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Pleasant Township v. Aetna Life Ins. Co., 138 U.S. 67 (1891)

Pleasant Township v. Aetna Life Insurance Company

No. 1214

Submitted December 18, 1890

Decided January 19, 1891

138 U.S. 67


The Act of the Legislature of Ohio of April 9, 1880, authorizing townships having a population of 3,683 under the census of 1870, "to build railroads and to lease or operate the same," and "to borrow money . . . as a fund for that purpose," and "to issue bonds therefor in the name of said township" is repugnant to the provision in article 8, section 8 of the constitution of that state, which provides that

"The General Assembly shall never authorize any county, city, town or township, by vote of its citizens or otherwise, to become a stockholder in any joint stock company, corporation, or association whatever; or to raise money for, or loan its credit to or in aid of any such company, corporation or association,"

and bonds of such a township issued under the supposed authority of said act are void.

It appearing that a decision of the highest court of the Ohio made prior to the issue of the bonds in controversy in this action as to the validity of such municipal bonds was, argumentatively at least, in conflict with decisions of the same court made after the issue of such bonds, this Court, following the rule laid down in Douglas v. Pike County, 101 U. S. 677, and Burgess v. Seligman, 107 U. S. 20, in the exercise of its independent judgment, finds the issue here in controversy to be invalid.

This was an action at law to recover upon bonds issued by the plaintiff in error to aid in the construction of a railway

Page 138 U. S. 68

under the Act of the Legislature of Ohio of April 9, 1880. Demurrer to the petition, judgment for the plaintiff on the demurrer, to review which the defendant sued out this writ of error. The case is stated in the opinion.

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