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does not prohibit the issuance of evidences of indebtedness not bearing interest, therefore when a municipal corporation issued interest-bearing notes to E. in consideration of a loan of money, borrowed from E. for a legitimate purpose, E. may recover the amount of the notes but can not recover any interest thereon. MUNICIPAL CORPORATIONS-DEBT-NOTES-INTEREST.-Where a municipal corporation borrowed money for a purpose authorized by statute, and gave an interest-bearing note therefor, the provision in the note calling for the payment of interest is in excess of the authority of the city council, and may be regarded as surplusage. Appeal from St. Francis Circuit Court; J. M. Jackson, Judge; affirmed.

W. W. Hughes, for appellant.

1. The city had no power to borrow money in the absence of express authority in the Constitution or from the Legislature. Kirby's Digest, §§ 5436-7, 5442-3; 1 Dillon on Mun. Corp. (5 ed.), § § 289, 290; 19 Wall. 468; 89 Ala. 641; 102 Iowa 69; 117 Md. 122; 29 Am. Cases 73; 29 La. Ann. 973; 37 N. J. L. 191; 6 Ann. Cases 754, and note; 119 N. Y. 280; 61 Tex. 316; 85 Id. 520, 540; 94 Va. 668; 28 W. Va. 288; 144 U. S. 173, 549; art. 12, § 3, Const.

No power is given to borrow for any other purpose than to extend the time of payment of indebtedness theretofore incurred. The maxim inclusio unius exclusio alterius is applicable. 54 Ark. 509, 513; 71 Id. 4, 8, 9.

2. Nor has the city power to issue negotiable paper. 2 Dillon, Mun. Corp. (5 ed.), § § 870, 878; 144 U. S. 173; 56 Fed. 197; 71 Ark. 4, 8, 9; 82 Fed. 568; 83 Id. 669; 67 Id. 137; 59 Id. 221, 227; 73 Id. 395-9; 112 Mich, 102; 70 N. W. 412; 49 La. Ann. 1758; 22 So. 1012. Such power must be specially conferred 70 N. W. 412; 148 S. W. 680; 15 Wall. 566; 5 Dill. 165; 10 Fed. Cases 3276; 131 Iowa 540; 9 Ann. Cases 1117; 141 Fed. 941.

3. No city can issue interest-bearing evidences of debt. Const., art. 16, § 1. The cases cited by appellees, 67 Ark. 542, and 74 Id: 190, against the right to plead ultra vires are distinguishable from this case. So are 87 Ark. 389; 89 Id. 95, and 49 Am. Dec. 416. Here the

notes were issued in violation of law and the city is not estopped to plead ultra vires.

Dig.,

4. The resolution was not legally passed. Kirby's 5473; 50 Ark. 105; 28 Cyc. 334.

5. There was no power in the city to renew the notes except by ordinance or resolution authorizing the renewal. 2 Dill. Mun. Corp. (5 ed.), § 939; 82 Fed. 568; 138 U. S. 673; 192 Ill. 355.

6. The bank was not a bona fide purchaser of the notes. One can not be an innocent holder of paper issued by a municipality without authority. Joyce on Com. Paper, 87; 32 Ark. 619; 94 U. S. 225; 131 Iowa 540; 9 Ann. Cases. 1117; 144 U. S. 173; 192 Ill. 355; 83 Fed. 669; 107 Mich. 409; 65 N. W. 376; 115 Wis. 340: 91 N. W. 1104; etc.

7.

The notes are entire contracts and not severable. 1 Page on Cont., § 509; 54 S. W. 655; 197 Ill. 346; 5 Am. Rep. 664; 164 S. W. 1092; 62 Ark. 370, 375.

8. The notes are barred. 73 S. C. 83; 6 Ann. Cases 754.

R. J. Williams and James P. Clarke, for appellees. 1. The facts justify a judgment for appellees, regardless of the court's findings and declarations of law. 64 Ark. 236; 62 Id. 228.

2. Kirby's Dig., § 5473, only applies to the passage of ordinances or resolutions entering into a contract. 75 Ark. 340. Courts presume that unauthorized persons are not allowed to participate in council meetings, and take judicial notice of the persons whose names are cited in the order. 66 Ark. 180.

3. The record of the proceedings of the council were introduced in evidence without objection. It is too late to object now. Kirby's Dig., § 1233; 75 Ark. 342; 68 Id. 71. Besides, the objection is too general. 62 Ark. 208.

4. The motion for new trial does not state specifically the objections to the finding of the court. 65 Ark, 278. 5. The notes are not barred. 22 Ark. 217; 66 Id. 464.

6. A municipality has the right to issue written evidences of indebtedness. 103 Fed. 424; 74 Ark. 503; 131 Iowa 540; 9 Ann. Cases 1117; 111 U. S. 408; 74 Fed. 528; 5 Dillon 338; 61 Ark. 402; 87 Id. 390; 76 Fed. 282; 80 Ark. 126; 47 Id. 283; 3 Dillon, Mun. Corp. (late ed.), § 1303; 23 Fla. 203; 98 Ark. 510; 50 Id. 416.

HART, J. This suit was instituted in the circuit court by Eugene Williams and the Bank of Forrest City against the city of Forrest City, to recover the sum of $5,196.43 alleged to be due plaintiffs by the defendant. The pleadings and proof introduced established the following state of facts:

Forrest City is a city of the second class and on the 8th day of June, 1906, its common council passed a resolution whereby its mayor was authorized and directed to execute to Eugene Williams, two notes, one for $3,160, due and payable February 8, 1907, for cash borrowed, and one for $2,196.43, due and payable one year after date, being for the purchase of material and stock for an electric light plant, said notes to bear 8 per cent. interest from maturity. The yeas and nays were called on the passage of the resolution and it was duly adopted. At a subsequent meeting of the council the mayor reported that, pursuant to the first resolution, he had executed the two notes to Eugene Williams, that one was for $2,196.43, due twelve months after date, for stock and merchandise on hand at the light plant at the time of delivery and not included in the purchase price of the plant; that the other one was for $3,160, due eight months after date, and that the loan was made for the purpose of removing the pumping station of the water plant to the lot occupied by the light plant. His report was accepted and approved by the council.

On the 20th day of September, 1910, the council passed a resolution authorizing the mayor and recorder to renew said notes. The yeas and nays were not called on this resolution. Pursuant to the resolution the mayor and recorder executed renewal notes in place of the orig

inal notes. On September 24, 1910, a payment was made on the notes.

The case was tried before the court sitting as a jury and the court found that the city was not liable for interest and rendered judgment in favor of plaintiffs for the sum of $5,196.43, the amount of the principal of the notes. The defendant pleaded the statute of limitations and to reverse the judgment relies upon the statute of limitations of three years.

It is the contention of counsel for the defendant that because section 1 of article 16 of our Constitution prohibits a municipal corporation from issuing interestbearing evidence of indebtedness, it thereby prohibits municipal corporations from executing any written evidence acknowledging its debt and stipulating therein the terms of payment.

Counsel admit that under section 5443 of Kirby's Digest which provides in effect that municipal corporations shall have power to provide for and construct or acquire works for lighting its streets, alleys, parks and other public places, the city council had authority to incur the indebtedness of $2,196.43 for the material purchased by it from Williams for its light plant. But they insist that it had no authority to issue its promissory note in evidence of said debt.

Section 5473 of Kirby's Digest provides that on the passage of every by-law or ordinance, resolution or order to enter into a contract by any council of any municipal corporation, the yeas and nays shall be called and recorded.

It will be noted that the original contract was entered into with Williams on the 8th day of January, 1906, and the yeas and nays were called on the passage of the resolution authorizing the contract. The renewal was provided for by resolution passed on September 20, 1910, but the yeas and nays were not called on the passage of the resolution.

The present suit was instituted on the 4th day of March, 1914. This was more than three years after the

passage of the resolution on September 20, 1910, authorizing the renewal. It is the contention of counsel for the defendant that the notes executed by the city are void and that the city was only liable on its contract for the purchase of the material for the electric light plant and that the claim therefor is barred by the three years statute of limitations.

The same contention is made in regard to the procurement of the loan of $3,000 and in addition counsel for the defendant contend that the city had no authority whatever to borrow $3,000 for the purpose of moving the pumping station to the electric light plant. In regard to this latter contention it may be said that section 5442 of Kirby's Digest provides in effect that municipal corporations shall have power to provide a supply of water by constructing or by acquiring by purchase or otherwise, wells, pumps, cisterns, reservoirs or waterworks, to regulate the same, and to prevent unnecessary waste of water, etc.

(1-2) The power expressly conferred by this section carries with it as a necessary incident the authority to make such subsidiary contracts as are necessary to effectuate the purposes of the act. Therefore we are of the opinion that the city council had the power to borrow the money to pay the expense of moving the pumping station of the water plant to the site of the light plant. Hence, the right to recover on both notes is the same.

In the case of Merrill v. Monticello, 138 U. S. 673, the court held that the implied power of a municipal corporation to borrow money to enable it to execute powers expressly conferred upon it by law, if it exists at all, does not authorize it to create and issue negotiable securities to be sold in the market and to be taken by a purchaser freed from equities that might be set up by the maker. Under the authority of this decision and others to the same effect, it is contended by counsel for the defendant that the notes originally given by the municipal corporation sued on herein were void.