to dispose of such children in any manner it might deem best for their welfare.

The order made by the respondent is affirmed.

Lennon, J., Wilbur, C. J., Myers, J., Seawell, J., Kerrigan, J., and Lawlor, J., concurred.

Rehearing denied.

All the Justices concurred.

[L. A. No. 7302. In Bank.-April 5, 1923.]

W. E. SER-VIS, etc., Appellant, v. VICTOR VALLEY IRRIGATION DISTRICT, etc., Respondents; EDWIN O. WEIK, Intervener and Respondent.

[1] IRRIGATION DISTRICTS-SERVICES IN ORGANIZING-SECTION 61 OF ACT 1726, GENERAL LAWS-CHARGES AGAINST DISTRICT.-Under the exception contained in section 61 of Act 1726 of General Laws no services rendered prior to the time of the filing of the petition with the board of supervisors proposing the or ganization of an irrigation district can be deemed or con sidered services rendered for the purpose of organization as that phrase is employed in said section, so as to be chargeable against the district; but services from and including the filing of the petition to the time of filing the return of the election, as provided in section 10, fall within the organization period for which the district may be chargeable.

[2] ID.-FAILURE OF ORGANIZATION-LIABILITY FOR COSTS.-Where the proposed formation or organization of an irrigation district is defeated at an election, the burden of the cost thereof is placed on the promoter through the medium of the under taking required by the act.

[3] ID. PREORGANIZATION SERVICES WHEN CHARGEABLE AGAINST DISTRICT.-Services rendered prior to organization of an irrigation district in securing certain valuable options on water rights, reservoir sites, land, and other property taken in the name of a third person who was to hold, and did hold, the title until the irrigation district was organized and then conveyed them to the district, the property covered by said options and the water rights being of such nature that the irrigation district could not have secured water from any other source and

without which the district could not have constructed an irrigation system or put the land in the district in cultivation or under irrigation, are services coming within the purposes of the act and for payment of which warrants of the district are authorized to be issued.

[4] ID. SINGLE DEMAND - ILLEGAL ITEMS VOID WARRANTS.-Warrants of an irrigation district based upon a single demand of which a substantial part is beyond the power of the board of directors to allow are totally void.

[5] ID.-TRANSFER OF WARRANTS-DEFENSE OF INVALIDITY-INNOCENT PURCHASER. Warrants of an irrigation district issued in payment of illegal demands are void either in the hands of the original holder or of a purchaser for value.

APPEAL from a judgment of the Superior Court of Los Angeles County. Bertin A. Weyl, Judge. Reversed.

The facts are stated in the opinion of the court.

Charles J. Kelly for Appellant.

H. G. Redwine, G. A. McElroy, Roy V. Reppy, B. F. Woodward and S. V. O. Prichard for Respondents.

KERRIGAN, J.-This is an action brought by a land owner in the Victor Valley Irrigation District to have canceled by decree of court certain warrants issued by the board of directors of said district, on the ground that the said board had no authority to issue the warrants and that they are therefore void. Judgment went for the defendants and intervener, declaring that the warrants thus sought to be canceled were legal and valid and subsisting obligations of the district. From this judgment plaintiff appeals.

F. M. Walton, one of the defendants, had been employed by an unincorporated association to perform certain services looking to the organization of a regularly, legally constituted irrigation district. In his capacity as an officer and agent of the unincorporated association, covering a period of four years, he rendered services and made disbursements, which services and disbursements, it is claimed, come within the purview of the exception to section 61 of the California Irrigation District Act, approved March 31, 1897, (Stats. 1897, p. 254; Deering's General Laws, 1915, Act

1726). Whether they do or do not presents the question we are required to decide.

The section reads: "The board of directors or other officers of the district shall have no power to incur any debt or liability whatever, either by issuing bonds or otherwise, in excess of the express provisions of this act; and any debt or liability incurred in excess of such express provisions shall be and remain absolutely void, except that for the purposes of organization, or for any of the purposes of this act, the board of directors may, before the collection of the first assessment, incur indebtedness in such sum or sums as shall amount to two thousand dollars, or if the district shall contain more than four thousand acres, to one-half as many dollars as there are acres of land in the district, and may cause warrants of the district to be issued therefor, .

Section 42 of an earlier statute, the Wright Act (Stats. 1887, p. 29), was similar to section 61, bove quoted, down to the words "absolutely void." In 1891 (Stats. 1891, p. 142), said section 42 was amended by adding an exception, substantially the same as that contained in said section 61; so that, prior to such amendment, only such liabilities as were expressly provided for in the act could be incurred by the board of directors, and any liability incurred in excess of such provision was and remained absolutely void.

In construing section 42 of the Wright Act, as amended in 1891, the supreme court, in Mitchell v. Patterson, 120 Cal. 286, 293 [52 Pac. 589, 591], said:

"The amendment purports to save or except from the operation of the original act certain liabilities which by it were made void. The use of the word 'except' implies that; and the first specification thereunder, 'for the purposes of organization,' confirms the implication. . . .

"The words immediately following, viz., 'or for any of the purposes of this act' must be held also to relate to indebtedness which under the original section would have been void,

...

The case was submitted upon an agreed statement of facts. They are as follows: The defendant, Victor Valley Irrigation District, was organized October 22, 1917, under said Act 1726, General Laws of the State of California. Prior to the organization of the defendant Irrigation District the various land owners within its boundaries formed an or

ganization under the name of Victor Valley Mutual Water & Power District Association, an unincorporated organization, which had for its object the making of arrangements preparatory to the organization of an irrigation district whereby the land embraced in the Victor Valley Irrigation District could be put under irrigation and cultivated. Of this former organization the defendant F. M. Walton was one of the active members and acted as the agent for all of those who belonged thereto, and for the period of four years, from October, 1913, to October, 1917, just preceding the organization of the defendant Victor Valley Irrigation District, rendered certain services and expended certain sums of money on behalf of the original organization and its members.

On December 4, 1917, shortly after the organization of the defendant Victor Valley Irrigation District, at a regular monthly meeting of its board of directors, the defendant F. M. Walton presented to the board of directors a detailed verbal statement of his expenditures made on behalf of the former organization, and also of a balance due him on account of his salary as agent of the former organization, at the rate of $125 per month; the expenditures and services totaling a sum of $12,000, which was compromised between F. M. Walton and the board of directors, and warrants were issued in his name in the sum of $6,635. Of the warrants so issued, approximately $3,575 have been paid, the remainder, in the sum of approximately $3,055, are now outstanding and unpaid. Of the warrants so remaining unpaid $600 are still held by defendant F. M. Walton, and $1,500, represented by three warrants, are held by the intervener, Edwin O. Weik, having been indorsed to him by F. M. Walton for good and valuable consideration. The remaining unpaid warrants are held by persons not parties to this action. The district contains approximately 73,000 acres of land.

The expenditures were made and the services performed prior to the organization of the irrigation district, and the services and advances were rendered and made for the purpose of securing data and perfecting plans and arrangements whereby an irrigation system could be organized and perfected. During the period for which defendant Walton received salary he spent some four months in securing sig

natures to the petition necessary to be filed with the board of supervisors of the county of San Bernardino in order to propose and bring about the organization of said irrigation district. He also, a short time before the organization of the district, spent considerable time and effort in securing valuable options on water rights, reservoir sites, land, and other property, which options were taken in the name of a third person, and, as intended and arranged, they were subsequently transferred and conveyed to the Victor Valley Irrigation District. The property covered by said options was indispensably necessary to enable such irrigation district to construct an irrigation system and to put the land embraced within the district under cultivation and irrigation.

The act under consideration contains various provisions for raising funds for the district, e. g., section 30 provides for the issuance of bonds to meet the expenses of construction of the irrigation works and for otherwise carrying out the provisions of the act; section 34 authorizes the levy of assessments to complete the construction of the irrigation works, and section 59 deals with special assessments. In order that the district may avail itself of any of these provisions, either a certain contingency must have arisen or certain prescribed steps must be followed, and the funds thus raised are destined to meet specified expenditures; they are "earmarked," so to speak, before they are collected by the district; and section 61 declares to be void any indebtedness incurred except under the conditions and in the manner prescribed by the various sections of the act dealing with the collection of funds, except that the board of directors is given power to incur a limited amount of indebtedness without compliance with those provisions, such indebtedness to be either "for the purpose of organization" or "for any of the purposes of this act."

Considering first the proposition of whether or not the services rendered and the expenditures incurred were for the purposes of organization, the warrants were issued for services and expenditures rendered and made by F. M. Walton as a promoter prior to the taking of any definite action looking to the immediate organization of the Victor Valley Irrigation District. The language of the agreed statement of facts itself indicates that the services and ad