UNITED STATES SUPREME COURT DECISIONS ON-LINE

QUINLAN V. GREEN COUNTY, 205 U. S. 410 (1907)

205 U. S. 410

U.S. Supreme Court

Quinlan v. Green County, 205 U.S. 410 (1907)

Quinlan v. Green County

No. 213

Argued February 27, 28, 1907

Decided April 8, 1907

205 U.S. 410

Syllabus

Where a question certified by the circuit court of appeals contains more than a single question or proposition of law, it will not be answered by this Court.

Where the qualified voters of the county vote for an issue of bonds for subscription to stock of a railroad on condition that the county be exonerated from a prior subscription authorized for another railroad, and thereafter the judge of the county court authorized by statute to make the subscription enters an order to that effect, receives the stock subscribed for, and issues the bonds, and nothing further is ever done in regard to the prior subscription, although no formal exoneration thereof was ever made or attempted, a bona fide purchaser before maturity of the bonds and coupons for value is entitled to assume in his purchase that the county had been fully exonerated from the prior subscription.

Plaintiff in error brought an action in the Circuit Court of clubjuris

Page 205 U. S. 411

the United States for the Western District of Kentucky upon certain bonds and coupons purporting to have been issued by the defendant in error, one of the counties of the State of Kentucky. The following was the form of the bond:

"United States of America"

"County of Green, Kentucky"

"$500.00"

"For the Cumberland & Ohio Railroad."

"Twenty years after date, the County of Green in the State of Kentucky will pay to the holder of this bond the sum of $500 with interest thereon at the rate of six percent per annum, payable semiannually upon presentation of the proper coupons hereto attached, the principal and interest being payable at the Bank of America, in the City of New York."

"In testimony whereof, the judge of said County of Green has hereunto set his hand and affixed the seal of said county, on the first day of April, A.D., 1871, and caused the same to be attested by the county clerk, who has also signed the coupons hereto attached."

"(Green County seal.)"

"T. R. Barnett, Judge"

"D. T. Towles, Clerk"

The case was tried without a jury, and the court, after finding facts, rendered judgment for the defendant. The case then went to the Court of Appeals for the Sixth Circuit, and that court has certified here two questions of law upon which it desires instructions, with a statement of facts upon which the questions arise. In addition to the statement of facts, we take into account the material parts of the charter of the Cumberland & Ohio Railroad Company, section 15 of which contains the following provisions:

"SEC. 15. That any city, town, or county through which said proposed road shall pass is hereby authorized to subscribe stock in said railroad company in any amount any such city, town, or county may desire, and the county court of any such

Page 205 U. S. 412

county is authorized to issue the bonds of their respective counties in such amount as the county court may direct, and the chairman and board of trustees, or mayor and aldermen of any town, and the mayor and aldermen or council of any city, are hereby authorized to issue the bonds of their respective towns or cities in like manner. All said bonds shall be payable to bearer, with coupons attached, bearing any rate of interest not exceeding six percent per annum, payable semiannually in the City of New York, payable at such times as they may designate, not exceeding thirty years from date; but before any such subscriptions on the part of any city, town, or county shall be valid or binding on the same the mayor and aldermen, or chairman and board of trustees of any town, the mayor and aldermen or council of any city, and the county court of any county, having jurisdiction, shall submit the question of any such subscription to the qualified voters of such city, town, or county in which the proposed subscription is made at such time or times as said chairman and board of trustees, or mayor and aldermen of any town, mayor and aldermen or council of any city, or the county court of any county, as aforesaid, may, by order, direct, and should a majority of the qualified voters voting at any such election vote in favor of subscribing said stock in said railroad company, it shall be the duty of such county court, trustees, or other authorities aforesaid, to make the subscription in the name of their respective cities, towns, or counties, as the case may be, and proceed to have issued the bonds to the amount of such subscription as hereinbefore directed;"

"* * * *"

"That, if preferred, the application herein authorized to be made to the county court may be made to the presiding judge of the county court, and all the powers herein given to the county court are hereby vested in the presiding judge of the county court. At all meetings of the stockholders for the purpose of electing officers, or any other purpose, the said town, cities, and counties may, by proxies duly authorized by the

Page 205 U. S. 413

authorities thereof, cast a vote for each share so subscribed by said town, city, or county. . . ."

The charter gives to the Cumberland & Ohio Railroad

"all the powers and privileges conferred upon the Louisville & Nashville Railroad Company by the laws of Kentucky for constructing and operating their said proposed railroad."

The charter of the Louisville & Nashville Railroad Company provides

"that said railroad company may receive subscriptions of stock to their company by individuals, towns, cities, counties, or other corporations, whether payable in money or other things, with such terms and time of payment, conditions annexed, and kind of payment that may be set forth in the subscription."

The commissioners of the Cumberland & Ohio Railroad requested the county court to submit to the qualified voters of the county the question whether the county should subscribe to $250,000 of the capital stock of the company, payable in bonds of the county, whereupon the judge of the county court on the 17th of June, 1869, ordered an election in the following terms:

"Whereas the commissioners of the Cumberland & Ohio Railroad Company, by virtue of the authority delegated to them by the charter of said company, have requested the county court of Green County, to order an election in said County of Green, and to submit to the qualified voters of said county the question whether said county court shall subscribe for and on behalf of said county $250,000 to the capital stock of the Cumberland & Ohio Railroad Company, and payable in the bonds of said county, having twenty years to run, and bearing six percent interest from date, and upon condition that said company shall locate and construct said railroad through said County of Green, and within one mile of the Town of Greensburg, in said county, and shall expend the amount so subscribed within the limits of Green County, and also upon the further condition that said bonds shall not be issued or said county pay any part of the principal or interest on said amount subscribed to said Cumberland

Page 205 U. S. 414

& Ohio Railroad Company, until said County of Green is fully and completely exonerated from the payment of the capital stock voted by said county, and authorized to be subscribed by said Green County court to the Elizabethtown & Tennessee Railroad, or any part of the interest thereon. It is therefore ordered by the court that an election, by the qualified voters of Green County at the voting places in said county, be held and conducted by the several officers, as prescribed by law, for holding elections, on the third day of July, 1869, to vote on the question as to whether or not the said county court shall, for and on behalf of said county, subscribe $250,000 to the capital stock of said Cumberland & Ohio Railroad, conditioned and to be paid as above stated."

The election was duly held July 3, 1869, and the vote was in the affirmative. During the year before this vote, the voters of the county had voted in favor of a proposition to subscribe to the stock of the Elizabethtown & Tennessee Railroad, and thereupon the county judge had ordered the clerk of his court to make a subscription to the stock of the Elizabethtown & Tennessee Railroad Company, "on the terms specified in the order submitting the question to a vote." This was the subscription from which Green County desired to be exonerated before the Cumberland & Ohio Railroad bonds should be issued, or any part of their principal or interest paid. On June 3, 1870, the county judge entered an order reciting the election at which the qualified voters had approved the subscription to the capital stock of the Cumberland & Ohio Railroad, and concluding:

"Now, therefore, I, Thomas R. Barnett, the presiding judge of the Green County Court, by virtue of the authority in me vested by law, and to carry out the wishes of said voters, do hereby subscribe for $250,000 of the capital stock of said Cumberland & Ohio Railroad Company for and on behalf of said County of Green, which subscription is to be paid in the bonds of said county as prescribed in said order of submission, and

Page 205 U. S. 415

this subscription is made with the conditions set out in the order of this Court ordering said election, and now of record in the office of this county."

At the April term, 1871, the supreme court of the state rendered a decision in the case of Mercer v. Kentucky River Navigation Company, 8 Bush 300. It is argued that this decision shows that the subscription to the stock of the Elizabethtown & Tennessee Railroad was void. However that may be at a time which does not distinctly appear, but later than that decision, the judge of the county court issued and delivered to the Cumberland & Ohio Railroad Company bonds of Green County to a small amount. On August 15, 1872, the judge, in a formal order, reciting that application had been made for the issue of the balance of the bonds, directed that, "the court being sufficiently advised," they be signed and issued. Thereupon, certificates of 2,500 shares of that stock of the par value of $100 per share were delivered to Green County, which has since held and owned them. It was conceded at the argument that the county had made payment of interest on the bonds thus issued to the Cumberland & Ohio Railroad. No formal or express exoneration of said county from the payment of the subscription to the stock of the Elizabethtown & Tennessee Railroad was ever made or attempted, but nothing further has, up to this date, ever been done in respect to it, and neither bonds by the county nor stock by the said last-named railroad company have ever been issued or delivered in execution of said orders or under the terms of said subscription. The proceeds of $150,000 of the bonds were expended within Green County in the partial construction of five miles of the road to Greensburg. This five miles was completed by a lessee at its own expense. Nothing also has been done within the county.

The plaintiff is the bona fide holder for value of the bonds and coupons in suit but had notice that the railroad had not been laid further than Greensburg, and therefore did not extend "through" the county. clubjuris

Page 205 U. S. 416

The questions certified by the circuit court of appeals are:

"1st. Do the facts found by the circuit court conclude or estop the county from denying liability to the plaintiff upon the bonds and coupons in suit, by reason of noncompliance with the terms and conditions imposed by the favorable vote of the county authorizing a subscription to the stock of the Cumberland & Ohio Railroad Company and the issuance of bonds in payment therefor? Or, if this question should be deemed too broad, then,"

"2d. Assuming the facts to be as found, was a bona fide purchaser, before maturity, of these bonds and coupons for value, entitled to assume in his purchase that Green County had, before their issuance, been"

"fully and completely exonerated from the payment of the capital stock subscribed for by the county court of said county for and in behalf of said county to the Elizabethtown & Tennessee Railroad Company? "

Page 205 U. S. 418


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