Court Opinion

ID: 7101550
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:16:19.648914+00
Date Added: 2024-06-11T16:13:25.540536
License: Public Domain

Adams, X,
dissenting. — A rehearing having been granted, the original majority opinion no longer stands as the opinion of the court, unless adhered to, and it is not stated in the present majority opinion that it is adhered to. The counties, then, were not precluded from recovering by reason of any consideration which .they received in the construction of the road. We have, then, a case where county bonds were executed and delivered under a void contract for which the counties never received anything, and never can receive anything, and of which bonds the railroad company had the full benefit, and which the counties unfortunately have been obliged to pay. It is conceded now by a majority that a right of action accrued to the counties upon this state of facts. It is settled, indeed, beyond controversy that money paid under an ultra vires contract, and for which no consideration is received, may be recovered back. This was distinctly held in Northwestern Union Packet Co. v. Shaw, 37 Wis., 656, and this case is now cited with approbation in the majority opinion. But, notwithstanding the rights of the counties were at one timé so clear and simple, it is thought by the majority that they must now be denied.
Mr. Justice Reed thinks that the cause of action accrued more than five years before the action was commenced, and is barred by the statute of limitations. Mr. Justice Seevers and Mr. Justice Rothrock remain of the opinion that no cause of action arose at any time, because they think that a consideration was received by the counties; but they concur with Mr. Justice Reed to this extent: that, if the bonds had been delivered to the company without consideration, as the majority think, a cause of action would have arisen in favor of the counties, and would have arisen at the time the bonds were delivered to the company, which was more than five years before this action was commenced. In my opinion, the *403position of the majority in respect to the time when the canse of action should be deemed to have accrued, upon the supposition that the counties received no consideration, is not souud. In my discussion of the case I shall assume that there was no consideration, as the majority hold, and treat the case accordingly.
We are not concerned to inquire when a cause of action accrued to the counties, but when the particular cause of action now set up accrued. It is not to be denied, of course, that the counties, having parted with bonds which might be transferred to innocent purchasers, were entitled to have them canceled or surrendered; and this right accrued at once, although they did not so understand it at the time. So, if the company proposed to put the bonds upon the market, the counties had a right to an injunction to-restrain it. But a cause of action existing in equity by reason of such right is entirely different from a cause of action at law for the recovery of a judgment for money. Our inquiry, then, is limited to the question as to when the counties became entitled to a judgment for money. I cannot think that such right accrued immediately upon the performance of the.unauthorized acts of their officers in the execution and delivery of these void bonds. As between the counties and the company, the bonds were of no more force than so much blank paper. Suppose the counties had concluded, immediately upon the delivery of the bonds, that the contract under which they were executed was ultra vires, and had demanded their cancellation or surrender; as the company regarded the contract as good at that time, it would, of course, have refused to comply with such demand. Now, if the counties had brought action to recover money judgments for the amount of the bonds, the court would, I think, have said, and very properly, that it did not appear that they had yet sustained any injury; and, what is more-, that they could not, so long as the bonds remained in the hands of the company; that the only injury so far was a threatened *404injury; and that the remedy which the counties needed was merely of a preventive character. If I am correct in this, then thepresent cause of action for a mouey judgment did not accrue immediately upon the execution and delivery of these void bonds to the company, nor while they remained in the hands of the company. After they were transferred to innocent purchasers, the situation was different. By such transfer the bonds, for the first time, were put in force. But this occurred, as I understand, at a time when it was assumed by both parties that there was no want of power on the part of tile counties, or county officers, to do what they attempted. The transfer, then, by the company involved no tuiqfitudc. The counties, it is true, had wrongfully been drawn into a valid obligation, but it was the result of a mistake. The most that can be said is that an implied contract arose on the part of the company to rectify the mistake; but a complete rectification required'nothing more than that the company should take up the bonds at maturity, and hold the counties harmless. This was required by good morals, and all that was required; and this, I have no doubt, was the contract which arose by implication of law on the part of the company. The sole proceeds of these bonds had gone to the company. The counties had received no benefit, and could receive none. Their paper, as it turned out, had been put upon the market for the company’s sole accommodation. The issuance and transfer had no other result. As, then, between the company and the counties, it was the duty of the former to protect the latter, the obligation of the company differed in no essential respect from that of any person who has had the use of another person’s paper. If I am correct in this, then the cause of the action accrued at the time of payment; and, as to some of the payments, at least, the actions were not barred at the time they were bought.
Chief Justice Beck concurs with me in this dissent.