Court Opinion

ID: 8853296
Source: CourtListenerOpinion
Date Created: 2022-11-26 17:21:36.439936+00
Date Added: 2024-06-11T17:05:34.631917
License: Public Domain

THAYER, Circuit Judge
(concurring). I concur in the foregoing opinion. The chief objection to a recovery on the bonds in suit is that they were issued under a law of the state of Kansas (Act March 10, 1879, supra) which did not contemplate or authorize the issuance of negotiable securities, and that the purchasers of the bonds were bound to take notice of the true construction of said act, and were not innocent holders. Whatever weight attaches to this argument is derived, in my judgment, from expressions found in Merrill v. Monticello, 138 U. S. 673, 11 Sup. Ct. 441, and in Brenham v. Bank, 144 U. S. 173, 12 Sup. Ct. 559, which were not decided for more than 10 years after the act of March 10, 1879, was passed, and therefore could have had no influence whatever on the legislature of Kansas iu framing said act. li. is safe to say that prior to March 10, 1879, municipal bonds aggregating millions of dollars had been executed and sold under the sanction of laws which, like the act now in question, authorized an issue of bonds with semi-annual coupons attached, without specifying whether they should be made negotiable in form or otherwise. It is doubtful whether a single bond had ever been put in circulation under such laws that did not contain words of negotiability, and more doubtful whether bonds not containing words of negotiability would have proven to be a marketable security.- In 3 879 it was the generally accepted view that a power conferred on a municipality to issue bonds, or simply to borrow money, carried with it, by necessary implication, a power to issue negotiable bonds. Bearing in mind these facts, a due respect for the legislature requires us to presume that if that body was solicitous of preventing frauds by making bonds issued under the act of March 10, 1879, nonnegotiable, it would have declared that they should be nonnegotiable in plain and direct terms, instead of employing language that was then deemed amply sufficient to warrant the execution of negotiable; securities. I have no doubt that the legislature of Kansas intended by the act of March 10, 1879, to authorize the various municipalities named in that act to issue negotiable bonds, and, in my judgment, the language *952of the act was adequate for that purpose, notwithstanding the decisions in Merrill y. Monticello and Brenham v. Bank, supra. The distinction between those cases and the one at bar is clearly pointed out in the foregoing opinion. According to well-settled rules of construction, the act of March 10, 1879, should be held to have conferred a power upon the defendant township which it was clearly intended to confer, and which the legislature had an undoubted right to grant. I concur in the order affirming the judgment.