Page:Federal Reporter, 1st Series, Volume 8.djvu/219

CABT V. CITT OP OTTAWA. 20& �sidered in that case, that I caniiot but consider the intiraations from that court as clearly indicating that they considered the purpose for which these bonds were issued as a corporate purpose within the meaning of the Illinois case ; and if it was a corporate purpose^ then there can be no doubt that a honafide purchaser of such bonds must have a right of action upon them. It is evident, I think, that the common council preferred to deal with Cushman as an individual, and accept the guaranty of bis personal contraot for the faithful ap- plication of the bonds for the use for which they were designed, than to deal with a corporation ; and the mere f act that Cushman chose to execute his contract through the agency of a corporation which had been created for the purpose of making this contemplated improve- ment, cannot affect the vaiidity of the bonds in the hands of any one who obtained them for value from or through Cushman. Nor does it seem to me that, even if Cushman had wholly violated his contract, would such violation fumish any defence to the city against a bona fide purchaser of the bonds for value from Cushman. What the understanding between Cushman and the Ottawa Manufacturing Company was, the testimony does not disclose ; but it does appear satisfactorily that Cushman tumed the bonds over to the manufac- turing company, and that they expended the proceeds thereof for the purpose for which they were designed by the common council ; and the money which was used in the enterprise was obtained by means of these bonds from Eames. �The supreme court, in Hackett v. Ottawa, held that a purchaser foi value need not look beyond the recitals in the bond. But if these bonds were issued for a corporate purpose, suppose he did look be- yond the recitals in the bond and leamed or knew that the corporate purpose that was intended was the one actually indicated by the ordinances of the city and the contract with Cushman, still that fur- nishes no reason why the purchaser should not be protected. �Much testimony was put into the case on the part of the defendant in regard to certain proceedings on the part of the common council at an earlier date than that in which these bonds had their inception, looking to a subscription of $100,000 by the commissioners named in the act of February 19, 1867. I do not see how that testimony can affect the vaiidity of these bonds. Either these bonds are good by reason of the recitals on their face and the facts which were within the knowledge of Eames at the time he purchased them, or they are not, and their vaiidity does not, in my opinion, depend in any degree upon the abortive attempts at a previous issue, which seems to have ��� �