Lamoille Valley Railroad v. Selectmen & Treasurer of the Town of Fairfield

The opinion of the court was delivered by Royce, J. The petition in this case asks that a peremptory writ of mandamus may be issued by this court, directed to the defendants as selectmen and treasurer of the town of Fairfield, commanding them, as such selectmen and treasurer, to issue the bonds or notes of said town for the amount of $40,000, and deliver them to the relator. It is not necessary to notice any of the allegations in the petition upon which the relator predicates his right to the writ, except the one in which he alleges that the instrument of assent which was required by the enabling act approved November 12, 1867, was duly recorded in the town clerk’s office of the town of Fairfield, and in the county clerk’s office in the county of Franklin, in full and exact compliance with said act. The defendants in their answer deny the truth of that allegation ; and upon the issue thus made, the question arises as to whether it is the duty of the relator to establish that allegation in order to entitle himself to the writ. [261] The Act of 1867, before referred to, provides that when the instrument of assent therein required shall have been signed and acknowledged, and the certificate of the commissioners appended thereto, said commissioners shall cause such instrument of assent and such certificate to be filed and recorded in the town clerk’s office of such town, and shall also cause a copy of such instrument and certificate, certified by the' town clerk of such town, to be lodged and recorded in the county clerk’s office in the county in which such town is situated ; and until such records are made, such commissioners shall not proceed to make any contract, subscription, or purchase on behalf of said town. A construction was given by this court to that portion of the act of 1867 above recited, in the case of The Essex County Railroad Company v. The Selectmen and Treasurer of Lunenburgh, 49 Vt. 143, and it was then held that the provision requiring the records to be made was mandatory ; that it was not sufficient to put the instrument of assent and certificate on file, but that they must be filed and recorded, and that without such records the commissioners had no power to make the contract. Ordinarily we should treat the question as res adjudicata, and feel content to stand upon the reasons that were given by the Chief Justice in that case ; but in consideration of the amount involved, and the request made by the learned counsel for the relator that we should review the decision made in that case, we have examined the authorities to which we were referred on the argument, and such others as we could get access to, and are confirmed in the belief that the construction given in that case was the only one that could be justified upon principle and authority. There is no ambiguity in the language used in the act; the legislative will is clearly and sharply defined, and thei’e is no occasion to add to or qualify by judicial construction the plain and unequivocal language employed. Newell v. The People, 7 N. Y. 99; McCluchy v. Cromwell, 11 N. Y. 593. And when the provision of the statute is the essence of the thing required to be done, and by which the right to do it is obtained, it is mandatory. Marshall v. Langworthy, 6 Hill, 646; Striker v. Kelly, 7 Hill, 9. The right of the town to subscribe for stock of The Lamoille [262] Valley Railroad Company, and issue its obligations in -payment for the same, was derived from the act of 1867 ; and it was the undoubted right of the Legislature to impose such conditions upon the exercise of that right as it thought proper. The recording of the instrument of assent and certificate of the commissioners in the town and the county clerk’s offices, was by that act made a condition precedent to the right of the commissioners to enter into any contract in the name of the to.wn with the railroad company ; and it was incumbent on the relator to show that that condition had been complied with before he could insist that the town was under obligation to subscribe for the stock and issue its obligations to pay for the same. The compliance with that condition was by the act made necessary to the right; and, until complied with, the commissioners had no power to bind the town by any subscription for stock that they might make. A want of power, as between a town and a corporation that the town has voted to aid, has always been allowed as a defence in the Federal and the State courts, when the corporation has endeavored to enforce the giving of such aid. East Oakland v. Skinner, 94 U. S. 255; Ryan v. Lynch, 68 Ill. 160; Delaware County v. McClintock, 51 Ind. 825; Barnes v. Lacon, 84 Ill. 461; Jones Railroad Securities, s. 230. Express authority is required, to enable a town to subscribe for stock in, and issue its securities to, a railroad corporation, and all the requirements of the law conferring the authority must be observed. Jones Railroad Securities, s. 226, and cases cited. It is claimed that the condition was complied with by filing the instrument of assent and certificate with the town clerk and a certified copy of the same with the county clerk before the subscription was made, and that the actual recording of the same has relation to the time of filing. This claim is based upon an assumed analogy between this statute and the statute requiring deeds to be recorded, and the decisions of this court that where a deed is spread upon the record, the record has relation .to the time it was filed for record. Jarvis v. Aikens, 25 Vt. 635. But that and all of the other cases where such an effect has been given to the act of filing, have been cases where it has been held that the ob-. [263] ject in making a record' as applicable to the case on trial, was, to give notice of the fact. In Ferris v. Smith, 24 Vt. 27, it is said that there is a distinction between those cases where the record is made essential in working a transmission of title or in creating or defeating a right, and those where it is required for the purpose of public notice ; that in the levy of an execution upon real estate, nothing is effectually accomplished until the necessary records are completed, and hence that comes within the former class. The' same distinction was observed in Bigelow v. Topliff, 25 Vt. 273. In the case of a deed, the title vests upon its execution and delivery ; as between the parties to it nothing remains to be done, to give to it binding force and validity, and the only object of the record is to give notice of the fact. In this case the contract between the town and the railroad company was not completed and binding upon the parties until the records required were actually made. The records were essential to the creation of the right. This is apparent from the language of the act, which prohibits the commissioners from making any contract or subscription until such records are made ; and the court would be no more justified in holding that this duty could be disregarded than that any of the other matters and things required by the act could be dispensed with. This brings us to the consideration of the question whether the records were in fact made before the subscription was ma.de by the commissioners. We have carefully examined and weighed all the evidence submitted to us bearing upon that question, giving to the certificates of the town and the county clerks all the weight that such certificates are by the rules of evidence entitled to, and the result is that we find that the records were not completed until some time after the subscription was made. It is further claimed by the relator that inasmuch as it appears that the claim of the railroad company against the town had been assigned to the Portland Rolling Mills before the bringing of this petition, and that this petition is being prosecuted for their benefit, the Portland Rolling Mills, as assignee, stands upon the same footing as a Iona fide holder of the bonds of the town would stand if bonds had been issued. The question which has been considered, [264] of the want of the requisite' records, goes to the power of the commissioners to make the subscription, and it has been uniformly held that the want of power in a municipal corporation to issue bonds is open to inquiry between the original parties. Jones Railroad Securities, ss. 230, 267, 287, 288. In Kennicott v. Supervisors, 16 Wal. 452, it is said by Hunt, J., that if there be lawful authority for the municipality to issue its bonds, the omission of formalities aud ceremonies, or the existence of fraud on the part of the agents of the municipality issuing the bonds, cannot be urged against a bona fide holder seeking to enforce them. There must, however, be an original authority to the municipality to issue bonds. It is provided by section 3 of the act of 1867, that when the commissioners shall have made and executed such subscription, purchase, or contract, in pursuance of the tenor of such assent and the provisions of this act, the same shall be binding on such town. The bonds, when issued, were to be signed by the selectmen and countersigned by the treasurer, and the duty to issue them was dependent upon the existence of a contract, or subscription, that'was binding upon the town. ■ Hence, it is the duty of the relator, if he would enforce that obligation, to show such a contract. It is not necessary to decide whether a bona fide purchaser ■ of the bonds of the town, if bonds had been issued, would be affected by the want of power to make the subscription, for the Portland Rolling Mills, in our judgment, do not occupy any such relation to the town. They are equitable assignee of the claim, and their claim, as such assignee, is subject to be defeated by any defenses, that might be made to it if prosecuted by and for the benefit of the assignor. The claim, when assigned to the Portland Rolling Mills, was not negotiable, even in form, and hence they are not entitled to the benefit of the rules of law which are invoked for the protection of the bona fide holder of negotiable paper Several other questions were made by the petition, answer, and proofs, but as the objection already considered is decisive against the right of the relator to the writ, we have not deemed it important to consider them. The petition is dismissed, but without costs.