Page:Federal Reporter, 1st Series, Volume 8.djvu/214

200 FEDERAL Rfi PORTER, �Judge Caton (■/. M.) and Jadje Eldredje, (G. S.,) for plaintiff. �Lawrence, Campbell e Lawrence, M. T. Maloiiey, and ISaiiiL Richol- ton, for defendant city of Ottawa. �Blodgett, D. J. This suit is brought upon certain bonds, for $500 each, isBued by the defendant city, bearing date on the second dayof August 1869, a portion of which were made payable in 5 years, a por- tion in 10 years, and a portion in 15 years from date, bearing interest at the rate of 10 per cent, per annum, payable annually, pursuant to the terma of interest warrants, or coupons, attached. Ail these bonds were made payable to W. H. W. Cushman, "or to the bearer thereof," and each bond bears upon ita face this recital: �^his is one of 120 bouda of the like amount and even date herewith, 1 to 120, respectively, issued by the city of Ottawa, by virtue of the charter of said city, wherein it is provided that — �"The city council shall have power to borrow money on the credit of the city, and issue bonds therefor, and pledge the revenue of the city for the payment thereof, provided that no sum or suras of money shall be bon-owed at a greater rate of interest tlian 10 per cent, per annum. [Article 5, § 3.] iTo money shall be borrowed by the city council until an ordinance therefor shall be submitted to and voted for by a raajority of the voters of said city attending an election for that purpose." [Article 10, § 20.] �And also in accordance with a certain ordinance passed by the city council of said city, on the flfteenth day of June, A. D. 1869, entitled " An ordinance to provide for a loan for municipal purposes," which ordinance was ratifled by a majority of the qualiiied voters of said city, at an election holden on the twentieth day of July, A. D. 1869, and in conformity with an ordinance passed by the city council of said city on the thirtieth day of July, 1869, entitled "An ordinance to carry into effect the ordinance of June 15, 1869, entitled 'An ordinance to provide for a loan for municipal purposes.' " �The defence set up by the numerous pleas filed in the case is in substance a deniai of the power of the city of Ottawa to issue these bonds, and an allegation that the plaintiff holds the same charged with notice of such want of power ; the substance of the allegations in the pleas being that these bonds were issued as a bonus to aid a private corporation — the Ottawa Manufacturing Company — in the improvement of the water-powers of the Illinois and Fox rivera, in the immediate vicinity of said city. The question wbether the aid extended by the city to the improvement of its water-power facilities is or is not "a municipal purpose," was before the supreme court of the United States in Hackett v. Ottawa, 99 U. S. 86, in which that court said : �" In View of the course of decisions in Illinois, we should hesitate to declare that money borrowed by the city of Ottawa and expeuded in developing its natural resources for manufacturing purposes, was uot in tlic sensu of the ��� �