Bullard v. County of Riverside, Drainage District Improvement

MARKS, J. Plaintiff brought this action in declaratory relief to determine his right to recover the principal and accruing interest of two bonds for $1,000 each issued by the County of Riverside, Drainage District Improvement No. 3. The case was heard on an agreed statement of facts and judgment was rendered for defendants. This appeal followed.

The County of Riverside, Drainage District Improvement No. 3 (hereinafter called The District) was organized [902]under the Drainage District Improvement Act of 1903 (Stats. 1903, p. 354, as amended Stats. 1915, p. 359) hereinafter called the Improvement Act of 1903, and its bonds were issued on the 8th day of November, 1920, after the effective date of the Drainage District Improvement Act of 1919 (Stats. 1919, p. 731 [Deering’s Gen. Laws, 1937, Act 2203]), hereinafter called the Improvement Act of 1919. While it is not definitely stated in the stipulation, it is rather apparent that The District, while organized under the earlier act, was not completed at the time the act of 1919 went into effect and therefore is partially controlled by some of the provisions of the later act.

The bonds of The District matured on November 8, 1935, when plaintiff presented his bonds for payment. Probably the interest was paid in full to that date, but payment of the principal was refused because there was not sufficient money on hand to retire them. They were also unsuccessfully presented for payment on several subsequent occasions. It is agreed that the principal and interest on all outstanding bonds, other than the interest accruing after maturity on two held by plaintiff, had been paid in full at the date of the stipulation. After the action was filed sufficient money was received to pay the principal of the bonds. This was paid on July 14, 1939, with the stipulation that acceptance of the principal would have no effect on plaintiff’s right to demand interest accruing between November 8, 1935, their due date, and July 14, 1939, the date of the principal payment.

It was further stipulated that after all the principal of all of the bonds, together with interest to maturity, had been paid there had accumulated from delinquent installment payments in the special fund out of which the interest could be paid, the sum of $374.35 and further that it was believed that there were outstanding assessments which, if paid, would be sufficient to pay in full the interest claimed by plaintiff.

The bonds had attached to them interest coupons the exact form of which is not in the record. These coupons matured semi-annually, the last becoming due on November 8, 1935. The bonds contained the following provisions: