charter provides shall be fixed by ordinance, the City Council can not delegate this power to some of its members: 2 Swan, 364.

And where a contract, under which work was done for a municipal corporation, is void because entered into in violation of the charter, the contractor cannot recover for the work in any form, neither under the contract, nor upon a quantum meruit: Brady vs. Mayor, &c., 2 Bosw., 173, affirmed 20 N. Y., 317; 7 Abb. R., 234; 16 How. R., 432; Cooley on Const. Lim., 196. And if the officers of a municipal corporation assume to incur an obligation which it is not authorized to do, it is not made liable by the fact that it has received the consideration for the obligation: Hodges vs. Buffalo, 2 Denio, 110; 3 N. Y., 430; 2 Barb. 104; 17 N. Y., 449; 18 Cal., 590; Cooley on Const. Lim., 196. And the fact that money has been paid to a municipal corporation where it had no capacity or power to receive it, will not sustain an action, unless it has been appropriated by the corporation to municipal purposes by a valid ordinance: Herzo vs. San Francisco, 33 Cal., 134.

All these decisions are clearly founded on a proper consideration of the scope and object of municipal corporations, and the necessity of limiting the authority of their officers for the protection of the corporation. Nor have we found any cases directly in conflict, although there are general expressions of text writers and judges thrown out in considering the general powers of corporations, without being called upon specially to distinguish between public and private corporations which might run counter to some of them. Direct decisions are believed to be all one way, and to be fully sustained by principle.

Some of these cases do hold that a municipal corporation may contract a debt upon credit, and give its notes or obligations therefor, in the prosecution of its legitimate business, and for purposes authorized by the charter: 14 N. Y., 356; 39 N. Y., 523. In the first of these cases, Ketchum vs. City of Buffalo, 14 N. Y., the court expressly deny that the concession of such powers carries with it the right to borrow money. "It may be objected," they say, "that the reasoning here adopted tends to establish the right of a corporation to contract a debt for any authorized purpose by borrowing the money necessary to accomplish it; a right which, from the numerous legislative acts on the subject, it would seem corporations have not generally been supposed to possess. It is true, the power to contract to pay A $10,000 at the end of a year for doing certain work, and the

power to borrow $10,000 of B upon the credit of a year, for the purpose of paying A for doing the work, might seem, at first view, to be substantially identical. The amount is the same, and the time of payment the same; the creditor only is different. A little examination, however, will show that there is a very material difference between the two. If the power of the corporation to use its credit is limited to contracting directly for the accomplishment of the object authorized by law, then the avails or consideration of the debt created can not be diverted to any illegitimate purpose. The contract not only creates the fund but secures its just appropriation. On the contrary, if the money may be borrowed, the corporation will be liable to repay it, although not a cent may be applied to the object for which it was avowedly obtained. It may be borrowed to build a market, and appropriated to build a theatre, and yet the corporation would be liable for the debt. The lender is in no way accountable for the use made of the money. It is plain, therefore, that if the policy of limiting the powers and expenditures of corporations to the objects contemplated by their charters is to be carried out, their right to incur debts for those objects must be strictly confined to contracts which tend to their direct accomplishment. If they may procure the requisite funds by the indirect method of borrowing, they may resort to any other indirect mode of obtaining them, such as establishing some profitable branch of trade, entering into commercial enterprises, &c., the avowed object being to obtain the means necessary to accomplish some authorized purpose. No one can fail to see, that to concede to corporations the power to borrow money for any purpose would be entirely subversive of the principle which would limit their operations to legitimate objects." See to same effect Curtiss vs. Leavitt, 14 N. Y., 62, 267.

And this is unquestionably the better doctrine, and in accord with the practice of applying for and obtaining legislative sanction to the borrowing of money upon corporation bonds. But in Mills vs. Gleason, 11 Wis., 470, it was held that municipal corporations have implied authority to borrow money for corporation purposes.

There is more seeming conflict of the authorities on the power o a municipal corporation, without express legislative grant, to execute paper clothed with all the attributes of negotiability. But here again, we think, the conflict will be found, upon a careful examination of the decisions, to be more seeming than real. If there be an express grant of the powers, all the authorities, we believe, agree

that the paper will be negotiable in the full sense of the law merchant. And of this class are all the cases decided by the Supreme Court of the United States, and to which we will more particularly direct our attention presently. On the other hand, in the absence of such legislative authority, all the cases in which the point has been directly m de, agree that the warrant, check or other instrument used for the purpose of paying money out of the treasury of the corporation, in the ordinary course of business, is not clothed with all the attributes of negotiability: Clark vs. City of Des Moines, 19 Iowa, 201, where the subject is fully discussed and numerous authorities cited. To those there cited may be added Bayerque vs. Sin Francise, 1 McAll., 175; Halsted vs. Mayor, &c., of N. Y., 5 Barb., 218; Lucas Turner & Co., vs. San Francisco, 7 Cal., 462.

Some of the cases hold that an instrument is not negotiable at all, and no action can be sustained upon it except by, or in the name of the original holder. And this is the decision in Bayerque vs. San Francisco, 1 McAll., 175, which was an action upon a warrant of the City of San Francisco brought in the Circuit Court of the United States for the District of California. And this is, undoubtedly, the general current of decision in regard to warrants of townships in the New England sense, counties, school districts, and the like municipal, or quasi municipal corporations: Smith vs. Cheshire, 13 Gray, 318; Sturtevant vs. Li erty, 46 Me., 318; Andover vs. Grifton, 7 N. H., 298; 26 Verm., 345; Pople vs. El Dorado County, 11 Cal., 170; Renseller County vs. Weed, 35 Barb., 136; 5 Denio, 117; Dyer vs. Covington Township, 19 Penn., 200; School District vs. Thompson, 5 Min., 280; Bullock vs. Curry, 1 Met., Ky., 171.

On the other hand, there are a few cases both of city and county warrants, where it has been held that such warrants, if in form negotiable, may be passed to third persons so as to authorize them to sue thereon in their own name. Thus, the case of Kelly vs. Mayor of Brooklyn, 4 Hill, 265, which is the leading case on this point, and is based entirely upon the analogy of the powers of a municipal corporation to those of a private corporation in the issuance of negotiable paper, was a suit by such a holder. The report expressly recites that: "It appeared (on the trial) that the instrument was drawn in the ordinary form and according to the usual course of business in such cases, having been authorized by a vote of the Common Council." The decision is, therefore, simply that a municipal corporation may, by express ordinance, authorize the execution of a warrant upon its

treasury, or other instrument binding upon it, in a form that will enable a subsequent holder to sue upon it in his own name. And this is the full extent of the decisions in 6 McLean, 447; Bull vs. Sims, 23 N. Y., 570, and Clark vs. Des Moines, 19 Iowa, 209. But the courts of New York and Iowa, in which these two last decisions were made, have also repeatedly held, and the Iowa courts in the very case referred to, that municipal corporations have no power, without express legislative authority, to bind themselves by negotiable paper, with all the incidents of negotiability; and that such paper issued without such authority has no other binding effect in the hands of a bona file indorsee for value before maturity, than it would have in the hands of the original holder: Clark vs. Des Moines, 19 Iowa, 209; Halsted vs. Mayor of New York, 5 Barb., 218; Aff. 3 Comst., 430; Gould vs. Town of Sterling, 23 N. Y., 459; and the case of Treadwell vs. Commissioners, 11 Ohio St., 183, is to the same effect.

The case of Clark vs. City of Des Moines, 19 Iowa, 209, is directly in point. The charter of the City of Des Moines provided that every warrant on the treasury should be signed by the Controller, and countersigned by the Mayor, and that no money should be drawn from the treasury unless appropriated by the City Council. The City offered to show that the warrants were issued without any authority from the City Council, and without any vote of the Council authorizing the same. It was held, upon an elaborate review of the authorities, and full consideration of the subject, that the evidence should have been admitted, and that it would constitute a complete defense.

"We have been able," say the Court by Dillon, J., "after a thorough investigation, to find no case which holds that city and county warrants, like those before us, are freed from equities in the hands of bona fide holders. Nor has the plaintiff's counsel called our attention to any such. On the other hand, we have found several cases in different States expressly holding that such orders were not commercial paper in the hands of an innocent holder, so as to exclude evidence of the legality of their issue, or preclude defenses thereto:" citing Halstead vs. Mayor of New York, (on audited city warrants,) 5 Barb., 218; affirmed in 3 Comst, 430, but without passing on rights of bona fule holder; People vs. El Dorado County, (on audited county warrants,) 11 Cal., 170; S. P. Sturtevant vs. Liberty, (town orders,) 46 Me., 318; 13 Gray, 318; 7 N. H., 298; 2 Id., 251; 26 Verm., 345; 9 Ind., 224; 5 Minn., 280. And see language of Bennett, J., in Turner, Lucas & Co. vs. City of San Francisco, 7 Cal., 462, a case

almost identical in facts, with the addition that the charter of San Francisco expressly authorized the creation of debts to the amount of $50,000 for any purpose allowed by the charter, and the borrowing of money on the credit of the city not to exceed that sum.

And this is the conclusion of Judge Cooley, in his able work on Constitutional Limitations, page 215 and notes, upon a careful review of the cases: "The first requisite," he says, "to the validity of such subscriptions (stock in railroads) or (issuance of negotiable) securities, would seem, then, to be a special legislative authority to make or issue them-an authority which does not reside in the general words in which the powers of local self-government are usually conferred, and which must be followed by the municipality in all essential particulars, or the subscription or security will be void. And while mere irregularities of action, not going to the essential of the power, would not prevent parties who had acted in reliance upon the securities enforcing them, yet, as the doings of these corporations are matters of public record, and they have no general power to issue negotiable securities, any one who becomes holder of such securities, even though they be negotiable in form, will take them with constructive notice of any want of power in the corporation to issue them, and can not enforce them when their issue was unauthorized."

The learned author, after citing the cases in notes, concludes that "it is impossible to reconcile the authorities upon the point whether, where a corporation has power to issue negotiable paper in some cases, and has assumed to do so in cases not within the charter, a bona fide holder would be chargeable with notice of a want of authority in the particular case, or, on the other hand, would be entitled to rely on the securities themselves as sufficient evidence that they were improperly issued, when nothing appeared on their face to apprise him of the contrary." He is, himself, of opinion that the doctrine in the case of Gould vs. Town of Sterling, 23 N. Y., 458, cited and relied on in Clark vs. Des Moines, ut supra, is sound, and that wherever a want of power exists, a purchaser of the securities is chargeable with notice of it, if the defect is disclosed by the corporate records, or, as in that case, by other records where the power is required to be shown.

The decisions which he cites as sustaining a doctrine in conflict with his own conclusions, are all cases of private corporations: 11 Paige, 635; 16 N. Y., 125; 24 Ind., 461; 6 El. & Bl., 327. But there are dicta of learned judges, which, considered abstractly from the facts of the particular case then before them, tend to extend the