V, .COUNTY OF LINCOLN.
and a court "of law., He cannot be compelled to seek a remedy at law against another, in preference to relief in equity against the present defendants. A decree is ordered for the complainant.
VINCENT v. LINCOLN Co.
(OVrcuit (Jourt,D. NefJada.
April 30, 1887.)
In Nevada counties aTfi' liable to pe sued in the state courts, the sameaa '''natural persons." Held,a18o, that they are liable to be'sued in the courts of the United States. '
(81JllabUBby Ql,e Oourt.)
Demurrer to Complaint. Freeman, Bate$ & Rankin, for plaintiffs. T. J. Osporne, Dist.· Atty" and Trenmor Coffin, for defendant. SABIN, J. These actions are brought by plaintiffs to recOver from Lincoln county, Nevada, various sums, aggregating something in e,xcess of $300,000, alleged to be due phiintiffs upon certain bonds and interest COll pons issued by said county pursuant to an act of the legislature of said state approved February 17, 1873. St. Nev. 1873, p. 54. The object of the act was to provide for the·funding and consolidation of the outstanding indebtedness of said county, a.nd the bonds sued upon were issued pursuant thereto. Default having been made in the payment of both principal and interest, these actions are brought. Two ·of the plaintiffs are citizens of California; the other is a citizen and subject of Germany. A demurrer was filed by defendant in each case upon the same grounds, and, the cases being all upon like causes of action, the demurrers were argued and submitted together. The points raised by the demurrers are: (1) court has no jurisdiction over the defendant, which is one of, the organized counties of the state of Nevada; (2) the court has no jurisdiction over the subject-matter of the action. In support oithe first point raised by the demurrers, it is urged that a county is a political subdivision, and a portion of the sovereignty of the state; that it is in no just sense. a citizen of the state; that iUs not a corporation, and cannot besuell except by permission of the state. ,and then only in such courts as the state may designate for that purpose. In support of these propositions, counsel cite Hunsaker v. Borden, 5 Cal. 290; Hastings v. San Francisco, 18 Cal. 57; Sharp v. Contra Costa Co., 34 Cal. 284; County of Rock Island v. Steele, 31 Ill. 53';!; Loumdes Co. v. Hunter, 49 Ala. 511;' Tay70r v. Salt Lake Co., 2 Utah, 405; Ho,milton. Co. v. Mighels, 70hio St. 109; Dill. Mun. Corp. §§ 22, 23.
, Upon thesecond'poiht' of demurrer,' it is .insisted ,nuit .the court has ,not jurisdiction of the subject-matter of the action, -fol' the reason that the act under which the bonds were.issued provides the means and court by which the act may be enforced." Section 19 of the act is as follows: "The district court of Lincoln couJ+ty shall have power to enforce obedience to the provisions of this act, and for that purpose shall have full power to issue process of mandamus, prohibition, and all other writs that may be reguired that are authorized by law. " , " That, having specified the court and remedies in the act, all others them to are prohibited, and that the holders ofthe bonds these limitations as to courts and remedies. 31 Ill. 534, and 18 Cal. 57, supra, are cited.. . ·PI:rintiffs contend that a county a municipal corporation, or, at least. a quasi municipal corporation, and liable to be sued in any proper court, upon default in its obligations; that the constitution and statutes of Nevada give this right of action; that it has been so adjudged by the supreme court of Nevada in a number of cases; that section 19 oithe act, referred to, places no restriction upon the right to bring suit in any court of competent jurisdiction. Connsel cite Blanchardv. Kaull, 44 Cal. 451; Mills v. Williams, 11 Ired. 561; Ang. & A. Corp. §§ 14, 23, 1:64; Dill. Mun i· Corp. §22;Maury 00. v. Lewis 00., 1 Swan, 240; Lowi8ville N. R. R. v; C'.ounty Court, 1 Sneed, 687; Shawnee Co. v.Carter, 2 Kan. '128; PM v. County of Sacramento, 6' Cal. 256; Dean v. Davis, 51 Cal. ,(06; Levy Court-v. Coroner,2 Wall. 501; Waitz v. Ormsby Co., 1 370; Floral Springs -W. 00. v. 14:. Nev. 434; McCoy v. Washington Co., 3 WalL Jr. 385;CowleB v.McrcerOo., 7 Wall. 118; Adams v. County of Republic, 23 Fed. Rep.21l;WaU v. Monroe Co., 103 U. S. 77; wan A88'n v,'Topeka, 20 Wall. 655; Cromwell v.County of Sac, 94 U. S. 351; County of Greene v. Daniel, 102 U. S. 195. state of Nevada, Whatever may be the legal statUs of counties in whether considered as municipal corporations or otherwise, we think their liability to be sued in any court of competent jurisdiction is too clear to admit of doubt., Ever since the adoption of the constitution of the state, in 1864, the supreme court of the state has, in numerous decisions, af, firmed this'right, and enforced this liability. Waitt v.Ormsby Co., 1 Nev. 370; Olarkev.Lyon Co., 8 Nev. 181; Floral SpringsW. Co. v. Rives, 14 Nev. 434. . Nearlyevery volume of the Nevada Reports contains one or more cases "in which counties appear as parties seeking to enforce alleged rights and obligations, and their legal capacity and right so to db passes unquestioned, or, if questiol1ed, has alwaYs been maintained. ,. In 1 Nev. '370. supra, the very points raised by the demurrers in these cases, though stated in inverse order, are considered by the court, and decided adverse to defendant. In 01" 8 Nev. 181, it is decided that a county isliable 'to be sued iII arty district court within the state, and, if the defendant county desires the action tried in the judicial' district of which it is a
VINCENT V. COUNTY OF LINCOLN.
it must move to have the case trans(e,rred, the same as would be required 'Of any defendant. . , .. . , In 14 Nev. 431, it iSh.eld: "Under those provisions, [constitutional,] the jurisdiction pf an action against a county is determined by the, same rule that determines the jurisdiction of actions against natural persons. ... * ... That the right to sue a county on demands under, as well as over, tbree hundred dollars does exist, cannot be doubted. The statute of 1864 confers it, and nothing in the constitution, or an subsequent statute, bas taken it away." The statute referred to provides only for· bringing suits against counties in the district courts,' which have not jurisdiction of cases involving less than $300. It reads: "ACtionsagainst a county may becommenced in the district court of the judicial district embracing said county." St. 1864,p. 45jGen. St. Nev. 1885, § 3667. The constitution of the state, art. 8, of "Municipal and other Corporations," § 0, provides: "Corporations may sue and be sued in all courts, in like manner as individuals." Section 10: "No county, city, town, or other municipal corporation, shall/'ete. Article 9, §4: "The state shall never assume the debts of any county, town, city, or other corporation, whatever, unless,".etc. "Erom these provisiQDs of the constitution and the statuJes,' and th<uniform and .repeated :rlliings of the supreme court thereon; the liability of a county to be sued iuany court of competent jurisdiction cannot bl>. questioned. , It remains, then, only to determine whether or not liability can, be enforced in a national court. The jurisdiction of. these courts is regulated by congress solely, ani). ,arew,itllOutauthority to enlarge,. restrict, or abridge that jurisdiction. Where the jurisdictional facts exist, as to citizenship and ject-matter, it is the right of any person to invoke the jurisdiction and aid of the national courts in the enforcement of alleged rights. It is urged there is an element of ·sovereignty lingering about a county which exempts it from the jurisdiction of the United States courts, unless the state has expressly provided by statute that scounty shall be subject to such jurisdiction. 1'his claim is not new in character, nor in the purpose for which it is invoked, to.wit, in aid of repudiation. In every reported case which I have found where this defense is urged, its sale and single pUrpOse has been to avoid legal obligations. It is difficult, however,' to perceive very much of sovereignty in a county. Subject, in a state, only to constitutional limitation, or in a territory to therestrictioll of the organic act,a QOunty is the merest creature of the legislature. From it it derives its name, its extent of territory,its mode and manner of government, its powers and rights. It is the creature of the legislature, called into, existence by it, and subject to the restrictions above named, its whole being may be changed by the same power which created it. Itsna,me may he changed, its territory cutup and p/l.rceled out to other counties, i:ts board of officers shorn of their powers, its revenues cut off, it,sexisten(.je as a C9:tll1ty blotted aut"and this against the of its inhabitants. ' O<nnmu8'ior,tera oj Laramk 00.,· v. O<miJ. ·
· . ._ oj, -'" J
If aught of sovereignty really exists in a county, it would seem to rest wholly in the sovereign right of repudiation,-a right or privilege sometimes exercised by sovereigns. In LyeU v. Lapeer 00., 6 McLean, 446. this defense was urged: "That this court has no jurisdiction in the cause, the defendant being a political body of the state, and to legal process inthe United States court." Mr. Justice McLEAN disposes of this defense in few words: , county cannot cIllim the immullity of not being suedunder the eleventh of the constitution. ,Ifevel''y COUl,lty could throw itself on its and hold at tbe'judicial powel' of the we should , have m the country more soverergnty than l,aw."
,In McCoy v. Washington Co., 8 Wall. Jr. 881, the same defense was interposed. Says Mr. Justic(lGRIER; is' contended that the county of Washington; being merely a, subordinate politiclJ,1 ,of; the state: of Pennsylva.nia,is liota citizen of this state, ,within the meaning of the const,ituti.on or afthe act of congress, and thereforll ",To that, entlty called a corporatIOn may not be ph;rsICally a CItizen, yet the law IS well settled that it may sue and be sued ,in the courts of the UnitEld states, because it is 'but the name under which a nutnber of persons; corporators and citizens, may sue and be sued., .In deciding the question of jurisdiction, the court look .behind the name and,1ind who the parties reallyin interest. In this case, the parties to be affected by the jUdgment are the people ofWashington county. That the defendant is a municipaJ corporation,aud nota, private one, furnishes a stronger reason why a, citizen of another state should have his remedy in this court, and not in a county where the parties against whom the remedy is sought would compose the court and jury to decide their own case. This point is therefore overruled." . In Cowles v. Mercer Co., 7 Wall.lt8, the cour.tsays:. . "But it was argued that counties in Illinois, by the law of their organization, WElre exempted from .suit in the circuit conrts of the county; and this seems to be the construction giyen to the statutes concerning counties by the supreme court of Illinois. But that court has never decided that a oounty in Illinois is exempted from liability to suit in national courts. It is unnecessary, therefore, to consider what would be the effect of such a decision. It is enough: for this case that we lind the board of supervisors to be a corporation authorized to contraqt for the county. The power to contract with citizens of other states implies liability to suit by of other states, and no statute limitation of suability can defeat a jurisdiction given by the constitution. We cannot doubt the constitutional right of the defendant in error to bring suit in the circuit court of the United States upon the obligat,ons of the county of Mercer against,the plaintiff in error, ,And we find no errorin thejudgmept of that court. Itillust therefore be affirmed."
mwsioners of Albany 00., 92 U. S. 807.
We think the authorities ditddare decisive of the matters under discussion. We cite, h'(}wevei', in addition to those cited by plaintiff's counsel, thefollowfngas pertinElUtand applicable: Ndtional Bank v. Beba$tian 00., 5 414; Railway v. Whitton's Adm'T, 13 Wall. 270 ; Md,rion Co: 10 543; Cwnningham V. Oounty oj Ralls;'1 Fed. Rep. 1:453; Davi8 v. Jdme8, 2 Fed. Rep. 618; Jordan v
VINCENT V. COUNi'Y OF LINCOLN.
Cass Co., 3 Dill. 185; 7 Cent. Law J. 262; Lyell v. St. Clair Co., 3 McLean, 580. Upon the first point urged, that section 19 of the act under which these bonds were issued imposes a limitation upon the holder to sue only in the state court, the case of Insurance Co. v. Morse, 20 Wall. 445, is a complete answer. If that was the object and purpose of that section,it is void, since the state cannot directly nor indirectly control the jurisdiction of the national courts, nor can it limit or control the rights of parties to bring suits therein. But we scarcely think such was its purpose, though we may not be able to say what that purpose was. It conferred' no additional powers upon the district court for that county to those already conferred. By act approved January 26, 1865, it was enacted that "the district courts, and the judges thereof, shall have power to issue ;writs . of mandamus, injunction, quo u'arranto, certiorari, and all othei' writs proper and necessary to the complete exercise of their jurisdiction." .St. Nev. 1864-65, c. 19, p. 110; Gen. St. Nev. § 2439. Section'19 of the act of 1873, referred to, bonfers no greater powers. It is mere surplusage. But, giving it full effect, it can only be ered 'as' an 'effort to give a more complete' remedy and proceeding than any then existing. Hanother remedy and proceeding existed, the bondholder could elect which he would pursue. This is distinctly ruled upon in Waitz v. Ormsby 00., 1 Nev. 370, supra. Concurrent remedies often exist, with option to the party invoking either. It may not be necessary, for the. purposes of this case, to formally decide whether or not cities, towns, and counties in Nevada are municipal "corporations," in the absence of any statute in terms deClaring them to be snch. We think their liability under the constitution and statutes of Nevada, and the decisions of the supreme court of the state thereon, to be sued and brought to judgment upon their obligations, has been fully We are not dealing with mere forms and shadows, and creditors are' not, when advancing woney upon the obligations of these bodies. No city, town, or connty would possess any greater corporate power, right, or authority from the fact that it was, by statute, declared to be a body politic and corporate. The power and legal right of these bodies to borrow money and incur obligations implies the right and duty to pay back that money when due, and to meet those obligations when mature, and, if they will not do this voluntarily, that they be brought to judgment. Without this accountability, there is no safety in dealing with these bodies in any way, and there is in enforcing it against them, the same as against natural persons, not the slightest injustice. In the case of Oommissioners of Laramie 00. v. Commis.sioners of Albany Co., 92 U. S. 307, the court say: . "Counties, cities, and towns are municipal corporations, created by the authority of the legislature, and they derive alJ their powers from the source of their creation, except where the constitution of the state otherwise pro. vides." , It may be quite immaterial what name maY,be given to a partic\11ar body: it is the powers posser,sed, used, and exercised by that body which v.30F.no.l0-48
determines its true legal character, and status. In the reports of.the national courts, supreme and circuit, will be found hundreds of cases in which cities,' towns, counties, school-districts, police juries, taxing districts, levy districts, etc., appear as parties plaintiff or defendant, enforcing or defending corporate rights, the corporate rights of each individual body, and no question.is made of their legal right or capacity so to do. True, it may be said that. this proves nothing, since their right and capacity were conceded from the fact that they were not challenged. But it does show the almost unanimous consensus of the bench and bar of the country that tklese bodies, by virtue of their corporate powers, possessed this right and capacity to sue and be sued, to defend and enforce their rights, in the national courts, in the absence of any state stat' ute relative thereto. We question if any state in the Union has by statute, in terms, at,tempted to say when or who of its. citizens or corporations, public or private, may be sued in the national courts. Such a statute would be anomalous, and for the most part nugatory, since the jurisdiction of these courts is not a subject of state control. The demurrers in these cases must be overruled; and it is so ordered.
DREXLER 'V. SMITH.
(Oirouit Oourt, JJ.Oregon. May 9,188T.)
NEGOTIABLE INSTRUMENTS-NOTE-ACTION ON-TRANSFER BY PARTNBR.
It is no defense to an action on a promissory note against the maker thereof that it was transferred to the vlaintiff by one of a firm who were the payees thereof, in payment of his indIvidual debt. ,.
SAME-ALTERATION BY HOLDER.
The payee of a note payable on or before a certain day wrote on the face of it, before maturity and without the consent of the maker, extending the time of payment thereof toa later day certain. Held, that this change ohime of payment was not such an alteration of the note as .avoided it, because it left the maker free to pay the note on or before such day, while it restrained the payeefroin compelling him to do, so before that time.! A defense to an action on such note which sets up this change in the time of payment thereof, and alleges that it was fraudulently done for the purpose of prolonging the negotiability of the note, so as to enable the payee wrongfully to negotiate the same, wit4ou.t stating that the maker had a defense to an action thereon while the same Was in' the hands of the payee, which he could not make a transferee before. maturity, does not show how the maker could be injured.by such negotiation, and is therefor,e bad on d,emurrer. A demand due the maker of note from the payee thereof, for money paid to the use of the latter,' work and labor performed for him, prior to the
note was held immaterial.
81 N. W. Rep. 889, and note. ' In Weaver v. Bromley, 8upra, the insertion of the words" or bearer" in a promissory
Respecting what alterations will be held material, see Weaver v. Bromley, (Mich.)