Erskine v. Nelson County

Corliss, J.,

(dissenting.) The plaintiff sought to hold the defendant liable upon certain alleged county warrants. These instruments were county warrants in form, and it appears to be in the main undisputed, so far as this record is concerned, that these warrants were issued for debts incurred by the county. It is also uncontroverted that, in so far as the trial court refused to give judgment upon these warrants against the defendant, the warrants were originally illegal and void. The debts which they represented were obligations which the board of county commissioners had no authority to create, because the expenditures at the time were in excess of the amount which could be provided for by the *78current revenue of the county from the tax levy of the year. It is unnecessary to refer to the statute or other authority which renders void these warrants representing such expenditures. The counsel for the plaintiff makes no contention against their original invalidity, but strenuously urges here that they have been transmuted into legal obligations of the county by an act of the legislature passed March 13, 1885, which provides as follows:

“An act to authorize the county commissioners of Nelson County, Dakota, to fund the outstanding indebtedness thereof.
"Be it enacted by the legislative assembly of the Territory of Dakota'.
“Section i. That the board of county commissioners of the County of Nelson, in the Territory of Dakota, be empowered, and are hereby authorized, to issue bonds for not less than five hundred (500) dollars each, the total amount of such issue not to exceed thirty thousand (30,000) dollars; said bonds to draw interest at a rate not to exceed eight (8) per cent, per annum, payable annually at the county treasurer's office of said Nelson County. Said bonds shall specify on their face the date, amount, for what purpose issued, the time and place of payment and rate of interest. Said bonds and coupons thereto attached shall be severally signed by'the chairman of the board of county commissioners of said Nelson County, and attested by the clerk or auditor of said Nelson County; said bonds to be payable at the office of the county treasurer of Nelson County, or at such other place as the board of county commissioners may designate.
“Sec. 2. Said bonds shall be dated on the first day of July, A. D. 1885, and shall be payable in twenty (20) years, with the privilege of calling in said bonds at any time after ten (10) years.
“Sec. 3. The board of county commissioners of said Nelson County is hereby authorized, and it is made their duty to levy a sufficient tax for each year, besides the ordinary tax authorized by law, to be levied for the purpose of paying the interest of said bonds; provided further, that seven (7) years after the time of issue of said bonds, it is made the duty of said board of county commissioners to levy a sinking fund for the purpose of paying *79off and redeeming said bonds, said tax not to exceed two (2) mills on the dollar of the valuation of said county in any one year.
“Sec. 4. It is hereby made the duty of the county treasurer of said Nelson County to negotiate the sale of said bonds, and to call in all outstanding county warrants whenever the bonds are sold, and he, said county treasurer, shall be allowed two (2) per cent, commission as his fees, and no more, for negotiating Said bonds, and paying out said money; provided further, said bonds shall not be sold for less than par.
“Sec. 5. That after issuing the bonds mentioned in § 1 of this act, no warrants shall be issued by the county board unless at the time of issuing the same there is money enough in the county treasury of Nelson County to pay the warrants so issued.
“Sec. 6. This act shall take effect and be in force from and after its passage and approval.
“Approved March 13th, 1885.”

At the outset we are informed by the title to the act, not that its purpose is to validate void county warrants, but to fund “the outstanding indebtedness” of the county. It is true that the title of a statute is not necessarily controlling; but something very convincing in the body of the act to the contrary of this avowed object of the law must be found, to overthrow this clearly expressed purpose merely to provide means for paying the outstanding indebtedness of the county. I find nothing to warrant me in construing this as a statute to validate void warrants, in that portion of the statute which makes it the duty of the county treasurer to sell the bonds, and call in all the “outstanding warrants.” These words “outstanding warrants,” are more naturally applicable to valid warrants than to void warrants. When we find them employed in a statute whose sole purpose, as disclosed by its title, is to fund the “outstanding indebtedness” of the county, is there any escape from the conclusion that they relate only to such warrants as represent county indebtedness? In no proper sense is a paper in the form of a county warrant, but - issued without authority, and against the *80commands of a statute, an indebtedness of the county. It is urged, however, that if only valid warrants were to be provided for there was no occasion'for the enactment of the statute, as all such warrants would be paid out of the annual revenue. But it is well known that, while in theory the revenue from taxation should equal the total tax levied, yet in practice it often falls short of it, because of the failure to collect all taxes due. Sales of property to enforce collection will not bring cash to the treasury when no purchasers can be found. Bec.ause of inability to obtain cash for taxes, it might well happen that it would be necessary to provide another mode of payment for valid county warrants. In some of the counties, (and Nelson County was not more fortunate than other counties,) many farmers found themselves unable, through repeated crop failures, to pay their taxes. Nor does it necessarily follow that, because all legal warrants would be paid out of current revenues if the affairs of the county were lawfully managed, the legislature was bound to assume that all of them had been so paid. It might easily happen that the county treasurer would pay the warrants in their numerical order, and in this way the illegal warrants of one year might be paid out of the revenue of the next year; completely exhausting such revenue, and leaving the valid warrants of that year entirely unprovided for. It is not utterly impossible for it to have been a fact that very few of the legal warrants of either year had been paid at the time the act in question was passed. The revenues of these years might have been improperly spent. Valid warrants to the amount of over $10,000 could have been issued during these two years. It seems to me an extraordinary doctrine that the legislature inquired whether a strictly legal levy had been made during the year 1884 before passing this law. Nor is it important whether they made such inquiry or not. It is not controverted that there were some steps taken towards a legal levy. If the power of a county to incur debts depends upon their being in fact a valid tax levy for the county, — if the validity of tax proceedings are indispensible, — then very few valid warrants, in such cases, have been *81issued. The county may contract an indebtedness equal to the amount of taxes it can collect during the year, on the theory that the taxes are legal. Whether the taxes are legal or not is entirely immaterial, provided there are some steps taken towards the levy of a tax.

The prevailing opinion in this case, in assuming that there were no valid warrants outstanding at the time of the passage of this act, assumes a fact which I am unable to find in this record. I know it was possible for there to have been valid warrants outstanding at that time, for the reasons already stated, and it appears from this record that such was the fact. The court expressly finds that at the time the act was passed only $4,411.53 of over $32,000 of warrants had been paid. As valid warrants to the amount of over $10,000 might have been issued during the years 1883 and 1884, how can it be said that the legislature was bound to know that all of these unpaid warrants were void, when over $5,000 of them might have been valid? But what I regard as a conclusive argument against this reasoning is that it embodies still another unwarranted assumption. It assumes that the legislature was as fully in possession of all the facts regarding the illegality of these warrants as this court,- after careful judicial investigation. This assumption is unreasonable, because it nowhere appears upon the face of the bill that the question whether these warrants were illegal was called to the attention of the legislature, or was in their minds, when the act in question was passed. This act does not pretend to legalize illegal warrants, or to deal with'them in any way. On the contrary, its provisions relate to such warrants as constitute indebtedness of the county, i. e. valid warrants. When the legislature was asked to pass a law to fund the outstanding indebtedness of the county, and was informed that there were warrants outstanding to about the amount of $30,000, there was nothing in the circumstances of the case, or in the nature of the legislation asked at their hands, to call their attention to the question whether these warrants were *82illegal, or to lead to an investigation of the matter. They were merely asked to give the county authority to fund such of them as constituted indebtedness of the county, not exceeding $30,000. They did not give power to fund $30,000 of warrants and pretended warrants. It is only on the theory that they are presumed to have made a careful investigation of this question, which was not before them, so far as this act shows, that it can be said that they intended to legalize void warrants on the ground stated in the prevailing opinion, that it was only for void warrants that such funding measure was necessary. If they did not make such investigation, they knew nothing of the validity or invalidity of the warrants. To support the contention that the legislature, investigated the question of their legality, it is necessary to assume, in the first instance, that the act relates to illegal as well as valid warrants. This is the very question to be detex-mined. It is hardly logical to assume it in order to prove it. It is a rational assumption that they took it for gx-anted that these alleged warrants which wex-e outstanding wex'e valid waxTants, thex'e being nothing in the statute to x-aise the question of invalidity, and the act being limited to valid wan'ants. The absence of all language showing a pux-pose to legalize the warrants is to my mind conclusive that the question of their illegality was not before them, and had not occuxTed to them. It would have been easy to have expx-essed such a purpose, had such been the legislative will. Whenever the legislatux-e has wished to legalize county waxrants, they have not found it difficult to express this purpose in unmistakable language. In one instance we find the contx'ast shai'ply pi'esented between the funding of outstanding indebtedness and the legalizing of county warrants. The tittle of an act passed in 1881 is “An act authorizing the board of commissionex's of Hutchinson County to fund cex’tain outstanding indebtedness and legalizing wax-rants issued by the commissionex-s of Ax-mstx-ong County.” The act declax-es “that the board of commissioners of Hutchinson County are hex-eby authorized to fund such indebtedness of said county as may exist on the first day of March, 1881, *83and also to fund the outstanding warrants issued by authority of the commissioners of Armstrong County prior to the date of the delivery of the books of said Armstrong County to the officers of said Hutchinson County, which warrants issued in the regular order of business of said acting commissioners of Armstrong County are hereby legalized.” Laws 1881, Ch. 16. The act in question in this case embraces only the funding feature. It does not also “legalize” the warrants. Power to incur indebtedness binding upon a municipal corporation must be clearly conferred. No doubtful implication will suffice. Shall the act which is to ratify an illegal exercise of authority be less explicit?

I regard it as a dangerous doctrine that after extravagance has issued pretended obligations of a municipality in excess of authority, and in the very face of statutory prohibition, cunning can outwit the wise and salutory restrictions upon municipal expenditures, by concealing, in artfully framed statutes, its purpose to legalize the void obligations, and then secure from the courts a construction of the law which the language of the act not only did not reveal, but studiously buried from sight. When a bill is introduced to legalize void indebtedness, it must disclose its purpose upon its face, to the end that every legislator may act intelligently, — may meet that issue upon its merits. A court which, after a measure, whose real purpose to legalize is concealed by its author from the legislature, has skulked through the legislative halls in the disguise of ambiguous and doubtful language, aids in throwing off the cloak of deception, will find that it has encouraged like practices in the future. I do not say that deception was in the mind of the one who framed this statute. But I venture the prediction that practically every member who voted for it will be dumfounded at finding such radical consequences wrapped up in this simple funding law. Whatever rule may elsewhere obtain, in my. judgment, we should lay down as a rule to be rigidly enforced that the purpose to validate a void obligation must be expressly declared, or be deduced from the law by the clearest necessary implication. The case of Brown *84v. Mayor, 63 N. Y. 239, is one in which the purpose to validate was necessarily embraced in the act. In that case the commissioner of public works had entered into a contract with plaintiff “for regulating, grading and setting curb and gutter stone in Tenth avenue from Manhattan to 155th street, and flagging the sidewalks thereof.” The contract was held void because it was not founded upon sealed proposals, and was not let to the lowest bidder after advertisement, as required by the statute. The court, however, held that the contract had been validated by a subsequent act of the legislature, which provided as follows: “The board of the assessors of the City of New York are hereby authorized and directed to assess upon the property intended to be benefited, in the manner provided by law for making assessments for local improvements, the expense which has been, or shall be actually incurred by the mayor, aldermen and commonalty of the City of New York for regulating, grading and setting curb and gutter stones and flagging the sidewalks in the Eighth avenue, from Fifty-Ninth street to One Hundred and Twenty-Second street, in said city; also in the Tenth avenue, from Manhattan street to One Hundred and Fifty-Fifth street in said city.” The law required all expense connected with this particular work, whether incurred or to be incurred, to be assessed upon the property benefited by the improvement. Here was a legislative declaration that the amount of expenses already incurred and to be incurred under any contract relating to the improvement to these parts of streets should be raised by assessments upon the property benefited. The money so raised was clearly intended to be used in paying these expenses, and this would involve payment of the expenses under the void contract. I do not wish to be regarded as expressing my approval of this case. I think the doctrine that a void claim against a municipality can be legalized by anything short of a very clear manifestation of such purpose is fraught with danger, —is repugnant to sound policy. Let it once be understood that the courts demand an unequivocal expression of the purpose to *85validate the void obligation, and there will be found no difficulty in so framing statutes as to express this purpose in unmistakable language. Let the contrary rule prevail, and funding statutes will become the stalking horses to cover the secret wish of interested parties to secure the legitimation of void debts, when it would not be safe to reveal such purpose to the legislature; and, to the surprise of legislators, the innocent funding bill for which they voted will be found to be a wide reaching and radical measure, to create, and not merely to fund, legal obligations.

The case of Beloit v. Morgan, 7 Wall. 619, which is relied upon by plaintiff’s counsel, is, in my judgment, distinguishable from the case at bar. The town of Beloit have issued certain bonds in payment for railroad stock, which were void, the legislature created out of a portion of the territory embraced within the limits of such town the City of Beloit. No other bonds had at that time been issued for railroad stock by the town of Beloit, except those already referred to. Under these circumstances the legislature declared that “all principal and interest upon all bonds which have heretofore been issued by the town of Beloit for railroad stock or other purposes, when the same, or any portion thereof shall fall due, shall be paid by the town and City of Beloit in the same proportions as if said town and city were not dissolved.” The court laid stress on the fact that the act could have no effect, as to bonds issued for railroad stock, unless it was held to apply to those void bonds, as they- were the only bonds which had been issued for that purpose by the town, and that the act declared that such bonds should be paid. Said the court: “No bonds were issued in payment for railroad stock, but those to a part of which this controversy relates. The language used by the legislature is clear and explicit. No gloss can raise a doubt as to its meaning. It distinctly affirms, and the affirmation is repeated, that the bonds shall be paid.” The more recent decision of the Federal Supreme Court fully sustains my conclusion. Hayes v. Holly Springs, 114 U. S. 120, 5 Sup. Ct. 785. The facts of that case are as follows: The constitution of Mississippi *86declared that the legislature should not authorize any county, city, or town to become a stockholder in, or to lend its credit to, any company, association, or corporation, unless two-thirds of the qualified voters of such county, city, or town, at a special election or regular election to be held therein, should assent thereto. A city in that state subscribed for stock in the Selma, Marion & Memphis Railroad Company, after an election held to vote on that question, but neither the election nor the subscription was authorized by the legislature. There being a vote of more than two-thirds in favor of the proposition to subscribe for the stock, the subscription was made, and bonds to pay for the stock were issued They were, of course, void. But subsequently the legislature passed an act which declared that “all subscriptions to the capital stock of the said Selma, Marion & Memphis Railroad Company, made by any county, city or town of this state, which were not made in violation of the constitution of this state, are hereby legalized, ratified and confirmed.” Laws 1872, Ch. 75, p. 313. This act more strongly indicates a purpose to validate the void subscription and bond than does the act relied on in this case indicate a purpose to legalize void warrants; and yet the court was clearly of the opinion that it had no such effect, and there was no dissent in the case. Counsel for plaintiff seeks to distinguish this case on the ground that the legalizing statute was not applicable to the subscriptions and bonds in question, for the reason that it validated only such subscriptions as were not made in violation of the constitution. This reasoning of the counsel assumes that the subscription in question did violate the constitution. But it did not. The subscription was not void because the constitution prohibited it, but because there was no statute authorizing it. The case was one of a want of power, and not of the violation of the fundamental law. The subscription was such a one as the constitution permitted the legislature to authorize. The only trouble with it was that the legislature had failed to authorize it. The case was in no manner different from what it would have been, had the constitution been silent on the ’Subject, *87and there had been no statute authorizing the subscription; and yet, in such a case, it would not be pretended that the subscription would have been in violation of the constitution. The constitution merely restricted the legislature in the exercise of its power to authorize such subscriptions, and is it only with reference to such subscriptions as the legislature were prohibited from authorizing that it could be said that the subscription would be in violation of the constitution. But the subscription made was one which the legislature might have authorized. The following language of the court in that case embodies my conception of the true doctrine: “The intention of the legislature to confirm and ratify the subscription in question cannot be ascertained with certainty from the language of the act, which is too vague to form the basis of so important an authority as that sought to be deduced from it. As is said in State v. Stoll, 17 Wall. 425, 436, if the legislature intended to do what is claimed, ‘it was bound to do it openly, intelligibly, and in language not to be misunderstood;’ and, ‘as a doubtful or obsecure declaration would not be justifiable, so it is not to be imputed.’ ”

The argument that the legislature should not be presumed to have passed an idle act has but little weight, under the circumstances of this case. There might have been several thousand dollars of valid warrants outstanding when the acts was passed. I believe that there were. If so, the act would have force when construed as a mere funding law. The legislature does not declare that the county shall bond to the amount of $30,000. It says that this shall be the limit. Whatever amount, under this sum, shall be needed to pay warrants, may be raised by the issue of bonds. Suppose that the legislature had said in terms that only valid warrants should be paid. Would it be argued that illegal warrants must be paid because to hold otherwise would render the act of no effect? Had the statute in terms spoken of valid warrants, it would not have been clearer. We have seen that the legislature knew what language to employ when they desired to legalize void waixants. They used explicit language in such a

*88case, but in this act, they refrain from the use of such language, and expressly limit the law to valid warrants by describing it as a law to fund the indebtedness of the county. It seems to me that the fallacy of the reasoning that the legislature must be presumed to have known all the facts is two-fold: Their attention was not called by the prepared bill to any matters connected with the validity of these warrants, and we have no means of knowing that they had evidence that all of these warrants were void. We do not know it ourselves. There is nothing in the language of the cases cited in the prevailing opinion warranting the rule that this court must assume that the legislature had investigated' a mass of facts which were entirely foreign to the measure they were about to pass, — a measure to provide for the funding of the county indebtedness by the issue of bonds to the necessary amount, not exceeding $30,000. I know of no decision which holds that the legislature must be presumed to have investigated facts not suggested by a bill before them, for the purpose of forcing into the act, by a strained construction, a meaning not apparent on the face of the act itself, — a meaning directly opposed to the terms of the statute; a meaning which finds no support, except upon the theory that the legislature, without any hint as to their relevancy from the act itself, have examined into these facts. What right have we to say that such an investigation, even if made, convinced the legislature that there were nothing but void warrants to be funded? It is said that the provision requiring the treasurer to call in all outstanding warrants, etc., is conclusive that void warrants were intended to be legalized. But the treasurer is not directed to call in pretended warrants. He has no power or right to do so. The instruments he is to call in are warrants, and warrants are instruments which represent the indebtedness of some municipality; and he is distinctly informed that it is only warrants of that kind —only real warrants, and not pseudo warrants — that he is to pay, by the very title of the act, which speaks of the funding of the indebtedness as being the sole purpose of the statute. It cannot *89be said that to hold that the county commissioners were to pay only valid warrants out of the proceeds of the bonds sold would vest them with judicial power. Not at all. They were not to determine this question finally. Should they refuse to pay a valid warrant, they could be compelled to pay it. Should they undertake to pay a void warrant, they could be restrained from doing so. They would merely determine, as the officers of any other corporation would determine, what were valid claims against the corporation. No one ever dreamed that the decision of such a question as the basis of business action was the exercise of judicial power. It is a decision that is being made thousands of times every day by business men, when asked to pay some claim or some pretended obligation. They do not decide it finally. They merely decide it for the purpose of governing their conduct in paying or refusing to pay the claim presented. So with reference to these outstanding warrants. The county commissioners could not finally determine which were to be paid and which were not to be paid. They could only decide the matter as other business men decide similar questions, in determining whether they will pay a claim or contest it in the courts.

The statute, upon its face, is simply a funding law. 'Nothing else can be made of it, unless extrinsic circumstances are to be considered. Now, there is no rule better settled than that which forbids an examination of extrinsic facts, — which prohibits an inquiry as to consequences when the act, upon its face is unambiguous. Courts look to consequences, and investigate circumstances, not to introduce doubt and uncertainty into an act, the meaning of which is plain upon its face, but to aid in solving doubts which the very terms of the act itself create. When the legislature has passed a statute which in terms is clearly a mere funding law, what right have we to construe it as a legalizing statute because investigation may lead us to the conclusion that the outstanding legal warrants against the county were less in amount than the sum for which the county might issue its bonds to fund its indebtedness? What right have we, at all, to look beyond the *90language of the act itself? For my part, I believe we have no right to fix the judicial eye upon anything but the words of the plain statute itself. The rule which I invoke is ancient, and it is universally recognized. “If the meaning of statutes is doubtful, the consequences are to be considered in the construction of them; but, if the meaning is plain, no consequences are to be regarded, for that would be assuming legislative authority.” 4 Bac. Abr. 652. See Coffin v. Rich, 45 Me. 507. The court said: “It is only when the words of the statute are obscure or doubtful that we have any discretionary power in giving them a construction, or can take into consideration the consequences of any particular interpretation.” In Salling v. McKinney, 1 Leigh, 42, the court said: “In the construction of statutes, we are told, from high authority, that, when the words are doubtful and uncertain, it is proper to inquire what was the intent of the legislature, but, where they have expressed themselves in plain and clear words, it is very dangerous for judges to-launch out too far, in searching into their intent.” In Hoke v. Henderson, 4 Dev. 1, it is held that “in construing a statute, if the words are ambiguous, resort should be had to the probable consequences which would arise from the one or the other construction; but, if the meaning of the language of the statute is plain, there can be no such reason.” In U. S. v. The Sadie, 41 Fed. 396, the court said, (quoting with approval the language of the court in U. S. v. Rector, etc., of Church of Holy Trinity, 36 Fed. 304:) “Where the terms of the statute are plain, unambiguous, and explicit, the courts are not at liberty to go outside of the language, to search for a meaning which it does not reasonably bear, in the effort to ascertain and give effect to what may be imagined to have been the intention of congress.” Mr. Sutherland says, in his work on Statutory Construction: “And, if the legislature has expressed its intention in the law itself, it is not admissable to depart from that intention on any extraneous consideration or theory of construction. Very strong expressions have been used by the courts to emphasize the principle that they are to derive their knowledge of the legislative *91intention from the words or language of the statute itself, which the legislature has used to express it, if a knowledge of it can be so derived.” Section 236, p. 312. He says further, in § 237, on p. 312: “It is, beyond question, the duty of courts, in construing statutes, to give effect to the intent of the lawmaking power, and seek for that intent in every legitimate way, but * * * first of all in the words and language employed; and if the words are free from ambiguity and doubt, and express plainly, clearly, and distinctly the sense of the framers of the instrument, there is no occasion to resort to other means of interpretation. It is not allowable to interpret what has no need of interpretation. The statute itself furnishes the best means of its own exposition, and, if the sense in which words were intended to be used can be clearly ascertained from its parts and provisions, the intention thus indicated will prevail, without resorting to other means in aiding in the construction.” Again on p. 313, he says: “The legislative intent being plainly expressed, so that the act, read by itself, or in connection with other statutes pertaining to the same subject, is clear, certain, and unambiguous, the courts have only the simple and obvious duty to enforce the law according to its terms.” In Alexander v. Worthington, 5 Md. 485, the court said: “The language of a statute is its most rational exposition, and, where its language is susceptible of sensible interpretation, it is not to be controlled by any extraneous considerations.”

(58 N. W. Rep. 348.)

In conclusion, I wish to express my pleasure that the majority of this court are able to reach a conclusion contrary to this opinion, and hold the county liable on these warrants. To a new state, its financial honor is of the highest importance. To develop its resorces, capital is indispensable, and every thing that savors of repudiation, in any form, tends to frighten capital from its borders.