Lake County v. Rollins
This action was instituted in the circuit court of the United States for the district of Colorado. It is a suit against the county of Lake, in that state, and is based on a large number of county warrants, issued for the ordinary county expenses, such as witnesses' and jurors' fees, election costs, charges for the board of prisoners, county treasurer's commissions, etc. The county has offered several defenses; but the view we take of the case renders it unnecessary to notice any save one. The fifth defense offered is that of want of authority on the part of the county commissioners to issue the warrants in question, or any of them. It is claimed that section 6, art. 11, of the state constitution of 1876, fixes a maximum limit, beyond which no county can contract any indebtedness, and that the warrants sued on were all issued after that limit had been reached, and even exceeded; and that they are all, for that reason, void. The constitutional provision in question is as follows: 'No county shall contract any debt by loan in any form, except for the purpose of erecting necessary public buildings, making or repairing public roads and bridges; and such indebtedness contracted in any one year shall not exceed the rates upon the taxable property in such county following, to-wit: counties in which the assessed valuation of taxable property shall exceed five millions of dollars, one dollar and fifty cents on each thousand dollars thereof; counties in which such valuation shall be less than five millions of dollars, three dollars on each thousand dollars thereof; and the aggregate amount of indebtedness of any county, for all purposes, exclusive of debts contracted before the adoption of this constitution, shall not at any time exceed twice the amount above herein limited, unless when, in manner provided by law, the question of incurring such debt shall, at a general election, be submitted to such of the qualified electors of such county as in the year last preceding such election shall have paid a tax upon property assessed to them in such county, and a majority of those voting thereon shall vote in favor of incurring the debt; but the bonds, if any be issued therefor, shall not run less than ten years; and the aggregate amount of debt so contracted shall not at any time exceed twice the rate upon the valuation last herein mentioned: provided, that this section shall not apply to counties having a valuation of less than one million of dollars.' To this defense the plaintiff below responded, to the effect that the provision quoted was not applicable to the warrants in question; that it is properly applicable only to debts created by loan, for the purpose of erecting necessary public buildings, or making or repairing public roads and bridges; and that as to debts so created by loan for the purposes designated, and as to them alone, a limitation of amount is fixed-First, as to the sum that may be incurred in any one year; and, secondly, as to the aggregate sum that may be incurred by the accumulating debts of more than one year; and that these objects and restrictions exhaust the scope of the provision.
The cause was tried below on an agreed state of facts, before the court, on the written waiver of a jury. In the agreement is found the following stipulation: 'It is further stipulated and agreed that if section six, (6,) of article eleven, (11,) of the constitution of the state of Colorado, be construed to be a limitation upon the power of defendant county to contract any and all indebtedness, including all such as that sued upon in this action, then it is admitted that the claimed indebtedness sued on herein was incurred after the limitation prescribed by said constitution had been reached and exceeded by the said defendant, the county of Lake, and in the event of such a construction by this court, or the supreme court of the United States, then, and in that case, and for the purposes of this action, it is hereby also admitted that all the allegations of the fifth separate defense to this action of the answer of the defendant are true and correct, and the defendant entitled to judgment thereon.' The court below held (34 Fed. Rep. 845)-First, that the said section 6, in all of its sentences, does not refer exclusively to debts contracted by loan, but there are two independent declarations in it, the second declaration beginning with the words, 'and the aggregate amount of indebtedness of any county, for all purposes, etc.;' secondly, that, in determining whether the limit of county indebtedness, fixed by the second declaration, had been reached, it is immaterial how any particular portion of the indebtedness arose; but that, thirdly, when such limit had been reached, while the power of the county to incur further debt by contract was suspended, the liability for further amounts in the shape of fees and salaries, and the other 'compulsory obligations' imposed by the will of the legislature, remained and was enforceable. Proceeding on this idea, the circuit court rendered judgment in favor of the plaintiff below; whereupon the county brought the case here by writ of error.
Daniel E. Parks, Co. Atty., and H. B. Johnson, for plaintiff in error.
Willard Teller, for defendant in error.
[Argument of Counsel from pages 664-669 intentionally omitted]