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as used in the Constitution and "assessment roll" as used in the statutes are correlative, and mean the aggregate of all taxable property as finally determined by official ascertainment.' The assessed value is to be ascertained by the completed act of all the agencies employed in determining the amount and value of the property available for taxation, and not merely by the determination of the local assessor where his acts are subject to revision and correction. When the Constitution declares that the debt of any county, city, borough,

"The omission of the value only should not deprive a creditor of having such property estimated."

Seymour v. Tacoma, 6 Wash. 138, 427. The property of a manufacturing company was required by the Constitution and by statute to be included in the assessment. It was entered on the assessment roll with its value, and the tax carried out. By another statute the municipality was permitted to refund to the company the greater part of the taxes. Held, that its property was taxable property, and not exempt in such sense as to exclude it from the assessed value of the property in the municipality in arriving at the debt limit. Atlantic Trust Co. v. Town of Darlington, 63 Fed. Rep. 76, aff'd 68 Fed. Rep. 849; Germania Sav. Bank v. Darlington, 50 S. Car. 337.

2 Wilkinson v. Van Orman, 70 Iowa, 230; Chicago, B. & Q. R. Co. v. Wilber, 63 Neb. 624.

In Colorado, the test by which to ascertain the power to incur debt is the assessment of the preceding year, until that of the current year has been revised by the State board of equalization and certified to the clerks of the respective counties. When the assessment has been revised, completed, and certified by the board of equalization, it supersedes the preceding assessment, and thereafter constitutes the valuation which determines the power of a county to contract future indebtedness. Lake County v. Standley, 24 Colo. 1. In Illinois, it is the assessment as finally fixed by the State board of equalization that governs, and not that made by the local assessor. Culbertson v. Fulton, 127 Ill. 30, overruling People v. Hamill, 134 Ill. 666. In Nebraska, this is also the rule. McLean v. Valley County, 74 Fed. Rep. 389. In Missouri, the Constitution limits the debt upon the value of the taxable property "to be ascertained by the assessment next before the last assessment for the

State and county purposes, previous to the incurring of such indebtedness," and an assessment cannot be considered until it has passed the State board of equalization. Prickett v. Marceline, 65 Fed. Rep. 469.

In New York, where the limit of municipal debt is based upon "the assessed valuation of the real estate," the assessed value of "special franchises," i. e., the right to maintain and operate railroads and other public utilities in streets and highways, which are declared by the statute to be taxable as real property in connection with the tangible property in the streets and highways, is to be included in determining the limit of indebtedness. Kronsbein v. Rochester, 76 N. Y. App. Div. 494. In South Carolina, the Constitution (art. x. § 13) directs that "State, county, township, school, municipal, and all other taxes shall be levied on the same assessment, which shall be made for State purposes.' There can be only one assessment of town and city property for county, State, and municipal taxation. State v. Kelley, 45 S. Car. 457; Todd v. Laurens, 48 S. Car. 395.

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In Wisconsin, the "last assessment for State and county taxes previous to the incurring of the indebtedness" is the assessment of the town, city, or village as equalized by the local board of review for the purposes of general taxation, and not the so-called "State assessment" made in advance of the local assessment, "from all the sources of information accessible to the board as a means of apportioning State taxes. between the several counties." The last assessment of the town, city, or village, as fixed by the local board of review, upon which county and State taxes may be extended, as well as local taxes, is the assessment intended. State v. Tomahawk, 96 Wis. 73; Stedman v. Berlin, 97 Wis. 505.

township, school district, or other municipality shall not exceed a specified percentage of the assessed value of the taxable property therein, the limit of the debt of a city is the prescribed proportion of the valuation fixed by the city authorities as a basis of taxation for city purposes, and not the valuation made by county officers for county purposes. But when the basis of the limitation is the value of the taxable property within the city "to be ascertained by the last State and county tax lists," and these lists include all the property in the city limits, whether taxable for city purposes or not, the limitation is not to be based solely on the property subject to taxation for city purposes.2

§ 208. Effect of Judgment against Municipality. — The rendition of a judgment against a municipality does not create indebtedness in excess of the limitation fixed by the Constitution. The judgment is simply conclusive evidence of a valid pre-existing debt which had been created prior to the time the court rendering it was called upon to act. If the indebtedness which had been previously created was in excess of the constitutional limit, that was a matter which the municipality should have pleaded in defence to the action brought to recover the amount due. The constitutional provision is not self-enforcing. It is purely a matter of defence to a recovery upon a contract which created a debt in excess of the limitation provided; and if not interposed at the proper time and in a legal manner, it is waived. When, therefore, a judgment has been rendered for indebtedness against a municipality, it is a conclusive adjudication that the debt is valid and is not affected by the constitutional provision.*

1 Bruce v. Pittsburg, 166 Pa. 152; Dupont v. Pittsburg, 69 Fed. Rep.

13.

2 Windsor v. Des Moines, 110 Iowa, 175.

3 Lake County Com'rs v. Platt, 79 Fed. Rep. 567; Taylor v. School Dist., 97 Fed. Rep. 753; Edmundson v. Independent School Dist., 98 Iowa, 639; Thompson v. Independent School Dist., 102 Iowa, 94: County of Hamilton v. Montpelier Sav. Bank, &c., 157 Fed. Rep. 19.

Ætna Life Ins. Co. v. Lyon County, 44 Fed. Rep. 329, 344; Lake County Com'rs v. Platt, 79 Fed. Rep. 567; Holt County v. National Life Ins. Co., 80 Fed. Rep. 686; Geer v. Ouray County, 97 Fed. Rep. 435; Helena v. United States, 104 Fed. Rep. 113; People v. May, 9 Colo. 404; Edmundson v. Independent School Dist., 98

Iowa, 639; Howard v. Huron, 5 S. Dak. 539; s. c. 6 S. Dak. 180; Smith v. Ormsby, 20 Wash. 396; State v. Gloyd, 14 Wash. 5; Grand Island & N. W. R. Co. v. Baker, 6 Wyo. 369. See on this subject, post, chapter on Municipal Bonds. Under the provisions of the Constitution of Wyoming, limiting the tax for county revenue for all purposes except for the payment of its "public debt," the rate of taxation for all ordinary expenses and charges of the county is limited, and while a judgment absolutely precludes the county from disputing the validity of the debt for which it is rendered, the character of the original claim may nevertheless be considered for the purpose of determining from what source the judgment shall be paid. A judgment entered upon a claim or evidence of indebtedness incurred in excess of the

Such a judgment cannot of course be collaterally attacked on the ground that the indebtedness exceeds the constitutional limitation; ! and if bonds are issued by the municipality for the purpose of paying such judgment, these bonds cannot, in the hands of innocent holders for value, be defeated by showing that the judgments were rendered for debt exceeding the constitutional limit, and that the municipal authorities fraudulently omitted to interpose that defence when action was brought upon the debt. But if the judgment has been rendered through the fraudulent collusion of the municipal authorities with the claimant, in failing to interpose the defence that the debt exceeds the constitutional limit, a court of equity has jurisdiction, on the ground of fraud, of a direct proceeding by suit against the judgment creditors attacking the validity of the judgment for fraud in procuring the same, and praying that it be set aside and its enforcement enjoined." The collusion to constitute a fraud which will justify a judgment being set aside, does not require necessarily any express agreement between the officers and the claimant to aid the latter to obtain his judgment or any specific intent to injure. Utter failure of duty on the part of the officers to defend against a claim known to be void, or one which they have good reason to believe to be void, from a desire to co-operate with the plaintiff to enable him to obtain an advantage over the municipality, all parties concerned knowing that the taxpayers dispute the validity of the claim, constitutes, or may be sufficient to constitute, collusion within the meaning of the rule of equity jurisprudence rendering the judgment open to attack in equity for fraud, at the suit of the municipality or a taxpayer whose interests would otherwise be sacrificed. And in such cases the court will grant or refuse relief according to the general rules and principles of equity.

§ 209. Attempts by Creditors to obtain Relief from Invalidity. Persons dealing with municipalities, who have advanced money to ordinary revenue of the county or in that more bonds were issued than were excess of the constitutional limitation is not a "public debt," and must be paid out of the amount realized by the levy for ordinary county purposes. Grand Island & N. W. R. Co. v. Baker, 6 Wyo. 369.

Edmundson v. Independent School Dist., 98 Iowa, 639; post, chapter on Municipal Bonds.

necessary to pay the judgments, the burden is on the defendant to show that the bonds which he holds extinguished judgments to the extent of the amount of the bonds, or what part of the proceeds thereof was applied in payment of an unpaid judgment. Independent Dist. v. Society for Savings,

98 Iowa, 581.

Kane v. Independent School Dist., 82 Iowa, 5; Balch v. Beach, 119 Wis

2 Sioux City & St. P. R. Co. v. Osceola County, 52 Iowa, 26. See also Sioux City v. Weare, 59 Iowa, 95. In a suit 77. to cancel the bonds, where it appears

Balch v. Beach, 119 Wis. 77.

them, or who have furnished material and property, or rendered services, have made attempts to obtain relief from the invalidity which has attended their contracts and obligations by reason of the municipality being indebted beyond the constitutional limit. Such attempts have generally been unsuccessful, unless there were special facts and equities. If an indebtedness is created in excess of the constitutional limit, it cannot be collected unless the municipality is estopped by recital, or by judgment or otherwise to set up the defence.1 Even a court of equity will not direct that any portion of the city's taxes be appropriated to the payment of indebtedness incurred in violation of the Constitution, and the municipality cannot be held liable for the indebtedness upon any theory of tort permitting the creditor to recover as damages the amount of the indebtedness with interest.3 Money lent to a city at a time when its indebtedness exceeds its constitutional limit cannot, after the money has been expended and lost its identity, be recovered back under any express or general implied promise of the city to pay, or by an ordinary action to recover as for money had and received. The constitutional limitation was held under the special facts to operate to prevent moneys loaned to the municipality in violation of its provisions from becoming a lien upon the works partly constructed with it. Where works or appliances for general public utility were installed under a contract violating the constitutional debtlimit provision, the creditor was held not to be entitled to a decree in equity giving him an accounting in reference to the past use to ascertain just compensation therefor, and for an arrangement between the parties for future compensation for the use at an annual rental, or in default of such arrangement that the plant be turned over to the creditor as an entirety for management and use, together with a perpetual franchise for that purpose to be implied from the contract. If the property can be identified and followed in its

Prince v. Quincy, 105 Ill. 138, 215; State v. Helena, 24 Mont 521 See ante, § 204, as to effect of recitals as an estoppel; and post, chapter on Municipal Bonds.

2 Griswold v. East St. Louis, 47 Ill. App. 480.

3 Prince v. Quincy, 128 Ill. 443.

Litchfield v. Ballou, 114 U. S. 190. To justify such a recovery or relief in equity, there must be special facts and equities, which the court held did not exist in that case. See Paul v. Kenosha, 22 Wis. 266; Wood v. Louisiana, 5 Dillon, 122, aff'd 102 U. S. 294, where re

lief was granted; and chapter on Contracts and Municipal Bonds, post, as to implied liability; also to chapter on Actions and Liability, post.

5 Litchfield v. Ballou, 114 U. S. 190. 6 Gamewell Fire Alarm & Telegraph Co. v. La Porte, 102 Fed. Rep. 417, aff'g 96 Fed. Rep. 664. It has been declared to be beyond the power of the legislature to afford the creditor relief by the enactment of a statute giving him a lien for materials furnished in a public improvement, as such a statute merely seeks to render the corporation liable for improvements beyond its constitu

original form, the party contracting with the municipality may recover the property transferred in the transaction upon the return of any void evidences of debt.1 But if the property consists of materials used in the erection of a building, the contractor cannot remove the building or any part thereof for a failure to pay a balance of the purchase price.2

$ 210. Limitations of Indebtedness based upon Income and Revenue. In the Constitutions of California and Idaho, a prohibition is to be found against incurring any indebtedness or liability in any manner or for any purpose exceeding in any year the income and revenue provided for such year without the assent of a vote of the electors. This prohibition has given rise to some novel and difficult

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tional limit of indebtedness. Mosher electors thereof voting at an election v. Independent School Dist., 44 Iowa, to be held for that purpose, nor unless 122. But special facts and circum- before or at the time of incurring such stances and equities of such a cogent indebtedness provision shall be made nature may exist, that, in order to prevent fraud and injustice, the power of the legislature to provide proper relief in rem, if not in personam, may, we think, rightly be held to exist. The power of the legislature to provide a remedy for fraud or injustice is not lightly to be denied.

Municipal Security Co. v. Baker County, 39 Oreg. 396. But when the creditor is not the person by whom goods were sold or property was furnished the municipality, but is simply an endorsee of a note made by the municipality therefor, he cannot obtain relief by having the court appoint a receiver to take possession of the property, sell it and apply the proceeds towards the payment of the note. The creditor did not sell the property to the municipality, nor did he ever have any title to it, or any lien or claim upon it. Wadley v. Lancaster, 124 Ga. 354. But if the original creditor had a right to equitable relief, the right of his assignee to be subrogated thereto would not, as it would seem, appear to be difficult to sustain.

2 Grady v. Pruitt, 111 Ky. 100.

California. Const., 1879, art. xi. § 18, as amended in 1900, declares: "No county, city, town, township, board of education, or school district shall incur any indebtedness or liability in any manner or for any purpose exceeding in any year the income and revenue provided for such year without the assent of two-thirds of the qualified

for the collection of an annual tax sufficient to pay the interest on such indebtedness as it falls due, and also provision to constitute a sinking fund for the payment of the principal thereof on or before maturity, which shall not exceed forty years from the time of contracting the same. . Any indebtedness or liability incurred contrary to this provision, with the exceptions hereinbefore recited, shall be void."

Idaho. Const., 1889, art. viii. § 3, provides: "No county, city, town, township, board of education, or school district, or other subdivision of the State, shall incur any indebtedness or liability in any manner or for any purpose, exceeding in that year the income and revenue provided for it for such year, without the assent of two-thirds of the qualified electors thereof voting at an election to be held for that purpose, nor unless, before or at the time of incurring such indebtedness, provision shall be made for the collection of an annual tax sufficient to pay the interest on such indebtedness as it falls due, and also to constitute a sinking fund for the payment of the principal thereof, within twenty years from the time of contracting the same. Any indebtedness or liability incurred contrary to this provision shall be void. Provided that this section shall not be construed to apply to the ordinary and necessary expenses authorized by the general laws of the State."

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