"We think that, in the present case, the rule applied in the cases before cited of The Scotland Co. v. Thomas, 94 U. S 682; Town of East Lincoln v. Davenport, 94 U. S. 801; Wilson v. Salamanca, 99 U. S. 499; Menasha v. Hazard, 102 U. S. 81; Harter v. Kernochan, 103 U. S. 562; New Buffalo Township v. Cambria Iron Co., 105 U. S. 73; Bates Co. v. Winters, 112 U. S. 325, is the more proper and salutary one, and that the doctrine laid down in Harshman v. Bates Co., 92 U. S. 569, and The Bates Co. v. Winters, 97 Ü. S. 83, that a county court in Missouri could not, on the vote of the township to issue bonds to a corporation named, issue bonds to a corporation formed of the consolidation of that corporation with another corporation, would not, if applied here, be sound doctrine."

Sale and Consolidation.-In Cantillon v. Dubuque and Northwestern Iowa Co. (Iowa), a county had voted a subscription in aid of the Dubuque & Northwestern R. Co., one half of which was payable when the corporation completed its road-bed for five miles from its eastern terminus, and the remaining half when ten miles were completed. The first five miles were completed before December, 1885, and the second five miles before September 1, 1886. On May 5, 1885, before the completion of the construction, a contract was made between the Dubuque & Northwestern R. Co., and the Minnesota & Northwestern R. Co., which provided that the Dubuque Co. should, by a specified time, complete fifty miles of its road from Dubuque in a northwesterly direction, and the Minnesota Co. should complete its line so that, by that time, a junction of the two roads should be effected. The contract also provided that, at or before the completion of the line, the two companies should be consolidated, the Dubuque Co. selling to the Minnesota Co. all its railways and appurtenances. On November 13, 1886, an agreement was entered into whereby the contract was cancelled and annulled, and on the same day a conveyance was made by the Dubuque Co. whereby the corporation transferred its whole property to the Minnesota Co. The court held that, as the stock of the Dubuque Co. had not been delivered in terms of the subscription, and it had practically ceased to have any existence, the subscription in aid of the construction of the road could not be further enforced, and, consequently, that an in

junction against the enforcement of a tax for the subscription must be granted. The courts say: "Counsel for the appellees contend that the tax in question is invalid, or its payment cannot be enforced for several reasons. One is that the corporation has alienated or sold all of its road and property of every description to another corporation, and therefore cannot issue and give to each taxpayer the stock of the corporation in aid of which the tax was voted, for the amount of tax paid by him, as is provided by the statute authorizing municipalities to contribute in aid of the construction of railroads. Chapter 1331, Acts 16th General Assembly and acts amendatory thereto. If the property of the corporation has been sold and conveyed to another corporation, within the meaning and intent of the rules established in Manning v. Mathews, 66 Iowa 675; Blunt v. Carpenter, 68 Iowa, 265, and Barthel v. Meader, 72 Iowa, 125, then the payment of the tax cannot be enforced. But counsel for the appellant contend that such rule is not applicable, for the reason that the tax was earned before the sale and conveyance of the property of the corporation. By the contract of May 5th, the Dubuque Co. obligated itself to sell and convey all that it has. At that time the tax was not earned, and said company could not at that time have enforced the payment of the tax, and, in view of other contracts made about that time, and all the facts and circumstances, together with the subsequent acts and conduct of both corporations, the contract made in May amounted to a sale and disposal of all the road and property of the Dubuque Co., and it was so understood; and, therefore, this case is within the cases above cited. Neither of the corporations regarded the contract made in May as a nullity, and it can hardly be so regarded when the question is practically considered, conceding the approval thereof by the stockholders essential. This could, in all probability, have been procured at any time. Again, it might be regarded as doubtful whether any one but a stockholder could avoid it. But, conceding otherwise, we feel satisfied that the plaintiffs were not bound to take such risk and the burden to establish that the contract was void. It is said that the plaintiffs can have stock in the Minnesota Co. in the place and stead of stock in the Dubuque Co., and that the former is of greater value than the last

named stock could ever possibly be. This last proposition is uncertain and must ever remain so. But, conceding all that is claimed, it seems to us that the tax payers who voted against the tax are at least entitled to the thing the statute provided they should have. They cannot be compelled to take something else, which, in the opinion of some business man, is of greater value. It is claimed the plaintiffs are estopped by their conduct; but this question was considered and determined adversely to appellants in Bartell v. Meader, before cited."

The power of a municipal corporation to aid a railway company "is, in its essence, a right and privilege of the railroad company which, under the general laws of the State, passed to the consolidated company." Empire Township v. Darlington, 10I U. S. 8791.

1. State v. Linn Co. Court, 44 Mo. 504: People v. Ohio Grove Township, 51 Ill. 192; Commrs. v. Sharter, 50 Ga. 489; Ex parte Selma etc. R. Co., 45 Ala. 696; s. c., 6 Am. Rep. 722; Napa Valley R. Co. v. Napa Co., 30 Cal. 435; California etc. R. Co. v. Butte Co., 18 Cal. 671.

The actual subscription may be made by an agent appointed by the county court. Hannibal R. Co. v. Marion Co., 36 Mo. 294. A pledge to subscribe to the stock of a nonexistent corporation is not authorized by authority for "making subscriptions for stock." Winchester etc. Turnpike Co. v. Clarke, 3 Metc. (Ky.) 140; Ill. act of 1857, p. 710, § 9. Empowering the directors of a certain railroad company "to receive subscriptions from any county, city, town, or village making the same,' did not empower such corporations to make such subscriptions. Pitzman v. Freeburg, 92 Ill. 111.

The Power to Become a Stockholder in a Railroad Company Must be Expressly Conferred Upon a Municipal Corporation-It Cannot be Implied from Ordinary Municipal Grants.-Kelley v.

Town of Milan, 127 U. S. 139; Norton v. Dyersburg, 127 U. S. 160; Wells v. Pontotoc Co., 102 U. S. 625; Concord v. Robinson, 121 U. S. 165; Kelley v. Town of Milan, 21 Fed. Rep. 842; Wetumpka v. Wetumpka Wharf Co., 63 Ala. 611; Welch v. Post, 99 Ill. 471; Katzenberger v. Aberdeen, 16 Fed. Rep. 745; Dillon's Mun. Corp., § 161, and note.

2. Morgan Co. v. Thomas, 76 Ill.

120.

Before the railroad company can have a mandamus to enforce a subscription it must show a demand and a tender of the subscription book. Oroville etc. R. Co. v. Plumas Co., 37 Cal. 354. Where there is danger of a misapplication of the funds subscribed by the county, a court should refuse to enforce the subscription until security for its proper application is furnished. Cumberland etc. R. Co. v. Washington Co. Court, 10 Bush (Ky.) 564.

A donation to a railroad invested in the stock of the company is a subscription. State v. Delaware Co., 92 Ind. 499.

3. Aspinwall v. Daviess Co., 22 How. (U. S.) 364; Town of Concord v. Portsmouth Sav. Bank, 92 U. S. 625; Harshman v. Bates Co., 92 U. S. 569; s. c., 3 Dill. (U. S.) 150; Fairfield v. Gallatin Co., 100 U. S. 47; Ogden v. Daviess Co., 102 U. S. 634; Wadsworth v. Eau Claire Co., 102 U. S. 534; German Sav. Bank v. Franklin Co., 128 U. S. 526; Jeffries v. Lawrence, 42 Iowa 498; Land Grant R. & Trust Co. v. Davis Co., 6 Kan. 256; State v. Saline Co. Court, 48 Mo. 390; s. c., 8 Am. Rep. 108; Limestone Co. v. Racher, 48 Ala. 433; Ex parte Selma etc. R. Co., 45 Ala. 696; s. c., 6 Am. Rep. 722; Bound v. Wisconsin Cent. R. Co., 45 Wis. 543.

A vote in favor of a proposition to make a donation in aid of a railroad, for which a tax is to be levied, is distinct from one to create a debt in respect to such a donation. Schaeffer v. Bonham, 95 Ill. 368.

1. Cumberland etc. R. Co. v. Barren Co. Court, 10 Bush (Ky.) 604; Shelby Co. Court v. Cumberland etc. R. Co., 8 Bush (Ky.) 209.

2. Shelby Co. Court v. Cumberland etc. R. Co., 8 Bush (Ky.) 209; Cumberland etc. R. Co. v. Barren Co. Court, 10 Bush (Ky.) 604; State v. Garroutte, 67 Mo. 445.

In Town of Concord v. Portsmouth Sav. Bank, 92 U. S. 625, where a town had voted to make a donation, provided the railroad company would run its road through the town, the court said: "But the court was not empowered to make the donation until the road was located and constructed through the town. It had no authority to make a contract to give. And the acceptance was an undertaking to do nothing which the company was not bound to do before the authority of the town to make a donation, or to engage to make a donation, came into existence. What is called the acceptance of the railroad company cannot be construed as an engagement to locate and build the railroad through the town. It amounted to no more than saying, 'If we build our road through your town, we will receive your gift.' There was, therefore, no consideration for the town's promise to give, even if the popular vote can be considered promise. There was no contract to be impaired. A contract should be clearly proved before it invokes the protection of the federal constitution. We conclude, then, that, at the time the donation was made, there was no authority in the municipality to make a donation to the railroad company, and, consequently, no authority to issue the bonds." Burges v. Mabin, 70 Iowa 633; Barthel v. Meader, 72 Iowa 125.

a

3. Harshman v. Bates, 92 U. S. 569; S. C., 3 Dill. (U. S.) 150; Bates Co. v. Winters, 97 U. S. 83; State v. Garroutte, 67 Mo. 445.

In Harshman v. Bates Co., supra, MR. JUSTICE BRADLEY, said: "Another objection to the validity of the

subscription for which the bonds were given in this case is, that the township voted a subscription to one company and the county court subscribed to another. This is sought to be justified on the ground that the former company became consolidated with another, thereby forming a third, to whose stock the subscription was made. This consolidation was made under a law of Missouri authorizing consolidation, and declaring that the company formed from two companies should be entitled to all the power, rights, privileges and immunities which belong to either; and it is contended that this provision of the law justifies the county court in making the subscription without further authority from the people of the township. But did not the authority cease by the extinction of the company voted for? No subscription had been made, no vested right had accrued to the company. The case of State v. Linn Co. Court, 44 Mo. 504, only decides that if the county court refuses to issue bonds after making a subscription, a mandamus will lie to compel it to issue them. There the authority had been executed, and a right had become vested. But so long as it remains unexecuted, the occurrence of any event which creates a revocation in law will extinguish the power. The extinction of the company in whose favor the subscription was authorized worked such a revocation. The law authorizing the consolidation of railroad companies does not change the law of attorney and constituent. It may transfer the vested rights of one railroad company to another, upon a consolidation being effected; but it does not continue in existence powers to subscribe for stock given by one person to another, which, by the general law, are extinguished by such a change. It does not profess to do so, and we think it does not do so by implication. As sufficient notice of these objections is contained in the recitals of the bonds themselves to put the holder on enquiry, we think that there was no error in the

1. Griffin v. Macon Co., 36 Fed. Rep. 885; 26 Am. & Eng. Corp. Cas. 523.

"The point is novel," said THAYER, J., "and, so far as I am advised, has never been expressly determined. In several well considered cases it has been held that, when money due on a note or bond is made payable by instalments, the statute of limitations begins to run against each instalment from the time it matures. Bush v. Stowell, 71 Pa. St. 208; s. c., ΙΟ Am. Rep. 698; Burnham v. Brown, 23 Me. 400; Estabrook v. Moulton, 9 Mass. 258; Heywood v. Perrin, 10 Pick. (Mass.) 228; s. c., 20 Am. Dec. 518.

"But Mr. Wood, in his work on Limitation of Actions, says that 'with singular inconsistency' it has been held in some cases that interest made payable annually is not subject to the same rule; that the statute does not run against interest instalments payable annually until the principal debt matures. Wood on Lim., § 126, p. 196.

"In my opinion there is no distinction in principle between a debt payable by instalments and interest payable annually or semi-annually in instal

ments. If the statute begins to run in the former case as soon as an instalment of the debt matures, for equally good reasons it ought to run against interest instalments as soon as they become payable. It is worthy of note that the few cases cited by Mr. Wood as holding that the statute of limitations will not run against interest instalments until the principal matures, were suits upon notes or bonds to which no interest coupons were attached. Separate contracts to pay instalments of interest at stated intervals were not annexed to the obligation to pay the debt. Grafton Band v. Doe, 19 Vt. 463; s. c., 47 Am. Dec. 697; Henderson v. Hamilton, I Hall (N. Y.) 314; Ferry v. Ferry, 2 Cush. (Mass.) 92. The rulings made in the cases last mentioned appear to have been based on the ground that interest is a mere incident of a debt, and is so inseparably connected therewith that it may be recovered in connection with the debt when it matures, no matter for how long a period it has been overdue. By this was meant, I suppose, that the

ute

stipulation with reference to interest in the cases then under consideration formed an inseparable part of the promise or obligation to pay the principal debt. But if, as in the present case, the parties to a note or bond make independent stipulations as to interest, and put such stipulations in the form of negotiable coupons, which may be detached from the bond, and are intended to be detached and negotiated, no reason is perceived why the statute of limitations should not run as soon as they mature against all such instalments of interest as are represented by such interest coupons. It appears to me that it would be extremely technical as well as illogical to say that the statof limitations runs against the promise contained in the coupon from the date of its maturity, but does not run against the same promise contained in the bond until the bond matures. In view of the fact that it has been held that the same period of limitation applies to a coupon that applies to a bond, -that they are contracts of equal dignity-the true doctrine is, no doubt, that when an action to recover a given instalment of interest cannot be maintained on a coupon by reason of lapse of time, such instalment cannot be recovered by a suit on the bond. Kenosha v. Lamson, 9 Wall. (U. S.) 477. 482; Lexington v. Butler, 14 Wall. (Ů. S.) 282. The views here expressed are incidentally confirmed by the decision in Clark v. Iowa City, 20 Wall. (U. S.) 583."

Limitation of action on bonds as affected by the form of action in Colorado. See Toothaker v. Boulder, 13 Colo. 219, s. c., 26 Am. & Eng. Corp. Cas. 515. See McAleer v. Clay Co., 38 Fed. Rep. 707.

A committee of the city council appointed to consider the city's indebtedness made a report containing a statement of the assets and liabilities of the city, and included among others a certain issue of bonds called "M." bonds. The report further contained a plan of compromise to be made with the holders of the city bonds, the proposal being in the form of a circular, which the committee recommended be sent to "each person holding city bonds, except M. bonds, as to which they make no report." The circular by its terms