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Brenham v. German American Bank, 144 U.S. 173 (1892)

Brenham v. German American Bank

No. 120

Argued March 17, 1892

Decided March 28, 1892

144 U.S. 173


Bonds were issued by the City of Brenham, in Texas, in July, 1879, payable to bearer, to the amount of $15,000, under the assumed authority of an Act of Texas, passed in 1873, incorporating the city and granting its council authority to borrow, for general purposes, not exceeding $15,000 on the credit of the city. Held that the city had no authority to issue negotiable bonds, and that therefore even a bona fide holder of them could not recover against the city on them or their coupons.

Power in a municipal corporation to borrow money not being nugatory although unaccompanied by the power to issue negotiable bonds therefor, it is easy for the legislature to confer upon the municipality the power to issue such bonds, and under the well settled rule that any doubt as to the existence of such power ought to be determined against its existence, it ought not to be held to exist in the present case.

The cases on this subject reviewed, and Ropers v. Burlington, 3 Wall. 654, and Mitchell v. Burlington, 4 Wall. 270, held to be overruled.

This was an action against a municipal corporation to recover upon coupons cut from negotiable bonds issued by it. Judgment below for plaintiff, to which this writ of error was sued out. The cause was first argued on the 14th of December, 1891. On the 26th of January, 1892, a reargument was

Page 144 U. S. 174

ordered which was had March 17. The case is stated in the opinion.

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