German Savings Bank v. Franklin County,
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128 U.S. 526 (1888)
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U.S. Supreme Court
German Savings Bank v. Franklin County, 128 U.S. 526 (1888)
German Savings Bank v. Franklin County
Submitted October 29, 1888
Decided December 10, 1888
128 U.S. 526
Bonds issued by Franklin County, Illinois, to the Belleville and Eldorado Railroad Company, in November, 1877, held invalid.
The vote of the people of the county in favor of subscribing to the stock of the company was taken in September, 1869, the subscription to be payable in bonds, which were to be issued only on compliance with a specified condition as to the time of completing the road through the county. At the time of the vote, the Act of April 16, 1869, was in force authorizing the county to prescribe the conditions on which the subscription should be made and declaring that it should not be valid until such condition precedent should have been complied with. The bonds were issued without a compliance with the condition. Held that, under the Constitution of Illinois, which took effect July 2, 1870, the issuing of the bonds was unlawful because it had not been authorized by a vote of the people of the county taken prior to the adoption of the constitution.
Before the bonds were issued, the Supreme Court of Illinois, in Town of Eagle v. Kohn, 84 Ill. 292, had decided the meaning of the Act of April 16, 1869, to be that bonds issued without a compliance with such condition precedent were invalid even in the hands of innocent holders without notice.
The fact that the bonds were registered by the state auditor under the Act of April 16, 1869, did not make them valid.
In equity to have certain bonds issued by the appellee declared void and to restrain the collection of taxes to pay them. Decree in complainant's favor, from which the respondent appealed. The case is stated in the opinion of the Court.