When the title of a statute of a state clearly and distinctly
expresses the whole object of the legislature in the enactment, and
there is nothing in the body of the act which is not germane to
what is there expressed, the act sufficiently complies with a
requirement in the constitution of the state that no law "shall
relate to more than one subject, and that shall be expressed in the
title," although some provisions in the act
Page 120 U. S. 518
respecting details in the execution of the purpose of the
legislature may not be expressed in the title.
The Act of the Legislature of Kentucky of January 80, 1878,
respecting the compromise and settlement of the County of Carter
with its creditors is not in conflict with the provision in the
constitution of the state that "no law enacted by the General
Assembly shall relate to more than one subject, and that shall be
expressed in the title."
Carter County in Kentucky, under legislative authority,
subscribed to the capital stock of a railroad company and issued
its negotiable coupon bonds in payment of the subscription.
Subsequently Boyd and Elliott Counties were created, in each of
which were included townships which formed part of Carter County
when the subscription was made and the bonds issued, and in each
case legislative provision was made for the continuation of the
liability of the persons and property set off to the new counties
on the subscription. Default being made in the payment of interest,
an act was passed in 1878 authorizing the County Court of Carter
County to compromise and settle with the holders of the bonds on
behalf of Carter County and on behalf of the parts of the other
counties taken from Carter County, and a compromise was made under
which new bonds of Carter County and of those parts of each of the
other counties taken from Carter County were issued, default being
made in the payment of interest due on these latter bonds, a holder
of the coupons brought suit against Carter County to recover on
them.
Held:
(1) That the legislature had authority under the Constitution of
Kentucky to authorize the County Court of Carter County to bind
those parts of the Counties of Boyd and Elliott taken from Carter
County.
(2) That under the act of 1878, the County Court of Carter
County was authorized to contract for the issue of negotiable bonds
of the county and of the parts of the county in order to retire the
old negotiable bonds of the county.
(3) That in the suit to recover upon the coupons of the new
bonds, it was not necessary to make the parts of Boyd and Elliott
Counties, which had been parts of Carter County, parties to the
suit.
This was a suit brought against the County of Carter to recover
the amount due on certain bonds and interest coupons issued under
the following circumstances:
By an act of the General Assembly of Kentucky "to incorporate
the Lexington and Big Sandy Railroad Company," approved January 9,
1852, and an act amendatory thereof approved March 1, 1854, the
County of Carter was authorized to subscribe $75,000 to the stock
of the company, and to issue its bonds to raise the money to pay
therefor. Under this authority, the subscription was made, and
seventy-five bonds, of $1,000 each, issued by the county. These
bonds were in the usual form of negotiable
Page 120 U. S. 519
coupon bonds, payable to the order of the railroad company
thirty years from date, with interest at the rate of six percent
per annum, semiannually at the bank of America, New York. The
railroad company endorsed them in blank, and all but one afterwards
came into the hands of Joseph C. Butler and L. Worthington,
citizens of Ohio, as purchasers for value before maturity.
In 1859, after this subscription was made and while the bonds
issued on that account were outstanding, the County of Boyd was
created by the General Assembly of Kentucky, which included within
its boundaries a part of the original County of Carter. In 1869,
the County of Elliott was created, and this took in another part of
Carter; but in each of the acts creating the new counties it was
provided
"That nothing in this act shall be construed so as to release
the citizens and property now subject, or which may hereafter
become subject, to taxation, within the boundaries of Carter
County, included in the first section of this act, from being held
and made liable for the bonds and interest, issued to the Lexington
and Big Sandy Railroad Company as though this act had never been
passed."
Default having been made in the payment of interest on the
bonds, suits were brought by Butler against Carter County for the
recovery of the amount due on coupons attached to the bonds he
held. The suits resulted in judgments against the county.
Afterwards, the following act, approved January 30, 1878, was
passed by the General Assembly of Kentucky:
"An act authorizing the County of Carter and those parts of Boyd
and Elliott taken from Carter County to compromise and settle with
the holders of the bonds and coupons of interest executed by Carter
County in its subscription to the capital stock of the Lexington
and Big Sandy Railroad Company, and to levy and collect a tax for
that purpose."
"Be it enacted by the General Assembly of the commonwealth of
Kentucky:"
"§ 1. That power and authority is hereby given to the
County of Carter, and those parts of the Counties of Boyd and
Page 120 U. S. 520
Elliott taken from Carter County, to compromise and settle with
the holders of the bonds and coupons of interest executed by Carter
County in its subscription to the capital stock of the Lexington
and Big Sandy Railroad Company. Said compromise and settlement
shall be made by the Carter County Court, composed of the county
judge and a majority of the justices of the peace in commission of
Carter County, for and on behalf of the County of Carter, and those
parts of the Counties of Boyd and Elliott taken from Carter County.
Said court may make said compromise through a commission appointed
for that purpose, but before the same shall become binding on the
County of Carter, it shall be approved by the Carter County Court,
constituted as county levy courts are required by law to be
constituted. Said court may execute to the holders of said bonds
and coupons of interest, severally, the obligations of the County
of Carter, and those parts of the Counties of Boyd and Elliott
taken from Carter County in their formation, which shall be signed
by the County Judge of Carter County, and attested by the clerk of
said court. Said obligations shall contain such stipulations as to
interest as may be agreed upon by the court and holders of said
bonds and coupons of interest, or either of them, but not at a
greater rate than six percent per annum, payable semiannually. Said
obligations shall be due and payable at such times, and be for such
amounts, as may be agreed for by the court and holder or holders of
said bonds and coupons."
The next three sections of the act contain provisions for the
levy and collection of taxes, to pay the interest and principal of
the compromise bonds, upon persons and property within the limits
of Carter County as it was when the debt was originally created.
The fifth and last section is as follows:
"§ 5. This act shall take effect and be in force from and
after its passage, but nothing in this act shall be so construed as
to affect or make more valid the bonds and coupons of interest
given by Carter County in its subscription to the capital stock of
the Lexington and Big Sandy Railroad Company than they were before
the passage of this act."
Under the authority of this statute, a compromise was made
Page 120 U. S. 521
with the holders of the original bonds, by which the County
Court of Carter County issued 119 new bonds of the County of
Carter, and those parts of the Counties of Elliott and Boyd taken
from Carter County, each for the sum of $1,000, payable to Henry
Peachey and Richard O. Butler, executors of Joseph C. Butler or
bearer, with semiannual interest warrants at the rate of six
percent per annum attached. The principal of the bonds was made
payable at different dates.
David Sinton, the defendant in error, purchased nine of these
bonds for value before maturity and five hundred and forty of the
coupons, and this suit was brought to recover the amount due
thereon. Originally the suit included other bonds and coupons, but
as it was discontinued so far as they were concerned before
judgment, no questions arise in this Court as to them.
To a petition setting forth the foregoing facts the county
demurred 1., because the petition did not state facts sufficient to
constitute a cause of action, and 2., because the petition shows a
defect of parties plaintiff and defendant. This demurrer was
overruled.
Sinton v. County of Carter, 23 F. 535. The
defendant then filed an answer, some paragraphs of which were
stricken out on motion and others demurred to and the demurrer
sustained. As no point is made on this branch of the case, a
further statement of it is not necessary.
The court gave judgment against the county for $29,121.54, and
to reverse that judgment this writ of error was brought.
MR. CHIEF JUSTICE WAITE delivered the opinion of the Court.
The principal points presented by the argument of the plaintiff
arise on the demurrer to the petition, and they may be stated
thus:
Page 120 U. S. 522
1. The Act of January 30, 1878, is void by the Constitution of
Kentucky because the subject to which it relates is not clearly
expressed in its title.
2. The act is also unconstitutional and void because it vests in
the County Court of Carter County the power to bind the parts of
Elliott and Boyd Counties which had been set off from Carter.
3. The act gave no authority to the County Court of Carter
County to issue negotiable securities which pass by delivery, and
in the hands of innocent holders are free from defenses which would
be good as between the original parties.
4. There is a defect of parties defendant because Carter County
is sued alone, without joining "those parts of Boyd and Elliott
counties taken from Carter."
1. As to the title of the act.
The provision of the Constitution of Kentucky relied on is
article II, � 37, as follows:
"No law enacted by the General Assembly shall relate to more
than one subject, and that shall be expressed in the title."
Undoubtedly the design of this provision was, as is said in
Pennington v. Woolfolk, 79 Ky. 20,
"to prevent the use of deceptive titles as a cover for vicious
legislation by enabling members of the General Assembly to form
such opinion of the nature of a bill by merely hearing it read by
its title,"
but as early as 1859, the Court of Appeals said in
Phillips
v. Covington & Cincinnati Bridge Co., 2 Met. (Ky.)
221:
"This prohibition should receive a reasonable, and not a
technical, construction, and, looking to the evil intended to be
remedied, it should be applied to such acts of the legislature
alone as are obviously within its spirit and meaning. None of the
provisions of a statute should be regarded as unconstitutional when
they all relate directly or indirectly to the same subject, have a
natural connection, and are not foreign to the subject expressed in
its title."
This is in accord with the decisions of this Court in
Montclair v. Ramsdell, 107 U. S. 147,
where we followed the rulings of the Supreme Court of New Jersey
upon a similar provision in the constitution of that state; in
Page 120 U. S. 523
Jonesboro City v. Cairo and St. L. Railroad,
110 U. S. 192, and
Mahomet v. Quackenbush, 117 U. S. 509,
where the Constitution of Illinois and the decisions of the Supreme
Court of that state were considered, and in
Otoe County v.
Baldwin, 111 U. S. 1, which
had reference to the Constitution of Nebraska, and the settled rule
of decision in that state, and in
Ackley School District v.
Hall, 113 U. S. 135,
which arose in Iowa. It is enough if the law has but one general
object, and that object is fairly expressed in its title. Cooley on
Const.Lim, 1st ed. 144, § 2; 4th ed. 175.
Here the title is
"An act authorizing the County of Carter, and those parts of the
Counties of Boyd and Elliott taken from Carter County, to
compromise and settle with the holders of the bonds and coupons of
interest executed by Carter County in its subscription to the
capital stock of the Lexington and Big Sandy Railroad Company, and
to levy and collect a tax for that purpose."
This clearly and distinctly expresses the whole object of the
legislation, and there is nothing in the body of the act itself
which is not in every way germane to what is there expressed. No
one interested in the subject matter of the law could be put off
his guard by hearing the bill read by its title. True, it does not
state that the County Court of Carter County is to act as the
representative of the parts of Boyd and Elliott Counties, as well
as the County of Carter, in making the compromise, or that bonds
are to be issued for the purpose of carrying it out, but all this
is matter of detail, suitable to the single purpose the legislature
had in view -- namely a settlement and compromise with the holders
of bonds issued by Carter County before its division, and for which
the present Carter County, and those parts of Boyd and Elliott
which were taken from the old county, were liable. It is difficult
to see how the subject of the legislation could be stated more
clearly without making the title of the act "a detailed statement,
or an index or abstract, of its contents," which all agree is not
necessary.
Montclair v. Ramsdell, 107
U. S. 155.
2. The authority of the County Court of Carter County to bind
"those parts of the Counties of Boyd and Elliott taken from Carter
County."
Page 120 U. S. 524
If we understand correctly the position of the county as to this
branch of the case, it is that the legislature has no power to
authorize the County Court of Carter County to act for these parts
of counties in compromising the old debt for which they were held,
because they were no longer parts of that county, and no
opportunity was given them to participate in the arrangement. These
parts of counties have no separate organization of their own,
corporate or otherwise. For all county purposes except this debt
contracted by Carter County when they were included within its
boundaries, they are subject to the government of the counties to
which they now respectively belong, but for the debt they still
remain a part of Carter. Such is clearly the effect of that
provision in the acts establishing the new counties which declared
that the liability of citizens and property in the territory set
off from Carter, for taxation on account of the bonds and interest,
should continue the same "as though this act had never been
passed." Had the acts never been passed, no one would doubt the
power of the legislature to give the County Court of Carter the
authority to make the settlement in the same way now provided for,
even though these parts of the county did not have a justice of the
peace in commission to take part in the deliberations. And this
because the county court was made the agent of the county, and of
those whose property was subject to taxation, for the transaction
of this business. The legislature might have appointed a commission
for the same purpose, or it might have selected any other suitable
agency. In order to bind the county or the taxpayers, it was not
necessary that the taxpayers should vote on the subject, or that
they should participate in an election of the body that was to act
in the matter. All that was properly within the discretion of the
legislature. No new debt was to be created, and no new subscription
to the stock of a railroad company was to be made. All that had to
be done was to compromise and settle an existing debt and to
substitute new liabilities on terms to be agreed on for an old one.
Certainly it was within the power of the legislature to designate a
suitable agency for that purpose, and what could be more suitable
than that department of the governing
Page 120 U. S. 525
body of Carter County which was entrusted with the management of
its financial affairs? The cases of
Allison v. Louisville &
Harrod's Creek & Westport Railway Company, 9 Bush 247,
253, and 10 Bush 1;
Scuffletown Fence Co. v. McAllister,
12 Bush 312;
Cypress Pond Draining Co. v. Hooper, 2 Met.
(Ky.) 350, and
Mercer County Court v. Kentucky River Navigation
Co., 8 Bush 300, referred to in the argument of counsel, all
relate to the creation of new liabilities, not to the settlement of
old ones.
3. The right to issue negotiable securities.
It is no doubt true that without sufficient legislative
authority, a municipality cannot issue commercial paper which will
be free from equitable defenses in the hands of innocent holders,
Claiborne County v. Brooks, 111 U.
S. 400, but in our opinion, that authority was given
here. The County of Carter was authorized to borrow money, and to
issue its bonds therefor to pay its subscription to the stock of
the railroad company. This, all agree, was sufficient authority to
issue bonds which were negotiable, and the averments in the
declaration are that the bonds which were in fact issued had that
character. The debt to be compromised, therefore, under the act of
1878 was a debt which had been created by the issue of such bonds,
and the authority was to execute to the "holders of said bonds and
coupons of interest"
"the obligations of said County of Carter, and those parts of
the counties of Boyd and Elliott taken from Carter County in their
formation, which shall be signed by the county judge of Carter
County, and attested by the clerk of said court."
They were to contain such stipulations as to interest, not
exceeding six percent per annum, and to be made due and payable at
such times as might be agreed on. As the new obligations were to be
executed to take up and cancel old negotiable securities to a large
amount, and were to be made payable at a future time, there cannot
be a doubt of the intention of the legislature to authorize the
execution of "obligations" negotiable in form and in law, if
necessary to secure a settlement. The authority to include in the
obligations such stipulations as to interest as might be agreed on
clearly implies authority to
Page 120 U. S. 526
attach interest coupons, and everything indicates a purpose to
invest the court with all the powers as to the form of the
obligations that were necessary to enable it to meet the
requirements of the holders of the outstanding bonds and coupons in
this particular.
4. The want of parties.
As we have already said, the parts of Boyd and Elliott Counties
which are interested in this matter have no separate organization
of their own, and they remain, for all the purposes of this debt, a
part of Carter County. A suit against Carter County on the bonds is
therefore a suit against them, and a judgment against that county
will be payable out of taxes collected within the boundaries of the
original county under the provisions of the act of 1878.
A suggestion was made in the argument for the county of a
variance between the bond described in the declaration and that
which was actually issued; but this is a matter which we cannot
consider, as there is no copy of the bond as issued in the
record.
Another objection is made to the form of the declaration in that
it does not meet the requirements of § 113 of the Civil Code
of Kentucky and set out distinctly in separate paragraphs each one
of the sixty separate causes of action sued on. That objection
cannot be taken by general demurrer, and besides it does not seem
to have been made below.
The objection to the action of the court in respect to the
answer is so little relied on that it is only necessary to say we
see no error in what was done.
The judgment is affirmed.
