12 Kan. 186

William J. Lewis v. Commissioners of Bourbon Co.1

July Term, 1873.

1. Contracts: Duty of Court. It is not the province of courts to make contracts between parties, but only to enforce contracts already made.

2. Principal and Agent: Estoppel. A principal is not bound by the acts of his agent, unless authorized, or unless Lis own acts and representations estop him from denying the authority.

-3. Counties: Securities of. In controversies between a county and the holder of its supposed securities, good faith to the tax-payer requires that *150no charge be left on his property unless legally placed there, and that no-contract be enforced unless legally made.

4. Municipal Bonds: Elections: Observance of Law. The forms of proceeding in the submission of the question of subscribing stock and issuing bonds to a railroad corporation are designed as a protection to the taxpayer, and a due observance of these forms is essential to valid action.

5. -: in Aid of Railroads: Corporation must be Named. Under the act of 1866 an existing corporation must be named as the recipient of the proposed subscription and bonds, and a submission of the question of issuing bonds to “any corporation now organized, or that may hereafter be organized, ” that shall construct a certain line of road, is unauthorized and void.

8. Railroad Stock: Counties: Rower to Subscribe for. The grant of power to a municipality to subscribe to the stock of a private corporation is the delegation of an extraordinary power,0 and should not be extended beyond the fair import of the words used. Without legislative sanction the assent of a majority of the voters would not authorize a municipality to make such a subscription.

7. -: Authority of Commissioners: Corporation must be Named. The authority given by the statute is not to give so much, or pledge so much, for the construction of a railroad, but to take so much stock in a railroad corporation; and some corporation must be named as the recipient of the subscription and bonds, or the proceedings will be without warrant of law, and void. A majority of the votes cast at such election is a condition precedent to the vesting of any authority in the commissioners to malee the subscription.

8. Election: Bonds: Authority to Canvass Votes. The statute does not make the county commissioners the canvassing officers, nor designate the time and place of making the canvass of votes cast at an election held on the question of subscribing stock in a railway corporation.

*1519. -: Unauthorized Canvass: Hotiee of Illegality. "Where the commissioners omit to prescribe by order the time and place of making the canvass, and where a majority of the votes cast are against the propo*sition, a canvass made by the commissioners which shows a majority in favor of the proposition, when the canvass appears upon its face to be partial, and not to include the returns from some townships, does not conclude the county as to the vesting of authority in the commissioners, and is notice sufficient to put every one on inquiry as to the actual state of the vote; and when the returns from the uncounted townships are filed in the county clerk’s office on tire very day of the convass, and are placed with the other returns, and so remain, every one is charged with notice of the actual result of the election.

10. Curative Act of 1868 Construed. The curative act of 1868 applied only to cases where “a majority of the persons voting” voted in favor of the subscription. It aimed to sustain, not to defeat, the will of the majority. [Atchison, T. & S. F. E. Co. v. Jefferson Co., 17 Kan. 29.]

11. Railroad Bonds: Election: Separate Submission. The statute does not authorize the submission to a single vote of the question of subscribing stock and issuing bonds to twro or more corporations. The question of making the subscription to each corporation must be submitted separately.

12. -: Hotiee to Purchasers: Recitals. "Where bonds purporting to have been issued by a county contain no recitals of an election, or of proceedings and orders of the county board, but are naked promises to* pay, every purchaser and holder of these securities is chargeable with notice of whatever appears upon the face of the county records.

13. -: Bona Fide Holders. If in such ease it appears upon the face of the county records that the commissioners had no authority to issue the bonds, the county may avail itself of that want of authority as a defense to an action even of a bona fide holder.

14. -: Must take Hotiee of Public Records. Purchasers of negotiable paper, issued by an agent, the nature and extent of whose authority must by law appear upon the face of public records, are chargeable-with notice of whatever appears upon those records.

15. -: Reference in One Instrument to Another. Where a bond or other instrument purports to have been issued by virtue of a certain order, named and referred to, but not copied or described, every one claiming any rights by virtue of that bond or instrument is chargeable with notice of the contents of the order.

Original proceedings in mandamus.

Lewis, as plaintiff, commenced suit in this court, in November, 1872, against the board of county commissioners of Bourbon county and James H. Brown, county clerk of said county, as defendants. Plaintiff claimed to be the owner and holder, by purchase from the Tebo & Neosho Railroad Company, of one hun*dred bonds of. $1,000 each, numbered from 1 to 100, respectively, issued by Bourbon.county to said railroad company, of which bonds the following is a copy:

“No.- State of Kansas. $1,000»

“Stock Bond of Bourbon Gbunty, Kansas.

“Thirty years after date the county of Bourbon promise to pay to» the Tebo & Neosho Railroad Company, (a corporation organized by *152authority of the laws of the state of Missouri, and by virtue of an act of incorporation passed by the legislature of the state aforesaid, and approved the sixteenth day of January, I860,) or bearer, the sum of one thousand dollars, for value received, with interest at the rate of seven per cent, per annum, payable semi-annually at the New York National Exchange Bank, in the city of New York, from and after the first day of January, 1871.

“By order of the board of county commissioners of the county of Bourbon, dated March 8,1867.

“Attest: C. Fitch, Clerk. D. Gardner, Chairman.

“City of Fort Scott, Kansas, July 1, 1870.”

To each bond were attached coupons for the semi-annual interest. The coupons for the interest due January 1, 1871, were detached by agreement before the bonds were delivered to the railroad company. The coupons for July 1, 1871, and January 1, 1872, were paid by the county. The railroad company, now known as the Missouri, Kansas & Texas Eailroad Company, not having complied with its contract to build its machine shops at Fort Scott, make Fort Scott the end of a division, etc., the board of county commissioners refused to pay, and by order entered on its records instructed the county treasurer not to pay, the interest coupons due July 1, 1872, (although said commissioners had previously caused a tax to be levied and collected for that purpose.) Plaintiff, Lewis, caused his one hundred bonds to be registered under the provisions of chapter 68 of the Laws of 1872, and the auditor of state, as required by section 16 of said act, certified the amount of interest to become due on said bonds January 1 and July 1, 1873, to the county clerk of Bourbon county, that said clerk might levy a tax upon the taxable property of said county for the year 1872, to pay said interest coupons, and place said tax on the assessment roll of said county for said year, as provided by section 17 of said chapter 68. The county clerk received said certificate, but refused to levy said tax. This action was brought to compel the payment of said interest due July 1, 1872, ($3,500,) and to compel Brown, *as county clerk, to levy the necessary tax to pay the interest to accrue January 1 and July 1, 1873, ($7,000.) The plaintiff alleged that he was an innocent purchaser for value. An alternative •writ of mandamus was issued and served. The defendants answered alleging that the bonds (150 in all, amounting to $150,000) issued to the Tebo & Neosho Eailroad Company were issued without any warrant or authority of law, and were void. The answer set up the acts and proceedings of the board of county commissioners under •which the bonds were issued. It was admitted that the Tebo & Neosho Eailroad Company was a corporation duly and legally organized under the laws of Missouri.

John D. Stevenson, for plaintiff.

Upon the facts the plaintiff insists that these propositions alone are presented: (1) Could these bonds be legally made? (2) Lid *153Bourbon county make them, and put them in circulation ? (3) The plaintiff, not a party to the original contract, being shown to be a purchaser in open market, and for value, do the facts of the case invalidate the bonds in his hands ?

The legislature of Kansas has unmistakably conferred upon the counties of the state the power to create this description of obligation. The act approved February 10, 1865, (chapter 12,) and the amendatory act of February 26,1866, (chapter 21,) in express terms authorize counties to subscribe to the capital stock of any railroad company, whether organized under the laws of the state of Kansas or any other state, proposing to construct a railroad in, near to, or through such counties, placing but one restriction upon the county authorities in the exercise of this authority; that is, that “no such bonds shall be issued until the question shall first be submitted to a vote of the qualified electors of the county at some general election, or at some special election to be called by the board of county commissioners; * * * and in submitting %'said question said board of commissioners shall direct in lohat manner the ballots shall be cast. If a majority of the votes cast at such election shall be in favor of issuing such bonds, the board of county commissioners shall issue same.” The act entitled “An act to authorize counties to issue bonds to railroad companies, approved February 25, 1868,” (Gen. St. 892,) cures all irregularities and omissions in the proceedings of the commissioners. There can be no question as to the legal authority to create this class of securities by counties, if these acts be fairly interpreted.

Did the commissioners actually make these bonds ? The records of the county commissioners prove conclusively the contract between the Tebo & Neosho Bailroad Company and Bourbon county authorizing the issue of the bonds; their actual preparation, execution, and delivery; and the same record proves that Bourbon county put them in circulation. What prerequisites, if any, were wanting, the absence of which would invalidate them as securities, or, rather, as negotiable instruments ? The only doubt that is suggested arises from the claim of defendants, that the vote canvassed was not the entire vote really east at the election of May 7, 1867. The only tribunal under the law that can canvass the vote is the board of county commissioners, bio other tribunal can make any declaration, or arrive at any conclusion, in regard to the vote. The statute provides : “If a majority of the votes cast at such election shall be in favor of issuing such bonds, the board of county commissioners shall issue the same.” This is a clear delegation of power to the commissioners to decide a question of fact of which they are the sole judges, and when once decided by them is conclusive. This fact being of record, is conclusive, and is notice to the world of the result of the election. The acts of the legislature are the authority to take steps to create this description of municipal indebtedness. The dec*154laration of the county commissioners that a majority of the votes cast were in favor of the issue of the bonds is the record authority that the board are authorized to issue the bonds. This record remains unimpeached *for two years. At a second election a large majority of the voters of the county directed the board of commissioners to issue the bonds under this original order and canvass. With full notice of this action of the board, it stands unimpeached. The act of February 25,1868, conferred complete, full, and ample authority of the commissioners to act under the election of May 7, 1867. The omission to canvass the vote in Franklin township does not affect the election. The voters in that township, by the failure to produce the return in time to be counted, through the delay of the messenger, are in law in the same position as if they had not voted. The vote was canvassed at the time appointed for that purpose,— the Friday next after the election. The return from Franklin was not delivered to the clerk until the board had completed the canvass, declared the result, and adjourned. Gen. St. 410, c. 86, § 2V8. By section 18, c. 25, Gen. St., elections similar in character to the one held on the seventh of May, 1867, must be governed by the laws governing the elections of county officers. The action of the board of commissioners in canvassing said vote was in time, manner, and place in accordance with the general law, the custom of the county, and the well-understood usage and general understanding of the people. The failure to receive and count the vote of Franklin township arises from no deviation from the law and usage and custom prevalent and understood on the part of the board of commissioners, but simply because no return was before them to be canvassed from that township.

The plaintiff being a purchaser in open market, for value, was only required to know that Bourbon county was by law authorized to issue bonds; that an election had been held according to law; and that a competent tribunal had declared that a majority of the votes cast at the election were for the issue of the bonds. He is not required to go behind the record of the board of commissioners. That record discloses no fact of an election having been held in Franklin township; on the contrary, negatives it in terms. *The doctrine is well settled that the' holder for value of this class of negotiable securities is only compelled to take notice of the laws authorizing the issue of the securities, and that the recitals of the instrument of t'he preliminaries required by the law to be done before the instrument is put in circulation — such as election, the requisite vote of assent by the people, and other requirements if any exist — are by such recitals held, for the protection of the bondholder, to be true. In this case, the bond itself failing to recite either the law itself by authority of which it was made, or compliance with the requisites of the law, the holder of the bond must look to the record of the board of county commissioners, the tribunal by the act itself specially charged with the duty, to see that all preliminary requisites have been com*155plied with antecedent to the issue of the bond, and, when found, their recitals are as conclusive as to his rights as if they were recited in the instrument itself. The acts of February 10, 1865, and of February 25, 1868, and the record of the board of commissioners showing an election ordered, due notice, election held, the vote canvassed, the declaration of the canvassers that the issue is assented to, that a contract was made, the bonds executed and delivered under the contract, was all that plaintiff was required to know, and fully confirmed in him the securities as valid and binding. Irregularities that existed in the election, of which he was not advised by the record, and of which he is not attached with notice prior to his acquiring the securities, in nowise affect the rights of the plaintiff. The county of Bourbon has received the full benefit of the contract made with the Tebo & Neosho Bailroad Company, — had the railroad built in accordance with that contract, received and disposed of the stock subscribed. The bonds, the consideration of the contract, have passed to a bona fide holder for value. Does not good conscience require the county of Bourbon to discharge their obligations ? Lapse of time, levy of taxes, collection of same, payment of interest, receipt of stock, and sale of same, are acts of acquiescence and ratification that cure the alleged irregularities, if any existed, in the *prerequisites required, by the law authorizing the issue of the bonds. The power to issue bonds, and irregularities in the issue of bonds, are wholly distinct propositions. Where the power to issue does not exist, the bonds are absolutely void. No matter where found, irregularity does not, per se, vitiate a bond. It may be cured by recitals in the instrument itself, or it may be cured by recitals in the record of the official charged with the execution of the act in which the irregularity is found, or may be cured by the acts of the maker of the instrument,-s-such as acquiescence, ratification, payment, etc. The accepted and recognized doctrine, as applicable to this class of securities, is that all presumptions are in favor of the bona fide holder for value, being a third party; that an unbending principle of right, and rigorous morality, demand that they shall not be made the instruments of fraud and wrong, but shall be held to be, what they purport to be, instruments of value, to be enforced against the maker whenever found in the hands of a third party, a bona ficle holder for value.

McOomas é McKeighan, for defendants.

The act of the county commissioners in issuing these bonds was ultra vires. The commissioners had no implied authority to issue the bonds. If such authority existed, it must have been conferred, by the legislature by positive enactment. If such authority did not exist, then the bonds are void, and their collection cannot be enforced against the tax-payers of the county. Floyd Acceptances, 7 Wall. 674; Marsh v. Fulton Co., 10 Wall. 676; Clarke v. Supervisors of Hancock Co., 27 111. 305; Marshall Co. v. Cook, 38 111. 44; Cooley, *156Const. Lim. 215. The “negotiability” of these bonds can have no effect upon this question, as the inquiry turns upon the legal existence of the bonds. The term “negotiability” presupposes the existence of an instrument made by a person having power to contract in that particular manner. For instance, the contract of an infant or lunatic would acquire no additional validity by being negotiated. Story, Bills Ex. For similar *reasons, an agent can no more enlarge his powers, by means of his unauthorized acts and representations, than he can create them. Swarthout v. Swarthout, 7 N. ¥. 364; Chouteau v. Eckhart, 2 How. 356.

As a matter of fact, we say there was no legislative authority given to the board of county commissioners to issue these bonds. There have been various acts of the legislature conferring upon counties, cities, and townships power to subscribe stock in railroads, and issue bonds in payment of such stock; but in every ease the grant of power has been coupled with the condition precedent that “before” such stock should be subscribed, or bonds issued, the question of issuing said bonds should be submitted to a vote of the people. There is no difference in principle between the non-existence of a power and the .grant of a power with a condition precedent, before the condition is performed. In the one case the power never exists; in the other, it never takes effect, because the condition is not performed. This is true in all cases where the condition is before the power, and not after it. An after or subsequent condition modifies or controls the exercise of this power; but where the condition is precedent the power itself never passes until the condition is performed. This condition may be the existence or the non-existence of certain facts. Hopple v. Brown Tp., 13 Ohio St. 311; Beckel v. Union Tp., 15 Ohio St. 437. It will be borne in mind that the Tebo & Neosho Bailroad Company is a foreign corporation, organized under the laws of the state of Missouri, and cannot even do business or make contracts in the state of Kansas, except under the doctrine of interstate comity. This bond •does not recite that any election was ever had in Bourbon county to vote bonds to this corporation, but refers the purchaser, and all persons who examine the same, to an order of the county commissioners made “March 8,1867.” Then we must go to that order; and this is express notice upon the face of the bond to the purchaser that he must go to that order to find if the county commissioners had “power” to issue this bond; if the county, acting through these agents or instruments, had complied with the conditions precedent to the exercise of this power granted *in the act of 1866, which was then in force. Laws 1866, p. 72. And when we go to this •order of March 8, 1867, what do we find? An order, upon petition of one-fourth of the electors of said county, (which was required by said act,) submitting the question to the electors of said county of taking stock in and issuing bonds to this company¶ No! But we find an order directing a vote on a proposition to issue bonds to.another *157 and different company, to aid in the building of a road which the Tebo- & Neosho Railroad Company could, by the terms of its charter, never have built. The order says to a road running “east,” (whether through Bourbon or Shawnee county it does not say,) to connect with the Tebo & Neosho Railroad, according to order published. When we look to this “order published,” it is for still anothér road,— a road running west from the Tebo & Neosho Railroad, via Fort Scott. One of these roads has no beginning, the other no ending. It cannot be contended or claimed that this was a proposition to vote bonds to the Tebo & Neosho Railroad Company, even if a majority of the electors of said county voting at such election had voted in favor of this proposition, (which they did not do.) The supreme court of the United States. (Marsh v. Fulton Co., 10 Wall. 677) held that a vote to one road did not authorize the issue of bonds to another, though part of the same line, and that no subsequent ratification by the commissioners, or acquiescence on the part of the people, could give validity to the-bonds. Under no circumstances could the Tebo & Neosho Railroad Company become entitled to these bonds. If it assigned its franchises, to some other road which might become entitled to 'them, such other road would become entitled to the bonds, if at all, by complying with the terms and conditions on which they were voted, and not by virtue of any right it might acquire from the Tebo & Neosho Railroad Company. Under the law, then, it seems clear that these bonds are void, and the plaintiff must be denied the relief sought at the hands of this, court.

But if it can be contended that this order of March 8, 1867, and the election held under it, as is shown by the canvass of May 10, 1867, was a vote to subscribe stock in, or to *issue bonds to, theTebo & Neosho Railroad Company, then we assert that this, election never conferred such a power, i. e., that it was not such an election as authorized the county board to issue bonds to any company. The first inquiry is: Under what law was this election held ? What statute authorized it? The statute of 1866 was in force when this vote was taken. It provides certain “limitations” and “conditions” upon which this vote shall be taken. One is, the order for the election shall not be made until it is petitioned for by one-fourth of the voters of the county, and all these conditions and limitations must be published in the order calling the election. That statute provides, in so many words, that the commissioners shall, “in their proclamation calling for a vote, publish the restrictions and conditions under which they will subscribe such stock; and they shall have no power to subscribe stock in any other manner.” There is no evidence that they published such restrictions and conditions. The record does not. recite it; the bond does not recite it. But the proclamation they did publish is-shown to the court, and it is not in compliance with the law. Are there any grounds here for “presumptions?” But as to *158the petition of one-foarth of the voters, was it presented? It cannot be said that the law confides the duty of deciding this question to the commissioners, and they having decided it, their decision will be taken as true. They did not so decide. No such petition was ever filed. The filing of this petition is made a condition precedent by the act of 1866. See Starin v. Town of Genoa, 23 N. Y. 452; Gould v. Town of Sterling, Id. 464; People v. Mead, 36 N. Y. 224; Dundon v. Starin, 19 Wis. 280; Cooley, Const. Lim. 215. If these bonds were not authorized by the act of 1866, then, if there is any law authorizing their issue, it must be found in the act of February 25, 1868, Gen. St. 892. This act is retroactive, and embraces bonds where two things have been done. The language is: “Whenever a majority of persons voting at any election called by the county commissioners of any county have heretofore voted in favor of subscribing stock and issuing bonds to any railroad company,” etc. Now, in this election held under the order of “March 8, 1867,” *there was no proposition to “subscribe stock and issue bonds to a railroad company.” The order was simply to vote $150,000 bonds. It-was no order to subscribe stock and issue bonds, and a majority of the people voting at such election voted against the proposition. But plaintiff says we cannot show this to defeat an innocent purchaser-. There is no presumption in favor of the poioer of county commissioners to issue negotiable securities from the mere fact that they have issued them.

The plaintiff relies, to show this power, upon the act of 1868, and presents a ease where, in truth, a majority voted against the bonds. The statute of 1868 lays down no basis for indulging presumptions, prescribes no rules of evidence, but simply declares that the commissioners shall have poioer to issue these bonds when a majority have voted for them; and here a majority voted against them. But plaintiff says that the commissioners canvassed the vote, and declared that a majority was in favor of the bonds. Such canvass is not conclusive. The cases where the certificate of the commissioners has been held conclusive where the bond has been negotiated have all been under statutes containing a provision authorizing the commissioners to canvass the vote and make a certificate of the result ; and, in fact, in such cases, the commissioners did canvass the vote, in the manner directed, and did make and sign a certificate that the proposition had received “a majority of all the votes” cast at such an election. Construed in the light of our statute, these decisions have but little weight in this case. Our statute does not authorize the commissioners to canvass the vote, unless the power to make such a canvass is an incident of the power to call the election. The statute making the commissioners a board of county canvassers only applies to certain elections mentioned, in which the elections of this kind are not included. The statute is silent as to who *159shall canvass the vote in these cases. If the commissioners may make the canvass, their right to do so is an incident of the power to call the election. If it is lawful for them to make the canvass, it is their duty to make an honest canvass of all the *legal votes cast (and returned) at such an election, to declare the result, and sign the same. Had they clone this, then there would be some plausibility in claiming that the result as declared by them should be presumed to be true in this proceeding. But in this case they do not say that they have canvassed all the votes east, nor do they certify that the proposition received a majority of all the votes cast. This record is not signed, and is not a certificate of anything.

In some cases it has been held that the recitals in the bonds constitute an estoppel in pais in favor of innocent holders. The plaintiff does not stand in the position of an innocent holder for-value. He is bound to take notice of the law and the records of the public offices. Story, Notes, § 6?; Cone v. Baldwin, 12 Pick. 545; Smith v. Sac Co., 11 Wall. 146. Where bonds bear upon their face evidence of the authority under which they are issued, all persons are bound to take notice of the extent of the authority of the persons issuing them. Aurora City v. West, 22 Ind. 88. Purchasers of such paper look to the law which authorizes its issue, and the recorded proceedings upon which it is based. Bissell v. City of Jeffersonville, 24 How. 298. Justice Field, in Marsh v. Fulton Co., 10 Wall. 676, says: “Purchasers of these bonds are bound to look to the action of the officers of the county, and ascertain whether the law has been so farfollowed as to justify the issue of the bonds.” See, also, Howe v. Mason, 12 Iowa, 203; Story, Ag. §§ 72, 73. If this doctrine be true, it applies with peculiar force to the bonds now under consideration. They do not recité anything, but upon their face they refer the purchaser to the order of “March 8, 1867;” and if the purchaser goes to the “record proceedings upon which they are based,” he will find enough to convince the most skeptical that these bonds, in their inception, were a fraud and swindle upon the people of Bourbon county. The record discloses that this order was not to vote bonds to the Tebo & Neosho Eailroad Company; that the order and proclamation do not correspond, even in substance.; that the canvass of May 10, 1867, was not signed by either the clerk or commissioners; that the returns of Franklin township had been filed away with the *other returns, and that that township gave a large vote against the bonds, and that a majority of the whole vote cast in the county was against the bonds.

The doctrine of the law of agency is sometimes invoked to help these bonds. The proposition is stated thus: the county is the principal; the commissioners, the agent. Now, applying the rules fixing the liability of the principal, it is claimed that the -agents have power to create debts, and the principal will be bound, even if the debts are created in excess of authority, where the debts are in the form of ne*160gotiable securities. The fallacy of this argument lies at its very foundation. The restriction of the law in question is not upon these commissioners, viewed in the light of agents, but it is upon the county itself, which, in this, argument, is made to represent the principal. The power never passes to the county until the condition precedent (namely, the election and a majority vote) is performed. The power is derived from the legislature. - Falsehood cannot create power by affirming the existence of facts which do not exist. A principal is only responsible for the unauthorized acts of the agent where they are done under the color or appearance of authority caused by the principal. Neither the statements of the agent, nor the appearance of the act, will establish the authority of the agent. The commissioners (if there is anything in this argument) are but special agents, and the principal would only be bound where the act is within the terms of the appointment. The public, dealing with special agents, or general agents for special purposes, must see that their acts are authorized. The principal is never bound, unless the act done is within the scope of the authority (real or apparent) conferred by the principal. If he is bound where there is “the appearance of authority,” this appearance mast be caused, by the principal. These are fundamental principles in the law of agency, and are not changed by the law-merchant.

Again, it is sometimes argued that the people have ratified the issuing of these bonds by their acquiescence and silence. The silence and assent of all the people in the county *could not confer the power to issue these bonds. How could it ratify them if they are issued? How can the people ratify what they cannot authorize? The power to issue these bonds comes only from legislative enactment. If the officers issue them without authority, how can their acts be ratified by the mere implied assent of the people, who could not, by express assent, have conferred the power ? But such a doctrine, if tenable at all, can have but little force in. this state, where the tax-payer cannot act until he is threatened with an illegal assessment or illegal tax. Then he may come to the court- and express his dissent; but the bonds are negotiated before this.

Brewer, J.

This is an application to this court for a writ of mandamus commanding the levy of a.tax to pay the coupons on certain bonds issued by the county of Bourbon to the Tebo & Neosho Bail-road Company, and by it sold and transferred to the plaintiff. Two-questions exist, and are discussed by counsel in their briefs with great ability: First, had the county commissioners the authority to issue these bonds? And, second, if not, can this want of authority be set up as a defense to an action by the present plaintiff, who claims as abona fide holder for value ? The material facts are these: On the eighth of March, 1867, without any prior'petition therefor, the county commissioners of Bourbon county ordered “that an election be called *161on the first Tuesday in May, 1867, for the purpose of submitting the question of voting $150,000 to any railroad running east to connect with the Tebo & Neosho Eailroad, as per order published.” The order published proposed to subscribe $150,000 “to the capital stock of any railroad company now organized, or that shall hereafter be organized, that shall construct a railroad commencing at a point on the Tebo & Neosho Eailroad running westward via Fort Scott, and that the bonds of said county be issued to said company for the same.”

On the tenth of May thereafter, being the Friday next succeeding the *first Tuesday of May, the county commissioners, as the record shows, made a canvass "of the votes. In this record appear in one column the names of the townships, and in columns opposite the number of votes for and against the proposition. The columns are added, and show 468 votes for the bonds and 442 against. Then follows this recital: “Majority for bonds, 26 votes; and it was declared that there was a majority of twenty-six votes cast for railroad bonds, and it is also further certified that there was no evidence of an election having been held in the townships of Franklin and Walnut.” This record is not signed by the commissioners, nor attested by the clerk. The poll-book from Franklin township was filed in the county clerk’s office on that day, placed with the poll-books from the other townships, and has been there kept ever since. It appears, however, from the testimony that it did not reach the county clerk’s office, and was not filed, until after the commissioners had left the office. This poll-book showed 4 votes for and 134 against the proposition, which, with the votes already counted, would make a majority of 104 against the bonds. On the twenty-third of July, 1869, more than two years after this election, the record of the commissioners shows that application was made by the officers of the Tebo 8s. Neosho Eailroad Company for a subscription to the capital stock of " this company in pursuance of this vote, (of 1867, as canvassed,) and; that the county board resolved that it was not advisable then to make-the subscription. At the same time an order was made submitting; to the voters the question of issuing bonds to a company building a, road west from Fort Scott. At the close -of that order appears the following recital:

“And whereas, some question has arisen as to the propriety and legality of subscribing the stock and issuing the bonds provided for by the election of the seventh of May, 1867, to the Tebo & Neosho Eailroad ; and whereas, it is considered that the foregoing order, in addition to the one affirmed on the seventh of May, 1867, aforesaid, will be generally satisfactory to the people of this county: it is therefore ordered and provided, that the decision of this question by the qualified voters of *said county, at the said election, in favor of such subscriptions, shall be also a decision in favor of the former subscription of the seventh of May, 1867, being made at once to the Tebo & Neosho Eailroad Company, and the board of county *162commissioners will accordingly in such case, make the subscription authorized by said election of May 7, 1867, and will issue the bonds therein provided for as soon as the terms and conditions of said subscription are complied with by said railroad company.”

A canvass of the votes cast at this election showed 1,428 votes for and 703 against the proposition. This result was declared by the canvassers, and thereafter the bonds were issued, and, for value, transferred to the plaintiff.

Upon these facts four questions are raised as to the authority of 'the commissioners to issue the bonds: First. Was the presentation of a petition signed by one-fourth of the qualified voters a condition ¿precedent to any action by the commissioners, and without which no ¿power to issue bonds passed to the county authorities ? Second. Did 4he failure to name the railroad corporation avoid the whole proceedings? Or, as counsel1 have stated the question in their brief: “Could a subscription be made to the stock of the Tebo & Neosho Railroad Company, under and by virtue of the order of March 8, 1867, and the vote of May 7, 1867, that corporation not being named as the recipient of the proposed subscription?” (This question is discussed more fully by counsel in a ease submitted subsequent to this, — that of’the Missouri River, F. S. & G. R. Co. v. Miami Co., — and we may bave occasion to refer to the briefs and arguments in that case.) Third. A majority of votes having been cast, (May 7, 1867,) as a «natter of fact, against the proposition, were the county board authorized to subscribe the stock and issue the bonds ? Fourth. If no authority existed theretofore, did the proceedings of July 23, 1869, and the subsequent vote, confer authority ?

Before noticing these specific questions it maybe proper to consider an argument which is often used in cases of this kind, and pressed ‘with great force and ability by counsel in this, — the argument of good faith. The county gave the bonds to obtain the road; it has obtained the road; '^therefore, in good faith, it should pay the bonds. The company has fully complied with its contract ; the county ought to do the same. The public conscience is weakened, and public morals suffer, wherever a municipality avoids Its contracts through any technicality. Credit is shaken, and confidence undermined, whenever promises to payare repudiated. Considerations of this kind, however appropriate for individual consciences, and as a guide to individual action, can never overthrow settled rules of law. A party may have given to another his note; every '.consideration of honor and good faith may demand that he pay it; but if suit be not brought till five years from its maturity have passed, :,and the statute of limitations be pleaded, the courts must sustain the '•defense. Mere good faith will never give a cause of action; it is only •when so connected with other considerations as to present a case of -equitable estoppel that the courts can interfere. Courts will never make a contract because they think the parties ought to have made one.

*163Again, in cases like this, the bondholder is not the only party who can rightfully press the demands of good faith. The tax-payer is entitled to equal consideration. He is guarantied protection in property as well as person. He may not be heard in the courts to restrain the issue of these securities. If the authorities, through stupidity or collusion, are placing a burden upon his estate, he is powerless to prevent it. Craft v. Commissioners of Jackson Co., 5 Kan. *518. A new election may enable him to change these officials, but the wrong is already done. He has a right, then, in the name of good faith, to demand of the court that no charge shall be left on his property unless legally placed there, and that no contract shall stand unless legally made. More than that he has no right to ask; less than that he ought not to receive. True, he is not a nominal party to this action, but is the real party in interest. The simple inquiry, then, in cases of this kind, should be whether the forms of law have been so far complied with that a valid cdntract has been made. If they have, the contract should be sustained, and the bondholder have his judgment. If they have not, then the county should *have judgment. No considerations of supposed good faith will justify a court in making and then enforcing a contract • between the parties. As protection to the tax-payers, the law has prescribed certain forms of proceeding, that nothing be done without their consent. These forms are all the protection the tax-payer has, and it is only by insisting on an observance of these forms, as a condition of valid action, that any security is afforded to him. If they are to be frittered away by judicial sanction, it were better to dispense with them altogether, and give the authority to the county commissioners to act without the delay and expense of first consulting the voters.

1. We shall not stop to discuss the first question raised, but will dispose of it by simply saying that if this were the only objection we should deem it cured by the act of 1868. Gen. St. 892.

2. No corporation was named in the proceedings of March, 1867, as the recipient of the proposed subscription and bonds. The proposition, in effect, was whether authority should be granted to the commissioners to take stock in any corporation “now organized, or that might hereafter be organized, that should construct a railroad from the Tebo & Neosho Railroad westward via Fort Scott.” That a vote authorizing a subscription to one corporation will not sustain a subscription to another, even though the latter build the very line of road contemplated by the former, and sought to be secured by the vote, is settled. St. Joseph & D. C. R. Co. v. Commissioners Nemaha Co., 10 Kan. *569. See, also, Marsh v. Fulton Co., 10 Wall. 676. The question now is whether under the statute the people must select the corporation, or may they delegate authority to the commissioners to make the selection. The statute reads:

“Section 1. The board of county commissioners of any county to, *164into, through, from, or near which, whether in this or any other state, any railroad is or may be located, may subscribe to the capital stock of any such railroad corporation in the name and for the benefit of such county, not exceeding in amount; * * * but no such bonds shall be issued until the *question shall first be submitted to a vote of the qualified electors of the countv,” etc. Laws 1866, p. 72, c. 24, § 1.

This statute grants to the commissioners an extraordinary power. The constitutionality of such legislation has been questioned, though sustained. Its wisdom has been denied, even when its constitutionality has been sustained. To prevent abuse of this power, a specific and express authority from the voter is required. The manner of proceeding to obtain this authority is prescribed. Without legislative sanction, the assent of a majority of the voters would not bind the county, nor make valid bonds issued in pursuance thereof. Pendleton Co. v. Amy, 13 Wall. 304. The assent of a majority binds the county no further than the legislature has provided it shall, and a statutory power so liable to abuse should not, by construction, be enlarged beyond the plain warrant of the language used by the legislature. What is the county board empowered to do ? It may make a subscription to the capital stock of a railroad corporation. A subscription is a contract. A contract requires two parties. There can be no subscription of stock without a corporation to receive the subscription. The county was not authorized to pledge its funds to aid in building a railroad. It could not bind itself to give so much for a road. The railroad project might be aided, it is true, but only by virtue of the fact that the corporation had obtained a responsible subscriber for a large amount of its stock. But before the board could make a subscription to the capital stock of any railroad corporation, the question must be first submitted to a vote of the qualified electors. What question? Manifestly the question of making the subscription,— entering into the contract with the railroad corporation. The whole question, not a fragment of it; the question of authority to make the contract, not a contract. The whole authority delegated to the board by the first clause of the section rests upon the expressed assent of the voters. It is an entire thing; it is the consummation of a contract; and to it, as an entirety, the people *must assent.

It may be said that the language used contemplates the submission of only the question of issuing bonds. “No such bonds shall be issued until the question shall be first submitted.” “If a majority of the votes cast at such election shall be in favor of issuing such bonds, the board of commissioners,” etc. But the issue of bonds is the last act of the board, — the consummation of the contract. Bonds are to issue only in payment of stock already subscribed. If the language limits the question to that of issuing bonds, it limits it to that which implies a subscription already made, a contract already entered into, *165and therefore an existing and named corporation, the recipient of the subscription, and the party to the contract.

In the arguments made in the case of the Missouri River, F. S. & G. R. Co. v. Miami Co., to which we referred, some stress is placed upon the use of the verbs “is” and “may be” in the first sentence of the section which authorized the commissioners of any county “to, into, through, from, or near which any railroad is or may be located, to subscribe to the capital stock of any such railroad corporation;” and it is claimed that “is” is used in a continuing sense, and refers not to the time of the passage of the law, but the time of making the subscription, and that therefore the addition of the words “may be” contemplates a location subsequent to the subscription. In support of that claim the ease of James v. City of Milwaukee, decided by the United States supreme court, and reported in Chicago Legal News of February 22, 1873, is cited. It is unnecessary to determine whether the citation supports the construction, or whether the construction is correct; for the corporation must exist before it can locate its road; and all that such construction would warrant is that the subscription might be made, and therefore might be authorized, before the corporation had finally located its road, and not that it might be authorized before any corporation existed. The citation might be pertinent, and the construction demand examination, if the language had been, “any railroad corporation which is or may be organized.” It *may be asked, what difference does it make? The thing to be secured is the railroad, and if that be accomplished it is enough. We reply, the legislature lias not authorized counties to give their bonds simply to secure railroads. It has authorized them to take stock in railroad corporations, and pay for it in bonds. It makes the same difference to a county that it does to an individual as to the corporation in which stock is proposed to be taken. The county, like an individual, might be willing to take $150,000 of stock in a corporation whose capital stock was only $250,000, thereby securing the control of the corporation, while it might not be willing to subscribe a like amount, or any amount, to one whose capital stock was $10,000,000, in whose control it would thus have little voice. Again, it might be willing to subscribe to and risk its funds with a corporation whose managers were men of known good character and financial responsibility, and not be willing to do the same with one whose controlling men were wholly irresponsible. The fairness and good sense of the legislation is altogether on the side of the construction which the natural meaning of the language so plainly demands. It seems, therefore, that some corporation must be named as the recipient of the subscription and bonds, or the proceedings will be without warrant of law, and void.

3. A majority of the votes cast'at the election in 1867 were against subscribing stock and issuing bonds. This is an undisputed fact. The statute reads: “If a majority of the votes cast at such election *166shall be in favor of issuing such bonds, the board of commissioners of the county shall issue the same.” Laws 1866, p. 73, § 1. That an election is a prerequisite to the issue of bonds is unquestioned. Equally clear is it that at such election a majority of the votes cast must be in favor of the issue. Power to issue is not vested in the commissioners by virtue of their office, but given only by express authority of the voters. Issuing bonds without a vote is no more ultra vires than issuing them against the vote of a majority. Express authority, by an affirmative vote, is a *eondition precedent to the existence of the power. These general propositions will not be disputed; and if the commissioners had, at their meeting, on May 10, 1867, canvassed the entire vote of the county, and declared the result in accordance therewith, (viz., a majority of 104 against the proposition,) no one would be foolhardy enough to-claim that the commissioners had any power to issue these bonds given them by that election. It is claimed, however, that the commissioners were the proper canvassing officers; that at the legal time and place they made the canvass, and declared the result; and that the county is bound thereby. It must be conceded that this claim finds ample support in the language of some of the opinions of the supreme court of the United States. That tribunal has uniformly held that the determination of the county board was the adjudication of a competent tribunal, with full jurisdiction, and cut off all inquiry as to the facts upon which the determination was based; at least, after the bonds had passed into the hands of a bona fide holder. In the case of Knox Co. Com’rs v. Aspinwall, 21 How. 539, Mr. Justice Nelson thus stated the proposition in his usual clear and forcible language :

“Full power is conferred upon the board to subscribe for the stock and issue the bonds, when a majority of the voters of the county have determined in favor of the subscription, after due notice of the time and place of the election. The case assumes that the requisite notices were not given of the election, and hence that the vote has not been in conformity with the law. This would seem to be decisive against the authority on the part of the board to issue the bonds, were it not for a question that underlies it; and that is, who is to determine whether or not the election has been properly held, and a majority of the votes of the county cast in favor of the subscription? Is it to be determined by the court, in this collateral way, in every suit upon the bond, or coupon attached, or by the board of commissioners, as a duty imposed upon it before making the subscription? The court is of opinion that the question belonged to this board. The act makes it the duty of the sheriff to give the notices of election for the day mentioned, and then declares if a majority of the votes' given shall be in favor of the subscription, *lhe county board shall subscribe the stock. The right of the board to act in an execution of the authority is placed upon the fact that a majority *167of the votes had been cast in favor of the subscription, and to have acted without first ascertaining it would have been a clear violation of duty; and the ascertainment of the fact was necessarily left to the inquiry and judgment of the board itself, as no other tribunal was provided for the purpose. This board was one, from its organization and general duties, fit and competent to be the depositary of the trust thus confided to it. The persons composing it were elected by the county, and it was already invested with the highest functions concerning its general police and fiscal interests. We do not say that the decision of the board would be conclusive in a direct proceeding to inquire into the facts previously to the execution of the; power, and before the rights and interest of third parties had attached; but after the authority has been executed, the stock subscribed, and the bonds issued and in the hands of innocent holders, it would be too late, even in a direct proceeding, to call it in question. Much less can it be called in question to the prejudice of a bona fide holder of the bonds in this collateral way.”

We have made this lengthy quotation because it contains as clear and complete a statement of the views therein expressed as can anywhere be found, and also because it is from the leading ease in that court. The views therein expressed have been uniformly adhered to-by that tribunal. Bissell v. City of Jeffersonville, 24 How. 287; Moran v. Miami Co., 2 Black, 722; Gelpcke v. City of Dubuque, 1 Wall. 175; Mercer Co. v. Hacket, 1 Wall. 83; Van Hostrup v. Madison City, 1 Wall. 291; Supervisors v. Schenck, 5 Wall. 772; Pendleton Co. v. Amy, 13 Wall. 297; City of Lexington v. Butler, 14 Wall. 283. It will be observed that this language does not affirm that the-determination of the county commissioners gives authority to issue bonds, but only that that determination estops the county from denying the authority. All that is asserted, and all that can be found in any of the opinions, is that that determination is evidence of authority otherwise given, — evidence that is conclusive in an action by a bona fide holder. It is like any other canvass, — evidence,^nothing but evidence, of acts already done and power already given. It is by universal consent open to inquiry and attack, unless made conclusive by statute, until at least rights have vested on the faith-thereof. It is no more potent to confer authority than a canvass of votes cast for any office is to give a right to the office. It should not be so weighty, even, as evidence; for in the one case it is necessary that offices should be filled, and that evidence of who are entitled to fill them should be easily accessible, while in the other it is not necessary that county bonds should ever be issued to railroad corporations, and the people’s right to control the extent of their obligations should not be frittered away on a mere matter of evidence. The substantial question is, did a majority of the voters grant the authority? the-formal question, what does the canvass show? Reverse the statu» for a moment, and suppose the canvass showed a majority of 26 votes. *168against, while an actual majority of 104 votes was in favor of, the proposition, would not the authority to issue pass to the commissioners, and would there be any question but that bonds thus issued, even in the hands of the obligee himself, could be enforced? “If a majority of the votes cast at such election,” is the language of the statute. Can the commissioners, by a canvass, destroy the power of the majority and set at naught the will of the legislator ? Can they, in defiance of the statute, create an authority in themselves ? It was well said by the supreme court of Ohio in State v. Commissioners, 11 Ohio St. 188: “The decision of the supreme court of the United States must rest on the assumption that it was competent for the commissioners of Knox county, by some act of their own, to make their authority complete,— an assumption we are not at liberty to make in this case.” In that case the county commissioners of any county, through or in which a railroad might be located by any corporation, were by statute authorized to subscribe stock and issue bonds. Under this statute bonds were issued, and passed into the hands of a bona fide holder. In mandamus proceedings thereon the answer alleged that the railroad had never *been located through or in the county, and this answer was held good, and in holding it good the court use the language above quoted. And see Starin v. Town of Genoa, 23 N. Y. 439; People v. Mead, 24 N. Y. 114; S. C. 36 N. Y. 224.

We have thus far considered this question on the assumption that the statute designated the commissioners as the canvassing officers, and fixed the time and place of the canvass. The contrary is the fact. No canvassing officers are named; no time or place for the canvass indicated. The only general election law then in force, in its first section, declares what elections are to be governed by its provisions, and they are, “all elections hereafter to be held for state, district, and county officers.” Comp. Laws, 490, § 1. Under that law the county commissioners are made the canvassers, and the Friday succeeding the election the day for the canvass. Section 27, p. 497. Section 4 of an act providing for the election of township officers (Comp. Laws, 504, as amended by chapter 58, Laws 1864, p. 100, § 1) makes the commissioners canvassers for such election, and names the first Monday of April for the canvass. There are also many special elections provided for in the statutes, and, as a general rule, the several acts in terms declare that such elections shall be conducted in the manner prescribed by the general election law. But the acts under which these bonds are claimed to have been voted contain no such provision. Laws 1865, p. 41, c. 12; Laws 1866, p. 72, c. 24. They provide that no such bonds shall be issued until the question shall be first submitted to a vote of the qualified electors of the county, at some general election, or at some special election to be called by the board of county commissioners, by first giving twenty days’ notice in some newspaper published and having general circulation in the county; or, in case there be no paper in the county, then by written or printed *169notices posted up in each election precinct twenty days previous to the day of such election; and, in submitting said question, said board of commissioners shall direct in what manner the *ballots shall be cast. The express authority given is to order a special election, and to direct in what manner the ballot shall be cast. If they have any further power in the matter, it is either because of their general authority to represent the county, and manage its business and concerns, where no other provision is made, (Comp. Laws, 412, § 15, cl. 5,) or because power to order an election carries with it the power to prescribe the manner of conducting it and determining its results. An examination of the order of the commissioners shows that they omitted to prescribe the manner of conducting the election, the time or place of the canvass, or to designate the canvassing officers. Notwithstanding the silence of the statute, and the omissions of the order, an election would doubtless be valid where the people generally acquiesced in the manner, and took part in the election. Here the evidence shows that all but one township took part in the election, and fails to show the relative population of that township, or that the voters in the others did not generally participate in the election. But while the election may be valid, (for it is a maxim that the will of the people should not be defeated by the omissions or irregularities of their officers and agents,) can it be that the commissioners can, without statutory authority, in the absence of notice to the voters, and before the returns are received from all the voting precincts, come together, and, by canvassing only a portion of the vote, create in themselves an authority which the majority of the voters have refused to grant to them ? Can such unauthorized and partial canvass be even prima facie evidence of the authority ? It seems to us doubtful. At any rate, when it carries on its face information that returns of the election have not been received from some townships, it is sufficient notice to put any one on inquiry as to' the actual facts of the election and the returns filed with the county clerk. It is claimed that the curative act of 1868 (Gen. St. 892) applies, and makes valid this election. This cannot be, for that applies only to cases in which “a majority of the persons voting have voted in favor of the subscription;” and here, as we have seen, a majority voted against the subscription. It was an act to cure irregularities, and sustain the will of the majority, and not an act to make form more than substance, and the canvass of the county commissioners more potent than the votes of the people.

4. No authority having been granted by the proceedings in 1867, was any conferred by those in 1869? The objections raised to the former do not apply to the latter. A corporation was named as the recipient of the aid, and a majority of the votes cast were in favor of the proposition. But an equally fatal objection exists to this. The question submitted in 1869 was that of extending aid to a road west from Fort Scott. It was upon that the people voted and to that *170gave their assent. The commissioners, it is true, by their order, declared that if the people authorized aid to a road running west, they should consider themselves also authorized to subscribe to a road running east. Yet submitting only one question, they cannot, by construction, enlarge the authority actually given. That the question submitted was also a railroad proposition does not make any difference. They might, with equal propriety and legal warrant, have submitted a question of issuing bonds for a court-house, and then, by construction, made an affirmative vote a delegation of authority to issue these bonds. Can an agent thus by construction create authority? But it may be said that while this is the form of these proceedings, it was practically and substantially a submission of both questions to be determined by a single vote. Conceding this to be the fact, and the difficulty, though lessened, is not avoided. The two questions were to be settled by a single vote. A vote for railroad bonds was a vote in favor of both propositions; and so of a vote against. There was no opportunity of voting.for one and against the other. Such a submission was not warranted by the statutes. It may be conceded that two or more questions may be submitted at a single election, provided each question may be voted on separately, so that each may stand or fall *upon its own merits. But that is a very different matter from tacking two questions together, to stand or fall upon a single vote. It needs no argument to show the rank injustice of such a mode of submission. By it several interests may be combined and the real will of the people overslaughed. By this combination an unpopular measure may be tacked on to one that is popular, and carried through on the strength of the latter. A necessary matter may be made to carry with it some private speculation for the benefit of a few. Things odious and wrong in themselves may receive the popular approval because linked with propositions whose immediate consummation is deemed essential. It is against the very spirit of popular elections. That aims to secure freedom of choice, not merely between parties, but also in respect to every office to be filled, and every measure to be determined. A voter at a state election would be shocked to be told that because he voted for a person named for governor on one ticket he must vote for all the other persons named thereon; or, that voting for one person, he was to be understood as voting for all. He would feel that his freedom of choice was infringed upon. None the less so is it by such a submission as this. This question is not a new one to the courts. In Supervisors of Fulton Co. v. Mississippi & W. R. Co., 21 111. 373, such a mode of submission was pronounced void in the following vigorous language: “The truth is,” says Breese, J., “the voters of Fulton have never had an opportunity to vote, and never have voted, on this subscription, for the question was at no time distinctly before them. The question before them was, will you vote for a subscription to two roads? Neither road has received the *171approving vote of the people; and until that is done, until the naked, single question shall be fairly presented to those voters, they ought not to be bound or injuriously affected by any such jockeying management and log-rolling. This system, condemned as it has always been by the moral sense, as well as the sense of justice, of the whole country, should, at this day, find no favor in the courts. We do not hesitate to say, this proposition to *vote on two roads at the same time was not authorized by the law, and is a fraud on the people.” The same ruling was made in People v. Tazewell Co., 22 Ill. 147; Clarke v. Supervisors Hancock Co., 27 Ill. 310. The same question was before the Iowa courts, and determined in the same way. McMillan v. Lee Co., 3 Iowa, 311. In giving the opinion of the court, Mr. Justice Stockton says: “The law, according to the view that we have taken of its provisions, evidently contemplates distinctness and unity in each question or proposition submitted for adoption or rejection by a vote of the people. Each proposition submitted to such vote should be complete in itself, and should contain every requisite prescribed by the statute as necessary to give validity and effect to the borrowing or expenditure of money, the subscription of stock, or the issue of county bonds.” A mode of submission which is so obviously unjust, so contrary to the spirit of election, and has received such condemnation from the courts, will not be imputed to the intention of the legislature unless necessarily demanded by the language used. The statute in force at the time of this election under consideration was that of 1869. Laws 1869, p. 108, c. 29. So far as this question is concerned, however, it is not dissimilar to the acts of previous years. It authorizes the county commissioners to subscribe for and take stock or loan credit to any railroad company “upon such terms and conditions as may be prescribed,” provided a majority of the voters shall first “assent to such subscription.” Upon making the subscription the county becomes, “like other subscribers to such stock, entitled to the privileges granted, and subject to the same liabilities imposed by this act, or by the charter of the company in which such stock is taken.” The singular number is used all the way through. It contemplates a separate transaction with each corporation, provides for a subscription to be made upon terms and conditions, and, in the nature of things, these terms and conditions would vary wdth different roads. No one can read thesections without being impressed with the factthat each county was to make a sep*arate subscription, each corporation to receive a separate subscription, and each subscription to be authorized by a separate vote. The curative statute of 1868 impliedly recognized this fact. It provides that if a majority of the persons voting at any election prior to January 21, 1868, have voted in favor of subscribing stock and issuing bonds, the county commissioners may make the subscription, “whether such order and election, or either of them, have been in compliance with the statute in such cases made and *172provided or not, or whether the proposition submitted at the election had, was for the subscription of stock and the issuance of bonds 'to one or more railroad companies.” Two things are thus aimed at: First, to cure all mere irregularities in the proceeding; and, second, to make valid elections wholly unauthorized by the statutes. It seems, therefore, that the statute requires a separate vote on the question of extending aid to each corporation; and if these proceedings (of 1869) are to be construed as a submission of two questions to a single vote, they were, in' the language of Judge Breese, “not authorized by the law, and a fraud on the people.” It seems, therefore, clear that neither by the election of 1867, nor that of 1869, was any authority given to the commissioners to subscribe stock to the Tebo & Neosho Railroad, or to issue these bonds.

5. A. graver question is now presented. Can this want of authority be shown as a defense by the county to this action of the plaintiff, who claims to be a bona fide holder for value, without notice ? Without express provision of statute the commissioners would have no authority to subscribe stock and issue bonds to a railroad corporation. Every one dealing with the commissioners, or purchasing •such securities, must take notice of the law under which they act. The act under which the commissioners assumed to issue these bonds required, as a condition precedent to the vesting in them of any authority to issue, an affirmative vote of a majority of the voters, given upon a single proposition, and naming the proposed recipient of the subscription and bonds. Of this every one purchasing bonds like these *must take notice. He knows that unless these conditions exist — these steps have been taken — the commissioners have no more power than the sheriff or the county attorney to bind the county. He knows that the commissioners cannot create the authority which the statute says the voters alone can give; that they are but agents, and agents, not with general power to act for their principal in matters of this kind, but requiring a specific and •express authority for every single act of subscription. Charged with notice of all this, how can he assume that because they have acted they must have been authorized ? That these bonds are negotiable paper does not alter the ease. The law-merchant does not make the act of an agent proof of his authority. When power exists, which may be exercised under circumstances peculiarly within the knowledge of the agent, the exercise of the power may bind the principal as an affirmance by the agent of the existence of those circumstances. But this presupposes the existence of the power. Here, no power ever passed to the commissioners. The silence of the principal where the agent is acting often works an estoppel as implying • an acquiescence. But where the principal can do nothing else than be silent, where the individual tax-payers are powerless to restrain the act, (Craft v. Jackson Co. Com’rs, 5 Kan. *518,) the enforced silence can hardly be construed as an acquiescence.

*173It may be conceded that the language of Justice Nelson is broad enough to cover a ease of this kind, and to make the act of the board in declaring their authority, and issuing the bonds, conclusive evidence-of the grant of power by the people. Equally broad is the language of Mr. Justice Swayne, in Gelpcke v. City of Dubuque, 1 Wall. 175, where he said: “Where a corporation has power under any circumstances to issue negotiable securities, the bona fide holder has a right to presume they were issued under the circumstances which give the requisite authority, and they are no more liable to be impeached for any infirmity in the hands of such a holder than any other commercial paper.” That such a construction was not intended *to be given to the language of these citations is evident from subsequent decisions of that court. In Marsh v. Fulton Co., 10 Wall. 676, the bonds of the county were issued, and in the hands of a bona fide holder, and the county commissioners were by statute authorized to issue bonds upon a previous affirmative vote of the electors of the county. Yet as such vote had not been had, the court unanimously held the bonds void, even in the hands of the bona fide holder. The bona fide holder had no right to presume they were issued under the circumstances which gave the requisite authority. He was bound to take notice of the county records, and they showing no authority, none existed We cannot do better than quote the language of Mr. Justice Field : “It is a case, too, where the holder was bound to look to the action of the officers of the county, and ascertain whether the law had been so far followed by them as to justify the issue of the bonds. The authority to contract must exist before any protection as an innocent purchaser can be claimed by the holder.. This is the law even as respects commercial paper alleged to have been issued under a delegated authority, and is stated in the case of Floyd Acceptances, 7 Wall. 676. In speaking of notes and bills issued or accepted by an agent acting under a general or special power,, the court says: ‘In each case the person dealing with the agent, knowing that he acts only by virtue of a delegated power, must, at his peril, see that the paper on which he relies comes within the power under which the agent acts; and this applies to every person who-takes the paper afterwards, for it is to be kept in mind that the protection which commercial usage throws around negotiable paper cannot be used to establish the authority by which it was originally issued.’ ” And in another place, replying to the claim that because some interest had been subsequently paid the original proceedings were made valid and good, he says: “The supervisors possessed no authority to make the subscription, or issue the bonds, in the first instance, without the previous sanction of the qualified voters of the county. The supervisors in that particular were the mere *agents of the county. They could not, therefore, ratify a subscription without a vote of the county, because they could not. make a subscription in the first instance without such authorization.”' *174It may be remarked here that the bonds in that case contained no recitals of proceedings of the county board, or of a vote of the people, but were simply naked promises to pay. The same is tbue of the bonds in this suit. The effect of this on the question may be considered hereafter. Pendleton Co. v. Amy, 13 Wall. 297, is a still later case in that court. In that case Mr. Justice Strong, for the court, after alleging that it was the duty of the county officers to determine whether a vote had been had according to law, and what the result was, uses this language: “To issue the bonds without the fulfillment of the precedent conditions would be a misdemeanor, and it is to be presumed that the public officers act rightly. We do not say this is a conclusive presumption in all eases, but it has more than once been decided that a county may be estopped against asserting that the conditions attached to a grant of power were not fulfilled. 21 How. 539; Bis-sell v. City of Jeffersonville, 24 How. 287; Knox Co. Com’rs v. Asp-inwall, 2 Black, 722; Meyer v. City of Muscatine, 1 Wall. 384; Supervisors v. Schenck, 5 Wall. 772. This estoppel, in these cases, was either by recitals in the bonds that the conditions precedent had been complied with, or by the fact that the county had subsequently levied taxes to pay interest on the bonds.”

In one of the early cases (Bissell v. City of Jeffersonville, 24 How. 287) Mr. Justice Clifford says: “Whether we look to the bonds, or the recorded proceedings, there is nothing to indicate any irregularity, or even to create a suspicion that the bonds had not been issued pursuant to a lawful authority; and we hold that the company and their assigns, under the circumstances of this case, had a right to assume that they imported verity.” It appeared that copies of the proceedings of the county board were shown to the plaintiffs in that ease at the time they received the bonds. It seems a fair inference from these citations that all the supreme court of the United States have decided is that when either the bonds, or the records of the county, contain a recital of an election, and all other conditions precedent, as prescribed *by the statute, the county is concluded by that recital, and may not show that, as a matter of fact, no election took place, or that some other condition precedent never existed. With such a construction of the law we have in this case no occasion to differ. The bonds sued on contain no recitals, and the records show a non-compliance with the statute. An examination of the decisions of other state courts shows a disposition to place the construction we have given upon this general language of the United States supreme court, or else to disagree with the views expressed by that tribun'al. We have had occasion to notice the decision of the supreme court of Ohio. State v. Hancock Co. Com’rs, 11 Ohio St. 183, cited supra. See, also, Hopple v. Brown Tp., 13 Ohio St. 311; State v. Union Tp., 15 Ohio St. 437. The supreme court of Iowa, in Clark v. City of Des Moines, 19 Iowa, 199, had occasion to notice these rulings, and, after citing the language hereto*175fore quoted from Judge Swayne, says: “Suppose a city charter expressly authorized the common council to issue negotiable securities for corporate debts, and that tbe mayor and recorder, without any order of the council, fabricate and manufacture such securities, and that they find their way into the hands of innocent purchasers, it cannot be that Judge Swayne means that the ‘bonafide holder has a right to presume that they were issued under the circumstances which gave the requisite authority,’ and yet he says so. The true rule is that the want of corporate power, or the want of authority in the municipal officers, cannot be supplied by their unauthorized acts or representations;” and in accordance with that rule the case was decided, all the justices concurring. To the same effect is the case of Veeder v. Town of Lima, 19 Wis. 280, in which the court, (Mr. Justice Cole dissenting,) held that the recitals in the bond were not conclusive, and dissented squarely from the United States court as to the effect of those recitals.

The cases of Starin v. Town of Genoa, and Gould v. Town of Sterling, 23 N. Y. 439, 456, are strongly in point. The legislature of that state authorized, by separate acts, these towns to issue their bonds in aid of railroads, provided the *written assent of two-thirds of the resident tax-payers was first obtained and filed in the clerk’s office. The court of appeals held, reversing the judgment of the lower court, that the bondholder, suing on bonds issued by these towns by virtue of these acts, must prove affirmatively tha.t the written assent of the requisite number of tax-payers was in point of fact obtained and filed, and that the town was not bound by the representation of its officers upon the face of the bonds that such assent had been obtained and filed. In the latter case, Judge Selden, replying to the claim that the recitals in the bond created an estoppel, says: “The agents here were designated, not by the town, but by the legislature; and no power whatever was conferred by the town unless the assent of the tax-payers was obtained. Any representation, therefore, by the supervisor and commissioners in respect to such assent would be a representation as to the very existence of their power. Such representations, as we have seen, are never binding upon the principal.” The same doctrine was sustained by the subsequent case of People v. Mead, 24 N. Y. 114; S. C. 36 N. Y. 224. In his work on Constitutional Limitations, Judge Cooley, commenting upon the doctrine of Gould v. Sterling, says: “This doctrine appears to be sound, that whenever a want of power exists, a purchaser of securities is chargeable with notice of it, if the defect is disclosed by the corporate records, or, as in that ease, by other records, where the power is required to be shown.” (For a further discussion of this question, and other authorities, see the note at the foot of page 216 of that work.) The difference between the federal and state courts is this: the former hold the county concluded by the recitals of the board; the latter that the bondholder is *176.chargeable with notice of whatever appears upon the county record. Both agree that where there are no recitals on the face of the bond, and the want of authority appears on the county records, the bonds are void, even in the hands of a bona fide holder. These bonds contain no recitals of an election, or other proceedings of the county board, but are naked promises to pay. At the *close of the obligatory words, they read: “By order of the board of commissioners of the county of Bourbon, dated March 8, 1867.” The-purchaser, therefore, is notified on the face of the instrument of the particular order under which the bonds were issued. Claiming under one instrument which recites the existence of another, and refers to-it as the authority for its own existence, is he not charged with notice of the contents of the latter? 1 Story, Eq. § 400.

We have given this case, and the questions involved in it, full and careful and patient consideration, both on accouut of the amount in controversy here, and because of the many interests which may be affected by the decision of these questions. The conclusions we-have reached are that the proceedings of March 8, 1867, were void, because no railroad corporation was named as the recipient of the proposed subscription‘and bonds; that the election of May 7, 1867, conferred no authority, because a majority of the votes cast were against the granting of authority; that for a like reason the curative act of 1868 did not apply to that election; that the proceedings in 1869 conferred no authority, because no question of issuing these-bonds was submitted to the voters of Bourbon county, and because-an attempt to submit two questions to a single vote is unauthorized by the statute, and a fraud upon the people; that there being no recitals on the face of the bond, the county is not concluded by the mere fact that the commissioners issued them, even in favor of a bona fide holder; that the want of authority to issue appears on the records of the county, and that the purchaser is referred to those records by the bond itself, and is chargeable with notice of their contents. It follows, therefore, that judgment must be entered in favor of the defendants.

(All the justices concurring.)

Lewis v. Commissioners of Bourbon Co.
12 Kan. 186

Case Details

Name
Lewis v. Commissioners of Bourbon Co.
Decision Date
Jul 1, 1873
Citations

12 Kan. 186

Jurisdiction
Kansas

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