Sutro v. Pettit

McFarland, J. This is an appeal from a judgment of the superior court of San Luis Obispo County, rendered on a writ of mandamus, commanding the appellant to pay to the respondents certain bonds alleged to have been issued by said county.

The legislature, by an act passed April 4, 1870, which was amended by an act passed March 14,1872, authorized the board of supervisors of the county of San Luis Obispo to issue bonds of said county, “ not exceeding in the aggregate the sum of forty thousand dollars,” for the purpose of erecting a court-house. (Stats. 1869-70, p. 816; Stats. 1871-72, p. 369.) The act provides what interest the bonds should bear, and when they should be payable, and that they should be “ of such denominations respectively as the board shall order.” It is also provided that the clerk of the board should keep a register of the date and number of each bond issued, and the amount realized from the sale thereof, with the name of the purchaser. Two copies of said register were required to be made by the clerk, one to be kept in the office of the county auditor, and the other in the office of the county treasurer. The bonds were to be issued from time to time as the work on the court-house progressed.

The board determined that the bonds should be of the denomination of one hundred dollars, and accordingly four hundred bonds were issued and numbered con[335]secutively from 1 to 400, which, of course, amounted to forty thousand dollars, the whole amount allowed by the act. But twenty additional bonds were issued, numbered from 401 to 420, which were over-issues, and entirely unauthorized by the act. These twenty last-named bonds were purchased by respondent for a valuable consideration before maturity, and in the ordinary course of business, and are the subject of this litigation. They were in form negotiable. Interest was paid on them for several years. On the first day of January, 1880, they were outstanding and unpaid.

Subdivision 14 of section 25 of the county government act (Stats. 1883, p. 305) provides that “the board of supervisors of any county having an outstanding indebtedness, on the first day of January, 1880, evidenced by bonds or warrants thereof,” may fund or refund the same, or may pay them with the proceeds of the sale of new bonds issued for that purpose. In supposed accordance with this provision, the board of supervisors of San Luis Obispo County, on May 4, 1885, ordered that the whole of said four hundred and twenty court-house bonds, amounting to forty-two thousand dollars, together with ten thousand dollars of road-repair bonds, be redeemed and paid with the proceeds of the sale of fifty-two thousand dollars’ worth of new bonds. The new bonds were issued and sold, realizing over fifty-two thousand dollars. The appellant (treasurer) paid all of said court-house bonds,-numbered from 1 to 400, but refused to pay the said twenty bonds held by respondents, numbered from 401 to 420. And from the judgment of the superior court commanding him to pay them, the treasurer appeals.