« ForrigeFortsett »
swer to all the questions raised by the plead- the supposed contract were performed before or ings, unless the consolidation released the sub-at the time of the consolidation. It is alleged scription, or unless the construction was a condition precedent.
VI. The bonds recite that they were issued pursuant to and under the order of the Board of Supervisors of Putnam County, for subscription to the capital stock of the Kankakee & Illinois River Railroad Company, as authorized by the laws of the State of Illinois. They are payable to that company or bearer. They are in the hands of an innocent holder for value before due, without notice of any defense. Therefore, the County is estopped from denying their validity, on any of the grounds set forth in the pleas. The County has recognized their valid ity by paying the interest, and assuming the position of a shareholder.
Moran v. Miami Co., 2 Black, 722, 17 L. ed. 342; Gelpcke v. Dubuque, 1 Wall., 203, 17 L. ed. 524; Meyer v. Muscatine, 1 Wall., 388, 17 L. ed. 564; Mercer Co. v. Hackett, 1 Wall., 83, 17 L. ed. 548; Van Hostrup v. Madison, 1 Wall., 291, 17 L. ed. 538; Supervisors v. Schenck, 5 Wall., 772, 18 L. ed. 556; Mayor v. Lord, 9 Wall., 409, 19 L. ed. 704; Pendleton v. Amy, 13 Wall. 297, 20 L. ed. 579; Lexington v. Butler, 14 Wall., 282, 20 L. ed. 809; Grand Chute v. Winegar, 15 Wall., 373, 21 L. ed. 194; St. Joseph Township v. Rogers, supra.
Mr. T. Lyle Dickey, for defendant in error: 1. The bonds and coupons mentioned in the first count are and were absolutely void, for want of authority in the county officers to issue the same and charge the County thereby.
Marsh v. Fulton Co., 10 Wall., 676, 19 L. ed., 1040; Clearwater v. Meredith, 1 Wall., 25, 17 L. ed. 604; Kennicott v. Wayne Co., 21 L. ed., U. S. 319; Chamberlain v. R. R. Co., 15 Ohio St., 247; Godefroi & Shortt R. R., 7; Buffalo v. Dudley, 14 N. Y., 336; R. R. Co. v. Shearer, 10 Ind., 244; Jewett v. R. R. Co., 10 Ind., 539; Pierce, R. R., 70, 71; Thrasher v. R. Co., 25 Ill. 405; Chase v. R. Co., 38 Ill., 215; R. Co. Kerr, 17 Barb., 581; Carrick's Case, 40 Eng. Ch., 509 (1 Sim. N. S., 510); Waterford R. R. Co. v. Pidcock, 8 Exch., 279.
that the bonds were issued Nov. 29, 1870, and that, before the bonds were issued (not before the consolidation) the railroad was located according to the conditions, and that the condition as to the iron contract was also either properly performed or waived, and it is insisted that the "construction" was not a condition precedent.
Upon this, the hypothesis of the plaintiff in error, we maintain that the bonds and coupons were void for want of lawful authority in the chairman of the Board and the county clerk to issue them, and present as authority for our position, the doctrines laid down in the case of Marsh v. Fulton Co., 10 Wall., 676, 19 L. ed.,
The authority of Marsh v. Fulton Cb. is fully recognized and re-affirmed by the Supreme Court of the U. S., in the recent case of Kennicott v. Wayne Co., supra.
To distinguish the case of Clearwater v. Meredith, supra, from the case at bar, the plaintiff in this case calls attention to the fact that, in that case, there was no allegation that the guarantor of that stock consented to the consolidation; while, in the case at bar it is alleged that the defendant consented to this consolidation.
To this we answer, that the defendant in this case never did consent to the consolidation. The defendant in this case is the County of Putnam, a Corporation consisting of the people of that County. Though the statute, as a matter of form, directs that, in suits against the County, the process shall be against the Board of Supervisors, still the Board of Supervisors does not constitute the County, but is merely agent for the County, acting under a special power of attorney consisting of the laws of the State. Unless the Board of Supervisors had some special authority to act in behalf of the County in that regard, such acts of the Board are absov.lutely void. This principle is fully established in the Floyd Acceptance Case, 19 L. ed. 169, and in the Fulton Co. Case. The law does provide that the Board of Supervisors shall have control of railroad stock which belongs to the County, but that power does not arise until the County has such stock to be controlled. In this case, at the time of the consolidation, and before that time, the County of Putnam was not a stockholder in the railroad company and, therefore, the Board of Supervisors did a gratuitous and void act when it gave its consent, and undertook to give the consent of the County, to such consolidation. It had no power to bind the County by such action. It is not perceived how the consent of the Board of Supervisors to the consolidation, given before consolidation, can have any more significance or binding effect upon the County than if given after the consolidation.
1. Let us examine the law upon the hypothesis assumed by the plaintiff in error, viz.: that, Oct. 21, 1870, at the time of the consolidation of the Kan. & Ill. Riv. R. R. Co. with the Indiana R. R. Co., by which the new corporation called the Plymouth, Kan. & Pacific R. R. Co. was created, there was a binding contract between the County of Putnam and the Kan. & Ill. Riv. R. R. Co.; on the part of the County, that the County would take $25,000 of the stock of that company and issue county bonds therefor, in case said railroad should be located and constructed through Putnam County, and within one half mile of Hennepin; and upon further condition that the R. R. Co. would provide for ironing and running the road by a suitable contract; and on the part of the R. R. Co. that it would perform these conditions and give the stock and receive the bonds therefor; and upon the further fact as part of the hypothesis, that the Board of Supervisors before the consolidation, gave its consent to such consolidation, and undertook to give the consent of the County. This is all that is claimed as to the facts of the case in that regard by plaintiff in error. It is not pretended that any of the conditions of
Was Putnam County a shareholder or member of the railroad corporation on or before Oct. 21, 1870, upon the hypothesis of plaintiff?
We answer, No. Some confusion has crept into the books on this subject, by reason of writers failing in many cases to distinguish between the meaning of the word "subscriber" and the word "stockholder." about from the fact that, by the provisions of most charters, the party who subscribes and
This has come
SUPREME COURT OF THE UNITED STATES.
pays a small installment on the stock subscribed, thereby becomes entitled to the immediate possession of the stock, entitled to have a certificate of the stock, entitled to be enrolled on the stock ledger of stockholders, entitled to vote at the meetings of stockholders, and, in a word, is entitled to all the rights of a member of the corporation. Usually, therefore, a subscriber is a stockholder, and the terms in such case may be used one for the other and convey no wrong idea. It depends altogether, however, upon the provisions, either express or implied, of the articles of agreement which are subscribed, whether such "subscriber" thereby becomes ipso facto a stockholder.
The vote of the people in favor of such subscription at the election Feb. 8, 1870, did not constitute a binding contract upon the County, even upon conditions, to take the stock and pay in bonds.
Aspinwall v. Daviess Co., 22 How., 364, 16 L. ed., 296; Waterford R. Co. v. Pidcock, 8 Exch., 279.
The Resolution of Mar. 15, 1870, pp. 82, 102, 117, did not constitute a subscription, conditional or otherwise, or any agreement binding upon the County, conditional or otherwise, to take stock.
By the terms of the proposition voted upon Feb. 8, this Board had no authority to do anything in relation to this proposed subscription, until said road should be located and constructed through said County," and that upon the line prescribed. The contingency, upon the happening of which depended the power of the Board, on the face of the Resolution, confess
Chamberlain v. R. Co., 15 Ohio St., 247; R. Co. v. Shearer, 10 Ind., 244; Pierce, R. R., 70, 71; Jewett v. R. Co., 10 Ind., 539; Chase v. R. Co., 38 Ill., 215; R. Co. v. Kerr, 17 Barb., 581. The rule is, that no party can be regarded as a member of a corporation, unless such party either actually holds the stock or has sub-edly had not happened. scribed for it upon terms which entitle him to demand the stock without anything further being done on his part; or has subscribed or contracted for the stock, and in view of the terms of his subscription or contract the corporation is in a situation to demand of him that he take the stock and pay for it, or some installment upon it without anything further being done by the corporation.
In this case, therefore, on the hypothesis of the plaintiff in error, that there was a binding contract upon the County to take the stock and pay for it on certain conditions, still the County was not a stockholder Oct. 21, 1870, when the consolidation took place, because it is not even pretended, by the plaintiff in error, that any of the conditions had at that time been performed by the railroad company. It is alleged by the plaintiff that the railroad was located, and that the required contract for iron, etc., was had before the bonds were issued (as he says Nov. 29, 1870), but it is nowhere alleged that the road was even located before the consolidation Oct. 21, 1870, nor is it claimed that any contract for iron, etc., was had at that time, and it is not pretended that the railroad has ever been constructed within one half mile of Hennepin. The County then was not even, on plaintiff's hypothesis, a member of the Kankakee & Illinois River R. R. Co., at the time of the consolidation and, therefore, was not a party to the act of consolidation, and by the rule laid down in 10 Wall., the Supervisors had no power after that to issue bonds for the stock of the new corporation, because that proceeding lacked the previous sanction of a vote of a legal majority of the legal voters of the County in favor of that proposition.
The plaintiff's proposition is, however, not sustained by the record. The record does not show that, Oct. 21, 1870, at the time of the consolidation, there was any subscription or contract valid and binding upon the County to take that railroad stock, even conditionally. On the contrary, the pleadings purporting to give all the facts and denying that there are any other Putnam facts, do show affirmatively that County never made any subscription whatever, conditional or otherwise, to the stock of the Kankakee & Illinois River R. R. Co., nor did the County ever make any agreement, conditional or otherwise, to so subscribe.
Again; even if the terms of the vote authorized the making at once of a conditional subscription, it did not authorize the making of the subscriptions indicated in that Resolution. The vote authorized subscription only upon condition that "Said railroad shall be located and constructed through said County on a given line." Pp. 78, 95, 113. This Resolution of Mar. 15, 1870, declares for such subscription, upon condition that "said railroad shall be lo cated in and through said County," on the given line, entirely omitted the vital condition, that said railroad shall be constructed as well as located on that line.
Bell v. R. Co., 4 Wall., 599, 18 L. ed., 338; R. Co. v. Stein, 21 Ill., 98; Thrasher v. R. Co. 25 Ill., 405.
In Carrick's Case, 40 Eng. Ch., 509, it was held that "A mere agreement to become a stockholder did not constitute a contributor, or one bound to pay for stock and take it."
There was, therefore, in fact, no subscription made by the County, by the Resolution of Mar. 15, 1870. At most, this Resolution can only be held to be a declaration of the willingness of the Board of Supervisors to make on the books or the R. R. Co., or to some other written instrument, such a subscription as is therein indicated, without appointing an agent to make such subscription. The act which the Supervisors thus manifested their willingness to do, was never done.
Suppose, however, that, waiving all these points, we assume for a moment that the Resolution of Mar. 15, 1870, shall be construed as an authorized and valid offer made by the County to the railroad company to make a contract with the railroad company, to take the stock and pay for it in bonds, on the terms stated in the Resolution. In that case, we call the attention of the court to the fact that, June 25, 1870, and before that offer had been accepted, this same Board of Supervisors retracted the offer by refusing to take the steps necessary to consummate the contract. On that day the Board spread upon its records a vote of its members, refusing to authorize its chairman to subscribe said stock on the books of the railroad company.
Pp. 84, 104, 119.
True, in the first plea it is admitted that June 3, 1870, the R. R. Co. gave notice that it 86 U. S.
did accept said subscription voted by said County. This, the court will see, made no contract, because the Board of Supervisors had never made an offer to make the subscription voted for, but had offered, as is insisted by plaintiff in error, to make the subscription indicated by the Resolution of Mar. 15, 1870; and we have already shown that the propositions were essentially different.
Pidcock Case, 8 Exch., 279.
Thus far, as to the power of the Supervisors to issue these bonds after consolidation. We now call the attention of the court to the fact that, by the pleas, the Board of Supervisors did not, in fact, issue these bonds, but that they were issued by the chairman of the Board and the County Clerk, without any lawful authority from the Board of Supervisors so to do. The pretended power is found, if at all, in 1st, 3d and 4tn pleas, and in replications to 1st, 3d and 4th pleas. An examination of these pages and the several allegations there found, will show that they are merely as follows:
1. That, on Mar. 15, 1870, the Board of Supervisors by the same Resolution of that date by which it declared that "Said subscription is hereby made," also resolved "that the clerk, under the seal of the County Court, shall execute in behalf of the County and issue, said bonds to the Kan. & Ill. River R. R. Co., when they have complied with the terms hereinafter contained, and upon the written order of said committee, and then repeating the conditions in that Resolution which we have above discussed.
2. That, on Sep. 20, 1870, the Supervisors, by Resolution, authorized and instructed their chairman to sign $25,000 bonds of the County, and place them in the hands of the committee, to be by the committee delivered to the President, etc., of the Kankakee & Ill. River R. R. Co., in such amounts and at such times as may be necessary in constructing said railroad, through Putnam County, subject to all the conditions upon which the subscription to the stock of said company was made, and upon the further condition that the proceeds of said bonds be expended in building said road through Putnam County.
3. That on Nov. 29, 1870, a majority of the committee decided that all the conditions of said subscription had been complied with, and filed with the clerk a Resolution, signed by two out of five of the committee, being the chairman and clerk of the committee, authorizing the clerk to sign the bonds and placed them in the hands of the committee to be sold, and appropriate the proceeds, in accordance with the order of the Board of Supervisors.
Upon all this, we say that the chairman and clerk did not thereby acquire lawful authority to issue the bonds in suit.
Remember, these bonds were issued after consolidation, and for the wrong stock, and the Board of Sup rvisors could not lawfully have issued the bonds and, therefore, could not confer power to issue the same.
Lyon v. Jerome, 26 Wend., 486; Ang. & Ames, Corp., 277.
III. It is said that plaintiff has rights as a bona fide holder of these bonds, which cut off our defense.
The opinion of this court in the Fulton Co. case, delivered by Mr. Justice Field, and so
copiously quoted in the opinion of the district judge in this case, establishes the position that, if these bonds are void for want of power in the officers to execute them, the defense, that the plaintiff is a bona fide holder, cannot prevail. That doctrine was declared by this court in The Floyd Acceptance cases, supra.
*Mr. Justice Strong delivered the [*247 opinion of the court:
We think the circuit court erred in sustaining the demurrer to the plaintiff's replication. The bonds to which the coupons in suit were attached, purport to have been made and issued by the order of the Board of Supervisors of Putnam County, in payment of the County's subscription to the capital stock of the Kankakee and Illinois River Railroad Company. They are made payable to that company or bearer, and the plaintiff is a bona fide holder of the coupons, having paid value for them without notice of any defense. If, then, the bonds are valid obligations, if they were rightfully issued, the right of the plaintiff to a judgment against the county is plain. The material facts relating to their issue, as gathered from the pleadings, may be concisely stated as follows: the Kankakee and Illinois River Railroad Company was a corporation existing in Illinois under a special charter, and it was authorized to construct and maintain a railroad from the eastern line of the State to Bureau Junction. It had liberty to increase its stock to such an amount as might be necessary to complete its road. At the same time the County of Putnam was empowered, by a general law of the State, to subscribe for the stock of the company, and to issue its bonds in payment of its subscription. In attempted exercise of the power thus conferred, the Board of Supervisors of the County, on the 4th day of June, 1869, ordered an election to be held, to determine whether the County should subscribe for stock of the railroad company, to the amount of $75,000, to be paid for with the bonds of the County, provided the railroad should be so located and constructed through, or within one half mile of, the Town of Hennepin. The election was held, and it resulted in favor of the subscription. On the 4th day of January, 1870, another election was ordered, to determine whether the County would subscribe for $25,000 more of the stock, to be paid in the same manner, and with a similar provision respecting the location of the road. This subscription was also sanctioned by the popular vote. On the 24th day of September, 1869, the railroad company accepted the $75,000 subscription, and on the 27th of October next following, gave notice of the acceptance to the Board of Supervisors of the County. This notice was put upon record, and on the same day the Board of Supervisors adopted a resolution that the subscription was thereby made for the building of the railroad, and directed the clerk of the County Court to execute and deliver the bonds on behalf of the County. The Resolution also declared that the bonds should be issued on the written order of a committee appointed to protect the interests of the County; that they should not be issued until the railroad company should have made a bona fide contract with responsible parties for all necessary iron for their road, nor until the com
pany should have made a bona fide contract with responsible parties for laying the iron and operating the road through the County, as specified in a previous order of the Board. On the 15th day of March, 1870, the second subscription for $25,000 was made in a similar manner, and with like directions.
That thus the County became in effect a subscriber to the capital stock of the railroad company, and liable for the sums designated, admits of no serious question. The fact that no subscription was formally made upon the books of the company is quite immaterial. In The Justices of Clarke Co. v. Turnpike Co., 11 B. Mon., 143, it was ruled that an order of the county court, by which it was said that it subscribed for a specified number of shares of road stock, was binding, the court having authority to make a subscription. In this case there was more. There was not only the Resolution, declaring the subscription made, but there was an acceptance by the railroad company, and notice of the acceptance. The minds of the parties came together. Both understood that a contract was made, and had nothing subsequently occurred to change their relations the County could have enforced the delivery of the stock, and the company could have compelled the delivery to itself of the bonds, on performance of the conditions stipulated. So the parties regarded their relations to each other. The bonds were delivered. The committee appointed by the Board of Supervisors to protect the interests of the county, under whose direction the bonds were ordered to be issued, were satisfied 248*] *that all the prescribed conditions precedent to their delivery had been complied with, and they so decided. The county accepted the position of a stockholder, received certificates for the stock subscribed, voted as a stockholder, and proceeded to levy a tax to pay the interest falling due on the bonds. Were this all of the case, the validity of the bonds, and of their accompanying coupons in the hands of a bona fide holder for value, would be beyond doubt.
before their consolidation. It was not until after this had taken place that the county bonds were handed over and sold, and it was certificates of the stock of the consolidated company which the County received.
What, then, was the legal effect of the consolidation? Did it release the County from its prior assumption to take stock in the Kankakee and Illinois River Railroad Company and give its bonds in payment? Or, did it render unauthorized the subsequent delivery of the bonds, and make them invalid even in the hands of a bona fide purchaser? These are the only questions presented by the record that need discussion.
It must be conceded, as a general rule, that a subscriber to the stock of a railroad company is released from obligation to pay his subscription by a fundamental alteration of the charter. The reason of the rule is evident. A subscription is always presumed to have been made in view of the main design of the corporation, and of the arrangements made for its accomplishment. A radical change in the organization or purposes of the company may, therefore, take away the motive which induced the [*249 subscription, as well as affect injuriously the consideration of the contract. For this reason it is held that such a change exonerates a subscriber from liability for his subscription; or, if the contract has been executed, justifies a stockholder in resorting to a court of equity to restrain the company from applying the funds of the original organization to any project not contemplated by it. But while this is true as a general rule it has no applicability to a case like the present. The consolidation of the Kankakee and Illinois River Railroad Company with another company was no departure from its original design. The general statute of the State, approved February 28, 1854, authorized all railroad companies then organized, or thereafter to be organized, to consolidate their property and stock with each other, and with companies out of the State, whenever their lines The circuit court, however, was of opinion, connect with the lines of such companies out of and so decided, that the bonds are invalid, be- the State. The Act further declared that the cause before their delivery the Kankakee and consolidated company should have all the pow Illinois River Railroad Company had become ers, franchises and immunities which the conconsolidated with the Plymouth, Kankakee and solidating companies respectively had before Pacific Railroad Company, another corporation. their consolidation. Nor is this all. The speThe facts of this part of the case, as set forth cial charter of the Kankakee and Illinois River in the pleadings, are as follows: on the 12th of Railroad Company contained in its 11th secJanuary, 1870, a company was organized under tion, an express grant to the company of authe laws of Indiana, for the purpose of building thority to unite or consolidate its railroad with a railroad from Plymouth, Indiana, to the east any other railroad or railroads then constructed line of the State of Illinois, at some point to be or that might thereafter be constructed within selected in the direction of Momence and Kan- the State, or any other State, which might cross kakee, with a view to connection with some rail- or intersect the same, or be built along the line road leading westward. Its corporate name thereof, upon such terms as might be mutually was the Plymouth, Kankakee and Pacific Rail- agreed upon between said company and any road Company. With this corporation, on the other company. It was therefore contemplated 21st day of October, 1870, the Kankakee and by the Legislature, as it must have been by all Illinois River Railroad Company became conthe subscribers to the stock of the company, solidated, taking the name of the former. The that precisely what has occurred might occur. consolidation was authorized by the general Subscribers must be presumed to have known laws of the two States, and by a section in the the law of the State and to have contracted in special charter of the latter company. No view of it. When the voters of the County of claim is made that it was not legally effected. Putnam sanctioned a county subscription by The result necessarily was, that the consoli- their vote, and when the Board of Supervisors, dated company succeeded to all the rights, prop-in pursuance of that sanction, resolved to make erty and privileges which belonged to each of the subscription, they were informed by the law the two companies out of which it was formed, of the State that a consolidation with another
company might be made, that the stock | consent. The same doctrine was asserted in 250*] they proposed to subscribe might be Bish v. Johnson, 21 Ind., 299; Hanna v. R. Co., converted into stock of the consolidated com- 20 Ind., 30. The Supreme Court of Connecticut pany and that the liability they assumed might recognized the rule in Bishop v. Brainard, 28 become owing to that company. With this Conn., 289, and a subscriber to one company knowledge and in view of such contingencies was held to be a debtor to the consolidated comthey made the contract. The consolidation, pany in a case where there was no general autherefore, wrought no change in the organiza-thority to consolidate, but the charter of the tion or design of the company to which they company was subject to amendment by the subscribed other than they contemplated at the Legislature, and where the Legislature, after time as possible and legitimate. It cannot be the subscription confirmed the consolidation. said that any motive for their subscription has See, also, Schen. & Sar. Plank Road Co. v. been taken away, or that the consideration for Thatcher, 11 N. Y., 102; R. Co. v. Dudley, 14 it has failed. Hence the reason of the general N. Y. 336; Meadow Dam v. Gray, 30 Me., 547; R. Co. v. Winchester, 13 Allen, 32; Noyes v. Spaulding, 27 Vt., 420; R. Co. v. Renshaw 18 Mo., 210; Fry v. Lexington, 2 Met. (Ky.), 314; R. Co. v. Beers, 27 Ill., 189; R. Co. v. Earp, 21 Ill., 292.
rule we have conceded does not exist in this case and, consequently, the rule is inapplicable.
In a multitude of cases decided in England and in this country it has been determined that a subscriber for the stock of a company is not released from his engagement to take it and pay for it by any alteration of the organization or purposes of the company which, at the time the subscription was made, were authorized either by the general law or by the special charter, and a clear distinction is recognized between the effect of such alterations and the effect of those made under legislation subsequent to the contract of subscription. In Railway Co. v. Paterson, 37 Eng. L. & E., 398, which was an action to recover a call of one pound per share on one hundred shares subscribed, it appeared that the defendant was one of the subscribers, to the agreement for the Cork, Middleton & Youghal Railroad Company. That agreement authorized the provisional directors to extend the purposes of the organization, to change the termini of the road, and to amalgamate with other companies. The subscriber's agreement for the Cork & Waterford Railroad Company contained similar provisions. After the defendant's subscription was made the two companies executed a deed of amalgamation, without any other assent of the defendant than his signature to the subscriber's agreement for the first named company. Upon this state of facts all the judges held that he remained liable on his sub251] scription. *Its effect was said, by Chief Justice Jervis, to be an authority to the company to tack his subscription to anything else they might see fit, and thus make him a subscriber to that and, therefore, added the judge, by signing the Cork & Youghal he afforded an authority to the directors to apply his signature to the Cork & Waterford, and so make him a subscriber to that. To the same effect are the cases of Nixon v. Brownlow and Nixon v. Green, 3 Hurl. & Nor., 686, 694. The American authorities are equally explicit. They uniformly assert that the subscriber for stock is released from his subscription by subsequent alteration of the organization or purposes of the company, only when such alteration is both fundamental and not provided for or contemplated by either the charter itself or the general laws of the State. In Sparrow v. R. Co., 7 Porter (Ind.), 369, where it appeared that after a public Act had taken effect authorizing the consolidation of the charters of two railroad companies, the defendant had subscribed for shares in one of them, and a consolidation was afterwards made, he was held liable to the consolidated company for his subscription, and this, though the consolidation took place without his knowledge or
Many other citations are at hand, but these are sufficient. *No well considered cases [*252 are in conflict with them. Marsh v. Fulton Co., 10 Wall. 676, 19 L. ed. 1040, is altogether a different case. In that it appeared that the people of the county voted in November, 1853, in favor of a subscription for stock in the Mississippi and Wabash Railroad Company, and in April, 1854, the Board of Supervisors of the County ordered their clerk to make the subscription. It was not, however, then made. Subsequently, in 1857, the Legislature made fundamental changes in the organization of the company, dividing it substantially into three companies, with a distinct governing body for each. and with three classes of stockholders. It was after this that the county subscription was made; and made not for the stock of the Mississippi and Wabash Railroad Company, but for the stock of one of the divisions. Necessarily, therefore, we held that there was no authority to make the subscription which was made; that it had not been approved by a popular vote, and hence that the bonds issued in payment for it were invalid. The County had entered into no contract until after the radical changes had been made in the organization of the company. It never assented to such a change, and when the proposed subscription was approved by the popular vote, there was no reason to expect the change afterwards made. There was at that time nothing in the general law of the State, and nothing in the charter, which authorized the company to change its organization, or which looked to its division into several distinct corporations. It needs nothing more to show how unlike that case was to the present.
In the case in hand the County had, under lawful authority, undertaken to subscribe for stock before the consolidation was made, and the undertaking had been accepted. A liability had been incurred, and the business agents of the County, to whom exclusively the law intrusted the management of its affairs, consented to and promoted the consolidation. And the subscription was made in full view of the law that allowed an amalgamation with another company. The contract was made with reference to that law. Nothing has taken place which the County was not bound to anticipate *as likely to happen, and to which the [*253 people in voting for the subscription, and the Board of Supervisors in directing it, must not be considered as having consented. What was