counties in this state, approved April 25, 1857.
“ The state of California promises to pay to the order of the governor thereof the sum of one thousand dollars, to be paid only out of any money hereafter to be appropriated by Congress for the payment of such expenses. This bond is transferable by assignment by the owner thereof, or by his attorney in fact.
“ In testimony whereof, the treasurer, controller, and governor have respectively signed, countersigned, and indorsed these presents, and the governor has caused the seal of the state to be affixed hereto this twenty-first day of May, A. D. 1862. D. E. Ashley, Treasurer.
“ G. B. Wabben, Controller.”
Indorsed:—
(Seal) “Lelajstd Stanfobd, Governor.
“ Issued to A. L. Pardee. Certificate 1238.”
The plaintiff is an innocent purchaser for value from Pardee,—so far as legal or mercantile innocence can be considered in connection with such instruments. The court found that he purchased without notice of any defects or infirmity in said bonds other than those disclosed by the terms thereof, and by'the several statutes of the state of California and the act of Congress mentioned herein; namely, Stats. 1857, p. 262; Stats. 1861, pp. 298,409; Stats. 1862, pp. 181, 329; Stats. 1863, p. 399; Stats. 1867-68, p. 601; Act of Congress, 12 Stats, at Large, 1861, p. 199.
The statements in the bonds put the purchaser upon inquiry, and he took them subject to all defects therein, and subject to all the conditions imposed by the acts of the legislature and of Congress upon the subject referred to in the act of April 25, 1857. (Civ. Code, sec. 3088; Cagwin v. Hancock, 84 N. Y. 532; Craig v. Andes, 89 N. Y. 409; Daniel on Negotiable Instruments, secs. 34, 52, 437; Nevada Bank v. Steinmitz, 64 Cal. 314.)
*597It appears from the face of the bonds that payment was dependent entirely upon the condition that Congress should make an appropriation therefor. This contingency has never occurred. No fund of the state has ever been pledged for their payment. The bonds are dated May 21, 1862. Congress has not made any appropriation for the payment of claims for the destruction of property. No fund has been created in any way out of which such losses can be paid. The only provision ever made by Congress is that found in the terms of the act of March 2, 1861, “ for payment for services of volunteers, and for supplies, transportation, and personal service furnished or rendered to said volunteers.” The purchaser knew — or was bound to know—that under the statute bonds could issue for the purposes only: 1. For services, etc.; 2. For the destruction of property. He was charged with the knowledge that the bonds could be paid only out of such appropriations as Congress might make therefor. Congress has made an appropriation for the payment of the first class of debts or obligations mentioned, but has made no provision for the payment of the second class. Respondent cannot be compelled to draw a warrant for the payment of the bonds set out in the petition until a fund for the payment thereof has been created by Congress.
Judgment affirmed.
Temple, J., and McKinstry, J., concurred.
Hearing in Bank denied.