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Mercer and his associates, on the twenty-fifth of October, 1843, shall receive the quantity of land to which such colonists may be entitled, to-wit, 640 acres to each family, and 320 acres to each single man over the age of 17 years: provided, that nothing herein contained shall be construed so as to place the contractors of said colony in a better condition in regard to the state of Texas than they would be if this law had not been passed.” In this language we have a distinct recognition of the fact that there was, at the passage of that act, a body of citizens in Texas known as "citizens of the colony of Charles Fenton Mercer and his associates," and that, as "such colonists,” they were entitled to a certain quantity of land. Persons within the limits of the Mercer grant, who did not settle there in pursuance of some arrangement with Mercer and his associates, could not have been regarded as citizens of “the colony of Charles Fenton Mercer and his associates. Nor could such persons have been described as of that colony and entitled, as "such colonists,” to receive 640 acres, or any other quantity, of land, unless they had entered upon the land under the contract between the republic of Texas and Mercer and his associates. The proviso in the section quoted does not at all militate against this view. That only shows the purpose of the state not to give " the contractors of said colony” any advantage they did not then have under their contract with the republic.

The next section of the foregoing act provided for the appointment by the governor, by and with the advice and consent of the senate, of a commissioner, “whose duty it shall be to hear proof and determine what colonists shall be entitled to land as aforesaid ; and said commissioner shall issue to parties entitled to the same, or to the heirs or legal representatives of such parties, certificates for their proper quantity of land." Plainly, the purpose of the legislature was, through that officer, to ascertain who were entitled to land in virtue of the contract with Mercer and his associates. It was in violation of the contract for the state thus to pass over the contractors and treat directly with the colonists, but it is none the less clear that she proceeded upon the basis of giving land only to those who were “of the colony of Charles Fenton Mercer and his associates." The official report of Crockett contains the names of all such persons. His action was judicial in its nature, and his determination as to who were entitled to land as colonists aforesaid, was a determination that Mercer and his associates had complied with their contract to the extent, at least, of the persons named in his report. The state gave land to all persons reported by Crockett as of the Mercer colony, and, consequently, she was bound by her contract to compensate Mercer. By the articles of her annexation to the United States it was provided that she shall "retain all the vacant and unappropriated land lying within her limits to be applied to the payment of the debts and liabilities of said republic of Texas, and the residue of said lands, after dis. charging said debts and liabilities, to be disposed of as such state may direct.” Her liability, under her contract with Mercer, was one of the liabilities for the discharge of which she was bound to apply the unappropriated lands within her limits. Had the articles of annexation been silent as to the debts and liabilities, and made no provision as to the unappropriated lands of the republic of Texas, and had the United States taken such lands, then, according to the settled principles of public law, they would have been bound to meet the debts and liabilities of the late republic; at least, such as had been made a charge upon its public property. To avoid all difficulty upon that subject, it was expressly stipulated in the articles of annexation that Texas should retain her public lands, with power to dispose of them after discharging the debts and liabilities of the republic, and that "in no event are said debts and liabilities to become a charge upon the government of the United States." Thus was created, by treaty between the United States and the republic of Texas, an express trust for the benefit of those to whom the latter, at the time, was indebted or under liability. The agreement between the United States and Texas, constituted, within the meaning of the constitution, a contract, the violation of which, upon the part of the officers of that state, it is competent for the courts to prevent.

In the opinion of the court it is stated, among other things, that, since the contract was made with Mercer, Texas, both as an independent republic and as a state of the Union, bas "denied its validity and refused to do anything under it." There is a serious obstacle in the way of our acceding to the correctness of this statement. It is found in the decision of the supreme court of Texas in Melton v. Cobb, 21 Tex. 540. Referring to this colonization contract with Mercer, that court said:

“That the contract of the twenty-ninth of January, 1844, if valid, reserved the land in question from location and appropriation by the plaintiff's certificate, cannot be doubted. But it is insisted that the contract was invalid, for the want of authority, on the part of the president of the republic, to confer on the grantee the benefits contemplated by the joint resolution of the sixteenth of February, 1843. He undoubtedly had authority under the act of the fourth of February, 1841, and the amendatory act of the fifth of February, 1842, to contract with the granted to colonize vacant lands of the republic for that purpose, and to set apart and reserve from location the territory within certain boundaries, which he should designate, for the period of three years from the date of the contract."

Referring to the act of February 3, 1845, copied in the opinion of this court, the supreme court of Texas said:

“This act cannot be regarded as anything less than a virtual ratification by the government of the act of its agent in making the contract, and its legislative affirmation of its validity.

The contract was again expressly recognized and treated as an existing contract by the act of June 25, 1845, and these acts were passed prior to the plaintiff's location and survey. It is udnecessary to refer to more recent acts containing similar recognitions of the validity of the contract. It will suffice to say that these legislative recognitions of its validity must be deemed to have put that question at rest.

HOUSton v. Robertson, 2 Tex. 23; Hancock v. McKinney, 7 Tex. 384, 411, 142."

In view of the grounds upon which the court rests its decision, it is. unnecessary for us to discuss the extent of relief to which Preston is entitled.

For the reasons stated we cannot assent to the opinion and judg. ment in this case.

(109 U. 8. 341) INHABITANTS OF THE TOWNSHIP OF BERNARDS, in the County of Som

erset and State of New Jersey, v. STEBBINS, Ex'r, etc.

SAME V. MORRISON and another.

(November 26, 1883.)

MUNICIPAL BONDS-DEFECTIVE EXECUTION-OMISSION OF SEAL-ACTION BY

CITIZENS OF ANOTHER STATE-TRANSFER TO GIVE JURISDICTION.

If commissioners, authorized by statute to subscribe in the corporate name of a

town for stock in a railroad company, and, upon obtaining the consent of a certain majority of tax-payers, to issue bonds of the town under the hands and seals of the commissioners, and to sell the bonds and invest the proceeds of the sale in stock of the railroad company, which shall be held by the town with all the rights of other stock holders, issue, without obtaining the requisite consent. of tax-payers, to the railroad company, in exchange for stock, such bonds signed by the commissioners, but on which the seals are omitted by oversight and mistake; and the town sets up the want of seals in defense of an action at law afterwards brought against it by one who has purchased such bonds for value, in good faith, and without observing the omission, to recover interest on the bonds,-a court of equity, at his suit, will decree that the bonds be held as valid as if actually sealed before being issued, and will restrain the setting up of the

want of seals in the action at law. A bill in equity in the circuit court of the Cnited States against a town in one state

by a citizen of another, for relief against the accidental omission of seals from bonds of the defendant, payable to bearer, and held by the plaintiff, some of which are owned by him, and others of which are owned in different amounts, part by citizens of the state in which the town is, and part by citizens of other states, and have been transferred to him by the real owners for the mere purpose of being sued, should be dismissed, under the act of March 3, 1875, c. 137, Ø 5, so far as regards all bonds held by citizens of the same state as the defendant, and bonds held by a citizen of another state to a less amount than $500.

Appeal from the Circuit Court of the United States for the District of New Jersey.

Alvah A. Clark and Thos. N. McCarter, for Inhabitants of Township of Bernards.

H. C. Pitney, for Stebbins, Ex’r, etc. Cortland Parker, for Morrison and Hutchinson. * GRAY, J. These are appeals by a township in New Jersey from decrees of the circuit court of the United States for the district of New Jersey, upon bills in equity by the appellees for relief against the ac

342

cidental omission of seals on its bonds. The facts appearing by the record, are as follows:

By the General Laws of New Jersey, the inhabitants of each town. ship in the state are a body politic and corporate, by the name of “The Inhabitants of the township of

in the county of

Rev. St. N. J. 1877, p. 1191. On the ninth of April, 1868, the legislature of New Jersey passed a statute entitled "An act to authorize certain towns in the counties of Somerset, Morris, Essex, and Union to issue bonds and take stock in the Passaic Valley & Peapack Railroad Company,” the first section of which directed the circuit court of either of those counties, on the application of 12 or more freeholders and residents of any township therein, situated along the route of the railroad, to appoint three "commissioners for such township to carry into effect the purposes and provisions of this act.” The next two sections are as follows:

“Sec. 2. It shall be lawful for said commissioners to borrow, on the faith and credit of their respective townships, such sum of money, not exceeding ten per centum of the valuation of the real estate and landed property of such township, to be ascertained by the assessment rolls thereof respectively for the year eighteen hundred and sixty-seven, for a term not exceeding twentyfive years, at a rate of interest not exceeding seven per centum per annum, payable semi-annually, and to execute bonds therefor, under their hands and seals respectively. The bonds so to be executed may be in such sums, and payable at such times and places as the said commissioners and their successors may deem expedient; but no such debt shall be contracted or bonds issued by said commissioners of or for either of said townships until the written consent shall have been obtained of the majority of the tax-payers of such township, or their legal representatives, appearing upon the last assessment roll, as shall represent a majority of the landed property of such township (including lands owned by non-residents) appearing upon the last assessment roll of such township. Such consent shall state the amount of money authorized to be raised in such township, and that the same is to be invested in the stock of the said railroad company, and the signatures shall be proved by one or more of the commissioners. The fact that the persons signing such consent are a majority of the tax-payers of such township, and represent a majority of the real property of such township, shall be proved by the affidavit of the assessor of such township, indorsed upon or annexed to such written consent, and the assessor of such township is hereby required to perform such service. Such consent and affidavit shall be filed in the office of the clerk of the county in which such township is situated, and a certified copy thereof in the town clerk's office of such township, and the same, or a certified copy thereof, shall be evidence of the facts therein contained, and received as evidence in any court in this state, and before any judge or justice thereof.

“Sec. 3. The said commissioners authorized by this act may, in their discretion, dispose of such bonds, or any part thereof, to such persons or corporations and upon such terms as they shall deem most advantageous for their said township, but not for less than par; and the money that shall be raised by any loan or sale of bonds shall be invested in the stock of said railroad company for the purpose of building the aforesaid railroad, and said money shall be applied and used in the construction of said railroad, its buildings, equipment, and necessary appurtenances, and for no other purpose. The commissioners respectively, in the corporate name of each of their said townships, shall subscribe for and purchase stock in said railroad company to the amount they may have severally borrowed as aforesaid; and by virtue of such subscription or purchase of stock, upon receiving certificates for the amount of said stock so subscribed for or purchased by them, the said townships shall acquire all the rights and privileges respectively of other stockholders of said company, and it shall be lawful for the commissioners provided for in this act, or either of them with the consent of the others, or a majority of the said commissioners, to participate in and to act in all the regular and legally authorized meetings of the stockholders, and either of them may act as director of said company, if he shall be duly elected as such.”

By section 4, the commissioners were directed to report annually to the township committee the amount required for the next year to pay the interest or principal of the bonds, and to apply in payment thereof the dividends on the stock subscribed or purchased for the township; and any deficiency was to be assessed and levied upon the landed property of the township, like other taxes. By section 5, the railroad company might agree with the commissioners, "in behalf of their respective townships,” to pay the interest accruing “on the bonds issued by such townships,” for three years, or until the rail. road should be completed and earning sufficient to pay dividends equal to the interest. By section 6, the commissioners might, after acquiring stock, exchange it for bonds issued, and cancel the bonds 80 received; or they might, with such consent as mentioned in section 2, sell the stock for cash at public sale, and apply the proceeds to the purchase or redemption of the bonds. And by section 7, at the end of 25 years, the sum due for principal and interest on the bonds, as reported by the commissioners, was to be assessed and levied on the landed property. By section 9, the commissioners were required, before entering upon the discharge of their duties, to give bond to the township, with sureties approved by the township committee or by the judge of the county court. By section 11, their pay and disbursements were to be “audited and paid by the township committee, the same as other township expenses." By section 12, the commissioners in each township were to “constitute a board to act for their said townships respectively." And by section 14, all bonds issued were required to be registered in the office of the county clerk, and the words “registered in the county clerk's office” be printed or written across the face of each bond, attested by the signature of the county clerk, “and no bond shall be valid unless so registered.”

Commissioners for the township of Bernards, in the county of Somerset, were appointed, and gave bond to the township according to sections 1 and 9. On the seventeenth of December, 1868, they filed in the county clerk's office the written consent of a number of taxpayers, not being a majority of all the tax-payers in the township, but being a majority in number and value of the owners of real es. otate therein; with an affidavit of one of the commissioners to the sig. natures; and an affidavit of the assessor that the signers were a majority of the tax-payers of the township and represented a majority of the real property of the township, and also that they were a ma

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