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City of South St. Paul v. Lamprecht Bros. Co., 31 C. C. A. 585, 589,

88 Fed. 449.

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We make these general observations because it appears that among the special findings which were made by the trial court concerning the issuance of the bonds in suit there are some findings of fact which cannot affect the plaintiff's right to recover, and are therefore immaterial, since the facts so found were unknown to him, and were not disclosed by the contents of the bonds. For example, the plaintiff is not chargeable with knowledge of the provisions of the city ordinance under which the bonds were issued (City of Evansville v. Dennett, 161 U. S. 434, 16 Sup. Ct. 613, 40 L. Ed. 760); nor with the fact that the water company, in whose behalf the bonds were voted, had been operating a canal for some years before they were issued, for the purpose of furnishing water power for hire for private enterprises; nor is the plaintiff chargeable with knowledge that the canai, as previously constructed, was narrow and deep, and that the water therein was below the surface of the surrounding country. Although these facts are stated in the special findings, yet there is no finding that the plaintiff was cognizant thereof, while there is a finding that he was a purchaser before maturity, in good faith and for value, which implies, of course, that he had no knowledge of any facts tending in any wise to impair the validity of the bonds, save such as was conveyed by the bonds themselves, and the act from which the power to issue them had been derived.

The principal argument which has been advanced in opposition to the judgment below is that the bonds recite that they were issued to aid in the construction of a canal for “irrigation and water power purposes.” Counsel concede that a canal constructed for "irrigation purposes” is a work of a public character, to which public aid may lawfully be extended, and such is the view that is entertained by the supreme court of the state of Nebraska. Cummings v. Hyatt, 54 Neb. 35, 74 N. W. 411. See, also, the opinion of this court in Perkins Co. v. Graff (decided at the present term) 114 Fed. 441.' It is claimed, however, that a canal constructed for water power purposes is not a work of a public character, in aid of which the taxing power can be exercised; that, because the legislature of Nebraska authorized counties and cities to extend aid in the construction of canals both for irrigation and water power purposes, the act conferring such power was invalid; and that as the bonds in suit show on their face that the canal, in aid of which they were issued, was designed to supply water, to some extent, for other uses than irrigation, a purchaser thereof in the open market was affected with knowledge that they were void. This argument, as applied to the case at bar, assumes that, if the water in a canal is used to generate power to be employed for any purpose (that is to say, either to operate railroads, produce electric light, or run a gristmill), such a canal is not a work of a public character. It further assumes that, even if the water of a canal is used principally for the purposes of irrigation, yet, if any part thereof is used to generate power, the canal loses its character as a work of public utility, and that the taxing power cannot be exercised in aid of its construction. We are not able to assent to either of the foregoing propositions, and believe them to be untenable. The general proposition may be conceded that a canal is not a work of a public character if the chief purpose of its construction is to create a water power to operate manufacturing plants which are in turn operated wholly for private gain, and in which the public is only incidentally or indirectly interested. Dodge v. Mission Tp., 46 C. Č. A. 661, 107 Fed. 827, 54 L. R. A. 242, and cases there cited. We conceive, however, that a water power may be devoted to a public use, as where it is employed to develop electric energy to propel cars or produce light for the public benefit. Possibly the creation of a water power, by means of a dam and canal, to operate a gristmill, would, in certain localities and under some conditions, be esteemed a work of such great public utility as to justify an exercise of the power of local taxation in aid of the enterprise. Burlington Tp. v. Beasley, 94 U. S. 310, 24 L. Ed. 161; Guernsey v. Burlington Tp., 4 Dill. 372, Fed. Cas. No. 5,855; Commissioners v. Miller, 7 Kan. 479, 523, 12 Am. Rep. 425. And it surely cannot be maintained, in those arid regions where water must be transported for long distances, not only for the purpose of irrigation, but to render the region habitable, by supplying other public wants, and dams and canals are constructed at great expense for that purpose, that such works lose their public character because a part of the water which they supply is used to generate power for any of the purposes to which power may be lawfully applied. When such works of internal improvement as dams and canals are undertaken in the arid regions, the public is interested in having them built of such dimensions as will supply sufficient water to satisfy all the needs of the community. We are of the opinion, therefore, that the act of the legislature of the state of Nebraska cannot be pronounced void upon its face because it declares that a "canal and other works constructed for irrigation or water power purposes or both are

1 52 C. C. A. 243.

works of internal improvement," and authorizes public aid to be extended in the construction of such works. The act does not mean that public aid may be extended to the creation of a water power which is used merely for private gain, and it should not be so construed. It must be understood to mean that counties and cities in the state of Nebraska may aid in the construction of canals, when the waters thereof are to be devoted to irrigation and other incidental objects to which they may be conveniently and profitably applied, without prejudice to the public use. The legislature foresaw that, if canals were constructed for the purpose of irrigation, it would oftentimes be found to be convenient and beneficial to the public to use the water, to some extent, for the purpose of generating power, and it intended to sanction such use.

It follows from what has been said that there was nothing in the statute to which this discussion relates, nor on the face of the bonds, to affect a purchaser with knowledge of their invalidity, even if they were invalid. The statute vested the municipality with a power, if rightfully exercised, to issue such bonds as those in suit profess to be. The bonds contain a recital, in the broadest language, that "all the requirements of the constitution and laws of the state of Nebraska necessary to authorize the issue and delivery of the bonds have been in all respects complied with,” and a purchaser thereof was entitled to



rely upon this recital unless he was advised that it was untrue. In other words, if bonds in aid of the construction of a canal for irrigation and water power purposes could be lawfully issued, he was entitled to assume that the bonds in controversy had been so issued, and was under no obligation to institute inquiries with a view of finding out whether the municipality had not abused its powers, and whether, under the guise of aiding in the construction of a canal for irrigation and incidental water power purposes, it had not in reality loaned its credit in aid of an enterprise of a purely private character. E. H. Rollins & Sons v. Board of Com'rs of Gunnison Co., 26 C. C. A. 91, 98, 80 Fed. 692. If a wrong of this character was in fact committed, it was the municipality, acting in obedience to the expressed will of more than two-thirds of its citizens, who committed it, and it cannot saddle the consequences of the wrong on an innocent purchaser of its securities. National Life Ins. Co. of Montpelier v. Board of Education of City of Huron, 10 C. C. A. 637, 651, 62 Fed. 778.

A final contention on the part of the plaintiff in error is that the proposition which was submitted to the electors of the city of Kearney relative to the issuance of the bonds, and in virtue of which they were issued, was unauthorized by law. Counsel for the city analyze the proposition, and argue that it was not a proposition to issue bonds in aid of a work of internal improvement, such as the statute contemplates, but that it was a proposition whereby the city submitted to its inhabitants the question whether it should purchase certain benefits, and pay for them in bonds; and the claim is that no law of the state authorized the submission of such a proposition, and that the bonds, for that reason, must be regarded as having been put in circulation without the sanction of a popular vote. We deem it wholly unnecessary to determine whether this analysis of the proposition is correct or otherwise, since in either event the result is the same. The plaintiff below was an innocent purchaser of the bonds. They recite the submission of a proposition to issue them "for the purpose of aiding

in the construction of a canal for irrigation and water power purposes,” and such a recital is conclusive in favor of the plaintiff, unless it is proven that he was acquainted with the terms of the proposition which was in fact submitted, and there is no such evidence. Even if no vote had been taken, the authorities are that the recital that a proper election had been held would have been conclusive in favor of an innocent purchaser, because it was the duty of the officials who issued the bonds to ascertain and determine if a proper election had been held. Commissioners v. Beal, 113 U. S. 227, 239, 5 Sup. Ct. 433, 28 L. Ed. 966; Town of Coloma v. Eaves, 92 U. S. 484, 491, 23 L. Ed. 579; Town of Oregon v. Jennings, 119 U. S. 74, 93, 7 Sup. Ct. 124, 30 L. Ed. 323; Town of Pana v. Bowler, 107 U. S. 529, 539, 2 Sup. Ct. 704, 27 L. Ed. 424.

The judgment below was for the right party, on the showing contained in this record, and it is therefore affirmed.


(115 Fed. 625.)



(Circuit Court of Appeals, Third Circuit. April 2, 1902.)

Nos. 10, 9.


The Chisholm patent, No. 421,244, for a method of hulling peas, is void for anticipation by the process disclosed in the Faure French patent of May 15, 1883, and the first certiticate of addition thereto. Gray,

Circuit Judge, dissenting. % SAME-INVENTION.

The Scott patent, No. 499,397, for a process of gathering and hulling green peas from the vines, claim 2, is void for lack of patentable nov

elty, in view of the prior art. 3. SAME-PEA-HULLING MACHINE.

The Scott & Chisholm patent, No. 500,299, for a pea-hulling machine, claims 1 to 6, are void for lack of patentable invention, in view of the

prior art. 4. SAME.

The Scott patent, No. 387,318, for a machine for hulling and separating green peas, claim 5, construed, and held not infringed.

Appeals from the Circuit Court of the United States for the District of Delaware. This was a suit in equity for the infringement of four letters pat

No. 421,244, issued February 11, 1890, to Charles P. and John A. Chisholm, for a method of hulling peas; No. 499,397, issued to Robert P. Scott, June 13, 1893, for a process of gathering and hulling green peas from the vines; No. 500,299, issued June 27, 1893, to Scott and the Chisholms, for a pea-hulling machine; and No. 387,318, issued to Scott, August 7, 1888, for a machine for hulling and separating green peas.

For former opinions, see (C. C.) 84 Fed. 384; (C. C.) 106 Fed. 191.
R. S. Taylor, for Zachariah Johnson.
Gustav Bissing and Henry A. Seymour, for Chisholm-Scott Co.
Before ACHESON, DALLAS, and GRAY, Circuit Judges.

ACHESON, Circuit Judge. Charles P. Chisholm, John A. Chisholm, and Robert P. Scott brought a suit in equity in the court below against Zachariah Johnson for the infringement of four patents. The decree of the court was in favor of the complainants upon three of the patents. As to the fourth patent, the decree was in favor of the defendant. Both parties have appealed. As the main appeal is that of Zachariah Johnson, we will consider it first, taking up the three patents involved in the order of their dates.

The first of these patents is numbered 421,244, is dated February II, 1890, was granted to Charles P. Chisholm and John A. Chisholm

upon an application the original of which was filed January 3, 1887, and is for an improvement in the method of hulling peas. This patent has two claims, which are as follows:

“(1) The improvement in the art of hulling green peas, which consists in removing the same from the pods by impact, substantially as described. (2) The improvement in the art of hulling green peas, which consists in carrying the filled pods to an elevated position, and impacting the filled pods while falling, so as to sever the connections of the two half shells of the pod and of the peas with the pods at one operation, substantially as described."

The specification of this patent states that by "impact” is meant the striking of a solid body against the pods while the latter are so situated that nothing but the resistance of the air holds them against the action of the solid body, and it is stated that the impact may be given by a "variety of apparatuses.” The specification proceeds to state: "For instance, a paddle, beater, or impact opener in the hands of a workman swung with just the proper velocity, impacting the peas while falling through the air, would execute the process.” But the patentees in their specification say, "We prefer the apparatus in the accompanying drawings.” The machine shown in the drawings consists of an exterior hexagonal drum, A, having upon its interior surface six ribs, B, extending a short distance inwardly. Inside of this is a shaft, E, carrying upon projecting arms four beaters, F. The drum and beaters are exhibited as rotating in the same direction. The drawings show that the unshelled peas, when thrown into the drum, are lodged upon the inwardly projecting ribs, and carried upwardly by the revolving drum. As the ribs approach the top of the cycle of their revolution, the pods fall off toward the interior of the drum, and as they fall they are struck by the revolving beaters. The blows burst the pods, and the peas escape from the drum through perforations therein. The beaters have a spiral inclination with reierence to the axis of the drum, and so gradually work the pods from the feed end to the exit end of the drum. After referring to the drawings, the specification contains the following description of the apparatus and its mode of operation:

"In this apparatus the peas are carried to an elevated position in the upper portion of a revolving cylinder, from whence they drop, and while falling through the air they are struck by the beaters, which revolve preferably in the same direction as the cylinder, but at a much greater rate of seed. The cylinder should revolve at just such a speed as not to carry the pods around by centrifugal force, but carry them up and then drop them; and in falling through the air they are struck by the beaters, which may or may not be covered by some soft material (as rubber or leather) to soften the blow. The pods must be struck by a sharp quick blow, which should be just sufficient to crack them open.---that is, to sever the connection of the two half shells of the pod, the connection of the peas with the pods being severed by the same operation. The air naturally confined in the pods protects the peas from being bruised. In the machine which we have shown, and which, by preference, we employ to execute our process, the inside diameter of the cylinder is about thirty-six inches, the length of the cylinder is eight feet, and the length of each beater or impact opener, measured from the geometrical axis of the cylinder, is sixteen inches. With a machine of these dimensions, the revolutions of the cylinder should be about eighteen

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