Meyer v. City and County of San Francisco

This is an action to recover of the defendant the amount due upon thirteen Dupont-Street bonds, issued by the defendant and held by the plaintiff. A general demurrer to the complaint was overruled by the court below, the defendant answered, and thereupon, upon motion of plaintiff, judgment was entered for the plaintiff upon the pleadings, from which the defendant appeals.

The complaint alleges the execution of the bonds, sets forth one of them verbatim, states that the others are of the same tenor and effect, differing only in the number, avers that the plaintiff is the holder of the bonds, and that the sum of money named in the bonds is due from the defendant to the plaintiff and is unpaid, although payment of the same has been demanded. The bonds became due, according to their terms, on January 1, 1897. The suit was begun on December 31, 1900. The prayer is for an ordinary judgment against the defendant for the amount of the bonds sued on and for costs of the action. The bonds state on their face that they were issued under the provisions of the act of March 23, 1876, for the widening of Dupont Street, and that they were to be paid out of the fund to be raised by taxation as provided in that act. The provisions of the act referred to are thus made a

The effect of these provisions and conditions is that there is no obligation on the part of the city and county of San Francisco to pay the bonds, and that the amount named therein never became due from the defendant as alleged. The bonds were to be paid out of a special fund, to be raised by certain city officers by means of a special tax upon the lands within a specified district, declared to be benefited by the improvements. All claims against the city for any part of the debt was waived, and the debt was due out of the funds to be raised in accordance with the provisions of the act, and not otherwise. It never became a general obligation of the city, to be enforced by a personal judgment against it, such as that prayed for in the complaint.

The judgment so obtained cannot be upheld under the allegations of the complaint. Mandamus lies to compel the performance of an act which the law specially enjoins as a duty resulting from an office, trust, or station. To authorize a writ, the complaint must show an existing duty and a failure to perform the' same on demand. (People v. Romero, 18 Cal. 91 ; Crandall v. Amador Co., 20 Cal. 75 ; Oroville etc. Co. v. Plumas Co., 37 Cal. 363 .) No breach of duty is alleged

But although no action could be maintained to recover a general judgment against the city for the money due on the bonds, and the complaint is insufficient to authorize a writ of mandamus, conceding that a mandamus suit to enforce payment of the bonds would lie against the city in any case, we think that the plaintiff may nevertheless maintain an action against the city on the bonds, not to enforce payment thereof, but to establish and perpetuate them as a claim upon the funds to be raised under the act, and to prevent the bar of the statute of limitations. At the time the action was begun but one day remained of the period of limitation. By the expiration of that period the plaintiff would have been barred forever of all right to enforce payment of the bonds, which the demurrer admits to be valid and unpaid. The delay was not the fault of the plaintiff. Circumstances might exist under which it would not be the fault of the defendant or its officers, and in which plaintiff could not force payment by mandamus,—as, for instance, if the officers, although exercising reasonable diligence, had been unable to collect the tax until after the period of limitation had run. In such a case the plaintiff would be practically without remedy if he could not maintain an action to prevent the running of the statute against him. Justice requires that he shall have some means of preventing his claim from becoming outlawed. No better or more appropriate remedy can be suggested than that of an action of the character above indicated.

In this conclusion we are supported by the example of the federal courts in a somewhat analogous case. Those courts have no original jurisdiction to issue writs of mandamus. The writ can only issue after judgment and in aid of its enforcement and execution. (United States v. County Court, 122 U. S. 306 , [ 7 Sup. Ct. 1171 ]; Labette Co. v. Moulton, 112 U. S. 217 , [ 5 Sup. Ct. 108 ].) With respect to bonds which constitute an obligation against a portion only of the county or city, and which do not constitute a general obligation

We are of the opinion, however, that in giving judgment on the pleadings the court improperly allowed the interest which accrued on the bonds after their maturity. The act in question provided a scheme for a public improvement, the cost of which was to be paid by a special assessment upon the lands in the district specially benefited thereby. For this purpose the assessment district was created, and upon the

It provides that the bonds should be “payable in twenty years from their date, unless sooner redeemed, as in this act provided,” and that they should “bear interest at the rate of seven per cent per annum, payable semi-annually.” This language does not necessarily imply that interest is to run after maturity. Coupons for the annual interest, consecutively numbered, were to be attached to each bond in such manner as to be easily removed. It was further provided that a tax should be levied annually upon the lands in the district to pay the interest as it matured, and that the money thus raised was “to be paid out by said treasurer only in payment of the coupons attached to said bonds, as the same from time to time become due,” and that at the same time and in the same manner there should be annually levied a tax sufficient to pay one twentieth of the principal, to constitute a sinking fund and which should be paid out only in redeeming the bonds. Provision was made for calls for bonds to be paid in the order of issuance, whenever there was on hand ten thousand dollars or more of the sinking fund. The twenty annual levies thus provided for, if made and collected as required, would fully pay the entire amount of principal and interest of the bonds. We think the provision of the act requiring the interest coupons to be attached to the bonds is to be understood as meaning that coupons were to be attached for each year’s interest accruing up to the time of their maturity. There is no provision for the attaching of any coupons for interest accruing after maturity. And in view of the rules of construction applicable to such acts we must hold that there is no authority either to issue such coupons or to attach them to the bonds. The provision that the levy

Section 1917 of the Civil Code, which provides that “Unless there is an express contract in writing, fixing a different rate, interest is payable on all moneys at the rate of seven per cent per annum, after they become due on any instrument of writing, ’ ’ does not apply here, because, as we construe the act of 1876, it does by fair intendment declare that interest shall not be payable after maturity.

The answer attempts to aver that there was an unauthorized overissue of the bonds. It does not allege any facts showing that the plaintiff’s bonds constituted a part of this alleged .overissue. The statute appears to contemplate that bonds might be issued at different times until the aggregate issue equaled the authorized amount. In such a case, the bonds would all be.valid, except those issued after the limit was reached. The question is raised as to whether, in view of the recitals, on the face of the bonds, this defense can be made without an allegation that plaintiff is not a bona fide holder. This question, we think, ought not to be decided in the absence of the property-owners, or some one of them at least, who might represent them all. Neither the city nor its officers have any substantial interest in the question. It is the property-owners who must bear the additional burden, if any there be, and none of them are parties to the action.

It is also alleged that certain property-owners have obtained judgments, which remain in full force, perpetually enjoining the tax-collector of the city and county, and his successors in office, from collecting from the lands owned by them any tax levied under the act, that the levies provided for in the act were regularly made each year for the twenty years, as required, upon all the lands in the district, and that the tax has been paid upon all of said lands, except that levied upon the lands protected by the said judgments. It is claimed that these

The judgment is reversed and the cause remanded for further proceedings in accordance with this opinion.

Angellotti, J., and Sloss, J., concurred.

Hearing in Bank denied.