Court Opinion

ID: 8744129
Source: CourtListenerOpinion
Date Created: 2022-11-26 11:00:24.207771+00
Date Added: 2024-06-11T17:00:34.124062
License: Public Domain

CALDWELL, Circuit Judge
(dissenting). At the time the bonds in suit were issued the county of Lake had exceeded the constitutional limit of indebtedness by hundreds of thousands of dollars. Under an act authorizing counties to fund their valid outstanding indebtedness, the county authorities issued funding bonds to the amount of half a million of dollars. These bonds were issued to retire county warrants, 90 per cent, of which had been issued after the constitutional limit of indebtedness had been reached and exceeded, and were, of course, void for that reason. The fact of this indebtedness was sufficiently disclosed by the public-debt record of the county, accessible to all, and of which the holders of warrants and all others were bound to take notice. The warrants in redemption of which the bonds were issued were offered in evidence and rejected. These warrants were found in the clerk’s office in the proper place for redeemed warrants of the county, where they had been for many years in official custody; and the dates, amounts of the warrants, and names and memoranda wrapped around the warrants tallied so perfectly with the bonds in suit as to leave little doubt that these were the warrants in redemption of which the bonds were issued. At any rate, it was for the jury to say whether they were the warrants, and the evidence offered undoubtedly tended to prove that fact, and was therefore competent. It is a radical error to hold that county warrants which were issued and dated after the constitutional limit of indebtedness had been reached and exceeded will be presumed to have been issued for an indebtedness contracted prior to the time the constitutional limit of indebtedness was reached. There is no such presumption of law. In this very case the fact is notoriously otherwise. The constitu-*517lio nal limit of indebtedness bad been readied years before tlie warrants were issued. No valid debt could be created after the constitutional limit of indebtedness had been reached, and all indebtedness contracted, as well as the warrants issued for the same, were alike roid. When it is shown that-80 per cent of the warrants in redemption of which the bonds were issued were void, the bonds are void in tolo. Borough of Millerstown v. Frederick, 114 Pa. 435, 7 Atl. 156; 1 Pars. Cont. 457. At most, the holder of the bonds would recover only the amount of the valid indebtedness included in the bonds.
The court, after indulging in a rhapsody over the rule of evidence which excludes hearsay testimony, — a matter quite foreign to any question of law or fact in the case, — proceeds to declare a series of presumptions of law which make it absolutely impossible for the county to prove a fact as open and notorious as the existence of the county itself. The presumptions declared are arbitrary, contrary to known facts, and have no foundation in the rules of evidence. The rules of evidence laid down by the court an; too exclusive. They exclude the facts of the case, and del ermine it upon presumptions which no jury would ever deduce from the facts. There is no recital in these bonds that they do not exceed the constitutional limit of indebtedness, and the county is not, therefore;, estopped by the recitals from showing that fact. Gunnison Co. v. Rollins & Sons, 173 U. S. 255, 19 Sup. Ct. 390, 43 L. Ed. 689; Lake Co. v. Graham, 130 U. S. 674, 9 Sup. Ct. 654, 32 L. Ed. 1065. In the case last cited, bonds of the ver-y same series of these in suit were held void by the supreme court of the United Stales. Beyond all doubt, this whole series of bonds is void, and they can be upheld only by overruling all rational rules for the investigation of Truth in a court of justice. The judgment of the circuit court should be reversed.