First National Bank v. Town of Mount Tabor

The opinion of the court was delivered by Royce, J.

This was an action brought to recover the interest due upon certain bonds purporting to be issued by the defendant town under the authority conferred by No. 1 of the Acts of the Special Session of 1867, and represented by interest coupons cut from such bonds. Interest coupons detached from bonds, payable to bearer at a specified time and place, are negotiable promises for the payment of money, and therefore subject to the same rules as bank notes or other negotiable instruments. They are, in effect, promissory notes by the law merchant, and possess all the attributes of negotiable paper. Jones Railroad Securities, ss. 317, 320, 322, and authorities there cited. Town of Concord v. National Bank of Derby Line, 51 Vt. 144 . Assumpsit will therefore lie.

*94 The plaintiff was a bona-fide holder of the coupons sued upon, without notice of any defense to said coupons or the bonds to which they were originally attached, and which were also owned by the plaintiff. To defeat the plaintiff’s right of recovery, the defendant offered evidence tending to show that the facts set forth in the certificate which was signed and caused to be recorded by two of the three commissioners named in the instrument of assent to which said certificate was appended, were not true. The act ¡1 provides (section 6) that such certificate, if duly executed and ¡recorded, shall be conclusive evidence of the facts therein set J forth. See First National Bank of St. Johnsbury v. Concord, 50 Vt. 257, 281 . The claim of the defendant is that the certificate in this case, being signed by but two of the three commissioners, was not a compliance with the act, and consequently does not estop the town from disproving the truth of the facts set forth in it. The offer was to show that the third commissioner refused “ to sign such certificate for the reason that such instrument of assent had not been signed by a majority of the resident tax-payers of said town, as required by said act ”; which necessarily implies that he acted with his associates, although the case does not show that he took the oath required by section 6, so far as to satisfy himself that the requisite assent did not appear upon the instrument, and thereupon refused to concur with them in the decision which they reached and embodied in their certificate. The question of law presented for our decision, then, is, Was the act ¡'of two of the three commissioners, the third sharing in their deliberations but refusing to concur in their decision, a sufficient ¡compliance with the law ? In view of the fact that there is a dictum /by Wheeler, J., in Danville v. Montpelier & St. Johnsbury Railroad Co. 43 Vt. 144, 155 , in which that learned judge expresses the opinion, upon common-law principles, that the authority conferred upon the commissioners under an enabling act almost precisely similar in its terms, so far as the duties and powers of the commissioners are concerned, to this one, was a joint authority, in the exercise of which all must concur, we have deemed it proper to give to the subject a more extended consideration than we should otherwise have thought necessary. It seems, at com *95 mon law, that when an authority is conferred upon several it is sometimes necessary to its lawful exercise that all should act together and all concur in the result, while under other circumstances the decision and act of the majority is good, provided all meet and deliberate, or have notice so to do ; and in yet other cases the act of the majority, or the majority of the quorum alone, will be upheld. In the case at bar it is only necessary to deduce from the authorities which of the two first named rules is to be here applied.

The distinction is laid down by Lord Coke, Co. Lit. 181b: “ Secondly there is a diversitie between authorities created by the partie for private causes and authoritie created by law for execution of justice. As, for example, if a man devise that his two executors shall sell his land, if one of them dye the survivor shal not sell it; but if he had devised his lands to his executors to be sold, then the survivor shall sell it. . . •. If a man make a letter of attorney to two, to do any act, if one of them dye the survivor shall not do it; but if a venire facias be awarded to foure coroners to empannell and returne a jury, and one of them dye, yet the other shall execute and returne the same. If a charter of feoffment be made and a letter of attorney to foure or three joyntly or severally to deliver seisin, two of them cannot make liverie ; because it is neither by them foure or three joyntly, nor any of them severally; but if the sherife upon a capias directed to him make a warrant to foure or three joyntly or severally to arrest the defendant, two of them may arrest him, because it is for the execution of justice, which is pro bono publico, and therefore shall be more favourably expounded, than when it is onely for private ; and so hath it beene adjudged. Jura publica ex privato promiscué decidí non debent.”. Following and applying this principle, the decisions down through the English reports, though not numerous upon this point, are clear that when an act is to be done by several which is matter of public concern, all must meet and confer, and the majority may then decide. In Billings v. Prinn, 2 Bl. 1017 , where a warrant of commitment required to be signed by two justices and they acted separately, Lord DeGrey, C. J., said : “ There is no Use in appointing two or more Persons to *96 exercise judicial powers, unless they are to act together.” This case was expressly followed in The King v. Forrest, 3 T. R. 38. In The King v. Beeston, 3 T. R. 592, the church-wardens and overseers, with the consent of the major part of the parishioners, were authorized by statute to contract for the support of the poor. All but one of the church-wardens and overseers acted in making a contract, and he refused to join. The act of the majority was held sufficient. Lord Kenyon, C. J., said: “ A contract has been entered into in which the parish at large is concerned, and which the act of parliament has enabled the parish officers with the concurrence of the parish to enter into, and the question is whether one obstinate man, in opposition to all the rest of the parish, in an act in which they are more interested than he is, shall be able to defeat their purpose. I do not mean to say that the churchwardens and overseers are technically a corporation; but as far as concerns the regulation of the poor of the parish they stand in pari ratione. . . . This is very different from the case of trustees in settlements, who are generally chosen by the different branches of the family, in which case it is necessary that they should all concur in every act, in order that each may protect the interest which he was appointed to guard.” In Witherell v. Gartham, 6 T. R. 388, a power given by deed.to the vicar and churchwardens to appoint a schoolmaster was held well executed by the vicar and a majority of the church-wardens, it being strongly urged by counsel, among other things, that the trust was one of a public nature. Lawrence, J., says: “In general it would be the understanding of a plain man that, where a body of persons is to do an act, a majority of that body would bind the rest.” In Grindley v. Barker, 1 B. & P. 229, which is regarded as a leading case upon this point, a condemnation by four out of six triers of leather appointed under a statute, the whole number having met and deliberated, was sustained. Eyre, C. J., says : “ I think it is now pretty well established that where a number of persons are entrusted with powers not of mere private confidence, but in some respects of a general nature, and all of them are regularly assembled, the majority will conclude the minority, and their act will be the act of the whole ”; referring to the opinion of Lord *97 Hardwick, in Attorney General v. Davy, 2 Atk. 212, — “when all have assembled and communicated to each other the necessary information, it is fitter the majority should decide than that all should be pressed to a concurrence.” Buller, J.: “ Now it seems to me that upon the first question the authority of Co. Litt., if we went no further, is decisive, because it is there said in express terms that in matters of public concern the voice of the majority shall govern.” Heath, J. : “ All must concur in trying, and then, though they be of different opinions, some of one opinion, some of another, yet all having tried, the majority shall bind.” Rooke, J.: “ The authority given to the triers in the present instance is general to examine and try whether certain goods are serviceable or not, and is committed to them for the advancement of public justice, and as a public trust. Now the decisions are numerous, (and may be found in Viner, title Authority, letter B.,) to show that a different construction prevails with respect to private authorities and authorities for the advancement of public justice. . . . We shall not advance public justice by saying that though a majority of the triers who have had the advantage of all the information to be derived from the whole six who compose the tribunal, are of opinion that the leather is unserviceable, still any one man shall have it in his power to prevent a finding by holding out against the rest. All six must undoubtedly try ; but it does not therefore follow that they must all decide the same way. Each man is after due examination and inquiry to decide according to the best of his judgment, and the question is to be determined by the opinion of the majority.”

Following these authorities and others in our own country,. Chancellor Kent lays down the rule, 2 Kent Com. 638, to be : “ And if the authority, in a matter of mere private concern, be confided to more than one agent, it is requisite that all join in the execution of the power; though the cases admit the rule to be different in a matter of public trust; and if all meet in the latter case, the act of the majority will bind.” To the same effect is Story Agency, s. 42, and note. The principle has been applied in a large number of adjudged cases in this country. We shall only advert to some of the principal decisions.

*98 In Jewett v. Alton, 1 N. H. 253, a case which in its facts has no special application here, the law is thus stated by Green, J.: “ The rule is, that when an authority is given by law to three or more persons it may in general be executed by a major part of the persons to whom it is delegated. But where individuals or corporations give an authority jointly to three or more persons, in order to bind the principal all the agents must act.” In Patterson v. Leavitt, 4 Conn. 50 , the court say: “ It is established beyond a question, that an authority given for a private purpose, to a number of individuals, is joint, and must be strictly pursued. On the other hand, if the power be of a public nature, the majority may perform the act delegated ; the power being considered as joint or several.” This was a case of a private arbitration, and an award by two of the three arbitrators, the third dissenting, was held invalid. In Scott v. Detroit Young Men’s Society’s Lessee, 1 Doug. Mich. 119, it was held that, “ as a general proposition it is undoubtedly true that where several persons are appointed to execute a power or trust, and no authority is given to a less number than the whole to act, all must join in its execution. A distinction is drawn, however, between a mere private trust or power and a power of a public nature conferred by law. In such cases, if all are present to deliberate, although a majority only assent to the act, it is unquestionably good.” In Commissioners of Allegheny Co. v. Lecky, 6 S. & R. 166, it was held that where the commissioners of the county had authority under a statute to purchase a site for a jail, the power might be legally exercised by two of them without the concurrence of the third; that “ the rule that requires all to join in the execution of a power has never been applied to public business of a judicial nature, nor to public business of a deliberative nature, though not strictly judicial.” See also Commonwealth v. Canal Commissioners, 9 Watts, 466, 471 ; Cooper v. Lampeter Township, 8 Watts, 125 ; Kingsbury v. School District, 12 Met. 99 , 105 Charles v. Hoboken, 3 Dutcher, 203 ; Curtis v. Butler County, 24 How. 435 , 450 ; Jones v. Andover, 9 Pick. 145 , 151, and Cooley v. O’Connor, 12 Wal. 391. In Downing v. Rugar, 21 Wend. 178, 182 , one of two overseers of the poor acted in the performance *99 of a merely ministerial act, and it was held that the assent of the other was to be presumed. Cowen, J., in the opinion, says: “ The rule seems to be well established that in the exercise of public as well as private authority, whether it be ministerial or judicial, all the persons to whom it is committed must confer and act together, unless there be a provision that a less number may proceed. Where the authority is public and the number such as to admit of a majority, that will bind the minority after all have duly met and conferred.”

The necessity for a meeting and deliberation of all the persons appointed to perform a duty calling for the exercise of.discretion, seems to be recognized by all the cases, unless it be obviated by circumstances which do not exist in the case at bar. In Crocker v. Crane, 21 Wend. 211, 218 , the court, Cowen, J., say: “ It has long been perfectly well settled that where a statute constitutes a board of commissioners or other officers to decide any matter, but makes no provision that a majority shall constitute a quorum, all must be • present to hear and consult, though a majority may then decide.” This was a .case where commissioners were named in the act of incorporation of a railroad company “ to open books, receive subscriptions, and distribute stock among subscribers as they shall deem most conducive to the interests of the corporation.” It will be observed, that the duty with which these commissioners were charged was one in which the public at large had no direct interest, except as it might voluntarily become interested in the stock of the corporation, and the distinction in this case seems to be based upon the fact that the decision was not alone to affect parties to a transaction or adjudication in the first instance, and who might have had some voice in the selection of the board and the scope of its powers, but that the board was a creation of the law, and intrusted with duties of a judicial nature, in the discharge of which it necessarily had power to affect and bind parties who might subsequently come in, with notice of the terms and scope of the act.

In Crocker v. Crane, supra, reliance is had upon the decision in Ex parte Rogers, 7 Cow. 526 , in which the court upheld the action of a majority of a board consisting of a canal commissioner *100 and two assessors, elected by the state senate to assess damages occasioned by canals. In the opinion per curia it is said : “ But in regard to a public judicial body it is clearly settled that though no provision be made giving a binding effect to the decision of a majority, yet where they all convene and act, the majority may decide, notwithstanding the express dissent of the minority.” Mr. Waterman’s note (a) to this case states the law to be that, “ where a public act is to be done by three or more commissioners appointed in a statute, and a competent number have met and conferred, though they separate and a majority do the act, without the presence of the others, the act seems good in construction of law; though it is otherwise where there is a positive statute, or charter, requiring that a full board should be present at the consummation.” The rule is, in substance, re-stated in Johnson v. Dodd, 56 N. Y. 76 , and also in Groton v. Hurlburt, 22 Conn. 178 . It is applied to ordinary town commissioners of highways in Babcock v. Lamb, 1 Cow. 238 .

The general rule, that in matters of public interest the majority of those upon whom the power or authority is conferred may act, is recognized in Baltimore Turnpike, 5 Binn. 481 ; Louk v. Woods, 15 Ill. 256 ; Walker v. Rogan, 1 Wis. 597 ; Jefferson County v. Stagle, 66 Pa. 202 ; Austin v. Helms, 65 N. C. 560 ; provided all meet and confer; but not when the minority is ignorant of the transaction, and has no opportunity to exercise its legitimate influence in the deliberation ; Schenck v. Peay, 1 Woolw. 175 ; or when the act in terms requires the' presence and concurrence of all; New York Life Insurance & Trust Co. v. Staats, 21 Barb. 570 ; Powell v. Tuttle, 3 Comst. 396 ; People v. Coghill, 47 Cal. 361 , which only says all must be present, under the statute in question. In New York this is recognized to be the common-law rule, and is also expressly enacted by statute. 8 Abb. Pr. n. s. 234; 38 How. Pr. 508 ; 10 Abb. Pr. 233 . In Pell v. Ulmar, 21 Barb. 500 , one of the two public loan commissioners acted in the matter of foreclosure of a mortgage, and the court, holding this insufficient, say, Strong, J.: “ Where powers are conferred upon a number to act collectively, and especially in matters involving any discretion, it is an indication that the association if *101 not the concurrence of all is essential.” And in The People v. Walker, 23 Barb. 304 , which has no application to the case at bar in its facts, Mitchell, J., in a very able and exhaustive opinion, says: “ When persons are appointed by the law to act as special tribunals of a quasi judicial character . . . both parties are entitled to the presence of all the judges, and to have the benefits of the consultation of each with every other. All must therefore meet together and consult, but then a majority may decide. In The Attorney General v. Davy, 2 Atk. 212, three out of twelve persons had power to choose a chaplain. Two of the three chose a chaplain, the third dissented, and the question was whether this was a good choice. It was held to be good.” The learned judge sums up his conclusions from a consideration of all the cases: “ First, that where a private authority is conferred, all must be present, and all must concur, unless provision be otherwise made. Second, that where a public authority is conferred on individuals (not on a court) who are to act judicially, all must confer together, as that is the object of having more than one or two, but that a majority may decide.” In The People v. Nichols, 52 N. Y. 478 , where an act provided for the purchase by the State of certain relics of George Washington, the money appropriated to be paid only on the certificate of three persons named in the act that the relics were genuine, and that in their judgment it was desirable that they should be placed in the museum of the state library, the three met, and one refused to certify. The other two signed a certificate in which his refusal to concur with them was set forth. The certificate was held sufficient, following Ex parte Rogers, on the ground that the matter was of public concern, and “ a majority act for the whole when all have met.” This holding, Peckham, J., says, in the opinion, would be in accordance with common-law principles, but is also within 2 R. S. 555, § 27.

The rule has been applied to committees of towns. In Martin v. Lemon, 26 Conn. 192 , a committee of a town had authority to remove obstructions and nuisances. One acted, without the advice or concurrence of the others, and it was held insufficient. Storrs, O. J., in the opinion, lays down the common-law rule as follows : “ If the act is one which requires the exercise of discre *102 tion and judgment, in which case it is usually termed a judicial act, unless special provision is otherwise made, the persons to whom the authority is given must meet and confer together, and be present when the act is performed, in which case a majority of them may perform the act; or, after all of them have been notified to meet, a majority of them having met will constitute a quorum or sufficient number to perform the act, and according to some modern authorities the act may be legally done by the direction or with the concurrence of a major part of the quorum so assembled”; citing Damon v. Granby, 2 Pick. 345 , in which the town chose a committee to superintend the building of a church, and it was held that a majority of such committee constituted a quorum, and that a majority of the quorum might act as the committee. That a majority of a town committee may bind, is held in Hanson v. Dexter, 36 Me. 516 , and Gallup v. Tracy, 25 Conn. 10 . Also to assessors. In Williams v. School District, 21 Pick. 75 , which was a case where two of three school-district assessors acted, and the third did not participate and was not notified, but had been previously invited by one of the two to assist in the assessment, and had then and repeatedly declined to have anything to do with it, Shaw, O. J., says : “ Where a body or board of officers is constituted by law to perform a trust for the public, or to execute a power or perform a duty prescribed by law, it is not necessary that all should concur in the act done. The act of the majority is the act of the body. And where all have due notice of the time and place of meeting, in the manner prescribed by law, if so prescribed, or by the rules and regulations of the body itself, if there be any, otherwise if reasonable notice be given, and no practice or unfair means are used to prevent all from attending and participating in the proceeding, it is no objection that all the members do not attend, if there be a quorum. In the present case, all three having had notice and an opportunity to act, the act of two is sufficient.”

In New York it is held generally that where power is vested in a board of assessors composed of three, all must be notified to meet and consult, though a majority may decide. Matter of *103 Beekman, 1 Abb. Pr. 449 ; Matter of Beekman, 31 How. Pr. 16 ; Matter of Palmer, 31 How. Pr. 42 .

The case of George v. School District, 6 Met. 497 , is pertinent, as there the third assessor, like the third commissioner in the case at bar, failed to qualify by taking the oath. Shaw, C. J., in the opinion, says: “ It appears by the facts stated that three assessors were duly elected by the town, at their annual meeting; that two of them were forthwith sworn, and thereby became qualified to act; but that the other one was not sworn, and, when notified of his election, made no reply; that he never in form declined to accept the office, but, when called on by the other two to act with them, he sent notice to them declining to act. But he gave no notice of this to the town, and the town did not proceed to treat his neglect to take the oath, as a vacancy, by choosing another in his stead. The law requires the town, at their annual meeting, to choose three or more assessors. Under these circumstances the court are of opinion, that when three assessors are duly chosen by the town, there is a board of assessors. Each is an assessor. But until qualified by taking the oath he is not competent to act. If a majority do qualify by taking the oath, and the third has not taken the oath, still if he has notice of their proceeding to execute the office, and decline to take the oath and act with them, their acts will be good in the same manner as if he had taken the oath and- declined to act with them; because he is an assessor and the office is full. . . . There is a board, and of these, by force of the statute as well as by long usage, the majority may act.” In our own State the general rule has been stated and applied in Newel v. Exr. of Keith, 11 Vt. 214 ; Wolcott v. Wolcott, 19 Vt. 37 ; and Hodges v. Thacher, 23 Vt. 455 .

The rule of law being clearly established, and the distinctions clearly and sharply defined, it only remains to apply them to the commissioners in the case at bar. Were the commissioners provided for by the Act of 1867, and named in the instrhment of assent of the town of Mt. Tabor, private agents, or clothed with a power, trust, or authority for merely private purposes ? We think not. They represented no party or interest but the town, which is a public corporation, and the inhabitants thereof. Were *104 they, then, public officers ? It is said, upon the authority of numerous cases, that every office is a public office the duties of which concern the public. In Bradford v. Justices’ Inferior Court, 33 Ga. 332 , the following excellent definition of a public officer is given: “ When an individual has been appointed or elected in a manner prescribed by law, has a designation or title given him by law, and exercises functions concerning the public assigned to him by law, he must be regarded as a public officer.” In People v. Hayes, 7 How. Pr. 248 , commissioners to lay out a road were held to be public officers, and in People v. The Comptroller, 20 Wend. 596 , commissioners appointed by the Governor, Secretary of State, and Comptroller to contract for and superintend the erection of an asylum, were held to be public officers, the question being upon their removal.

Whether the commissioners here were strictly public officers, however, is not material, for the legal distinction which determines the rule to be applied is not based upon the legal character of the board, but upon the origin and nature of its authority and'the character of the duties imposed therewith. We think they at all events come clearly within the definition in Williams v. School District, supra, of “ a body or board of officers constituted by law to perform a trust for the public, or to execute a power or perform a duty prescribed by law ” ; and in Crocker v. Crane, supra, of a board of commissioners appointed by a statute to decide a matter. These commissioners are officers appointed by the statute, which leaves their selection to the majority in numbers and amount of the legal tax-payers of the town. They are to act under an oath of office, and to perform certain duties the immediate object and purpose of which is to obtain for the town better railroad connections and facilities. That a railroad is a public work and interest, has long been established beyond a question. Jones Railroad Securities, c. 7 ; 1 Dillon Munic. Corp. 219 et seq., and authorities cited. Also Bennington v. Park, 50 Vt. 178 . In the discharge of these duties they were to act as the agents of the town, and were given power to make contracts which should bind the town, and to execute a certificate which should be conclusive evidence against the town. Although a town may be small, it is none the less a public corporation and *105 its inhabitants a “ public.” Village of Winooski v. Gokey, 49 Vt. 282 . We think these commissioners were officers created by law, to discharge duties and execute an authority involving deliberation and the exercise of discretion and of a purely public character, and that they therefore come clearly within the well-established, common-law rule which gives validity to the decision and. act of the majority, when all have met and conferred.

But further than this, we think the question is conclusively settled in this State by a statute, doubtless intended to be declaratory of the common-law rule. Section 2, c. 4, Gen. Sts. provides that, “ all words purporting to give a joint authority to three or more public officers or other persons, shall be construed as giving such authority to a majority of such officers or other persons, unless it shall be otherwise expressly declared in the law giving the authority.” It will be observed that the language of Wheeler, J., in Danville v. Montpelier & St. Johnsbury Railroad Co. 43 Vt. 155 , is simply a dictum, and unnecessary to the decision of the case, as it had already been held that the act done would have been invalid, even if participated in by, and done with the concurrence of, all three of the commissioners, because they had previously exhausted their authority and become functus officio ; and the learned judge, by some inadvertence entirely overlooked the words “ or other persons ” in the statute. These words must be construed to apply to any and all persons, not public officers, who are appointed to execute any authority conferred upon them by a statute law. In Hodges, Exr. v. Thacher, supra, this statute, which Redfield, J., says, “ seems to be nothing more than a codification of the long-established [common-law] rule upon this subject,” is applied to the case of probate commissioners, who certainly cannot be regarded as public officers in the common acceptation of the term, but who are officers created by the law, as contradistinguished from a board or tribunal created by act of the parties; and in Thompson v. Arms, 5 Vt. 546 , and in Newel v. Exr. of Keith, supra, the common-law rule is applied to auditors appointed under the statute by the County Court. The statute above quoted provides that the act of the majority shall be good, “ unless it shall be otherwise expressly declared in the law giving the authority.” In the *106 case before us, the law, instead of declaring otherwise, seems to contemplate that a majority may act by making provision in section 7, for the filling, through the intervention of the Court of Chancery, of any vacancy in the board caused*by death, removal, or incapacity to act, and none for filling vacancies otherwise occasioned, as by refusal to act, &c. Massachusetts has a statute almost precisely similar, Rev. Sts. c. 2, s. 6, clause 3, which was held in Plymouth v. Commissioners of Plymouth, 16 Gray, 341 , to give validity to the award of a majority of the board of county commissioners, and has been applied to assessors, in Howard v. Proctor, 7 Gray, 131 , and to fire-wardens, in Coffin v. Nantucket, 5 Cush. 272 ; and the common-law rule is applied to a school-district committee, in Wilson v. Watersville School District, 46 Conn.

We must hold that the certificate of a majority of the commissioners named in the instrument of assent of the town of Mount Tabor, all having met and deliberated, is a legal and valid certificate in compliance with the requirements of the law, and conclusive evidence of the facts set forth in it. The evidence offered by the defendant to impeach the truth of those facts was therefore properly excluded.

The signing of the bonds by two of the three selectmen was sufficient under section 92, c. 15, Gen. Sts.

The law being as we have held, none of the other proof offered by the defendant would constitute any defense to the bonds or coupons in the hands of a bona-fide holder, and it was therefore properly excluded.

Judgment affirmed.

Barrett and Powers, JJ., dissented.