Lewis v. Board of County Commissioners of Sherman County. It will be seen from the foregoing that before the commissioners can lawfully borrow money for the purpose of building a court-house, the right and authority to do so must be conferred by a vote of the electors of the county. This is indispensable, as no right for such purpose exists without it. It must be observed that the authority here conferred on the county commissioners is to borrow money to build a court, honse. The law does not authorize the people to vote bonds to erect the building. They may, by their votes, lawfully empower the commissioners to borrow money for the purpose in question, but they cannot authorize the commissioners to issue bonds for such a purpose, and have them hawked around the country and sold to A., B. and C. to raise money at a ruinous discount for any such a purpose. It is one thing to authorize the borrowing of money to build a court-house when needed, but it is another and very different thing to vote for the issuing of bonds therefor, when the law does not authorize it. It is true, if the people by a proper vote should authorize the commissioners to borrow money, that on receiving the money a bond or other evidence of indebtedness might be given for the payment of the money when due under the terms of the loan. This would perhaps follow as an incident to the right to borrow. But even then the amount of money so borrowed should equal the amount for which the bond was given, otherwise there would be no end to the fraudulent practices of both officers and purchasers of bonds. Such a practice cannot be encouraged, and it is the duty of courts to close the doors against it. If, then, the law does not authorize the voting of bonds for any such a purpose as building a court-house, then the authority to borrow money cannot be enlarged by the commissioners or the people so as to include the right to issue bonds and sell them at such price as can be procured therefor, when such authority has been withheld by the law-making power. This view is fully supported by a case recently decided by the supreme court (Scipio v. Wright, 101 U. S. 665). Lewis v. Board of County Commissioners of Sherman County. So far as the court-house bonds are concerned, then, they must be held invalid, for the reasons: First, want of authority for voting bonds for the purpose of building a court-house; second, because no bonds were ever voted by Sherman county for any such purpose; third, because none of the bonds or the proceeds thereof were ever used to build a court-house, or were ever used for any purpose by the county; and fourth, because the bond contains no recitals showing that the same had been issued conformably to law, so as to cut off the defenses relied on. But with reference to the coupons taken from the bridge bonds it is different. There is full authority of law for the people of a county to vote for the issuing of bonds to aid in building bridges. The bridge bonds recite on their face that their issue was duly authorized by a vote of the people of the county, and that the result of such election was entered upon the commissioners' records, as provided by law. This recital is perhaps untrue, as the commissioners' proceedings show no such thing. But, as stated, the law authorizes the voting of bonds for such a purpose, and the bond recites the fact that they were properly voted for and authorized by a vote of the people of the county on the eleventh day of August, 1873, and that the result of the vote was spread upon the commissioners' journal of proceedings. The purchaser of the bonds, without notice of infirmity, was not in a position to know or believe that the bonds recited a falsehood on their face, and he was not, under the circumstances, bound to look beyond the bond itself. He might well believe what he saw stated in the bond. Fair dealing will not permit the defendant to gainsay what it has, through its proper officers, thus solemnly asserted. But this is not all. The law not only authorizes the issuing of bonds for such purposes, but they were so issued, and used directly in payment for building several bridges in the county, the principal one being across the Loup river. The county has had the full benefit of the bridge bonds. They were turned over directly to the parties who built the bridges, and were by them put on the market and into circulation, with the state Brown v. Board of County Commissioners of Sherman County. ment on their face that they had been properly voted for and issued. Good faith and common honesty require their payment when found in the hands of innocent bona fide purchasers. The plaintiff must therefore have judgment on the coupons detached from the bridge bonds, with lawful interest thereon from the time the same became due and payable. BROWN V. BOARD OF COUNTY COMMISSIONERS OF SHERMAN COUNTY. (District of Nebraska. January, 1881.) 1. COUNTY WARRANTS WHEN VOID-STATUTE OF NEBRASKA.- County warrants, issued for the purpose of erecting a county court-house in the state of Nebraska, are void, where their issue was not authorized by a vote of the qualified electors of the county, and no benefit whatever resulted to the county from the issuing of the said warrants. Jury trial waived. Finding of facts. It is found from the pleadings and the testimony produced in support thereof that the county orders in suit were issued by the county commissioners of Sherman county in part pay. ment of the contract price for building a court-house for the county; that the building of a court-house involved the extraordinary expenditure of money, and that no vote of the qualified electors of the county ever authorized the expenditure of money or the issuing of the orders for any such purpose; that no court-house was built and accepted by the county, and no benefit whatever resulted to the county from the issuing of said warrants; that the warrants are not negotiable securities, and are void for want of proper authority to issue them. C. S. Case and J. C. Cowin, for plaintiff. Groff & Switzer, for defendant. DUNDY, District Judge.- Suit is brought on ordinary county orders, or warrants drawn on the county treasurer, to the Brown v. Board of County Commissioners of Sherman County. amount of $3,000. The orders were drawn on the ninth day of July, 1874, and were presented to the county treasurer and payment thereof demanded, and indorsed not paid for want of funds, on the eleventh day of July, 1874. Judgment is demanded for $3,000, with interest at ten per cent. per annum from July 11, 1874. The building of a court-house usually involves the necessity for an extraordinary outlay of money, and the necessity of resorting to an extraordinary remedy to raise money and supply the funds to pay therefor. The ordinary county revenue is usually insufficient, even if available, therefor. And when it becomes necessary to build a court-house for the convenience of a county, there is a well-known method provided by law for raising the funds and authorizing the work to be done. Sections 14, 15, 16, 17, 18, 19, 20, 21, 22, ch. 13, pp. 234, 235, 236, Gen. St. of Nebraska, fully explain the modus operandi. A county cannot well build a $10,000 court-house with an empty treasury and bankrupt in credit to commence with. When it is undertaken disaster usually overtakes the enterprise, as it did in this instance. Now, I must hold that, when a county desires to built a court-house, if it has not on hands a sufficient fund which can be applied in payment for such a purpose without doing violence to principle, it must first submit a proposition to the qualified voters of the county, to get permission to incur such extraordinary indebtedness, and for authority to resort to the extraordinary remedy provided for raising the necessary and appropriate funds therefor. This was not done. Without such authority the commissioners could not lawfully contract for the erection of such a building, and without such action on the part of the electors of the county the commissioners were powerless to proceed, however much the building may have been needed. As authority for make such an appropriation of money was wanting, there was no rightful authority for issuing the warrants sued on. As both acts were wanting in lawful authority to uphold them, it follows that the warrants were void, and that no recovery can Hutchinson v. Green. be had on them. This same question has been more fully considered in another case just disposed of, in which Lewis is plaintiff and Sherman county is defendant. That case involved the validity of $5,000 in bonds issued to build a court-house for defendant, and what is said in that case relative to the court-house bonds applies as well to the warrants here under consideration. Judgment for defendant for costs of suit. HUTCHINSON and others v. GREEN and others. (Eastern District of Missouri. April, 1881.) 1. INJUNCTION-INTERFERENCE WITH CONTROL OF PROPERTY IN POSSES SION OF STATE COURT.-No injunction will be granted by a United States court to interfere with the possession, control or disposition of property which is in the hands of a state court of co-ordinate jurisdiction. 2. RECEIVER-POSSESSION OF STATE COURT.- The possession of a receiver appointed by a state court, and acting under its orders, is the possession of the court itself, and the disposition of the property by the receiver is a matter to be ordered by the state court, and will not be interfered with by a United States court by injunction. INJUNCTION.- Where a state 3. SAME-FRAUDULENT ASSIGNMENT court has appointed a receiver of the property of a corporation, and a fraudulent assignment has been subsequently made of the same, a United States court will not enjoin the assignee from receiving such corporate property from the receiver, in case the state court having control thereof orders it to be turned over to him. In equity. E. T. Allen and J. O. Broadhead, for plaintiffs. James Taussig and I. A. Madill, for defendants. TREAT, District Judge.- The plaintiffs, citizens of Iowa, bring this suit in behalf of themselves and other stockholders who may join against the defendant corporation, of which they are stockholders, and the assignee of said corporation. The |