The cases of Gelpcke v. City of Dubuque, 1 Wall. 175; Sup'rs v. Schenck, 5 Wall. 772; City of Lexington v. Britton, 14 Wall. 296; and San Antonio v. Mehaffy, 96 U. S. 314, are cited as showing that when a corporation has power, under any circumstances, to issue negotiable securities, the bona fide holder has a right to presume that they were issued under the circumstances that gave the requisite authority; that they are no more liable to be impeached in the hands of such a holder than any other commercial paper, and that recitals are not necessary to estop the municipality. In three of these cases there was express authority to issue the bonds sued on, and they contained recitals showing that the proper officers had decided the precedent conditions existed upon which the power depended; while in the other, (Sup'rs v. Schenck,) although it does not expressly appear that the bonds sued on contained recitals, that is the fair inference, for the court say it is settled law that a negotiable security of a corporation, which on its face appears to have been duly issued, is valid in the hands of a bona fide holder.

It is further urged for the plaintiff that, even if the bonds and coupons mentioned in the complaint are impeachable in the hands of the plaintiff, the question before the court is one of pleading, and it devolves upon the defendant to show that the bonds were issued without authority. The coupons contain no recitals, and there is no allegation in the complaint that the bonds do. The argument of counsel on both sides assumes that there are no recitals in the bonds. The plaintiff was bound to know that the bonds were issued under express legislative authority, for school purposes, and it was his duty to inquire whether the conditions existed that authorized them to be issued. Power to issue commercial paper was the exception, and not the rule, and in the absence of such recitals as would preclude the municipality from impeaching the bonds in the hands of a bona fide holder, the plaintiff has no right of action, unless he shows in his complaint that the bonds were issued in substantial compliance with the legislative enactments, and for a proper purpose. Bonds which are not issued in pursuance of express legislative authority, and in a mode prescribed by it, possess none of the qualities of commercial paper. The legislature was careful, in conferring power on municipalities to borrow money and issue bonds for school purposes, to prescribe the mode and manner of its execution, thereby making the mode of its execution the measure of the power granted. Anthony v. County of Jasper, 101 U. S. 697. Demurrer sustained.

ROESNER, Adm'r, v. HERMANN.*

(Circuit Court, D. Indiana. 1881.)

1. NEGLIGENCE-CONTRACT AS TO.

A contract between employer and employe, whereby the employe, in consideration of the employment, agrees to release and discharge his employer from all damages on account of accident or death to the employe, caused by the negligence of his employer or co-employes, is void as against public policy.

This was an action brought by Peter Roesner, administrator of the estate of George Reed, against Henry Hermann, on account of the death of Reed while in the defendant's employ, alleged to have resulted from the defendant's negligent use of defective and unsafe machinery. The defendant, in one of his answers, pleaded his release and discharge from all damages under and by virtue of the following agreement, viz.:

In consideration of the employment given me by Henry Hermann, and as an inducement and as a consideration to said Hermann to actuate him to take and engage me into his employ, I herewith grant, bargain, and stipulate, for myself, my heirs, executors, administrators, assigns, or personal representatives, whoever they may be, to and with said Henry Hermann, his heirs, executors, administrators, and assigns, that I, being such employe of said Hermann, will not hold said Hermann, whatever befalls me during such employment, responsible or liable in any sum, or for any damages whatever; and I hereby release and discharge said Hermann from all liability herein, to me or my personal representatives, for loss, damage, suffering, sickness, ailment, death, or harm, of whatsoever nature or kind I or they, my personal representatives, may suffer by reason of any accident, mishap, death, or damage occurring to me while in the employ of said Hermann, whether it arise from negligence of said Hermann or by accident, or by reason of the negligence of the other of said Hermann's employes, or be the cause or mishap whatsoever it may; I hereby discharging him, said Hermann, as heretofore shown, from all kind and nature and manner of liability whatsoever, by reason of negligence on his part, omission of duty, or accident, during such employment, from date hereof forever.

And in addition I also promise and agree to work not less than 10 hours per day, while in the employ of said Hermann, under penalty of forfeiture and damages.

[Signed]

Signed in the presence of W. G. BOEPPLE.

his

GEORGE X REED.

mark.

The plaintiff demurred to this answer, and, after argument, the demurrer was sustained. No written opinion was filed.

Chas. Denby and J. S. Buchanan, for plaintiff.

Chas. L. Wedding and Jas. L. Shackelford, for defendant.

*Reported by Chas. L. Holstein, United States Attorney.

GRESHAM, D. J., (orally.) The substance of the complaint is that the defendant's machinery was defective and unsafe; that while operating the same with reasonable care, and without knowledge of its defective character, the deceased received the injuries which caused his death, and that the defendant knew of the character of the machinery, or with proper diligence might have known it. So far as he could do so by the exercise of reasonable care, the defendant was bound to supply his factory with suitable and safe machinery. If he failed to do this, and required his employe to operate machinery which was unsound and unsafe, and in doing so the latter, while exercising ordinary care and prudence, received injuries which caused his death, his personal representative has a right of action for the benefit of those who have sustained loss from the injury and death. When the defendant's negligence in supplying his employes with unsafe machinery has caused the death of the latter, the law will not allow the defendant to sayas in effect he does say in this answer-"It is true that my machinery was defective and unsafe, and my negligence caused the death of my employe, but I am not liable to those who have suffered from the loss of his life, because I had a contract with my employe which secured to me the right to supply him with defective and unsafe machinery, and to be negligent." Such a contract is void as against public policy. If there was no negligence the defendant needed no contract to exempt him from liability; if he was negligent, the contract set out in his answer will be of no avail.

MARSHAL and others v. THE TOWN OF ELGIN.

SAME V. THE TOWN OF PLAINVIEW.

(Circuit Court, D. Minnesota. September, 1881.)

1. MUNICIPAL BONDS - RECITALS CONSTITUTIONAL LAW - GENERAL LAWS OF MINNESOTA, 1877, c. 106-LIS PENDENS-NOTICE.

In an action to recover the amount of coupons attached to bonds, issued under the provisions of chapter 106, General Laws of Minnesota, 1877, owned by the plaintiffs, and also to recover the amount of coupons taken from bonds sold by them to other parties, held, that the recitals in the bonds are conclusive evidence, in favor of a purchaser without other information, that the conditions precedent prescribed in the law had been complied with. Held, also, that as the law under which the bonds were issued had been recognized as valid at the time of the purchase, by the highest state court, no subsequent decision could affect their validity in the hands of these purchasers. Held, also, that the rule affecting every one with notice of pending suits is inapplicable where negotiable securities constitute the subject-matter.

These actions are brought to recover the amount of coupons which were attached to bonds issued by the towns of Elgin and Plainview, in this district, the plaintiffs being owners of the bonds and coupons, and also to recover the amount of coupons owned by them taken from bonds held by other parties, to whom the plaintiffs had sold them. The bonds and coupons were issued to the Plainview Railroad Company by the town of Plainview, March 16, 1879, and by the town of Elgin about January 1, 1879, under chapter 106, General Laws of Minnesota, 1877, and were purchased by the plaintiffs July 9, 1879, for value, and without notice of any of the matters relied on as defences, except such as appear on their face.

Section 3 of the act referred to provides that no bonds shall be issued until a mutual agreement in relation to the construction of a railroad shall have been arrived at.

Section 4 enacts that a railroad company desiring aid in the construction of its road shall make a proposition in writing which shall contain a statement of the amount of the bonds of the town desired, and when they are to be delivered, which shall be filed with the auditor or clerk.

Section 7 declares that one mode of arriving at the mutual agreement required shall be:

* * *

* *

"First. That within three months after filing a proposition, the railroad company shall cause notice to be given that after a day named a petition to the proper authorities, asking them to agree to such proposition, will be presented to the resident tax-payers, and to the petition shall be appended a copy of the proposition. Second. If, within four months after the filing of such proposition with such clerk, the railroad company shall deliver to such clerk a substantial copy, or copies, of such proposition so filed, with such petition, to the proper authorities of such town, asking such authorities to agree to such proposition appended thereto, bearing the signatures of a majority of the persons residing in such * town, * * * who were assessed for taxes upon real or personal estate in such * * town, * * * as shown by the last assessment roll of the district of which aid is desired, which signatures shall be verified by the affidavit of some person witnessing such signatures, then such mutual agreement, for the issue of bonds by such municipality, and of the stock of such railroad company, shall be deemed and considered to have been arrived at and perfected, and thereupon such bonds shall be issued and delivered, in conformity with the true intent and meaning of such proposition, and with the provisions of this act." Each bond contains the following recital:

"This bond is issued in pursuance of a mutual agreement between said town and said railroad company, which agreement was made in accordance with the laws of the state of Minnesota, and through and by a proposition made by said railroad company, and duly accepted by said town, upon petition

therefor signed by a majority of the resident tax-payers of said town, said agreement having been fully performed by the said railroad company on its part.

"This bond is issued in pursuance of the authority given for that purpose by the laws of the state of Minnesota, and in compliance with a resolution of the board of supervisors of said town."

In the case of the town of Plainview, at or about the time the railroad company had complied on its part with the mutual agreement, one George Harrington, a tax-payer of that town, brought an action, in the district court of the state, against the town officers and the Plainview Railroad Company to restrain the town officers from executing and delivering the bonds as stipulated, for the alleged reason that the act under which they were issued, (section 7, c. 106, Laws of Minnesota for 1877,) which provides for arriving at a mutual agreement between the railroad company and the town by proposition and petition of a majority of the resident tax-payers, was unconstitutional and void. A temporary injunction was issued to restrain the execution and delivery of the bonds. The cause was tried January 27, 1879, upon stipulated facts, and among other things it was admitted at the trial

"That, relying on and induced and influenced by the proceedings set out, and particularly by the resolution of the board of supervisors, the Plainview Railroad Company constructed and had, before the commencement of that action, its line of road constructed, and has had the same graded and the ties and iron laid thereon, with the cars running thereon from a point of junction with the Winona & St. Peter Railroad, in the county of Olmsted, east of the west line of Eyota, in said county, to a point within the corporate limits of the village of Plainview, as the same existed December 31, 1877, and had, in all respects, complied with the terms and conditions specified in the proposition by it to be performed."

The district court held the act valid, and found for the defendants. A motion for a new trial, made by the plaintiff, was denied March 11, 1879, and he appealed from such denial to the supreme court of Minnesota on the next day. Three days afterwards judgment was entered by the district court dissolving the injunction and dismissing the action, and on the next day the town issued the bonds in question. On the sixth of October, 1880, the supreme court of Minnesota, having heard the appeal, decided that the act under which the bonds were issued (chapter 106, § 7, Laws 1877,) was unconstitutional and void.

S. U. Pinney and Thos. Wilson, for plaintiffs. Gordon E. Cole and Robt. Taylor, for defendants. v.8,no.11-50