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3 F.(2d) 623

involved, or certainly might be involved, in the changing of the course of a stream by straightening the same, or by digging ditches or canals to draw off its headwaters in different channels, than would be involved by the mere construction of a levee as provided for by chapter 131 of the Acts of 1871. In neither of said Acts of 1871 or 1901 is the power impliedly or expressly given to construct such a drainage district as that for which the bonds in question were issued.

[9] This brings us to a consideration of chapter 185 of the Acts of the Legislature of Tennessee of 1909, with its amendments thereto embraced within sections 3871a7 to and including 3871a170 of Shannon's Code. This law is commonly referred to and known as the "Drainage Law" of Tennessee. Manifestly, if no authority existed for the issuance of the bonds under either of the acts above mentioned, and if there existed any authority whatsoever for their issuance, then it must be found within the provisions of this latter act with its amendments. This act would seem to be a complete scheme within itself. However, whether it should be so considered, or whether it should be considered in conjunction with the acts above cited and as a part and continuation thereof, is a question which need not be here determined, in view of the construction placed upon said former acts. But before considering this act in detail it may be well to consider certain other provisions of the laws of Tennessee, relative to counties and county officials. By section 493 of Shannon's Code it is provided that every county is a corporation and the justices in the county court are the representatives of the county and authorized to act for it. This section is based upon the provisions of the Constitution of Tennessee, article 10, § 4, and article 2, § 29. By section 511 provision is made for a judge or chairman of the county court of the various counties, and the general duties of such official are set out under section 517. Nowhere is there found a statute which authorizes such official to issue bonds for any purpose binding the county.

By section 5993 of Shannon's Code it is provided that all business in the county court which cannot be lawfully done by the county judge or chairman shall be done at the quarterly sessions to be held at stated periods, and the general powers of the quarterly court are set out under section 6027, the last subdivision of which confers power upon the quarterly session of the county court to do "all other matters of

which jurisdiction is conferred by law." By none of the provisions of the statute is power conferred upon the quarterly court to issue bonds such as those in question, except where special provision is made by particular enactment. Furthermore by section 6045, provision is made for appropriations of county funds under sixteen specific heads, none of which applies to bonded indebtednesses, and it is specifically provided by section 6046 that the court shall have no authority to appropriate money for any purpose "unless specially provided for by law." By decisions too numerous to mention it has been repeatedly held in Tennessee that neither a county official nor the county court possesses any power except that given by statute.

Acts of 1909, c. 185, of the Legislature of Tennessee was first before the Supreme Court of Tennessee in 1911 in the case of State ex rel. v. Powers, 124 Tenn. 553, 137 S. W. 1110. In this case a mandamus suit was brought seeking to compel the county judge of Gibson county to issue a warrant to pay for certain preliminary expenses in connection with the construction of a proposed drainage district. The expenses had been provided for by the quarterly court acting under the provisions of the Act of 1909. The county judge declined to issue the warrant upon the ground that the act was in violation of the Constitution of Tennessee, for several reasons, and particularly because it was claimed it provided a system of taxation upon a basis of particular benefits to certain lands or individuals and that the power of taxation was conferred upon an authority other than the quarterly court of the county. In construing the act in this case, it was held that it was not violative of any constitutional provision of the state as contended, and that the power conferred by the act whereby assessments might be made against the lands within the bounds of the proposed drainage district was not a levy of taxes, but a fixing of special assessments according to the benefits to be derived by reason of the improvements proposed, and that inasmuch as the act did not provide for a system of taxation it did not fall within the provisions of article 2, § 29, of the state Constitution, requiring that taxes should be according to value, or that an election should be held before the credit of a county could be loaned in aid of any individual, etc. The court construed a drainage district such as proposed by the act as a county purpose for the construction of which special assessments might be made against the property within such district ac

cording to the proportionate benefits to be derived by the particular owners. The question of the validity of bonds issued under the act was not considered, nor so far as investigation has revealed has that question been determined by the Supreme Court of Tennessee.

After the provisions in the Act of 1909 for the establishment of drainage districts and the assessment of the costs of construction against the lands embraced therein, it is provided by section 12 that

"The assessments shall be levied upon the lands of the owners so benefited in the ratio aforesaid, and shall be collected in the same manner as taxes for county purposes, except as herein specially provided, and the funds so collected shall be kept as a separate fund, and shall be paid out only for purposes properly connected with such improvement, and on the order or warrant of the judge or chairman of the county court."

The act provides that wherever reference is made to the county court, except as otherwise specifically stated, it shall refer to and mean the court presided over by the county judge or chairman, and not the quarterly county court. By section 24 it is pro

vided that

"The assessments as provided for by this act shall be collected by the county trustee as county taxes are collected, except as herein provided, and the funds so collected shall be kept as a separate fund, and shall be paid out only for purposes properly connected with such improvement on the order or warrant of the county judge or chairman; but such assessments may be collected by bill filed in chancery, as herein below provided, and no personal property of the owner of land so assessed shall be liable or distrained upon for such assessment, but the land so assessed only shall be liable for such assessment."

By section 27 it is provided that

"If the county court shall determine that the estimated cost of reclamation and improvement of such district of land or levee or drainage district is greater than should be levied in a single year upon the lands benefited, the court may fix the amount that shall be levied and collected each year, and may issue drainage bonds of the county, bearing not more than 6 per centum annual interest, said interest payable annually, and may devote such bonds at par, with accrued interest, to the payment of expenses and work as it progresses, or may sell the same at not less than par, with accrued interest, and devote the proceeds to such payment;

and if, in the sale of said bonds, a premium is received, such premium shall be credited to the drainage fund; and should the cost of such work exceed the estimate, a new apportionment of the assessment may be made and levied and other bonds issued and sold in like manner, but in no case shall the bonds run longer than twenty years. Any property owner may pay the full amount of the benefit assessed against his property before such bonds are issued and receive a receipt in full therefor.

"The terms and times of payment of the bonds so issued shall be fixed by the board of directors of the improvement district, and such bonds shall be signed by the judge or chairman of the county court and countersigned by the clerk of the county court, each of said officers signing his name officially, and shall be verified either by the county seal or seal of the county court clerk. Said bond shall be issued for the benefit of the district numbered thereon, and each district shall be numbered by the county court and recorded by the county clerk in the drainage record, said record showing specifically the lands embraced in said district and upon which the assessment has not been previously paid in full.

"Each bond shall show expressly on its face that it is to be paid only by assess

ments levied and collected on the lands

within the district so designated and numbered, and for the benefit of which district such bond is issued; nor shall any assessment be levied or collected for the payment of said bond or bonds, or the interest thereon, on any property, real or personal, outside the district so numbered, designated, and benefited

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By section 33 it is provided that—

"The assessments provided for by this article, when made and levied, shall be and become valid liens upon such lands so assessed just as state and county taxes are liens upon lands"; and "when such assessments have been due and delinquent for sixty days, bills may be filed in the Chancery court of the county, or chancery district, in which the lands lie, upon which such assessments are due and delinquent, for the collection thereof out of such lands by a sale thereof in all cases, except in cases where the assessment is made against a railroad company or a public highway, as herein provided. Upon confirmation of such sale by the chancery court, it shall divest title out of the owner and vest it in the purchaser, and award a writ of possession, if asked for; but where title is

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so vested in a purchaser the land so purchased shall still be subject, in the hands of the purchaser, his heirs, or assigns, to any other assessments not yet due, or unpaid, that may have been made and fixed or levied upon it at the time of such confirmation of sale, for the benefit of the improvement district on account of which such sale has been made.

The amendments to the act do not alter the effect of the provision above quoted. The form of the bonds sued on is as follows:

"United States of America.
"Number

$500.00

"$500.00.
"Obion River Drainage District No. 2.

"Obion County Drainage Bond.
"6 Per Cent.

"Know all men by these presents that the county of Obion, in the state of Tennessee, acknowledges itself to owe, and for value received hereby promises to pay to bearer as hereinafter provided the sum of five hundred dollars in lawful money of the United States of America, on the first day of May, 1921, with interest thereon from the date hereof until paid, at the rate of six per centum per annum, payable annually on the first day of May in each year, on presentation and surrender of the annexed interest coupons as they severally become due. Both principal and interest of this bond are hereby made payable at the New First National Bank, of Columbus, Ohio.

"This bond is one of a series of one hundred and twenty-four (124) bonds, aggregating of the principal the sum of sixtytwo thousand two hundred and twenty-nine dollars ($62,229.00) issued by the county of Obion for the purpose of paying the cost of a combined system of drainage in said county known as 'Obion River drainage district No. 2' of Obion county, Tennessee, and in anticipation of the collection of a special assessment of tax duly levied upon lands benefited pursuant to an order made by the county court of Obion county, duly entered of record and in strict compliance with chapter 185 of the Acts of the State of Tennessee passed by the FiftySixth General Assembly of said state.

"This bond is based upon and constitutes a lien upon and is payable solely out of the proceeds of the special assessment for benefits heretofore legally levied on the lands in said District, and benefited by said improvements, and thereunto the said special assessment is hereby irrevocably pledg

ed; and it is hereby certified and recited that all acts, conditions and things required to be done in locating and establishing said district and in equalizing and levying said assessment against the lands benefited thereby and precedent to the issuing of this bond have been done, had and performed in due form of law, and that the total amount of bonds issued for the account of said drainage district does not exceed the assessment so levied therefor and uncollected at the time said bonds are issued or any legal limitations thereon; and for the prompt performance of all the covenants, recitals and stipulations herein contained and for the collection and application of said assessment, and for such other and further assessments authorized and required to provide for the prompt payment of this bond and the interest thereon, the full faith and resources of said county are hereby irrevocably pledged.

"In testimony whereof, the county of Obion, Tennessee, has caused this bond to be signed by the judge or chairman of its county court and countersigned and recorded by the county clerk and verified by the county seal or seal of the county clerk, and has caused the coupons hereto attached to be executed by the lithograph fac simile signatures of said officials, all as of the first day of May, 1913. George R. Kenney, Judge of the County Court of Obion County, Tennessee.

"Countersigned and recorded: C. S. Talley, County Court Clerk. [Seal.]"

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of the Acts of the State of Tennessee, passed by the Fifty-Sixth General Assembly of said state." And further is it provided in the face of each bond that

"This bond is based upon and constitutes a lien upon and is payable solely out of the proceeds of the special assessment for benefits heretofore legally levied on the lands in said district and benefited by said improvements.

The provisions of the law by the recitations of this bond became a part of the bond as if written therein. Attention is again called to the quotation above set out from the opinion of the Supreme Court of the United States in Anthony v. County of Jasper, 101 U. S. 693, 25 L. Ed. 1005, and under this authority plaintiff herein was charged with notice not only of the particular act of the Legislature cited in the bond, but with the laws of Tennessee applicable to such bonds.

It is true the bond states in the beginning that the county of Obion acknowledges itself to owe, etc., and promises to pay the amount specified in the bond to the holder thereof; but this general provision is but the usual form in which such a bond would be issued under authority such as conferred by the Legislature of Tennessee in the Act of 1909, and certainly could not prevail over a special provision in the bond calling the direct attention of any prospective purchaser to the fact that the bond is issued in accordance with and under the provisions of a particular power conferred by a particular act and that such purchaser or holder must look to certain specified property for the collection of the bond, and when such purchaser looked further to the provisions of the act he would readily see that the Legislature in unmistakable language was solicitous to limit the power to collect on any bonds issued to the lands within the drainage district proposed to the exclusion of all other property, either real or personal, of the individual owners of such lands or any other parties. It would be difficult to conceive in what phraseology the intention of the Legislature could have been couched to make it more plainly appear that each drainage district created under the provisions of the act should be made to bear the expenses of its own construction, and that no other method could be resorted to for the collection of the costs of construction than that provided by the terms of the act. A contemplative purchaser of the bonds could not read the general provisions of the first part of the bond and close

his eyes to the specific provisions and limits contained therein in another portion thereof, nor could such contemplative purchaser properly construe the wording of the latter portion of the bond as pledging any other resources of the county for the payment of the bonds than that to which the bond and the act specifically referred. If in fact the county officials issuing the bonds had undertaken to bind the county, under the authorities above cited, such acts on their part would have been void.

It is earnestly insisted by plaintiff that the latter portion of the bond quoted shows that the county has pledged its entire resources and its good faith for the payment of the bonds in suit, and that this wording means that not only the lands embraced within the drainage district, but the entire wealth of Obion county may be subjected to the payment of the bonds to the extent necessary. The bond will hardly bear the construction plaintiff seeks to place upon it. Furthermore, the bond must be construed as a whole. After it is stated in the bond that it is based upon and constitutes a lien and is payable solely out of the proceeds of the special assessments upon the lands within the particular drainage district it is true, it is recited:

"And it is hereby certified and recited that all acts, conditions and things required to be done in locating and establishing said district and in equalizing and levying said assessments against the lands benefited thereby and precedent to the issuing of this bond have been done, had and performed in due form of law, and that the total amount of bonds issued for the account of said drainage district does not exceed the assessment so levied therefor and uncollected at the time said bonds are issued or any legal limitations thereon.

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The most that can be said of this recitation is that the bonds state as a fact that the county has done, under the act, all that is required by law to be done to properly establish said drainage district and provide for the assessments, etc., in order that the bonds may be issued as provided by the act. As above stated, if the officials signing the bonds meant more than this, there was a total lack of authority for any attempt to bind the county or to provide any other method for the payment of the bonds than authorized by the Act of 1909. It is also true that it is recited in the bonds that

"For the prompt performance of all the covenants, recitals and stipulations herein

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contained and for the collection and application of said assessment, and for such other and further assessments authorized and required to provide for the prompt payment of this bond and the interest thereon, the full faith and resources of said county are hereby irrevocably pledged."

This portion of the bond contains its own limitation, and that is that for the prompt performance of the provisions of the bond as limited by the act, and any further steps necessary to provide for its payment out of the particular funds created therefor or out of the lands assessed or to be further assessed, the full faith and resources of the county are pledged; but it does not mean that the full faith and resources of the county are pledged for the payment of the bond out of any other fund or property than that provided by the act. If such was the intention of the officials, they had no authority for their acts, or if such construction should be placed upon this language, it finds no foundation in the act authorizing the issuance of the bond.

No language of the officials issuing the bond which might be placed therein could create a right which the law had not given them, nor could they, by any recitation whatsoever, place a binding obligation upon the county unless some authority so to do existed, nor could they by any such recitation give life and character to a totally invalid obligation, so far as the county generally was concerned-invalid because no warrant for its existence as such could be found in the law which it is claimed was its foundation.

The county officers signing the bonds had a right to issue the bonds in the form they did, and such bonds became and are an obligation against all the lands within the drainage district mentioned, to the extent of the proportionate benefits assessed against such lands. When the plaintiffs became the holders of the bonds, the duty rested upon them to take cognizance of the statutes of Tennessee which became a part of the bonds. There was nothing compulsory in their purchase. There were the records of the county open for inspection, which disclosed the drainage district for the construction of which the bonds were issued. These records showed the lands within the district, the number of acres, and their location. There was the legislative act which plaintiff was bound to know. It was a matter for plaintiff to investigate. If investigation would have revealed that the lands within the proposed district were of doubt

ful value, or that the amount for which the bonds were issued was in excess of the value of the lands, it was a matter for the consideration of plaintiff, or any contemplative purchaser of the bonds. The law gave notice that the security was thus limited. While it is true a bona fide holder of the bonds such as plaintiff is in this case should be given great consideration with a ' view of endeavoring to protect all rights such party may have, yet such a holder is no such favored object of the law as that his rights will totally obscure the rights of other parties who may be equally innocent of any intended wrongdoing.

It may be said that it is unfortunate that the drainage district in question did not prove a success, but this cannot alter the status of the respective parties, for it was a possibility that should have been within the contemplation of the plaintiff for investigation at the time the bonds were issued and purchased.

The rights of plaintiff are defined by the statutes, and to these rights it must be confined under the general principles of the law.

By this Act of 1909 and its amendments the Legislature has sought to provide a system whereby the low swampy lands of Tennessee may be drained at the expense of such lands, and inasmuch as the act proceeds upon the assumption that the lands will be benefited, it follows that whatever benefits flow from the creation of the drainage district under the act would be in the nature of increased value to the lands primarily, and thus inure to the benefit of the landowner, and secondarily such benefits as the public might derive (a) by reason of the locality being made more healthful, and (b) by reason of increased taxes as the lands become more valuable. However, neither the consideration of the question of public health nor economic benefits would warrant the drainage of such lands at the expense of those living in sections of the county remote from the drainage district who in reality derived no benefits therefrom. The act was sustained upon one ground by the Supreme Court of Tennessee because the assessments were fixed against the particular lands sought to be benefited and were not in the nature of general taxes. By this act the Legislature gave to the county judge authority to pass upon the questions presented relative to the construction of a proposed drainage district, not as the financial agent of the county, but in his judicial and ministerial character re

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