Court Opinion

ID: 6239678
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:41:21.830611+00
Date Added: 2024-06-11T08:58:09.673599
License: Public Domain

*316Opinion,
Me. Chief Justice Paxson:
This suit was brought iu the court below against the city of Pittsburgh to recover the amount due on a bond given by said city, and payable by instalments. There was no dispute as to the amount of the bond, nor that the respective instalments were all due; the contention was over the question of interest on the respective instalments after their maturity.
It appeared upon the trial below that no demand had ever been made by the holder of the bond for payment, and that for a portion of the time, at least, the money had been provided for its payment, and was in the city treasury. Under these circumstances the learned judge instructed the jury as follows: “ Therefore, as I say, the simple question is this: Did the city of Pittsburgh provide the means for the payment of these bonds ? If she did, before the maturity of the bond, that is, by the maturity of the last payment, then the interest would stop from that date, and you will fix the time when that provision was made. As I have said before, the evidence does not satisfy me that a provision was made before 1880. It is a question of fact, however, for you, and you will fix the time, and allow interest on the instalment from the time it came due, up until the time that you find that the city had provided for the payment of the bonds. That is all the interest the plaintiff is entitled to, in my judgment.” This and other instructions of like tenor were assigned for error here.
The contention of the plaintiff is that a municipal corporation, like an individual, must seek out its creditor,' if it desires to stop interest, and tender him the money due. If this contention is well founded, the effect of it will be to work a revolution in the mode of transacting business with such municipalities. Singularly enough, the precise point does not appear to have been decided in this state; yet there are plenty of dicta scattered through our books, which plainly show the bent of the judicial mind. In the case of Luzerne Co. v. Day, 23 Pa. 141, it was said by this court: “ When a legal claim is presented for payment, it is the duty of the commissioners to draw- their warrant for its payment. If this is refused, or if the order is not paid when demanded, a suit will lie against the county; but, until demand is made, neither the commissioners nor the county are in default, and without it a suit cannot be main*317tained.” And in Allison v. Juniata Co., 50 Pa. 351, it was beld that the holder of a county warrant or order cannot recover interest, even after demand and non-payment for want of funds.
It is true these cases were put partly upon the ground that such orders are neither bills, notes, checks, nor contracts, nor even a satisfaction of the original indebtedness. Had the action been upon such original indebtedness, as was said in Dyer v. Covington Tp., 19 Pa. 200, the court could decide whether it was a case for the allowance of interest or not. In Emlen v. Navigation Co., 47 Pa. 76, it was said by Justice Read, in discussing the general rule upon the allowance of interest: “ There are, however, exceptions to the general rule, as in the case of banks, who are the debtors of their depositors, and of trustees who have not failed in the discharge of their trusts. And we must undoubtedly add the cases in which the United States and the several states have been prepared to pay their loan-holders when their loans fell due, of which it is their practice to notify their creditors beforehand..... The result is that these debts are payable at a fixed period,.....at which time and place the loanh older is to present his evidence of debt and receive payment. Whether he does or not, interest stops from that moment.”- The point decided in that case was that the Lehigh Coal & Navigation Co. was not bound to seek its creditor in a foreign country, and make a tender, in order to stop interest.
In the state of Illinois it has been repeatedly decided that municipal corporations are not bound to discharge their indebtedness elsewhere than at their treasuries: City of Pekin v. Reynolds, 81 Ill. 529; People v. Tazewell Co., 22 Ill. 147; Johnson v. Stark Co., 24 Ill. 75; South Park Commissioners v. Dunlevy, 91 Ill. 49. It must be conceded that this is the rule applicable to the United States and to the several states. And the rule does not depend upon the fact alone that in such instances no suit would lie. It rests upon the broader ground of public policy and public convenience, and the further reason that, as to all municipal organizations or governments, the municipal treasury is the recognized place where all claims against it shall be paid. This rule has been recognized by common consent, by every person, and in every place. The reason of it applies with equal force to a city as to a state. The only *318difference between them is that one can be sued; tbe other cannot. It would entail intolerable inconvenience if the rule were otherwise. The bonds of some municipal corporations are largely held in every state in the' Union, and in nearly every nation abroad. It is impossible, in many instances, for such corporations to know their creditors, or where they reside. To hold that they must find them and tender the amount of their debt, before interest could be stopped, would entail endless confusion, and do no practical good. Their obligations are as much payable at their treasury as if so “ nominated in the bond,” and it is so understood by all who deal with them.
We regard the instructions of the court below as favorable to the plaintiff as he was entitled to. There is nothing in the remaining specifications of error which requires discussion.
Judgment affirmed.