dissenting, on certain points:
I concur fully with the views of the court on all the questions passed upon in this case, except two.
I can not agree to the views entertained by the majority of the court, as to the illegality of the city tax for interest on “ temporary loans,” or as to the supposed illegality of the city tax for money to entertain official visitors.
The latter is a matter of comparatively small moment, and on that subject little need be said. By a provision of the charter of the city of Chicago, express power is given to the city to make appropriations for that purpose. There is nothing in the general law for the reorganization of cities, under which that city was working at the time of this appropriation, in any manner inconsistent with that provision in the old statute. In section six (6) of art. one (1) of the general law, it is provided that “ from the time of such change of organization * * * all laws or parts of laws, not inconsistent with the provisions of this act, shall continue in force and applicable to any such city, the same as if such change of organization had not taken place.” I can not think that when the statute expressly declares that in such case, all parts of laws, not inconsistent, etc., shall continue in force the same as though such change had not taken place, it meant to save only laws conferring usual corporate powers not inconsistent with the act. Such powers are conferred by the general act itself and need no such saving. There are two classes of repeal by implication. First, where a new statute contains provisions so inconsistent with any provision of a former statute that they can not stand together, the former statute must yield, and cease to be operative. Second, where a new statute seems to cover a subject fully, so that it makes, of itself, a complete system of law on the subject, (so much so that it is fairly inferrable that the legislature intended it' as a substitute for all former laws on that subject,) it is held that the former statutes cease to be operative, although the former statute may not be strictly inconsistent with the latter. If this clause of section six had been left out, it is plain that this general law would have been construed to be a substitute for all former statutes forming part of the'old charter of a city adopting the general act. It seems to me th.e object of this clause in section six was to exelude that conclusion, and that is its only office. Any other construction makes that clause a dead letter. If it does not save such special provisions as the one in question, it does not save any thing, for, only special provisions- of the old charter, not repugnant to any clause of the new, needed to be preserved by means of section six. It was inserted for some purpose, and if possible some effect ought to be attributed to it.
The matter of the tax “ for interest on temporary loans ” is of much greater moment, and that- subject I feel it my duty to discuss more at large.
The statute requires of every city the passage of an annual appropriation bill, appropriating such sums as maybe deemed necessary to defray all necessary expenses and liabilities of such corporation, specifying the objects for which such appropriations are made, and the amount appropriated for each object. (Rev. Stat. 227, sec. 89.) This is in anticipation of the tax levy. The statute also requires that the city council shall ascertain the total amount of all appropriations legally made, and to be assessed and collected, and that an ordinance shall be passed levying and assessing such amount so ascertained, etc. A copy of this last ordinance is certified to the county clerk, and he is to extend the tax at a rate which will produce' the amount so ascertained and certified. Upon this, the collector’s warrant is founded, as regards city taxes. In the case at bar all this was done.
It is objected that so much of the appropriation bill as professes to appropriate money “ for interest on temporary loans,” is unlawful and void, and this because, before and at the time of the passage of the ordinance, the city of Chicago, being already indebted largely beyond the limit in the constitution, could not lawfully become farther indebted, and hence could not lawfully make temporary loans, or provide for paying interest thereon.
The items in this appropriation, alleged to be subject to this objection, are $40)000 for interest on temporary loans for the water fund, $25,000 for interest on temporary loans for the fire department, $25,000 for interest on temporary loans for the police department, and $48,690 for interest on temporary loans (purpose not specified) included in the item of $300,000, appropriated in part for interest on bonded debt.
Are temporary loans, here referred to, unlawful? According to the opinion of this court in the late case of The City of Springfield v. Edwards, 84 Ill. 626, loans by a city, in excess of the constitutional limitation, when made on the credit of the city, are in violation of the constitution and void; but such loans, when made on the credit merely of taxes already levied, and in course of collection, as I understand that opinion, are not forbidden by the constitution, for they, in no sense, constitute a debt of the city. In that case this court said:
“ Appellant contends that when liabilities are created and appropriations are made, which are within the limits of the revenue accruing, to meet them, they are not debts, within the meaning of the prohibition of the constitution; and that temporary loans are not, when within the limits of the revenue expected to be realized.
“ The first branch of this position has support in Grant v. The City of Davenport et al. 36 Iowa, 396, People v. Pacheco, 27 Cal. 175, Koppekus v. State Capitol Commissioners, 16 id. 253, The State v. McAuley, 15 id. 455, The State v. Medberry et al. 7 Ohio St. 522, and State v. Mayor, 23 La. An. 358.
“These cases maintain the doctrine that revenues may be appropriated in anticipation of their receipt, as effectually as when actually in the treasury; that the appropriation of moneys when received meets the services as they are rendered,— thus discharging the liabilities as they arise, or rather anticipating and preventing their existence.
“ In this view, we are only prepared to yield our assent to the rule recognized by the authorities referred to, with this qualification : First, the tax appropriated must, at the time, be actually levied; second, by the legal effect of the contract between the corporation and the individual, made at the time of the appropriation, the appropriation, and issuing and accepting of a warrant or order on the treasury for its payment, must operate to prevent any liability to accrue on the contract against the corporation.
“ The principle, as we understand, is, there is, in such case, no debt, because one thing is simply given and accepted in exchange for another. When the appropriation is made and the warrant or order on the treasury for its payment is issued and accepted, the transaction is closed on the part of the corporation— leaving no future obligation, either absolute or contingent, upon it, whereby its debt may be increased. But until a tax is levied, there is nothing in existence which can be exchanged; and an obligation to levy a tax in the future, for the benefit of a particular individual, necessarily implies the existence of a present debt in favor of the individual against the corporation, which he is lawfully entitled to have paid by the levy. If the making of the appropriation and issuing and accepting a warrant for its payment does not have the effect of relieving the corporation of all liability, or, in other words, if it incurs any liability thereby, it must manifestly incur, either absolutely or contingently, a debt.
“ Where a warrant or order, payable from a specific appropriation of a tax levied but not yet collected, is accepted in exchange for services rendered or- to be rendered, or for materials furnished or to be furnished, so that there is, in fact, but the exchange of one thing for another, the duty remains for the proper officers to collect and pay over the tax in accordance with the appropriation—but, obviously, for any failure in that regard, the remedy must be against the officers and not against the corporation, for, otherwise, a contingent debt would, in this way, be incurred by the corporation.” •
On a careful examination of the record in this case, nothing is found tending to show that the appropriations in question were made for an. illegal purpose, or that the loans contemplated in the ordinance, and on which interest was to be paid, were to be effected in any manner not sanctioned in the opinion in the Springfield case.
Testimony was heard, showing, that on April 1, 1875 (the beginning of the fiscal year in question), the funded debt of the city of Chicago was $13,500,000, and that it had not been less than that amount since the first of July, 1870; that on April 1, 1875, the floating debt of the city, evidenced by certificates on which money had been borrowed, during the year ending on that day, was about $3,000,000; that the amount of such certificates was more in 1874 than in 1873, and was more in 1873 than in 1872.
This bonded debt of $13,500,000 was in existence at the time of the adoption of the constitution. This debt was then secured by bonds, with interest coupons attached, and these interest coupons bore interest after due, as is usual with all coupons attached to such bonds. The constitution in no way affected that indebtedness. When it declared that this city should not become further indebted until this debt should be reduced below the constitutional limit, it was not intended that this bonded debt, already contracted, should not continue to bear interest and grow greater by the accumulation of interest, if the city was unable to pay the interest as it fell due, nor was it intended by that provision of the constitution that the city should not, from time to time, have power to make appropriations, and assess and levy taxes for the purpose of aying interest upon that bonded debt, or for the purpose of paying interest upon the interest mentioned in the coupons, if, by any misfortune or misadventure, the revenue of the city, for any given year or years, should not be sufficient to pay necessary current expenses, and also, at the same time, to pay the coupons as they fell due, and the interest upon coupons past due.
It is well to remember, in this connection, that in 1871 the principal part of this city, with its personal property, was destroyed by fire. This record shows, that part of the money for which this bonded debt was contracted, was, at that time, in the city treasury, and was destroyed at the same time.
It ought not to be thought strange, if, in the three and a half years which intervened between that great calamity and the time of the passage of the ordinance in question, on April 30, 1875, the amount of revenue actually collected from an impoverished people may not have been sufficient to pay the necessary current expenses of the city, and at the same time to pay and discharge the accruing interest upon this enormous bonded debt. In such case, it was the duty of the city to apply its revenues first to the discharge of its current expenses. The unpaid interest upon the bonded debt, in such case, must have remained in the hands of the coupon holders, bearing interest, unless the city borrowed the money to promptly pay off the coupons. This could only be done by substituting for the coupon debt, interest bearing evidences of debt in some other form. To borrow money to take up these interest bearing coupons, even on the credit of the city, in such case involved no violation of the constitution, either in letter or spirit. The making of such loans created no debt—it simply substituted one form of interest bearing security for another. Such transactions are properly denominated “ temporary loans,” and the payment of interest upon such loans is not unlawful.
Nor is it to be thought strange if, in 1874, temporary loans were made, in the way suggested, for the purpose of meeting lawful liabilities growing out of this bonded debt, which was made before the constitution; and if this was accomplished by merely substituting one kind of interest-bearing paper for another, no debt was thereby created. If this were done, it was not unlawful for the city to provide for taking up such certificates of 1874, by temporary loans in 1875, nor was it unlawful to provide for the payment of interest upon such proposed temporary loans.
The items for interest on temporary loans for water, fire and police departments, relate clearly to necessary current expenses. On the principle of the Edwards case, the tax levy of the fiscal year of 1875 might lawfully be anticipated by interest bearing certificates, payable, only out of that levy, and given directly in payment for services rendered or materials furnished, or given for money to pay for such services or materials. To meet these current expenses, and to pay the accrued interest on the bonded debt, (whether evidenced by coupons or by certificates substituted therefor,) it was known to the city council ready money would be needed before the tax levy of that year could be collected, and to meet this want the appropriation bill in question seems properly and lawfully to provide for the payment of interest on temporary loans, to be effected in a lawful manner and for these lawful purposes. It is. not to be assumed that the appropriation was for an unlawful end, if its language is consonant with a lawful purpose. It is not to be assumed that the term “temporary loans ” means loans to be effected upon the credit of the city, where such loans would be unlawful, unless such a meaning is unequivocally shown by the context and the circumstances under which the words were used.
The meaning of a statute or ordinance is to be sought from its words alone, if they are unambiguous and not qualified by other parts of the same instrument. If the words are not unequivocal—are open to construction—then they are to be so construed, if it can reasonably be done, as to express and provide for that which may be lawful, though its words may be capable of a construction expressive of an unlawful purpose. This is according to the canons of construction.
Following, then, the teachings of the opinion in the Edwards case, the words “ temporary loans,” for current expenses of any kind, must not be construed to be loans, made on the credit of the city, upon contracts from which a liability, either absolute or contingent, can accrue against the city, but these words must, in such case, be construed to mean such loans as may be made, after the levy, not on the credit of the city but upon the credit, merely, of the tax levy, and payable only out of the fund to arise from the collection thereof. The term “ temporary loans,” in this ordinance, must, by all rules laid down by the authorities, be held to mean such as may lawfully be made, if any such can be lawfully made, and must not, in such case, be taken to mean such as the law and constitution forbid.
To validate a contract (made for the purpose of anticipating the collection of the tax) relating to necessary current expenses, according to the rule laid down in the Edwards case, it was only necessary that the tax, at the time of making the contract, should be actually levied, and that the legal effect of the contract should be such that it does not operate so as to incur any liability on the part of the city, either absolute or contingent. The principle is, that when the order on the treasury is issued and accepted, the transaction is closed on the part of the corporation, leaving no future obligation, either absolute or contingent, upon the city, whereby its debt may be increased. It follows, that temporary loans to raise money for a lawful purpose, not made on the credit of the city, but merely on the credit of taxes already levied, are not forbidden. The legal effect of such transaction does not operate to create any liability against the city on the contract of loaning. The tax is actually levied, and when the certificate or order on the treasury for the payment of the loan is issued and accepted, the transaction is closed on the part of the city. There is, in fact, an exchange of one thing for another, and nothing remains but the duty of the officers to collect and pay over the tax in accordance with the appropriation. For a failure in this regard the holder of the certificate has his remedy against the officers, and not against the city.
The only question presented in this record is, whether this court will permit the collector to perform this duty thus imposed upon him.
It is contended, that tax levy is unlawful, because, before December, 1875, unlawful temporary loans had been made by the comptroller, to which this tax, if collected, will be unlawfully applied. This, if true, can not affect the question of the legality of the tax, and the proof fails to show that the allegation is true, in fact.
If the ordinance making the appropriation, and the ordinance for the levy of the tax, were valid when passed, they are still valid. The subsequent acts of the comptroller, though unlawful, can not invalidate ordinances valid at their passage, nor can the tax be invalidated by any such cause. The objection, to be effective, must reach and nullify the ordinances on which the tax levy is founded. If they be valid, all else must stand.
If a statute for appropriation, passed by the General Assembly, seems, on its face, to be for a purpose not obnoxious to any provision in the constitution, it would not be competent to call the State Auditor, or members of the finance committee who prepared the bill, to prove that the estimates which led to its enactment, related to a subject matter touching which appropriations were forbidden by the constitution; nor could such statute be invalidated in court, by proving that, under like statutes, former State officers had allowed claims, and paid out money upon them, for purposes forbidden by the constitution.
Upon the same principle, the validity of an ordinance which, on its face, seems not obnoxious to any provision of the statute or of the constitution, can not be assailed in court by proof that the estimates which led to its passage related to a subject matter in relation to which appropriations are forbidden by law or by the constitution, or by proof that taxes collected under former ordinances of the same kind had formerly been misapplied by the city officers, and paid out for purposes thus forbidden.
Nor is it perceived, from this record, that any unlawful acts are brought home to the comptroller. It is true, part of the loans for the fiscal year of 1874 were taken up by money arising from temporary loans made in the fiscal year of 1875. It is insisted, that, by law, the loans of 1874-were chargeable only to the fund arising from the tax levy of that year, and could not lawfully be paid out of any other or subsequent fund. This position is sound on the rule announced in the Edwards ease, if it were shown that the temporary loans of 1874 so taken up were made for the current expenses of that year. If made on account of liabilities in 1874, which lawfully grew out of and constituted part of the liability of the city on account of the bonded debt, which existed before the adoption of the constitution, then these temporary loans of 1874 were valid obligations upon the city, not dependent alone upon any special fund of 1874 for their payment; and in such case it was not unlawful for the comptroller to take up such temporary loans of 1874 by money raised by like temporary loans made in 1875. The proof fails to show that the temporary loans of 1874, so taken up, were not of a character approved by the law, and sanctioned by the constitution.
It is not sufficient to invalidate an appropriation, (whether made by the legislature of a State or the city council of a city,) to show that it may be for a purpose forbidden by the constitution. The burden of showing the illegality of the ordinance in question, rested upon appellant. Such an ordinance can not be set aside on this ground, unless it is made to appear clearly and affirmatively that it is for a purpose not warranted by law. Unless the objector has shown that these appropriations for interest on temporary loans, were made, when, under the constitution and law, no lawful temporary loans could be made or that provision had been made by ordinance to appropriate this tax to interest on a class of temporary loans which are forbidden, the objection can not properly prevail. Nothing in this record approaches such a showing.
It is shown by the proofs, that the bonded debt of this city was not less than $13,500,000, at the time of the adoption of the constitution, and that the interest on that debt, runs at a rate of from six to eight per cent. Assume, if you please, that this interest was promptly paid for 1870 and for 1871. In October, 1871, the chief part of the city was consumed by fire. In 1872 it lay in ashes, and its citizens were, with Herculean energy, re-building. It will not be an unreasonable presumption, that no more money could be raised by taxation in 1872 than was demanded for current expenses of that year. It is known to this court that a very large part of the tax levied for 1873 could not be collected, because this court decided that “ the city tax act,” under which it was levied, was so imperfect that it could not be made effective. It is fair to assume that, for that year, no more taxes were collected than was needed for current expenses. The imperfections of that law were promptly supplied by the General Assembly, but, it is known to this court that a large part of the tax levy for 1874 was not collected, for the reason that this court then decided that “ the city tax act ” under which it was levied was unconstitutional.
If, then, for the causes suggested, the taxes actually collected in the years 1872, 1873 and 1874, were not more than sufficient-to pay the necessary current expenses of those years, it is not strange that the floating debt, consisting of unpaid coupons and interest thereon, should have been greater in 1873 than in 1872, and greater in 1874 than in 1873, or that at the end of' the fiscal year of 1874 it should amount to $3,000,000.
If the interest on this bonded debt falls due, say on July 1 of each year, the unpaid coupon’s .on a bonded debt of $13,500-000, at seven per cent per annum, falling due in each year, amounted to $945,000. The amount of these coupons, which fell due in that case on July 1, 1872, 1873 and 1874, would, by June 30, 1875, amount (without interest on the coupons) to the round sum of $2,835,000.
The coupons bear six per cent interest, and by June 30, 1875, Avould be—
Interest on coupons 1872, 3 years - - - $170,000
Interest on coupons 1873,2 years - - - 113,400
Interest on coupons 1874, 1 year - - - 56,700
Total interest on coupons to June 30, 1875 - $340,100
Principal of coupons past due - - - 2,835,000
Total floating debt, arising solely" from bonded debt, on June 30, 1875 - - - - $3,175,100
To this add coupons maturing July 1, 1875 - 945,000
$4,120,100
This consists of principal of coupons $945,000 for each of four years 1872, 1873, 1874 and 1875 - - $3,780,000
And interest as above to June 30, 1875 - - 340,100
$4,120,100
Interest on the principal of the coupons from July 1, 1875, say nine months, until the money could be realized out of the tax, at six per cent. - $170,100
In these computations it will be observed that no interest has been compounded—no interest has been- computed upon interest, except upon the interest expressed in the body of the coupons; so, it is made to appear that this city, with all her untoward calamities had, in those three and a half years, not only always paid her current expenses, but had paid something on the floating debt growing out of the bonded debt, so that instead of being $3,175,000, April 1,1875, it was only $3,000-000, and instead of calling for $170,100 for interest on temporary loans to be made in 1875 on account of, and in connection with the bonded debt, call is made for but $48,600, less than one-third of that amount.
It seems to be thought strange that this floating debt should have increased from $3,000,000 on April 1, 1875, to $4,500-000 on 31st of December, 1875. It must not be forgotten that during that time the coupons falling due for 1875, say $945-000, had been added, and interest on money to pay interest (on the $3,000,000 of former coupon debt, until the collection of this tax—say nine months at rate of six per cent) say $135,-000, and for money for current expenses, say $420,000, making an addition of $1,500,000, all of which would have been lawfully paid long ere this had not this tax levy been arrested, and all this in no way at variance with the doctrine of the Edwards case.
This estimate is made on the assumption that the coupons on the bonded debt were left to stand by simply providing yearly for the interest on the coupons by paying part of it by taxation, and part by temporary loans for that purpose. The evidence shows that instead of this, the coupons as they fell due were paid by money borrowed for that purpose, upon interest bearing certificates, and from year to year the interest on these had been paid, as would appear, by taxation, and the principal of the coupon debt, from money borrowed on like certificates to run for one year. It is plain, as already said, that this substitution of one interest bearing security for another of the same amount is not the creation of a new debt. It is a mere change in form and not in substance. The constitution was not made to control forms, but substance.
It is suggested that the term “ temporary loans” prima facie imports the making of an absolute debt, a debt on the credit of the city, and hence the burden rested on the city to show by proof that they were not to be made on the credit of the city—not to be made on contracts binding the city absolutely to pay.
In this suggestion lies the point on which I differ from the majority of the court. So far as I perceive, it is the only point on which there is a direct issue between their views and mine. To this suggestion it may be said that the term “ loan” certainly does not always import a binding contract to pay. A loan may be made on a pledge of personal property, with the right to redeem, but without any obligation to do so, and without any personal promise to pay. I have also shown that it is not every binding contract to pay, made by the city of Chicago, which is unlawful, for she may lawfully make any appropriate binding contract as to matters growing out of the bonded debt existing before the constitution, if in so doing she contracts no new debt. If the loan relate to money for current expenses, it is not a binding contract upon the city, for, no matter what the form of the paper may be, its officers can not bind the city thereby. The rule laid down in the Edwards case confines such a paper, in its legal effect, simply to the office of an effective assignment to the holder of so much of the tax levy when collected. The city, in such case has no further concern with the temporary loan for current expenses, or with the collection of so much of the tax which has thus been assigned. By operation of law, whatever the form of the certificate, the holder is alone interested in the collection of this part of the tax. Does such burden of proof rest on such holder? It would, to say the least, seem unreasonable to adopt a rule requiring the thousand and one firemen and policemen, or their assignees, to hover around the county court, to prove that their claims are not unlawful. Such a rule would render such orders or certificates practically worthless.
The appellant made no such point in the court below, for the objectors called the comptroller as a witness, and took upon themselves the burden of proving this tax levy unlawful. Appellant ought not to be allowed to raise that point (if sound) for the first time in this court. It is not right, in my judgment, for the court to reverse a judgment rendered for the collection of taxes, upon the apprehension that, when collected, they may be unlawfully appropriated to purposes not contemplated by the constitution and law. The mode of vindicating that provision of the constitution forbidding any city to become indebted above the constitutional limit, is not by an appeal to the courts to arrest the collection of a tax which may be applied lawfully without violation of the constitution. That vindication, if made in the courts, must be by proceedings forbidding the making of the inhibited contracts, or by restraining municipal officers from unlawfully applying the public money to the satisfaction of such unconstitutional undertakings, or by holding such contracts void when proceedings are instituted in court for their enforcement, or by actions against public officers, either criminally or civilly, for a violation of duty in making such contracts, or in unlawfully applying public money in payment thereof.
In such proceedings, the nature of the contracts can be investigated on proper pleadings and proofs. It is impracticable to set out in a collector’s, warrant all the facts on which the validity of each tax is supported. Such a proceeding would make that warrant in the county of Cook too voluminous to be brought before any court.