Town of Weyauwega v. Ayling, 99 U.S. 112 (1878)

U.S. Supreme Court

Town of Weyauwega v. Ayling, 99 U.S. 112 (1878) Town of Weyauwega v. Ayling

99 U.S. 112

ERROR TO THE CIRCUIT COURT OF THE UNITED

STATES FOR THE EASTERN DISTRICT OF WISCONSIN

Syllabus

A town in Wisconsin having, pursuant to law, voted to issue its bonds in aid of the construction of a railroad in that state, the bonds bearing date June 1, 1871, and signed by A. as chairman of the board of supervisors, and by B. as town clerk, were issued, and by A. delivered to the railroad company. When sued on the coupons by a bona fide holder of the bonds for value before maturity, the town pleaded that the bonds were not in fact signed by B. until July 13, at which date he had ceased to be town clerk, his resignation of that office having been, June 17, tendered and accepted, and his successor duly elected and qualified.

Held:

1. That the town was estopped from denying the date of the bonds.

2. That in the absence of anything to the contrary, it must be assumed for all the purposes of this case that the bonds were delivered to the company by A., with the assent of the then town clerk, and that they were therefore issued by the proper officers of the town.

Page 99 U. S. 113

This was an action by Charles H. Ayling, a citizen of Massachusetts, against the Town of Weyauwega, Wisconsin, to recover the amount of overdue and unpaid interest coupons detached from certain bonds issued by that town in aid of the construction of the Wisconsin Central Railroad.

Upon the trial the following facts appeared:

1. That under and by virtue of chapter 126 of the General Laws of the State of Wisconsin for the year 1869, the legal voters of the Town of Weyauwega voted to issue negotiable bonds to the amount of $40,000 to aid in the construction of the Wisconsin Central Railroad.

2. That June 1, 1871, C. M. Fenelon was Chairman of the Board of Supervisors of the Town of Weyauwega, and C. A. Verke was the clerk of the said town.

3. That said Verke resigned his office of clerk of said town June 17, 1871; that his resignation was accepted; and on the same day one Francis W. Sackett was elected and duly qualified as such clerk, and entered upon his duties.

4. That Verke, after his resignation as town clerk as aforesaid, changed his residence to Peshtigo and ceased to be a resident of Weyauwega.

5. That July 13, 1871, Verke signed in Peshtigo, where he then resided, the bonds mentioned in the complaint; that the date in them at the time he so signed them was June 1, 1871.

6. That he did not in fact sign the coupons mentioned in the complaint, or any of them, but that his signature to them, as well as that of Fenelon, the chairman of said town, was lithographed from genuine signatures of Verke and Fenelon.

7. That at the time Verke signed the bonds, he was not Clerk of the Town of Weyauwega and had not been clerk thereof since June 17, 1871.

8. That July 13, 1871, the date when Verke signed said bonds, said Sackett was the duly and legally qualified clerk of the town.

9. That Fenelon, who signed the said bonds, was at the date he signed the same the Chairman of the Town of Weyauwega, and as such signed the same.

Page 99 U. S. 114

10. That after the bonds were so signed, they, with the coupons annexed, were issued and delivered by Fenelon, Chairman of the Town of Weyauwega, to the Wisconsin Central Railroad Company, and came to the hands of the plaintiff, who, prior to their maturity, purchased and paid a full and valuable consideration for them, in good faith, and without notice of any defect in them or the coupons, or the signatures thereto.

The judges were opposed in opinion upon the following questions:

1. Whether the Town of Weyauwega was estopped from showing the true date the bonds were in fact signed by Verke.

2. Whether the bonds, having been in fact signed by him after he had ceased to be the clerk of the town, and had removed therefrom his place of residence, and become a resident of Peshtigo, in law were or could be valid or legal bonds of the Town of Weyauwega.

3. Whether the fact that the bonds bear upon their face the date of June 1, 1871, and purport to be signed on that day by Fenelon, chairman, and Verke, clerk, estops or prevents the town from showing that the bonds were not in fact signed until July 13, 1871, and that on that day Verke was not the Clerk of the Town of Weyauwega, and if it does not, whether in law the said bonds and coupons are invalid in the hands of a bona fide holder of the same.

Judgment having been rendered in favor of the plaintiff in accordance with the opinion of the presiding justice, the town sued out this writ of error.

The act of 1869 provides as follows:

"SEC. 4. . . . It shall be the duty of the proper officers in every such . . . town . . . to cause said . . . bonds so voted to be . . . issued and to be paid over or delivered to the said railroad company. . . ."

"SEC. 5. For the purpose of giving effect to the provisions of this act, the proper officers of every . . . town . . . mentioned in this act are hereby declared to be . . . the chairman of the board of supervisors and the town clerk in each town. "

Page 99 U. S. 117

MR. CHIEF JUSTICE WAITE delivered the opinion of the Court.

The first question certified in this case is answered in the affirmative. The legal voters of the town, by a vote duly taken pursuant to statutory authority for that purpose, directed the issue of the negotiable bonds in controversy. As soon as this vote was given, it became the duty of the chairman of the board of supervisors and the clerk of the town to cause the bonds to be made out and delivered to the railroad company. Such was the requirement of the statute under which the vote of the town was taken. The designated officers had no discretion in the premises.

After the vote, an appropriate form of bond and coupons was lithographed and printed, with blanks in the bond for the signatures of the chairman and clerk. As printed, the bonds

Page 99 U. S. 118

bore date June 1, 1871. At that time, Fenelon was chairman and Verke clerk. The signatures of these officers were lithographed and printed on the coupons. Before the bonds were actually signed by Verke, he had resigned his office and moved out of the town. Another clerk had been appointed and qualified in his place. Apparently to save the expense of a new lithograph and another printing of the bonds, Verke, after going out of office, affixed his signature to those which had been printed. These bonds so signed by Verke and by Fenelon, who actually was chairman at the time, were taken by Fenelon and delivered to the railroad company. This having been done, Ayling, the defendant in error, purchased the bonds to which the coupons sued on were attached and paid their full value without notice of any claim of defense to their due execution. Under these circumstances, we think the town is estopped from proving that Verke in fact signed the bonds after he went out of office. If Ayling had put himself on inquiry when he made his purchase, he would have found 1, that the town had authority to vote the bonds; 2, that the necessary vote had been given; 3, that at the date of the bonds, Verke was clerk and Fenelon chairman; 4, that their signatures were genuine; and 5, that the bonds had actually been delivered to the railroad company by Fenelon, who was at the time chairman. If a bank puts out a note for circulation bearing the signature of one who was in fact president of the bank when the note bore date, no one will pretend that it could be shown as a defense to the note when sued upon by a bona fide holder, that the signature of the person purporting to be president was affixed after he went out of office. So if one puts out a note purporting to be signed by himself, but which was in fact signed by another having at the time no authority from him, he cannot prove the forgery or want of authority in the signer as against a bona fide holder. The reason is obvious. The bank, by issuing the note, and the individual, by delivering the paper which purported to be his obligation, adopted what they thus put out as their own and became bound accordingly.

The same principle applies in this case. There is no pretense that the obligation of these bonds is other or different

Page 99 U. S. 119

from that authorized by the voters. So far as the record shows, the town has received and retains the consideration for which they were voted. No bad faith is imputed to anyone. It is true the chairman alone made the actual delivery to the railroad company, but the presumption is that what he did was assented to by the clerk in office at the time. Certainly it could not have been contemplated that, to make a binding obligation, both the chairman and clerk must have been present when the delivery to the railroad company was made, and as the presumption always is, in the absence of any thing to the contrary, that a public officer while acting in his official capacity is performing his duty, it must be assumed for all the purposes of this case that the bonds were delivered to the railroad company by the chairman with the assent of the clerk, and therefore that they were issued as negotiable instruments by the proper officers of the town. It the fact was otherwise, it was incumbent on the town to make the necessary proof.

It is unnecessary to answer any of the other questions certified further than has already been done. The answer to the first question is decisive of the case.

Judgment affirmed.