text:
    FIXING THE AMOUNT OF A STREET ASSESSMENT.
    [Circuit Court of Lucas County.]
    Josephine Lippert v. City of Toledo et al.

    Decided, April 2, 1906.

      Streets — Improvement of — Assessing Ordinance — Preliminary Proceedings — Apportioning the Cost — Municipal Corporations — Injunction.
    1. It is not necessary that council shall determine in advance of the assessing ordinance the proportion of the cost and expense of making a street improvement that is to be assessed upon the property abutting thereon.
    2-. The fact that council may have indicated in the resolution and ordinances adopted and passed preparatory to the making of the improvement, the proportion it intended to assess on the abutting -property, does not bar it from designating a different proportion in the assessing ordinance, provided it is within the limitations fixed by the statute.

      Error to Lucas Common Pleas Court.
    B. A. Hayos, for plaintiff in error,
    cited the subjoined authorities :

      Bloom v. Xenia, 32 Ohio St., 461; Cincinnati v. Seasongood, 46 Ohio St., 296; Hunter v. Earl, 51 Ohio St., 573; Elyria Gas Water Co. v. Elyria, 57 Ohio St., 374; Comstock v. Nelson-ville, 61 Ohio St., 288; Scott v. Toledo, 36 Fed. Rep., 385; Freeman v. Hunter, 7 C. C., 117; Elyria Gas & Water Co. v. Elyria, 14 C. C., 219.'
    Parker, J.; Haynés, J.; and Wiedman, J.; concur.
    Josephine Lippert filed a petition in the court of common pleas, setting forth the facts respecting a pavement of Canton street and the assessment of a part of the costs thereof upon her property, and praying that a part of the assessment might be enjoined. The court of common pleas sustained a demurrer to this petition, and judgment was entered and the case is brought into this court for the reversal of that judgment.
    It appears that the council proceeded in the regular and ordinary Avay to make this improvement and to assess the cost thereof. It is claimed, hoAvever, that when they came to pass the ordinances assessing the cost, they assessed more of the cost upon the plaintiff and other abutting owners than was authorized or resolved upon by the ordinance preceding the assessment ordinance.
    Graff M. Acldin was also a plaintiff in the case and, upon the court’s sustaining the demurrer to the petition, Graff M. Acldin asked leave to amend and the case Avas divided. It is brought up by Josephine Lippert, but is pending in the court beloAV on behalf of Graff M. Acldin, he having amended his petition.
    The averments respecting the resolution and ordinance fixing the amount that should be assessed upon the property abutting Aip,on the improvement are as follows:
    “Paragraph fourth. Plaintiffs further say that on the fourteenth day of March, 1904, said council passed an ordinance for the improvement of said Canton street from Cherry street to Jackson street, by repaving the central forty feet thereof; that the fourth section of said ordinance provided, ‘that the cost and expenses of said improvement, less one-half (%) the cost of repaving and less one-fiftieth (1-50) of tlie cost of paving and the cost of intersections, and except the cost of that portion of said improvement lying between the outer rails of the tracks of the Toledo Railways & Light Company, if any such tracks there be, shall be assessed in proportion to the benefits which may result from the said improvement, upon all the lots and lands bounding and abutting upon said Canton street from Cherry street to Jackson street, and of printing and publishing notices, resolutions and ordinances required, together with the cost of serving said notices, the cost of construction, and the interest on bonds issued in anticipation of the collection of deferred assessments, and all other necessary expenditures.’
    “Paragraph fifth. Plaintiffs further say that on the sixteenth day of May, 1904, said council passed an ordinance determining to proceed with the improvement of Canton street from Cherry street to Jackson street, by repaying the central forty feet thereof ; that the third section of said ordinance provided, ‘that there be levied and assessed upon the lots and lands hereinafter described, the costs and expenses of said improvement, less one-half (%) the cost of repaving and less one-fiftieth (1-50) of the cost' of paving and the cost of intersections, and except the cost and expense of that portion of said improvement lying between the outer rails of the tracks of the Toledo Railways & Light Comp.any.’ ”
    The tracks of the railroad company mentioned in the petition extend along the center of Canton street.
    The contention of plaintiff in error is that, under the plan of assessing outlined, or formulated and provided for in this legislation, this being a case of repaving, one-half of the whole cost should be ascertained and laid upon the city, and from the other half should be deducted the amount apportioned to the railroad company and the amount of intersections, and the result would be, as.we find from computations made and presented to us, the cost of the improvement being $41,472.54, that after deducting one-half of that total cost, $20,736.27, and then the cost of intersections, $5,887.20, and the cost of the portions between the oirter rails of the street railroad which would fall upon the street railroad, amounting to $14,542.40, there would remain to be assessed upon the abutting property $306.67. It is contended, however, upon the part of the city that this is not the true construction of the legislation; that what the council must have intended, and what they evidently intended, was the thing that is usually done in such cases by the council; to-wit, the deducting from the total cost of $41,472.54 of these items of the cost of intersections and the cost of the portion between the outer rails of the street railroad, which would leave $21,042.94 to be divided between the city and property owners, one-half to be paid by each, or $10,521.47 to be assessed upon the abutting property. And it is pointed out or suggested to us in argument, and we suppose it is true, though we have no other evidence of the fact, that on Monroe street the same system was adopted, the same language was used in the resolutions and ordinances,'with the result, if the contention of the plaintiff in error is upheld, that instead of the property owners- paying anything for the pavement they would really have some $5,000 or $6,000 coming to them from the city on account of its laying the paving in front of their property. I suppose that could hardly be true. The result might be, however, that they would be relieved from paying anything whatever if the rule and construction contended for by counsel for plaintiff were upheld.
    I shall read one of these paragraphs again, since it has been seen what a startling result would flow from sustaining the contention of plaintiff in error. I read from the ordinance of May 16, 1904:
    “That there be levied and assessed upon the lots and lands hereinafter described the cost and expenses of said improvement less one-half (%) the cost of repaving and less one-fiftieth (1-50) of the cost of paving and the cost of intersections, and except the cost and expenses of that portion of said improvement lying between the outer rails of the tracks of the Toledo Railways & Light Company.”
    It seems to us that that language is entirely clear, and that it does not accomplish what it is said upon the part of the city it was the intention of the council to accomplish, but that the whole cost of the intersections and of the paving of the part the cost of which falls upon the railway company is to be deducted from the one-half of the cost of repaving which is to fall upon the property owners.

      We are told by the solicitor that this language of the ordinance results from trying to adopt a form in use when the statute did not contain the provision that “whenever special assessments have been levied and paid for the improvement of any street or other place the property so assessed shall not again be assessed for more than one-half the cost and expense of repaving or repairing such street or other place unless the grade of the same is changed”; and that to meet such conditions the old form was changed by inserting the words “less one-half the cost of repaving and,” as now found in the ordinances of March 14, 1904, and May 16, 1904. This seems to be the true explanation of the peculiar form now in use. Nevertheless, we must construe the language as we find it, and assume that it was meant by the council to have its usual and ordinary meaning. It will be readily seen that the old form was and is suitable for a case of original construction of an improvement, where the purpose is to except certain items from the whole cost and assess the remainder on abutting property, while the new form does not express a purpose to deduct such items from the whole cost and assess one-half the remainder upon the abutting property.
    But it appears from the petition that, notwithstanding this, the council did subsequently pass an ordinance in which it apportioned the cost differently; that is to say, in the way that the solicitor says it was designed from the first to apportion the cost, and therefore we have to pass upon the validity of that assessment, which amounted to a radical change of base upon the part of the council.
    The question is, might they lawfully do that or were they bound to follow out the scheme and plan and the rate of proportions set forth in the preliminary legislation, or the earlier legislation? We are cited to the case of Freeman v. Tinnier, 7 C. C., 117, decided by .this circuit court at its September term, 1892. That was a ease where property owners were resisting part of the assessment on the ground that there had been included, in the amount assessed, items that could not be lawfully assessed against their properties. Indeed, the assessment which was there attacked was made up entirely of items of a character which they declared could not 'be lawfully assessed upon their property. Prior to that time assessments had been made for the ordinary cost of the improvement, to which no resistance was made, but when- it came to the last assessment it covered awards of damages on account of property taken, by changing the grade of the street, amounting to over $10,000, and court costs in the cases where these amounts were determined, amounting to $352 and some odd cents, the witness fees, the interest, and so forth, the whole amount being $12,468,42. Now, the chief contention of the property owners in that case was, that these were items that could not be lawfully assessed as a part of .the cost of the improvement, and that was the question which was discussed by the judge of this court1 who delivered the opinion. In starting out to discuss it, he says, page 691:
    “The question as to the constitutionality of the proceedings whereby these assessments were made, being of prime importance, will be first considered.”
    And he proceeds to discuss it. That seems to imply a promise that he would come back to a consideration of the other question, but he did not, and one of the points made by the property owners complaining, but which was not discussed by the court, was stated as follows:
    “That even granting the power of the council originally to have assessed for any or all of said items, it did not determine to do so at the proper time; but, on the contrary, indicated by its action that it would not so assess them, and exhausted its power of assessing the cost and expenses of said improvement in making its said.assessment of September 5, 1890.”
    The case went to the Supreme Court, and there is a very brief mention of the point upon which it was decided by the Supreme Court, found in Hunter v. Earl, 51 Ohio St., 573, as follows:
    “Judgment affirmed on the ground that the ordinance of July 18, 1889, did not indicate an intention on the part of the city to assess on the abutting property, any part of the cost included in the assessment ordinance of October 27, 1890; nor was any opportunity given the parties assessed to be heard on or in opposition to the same.”

      So that'what was regarded by the parties and by the court below as the principal question in the case was not passed upon by the Supreme Court at that time.
    In a later case it did hold, as this court held in that case, that the assessing of such items as were objected to there was unlawful; that the law which appeared to authorize it was in that respect unconstitutional.
    Council for the plaintiff here cites this decision by the Supreme Court in support of his contention that the council, having declared and ordained in its ordinance of March 14, 1904, and again in its ordinance of May 16, 1904, that the assessment was to be made upon the basis which would relieve the property owners from paying any more than $306.67, it was not competent or lawful for the council afterward to change base upon this matter and require the property owners to pay $10,521.47. It will be observed that the Supreme Court states the concurrence of the two things or elements entering- into that case as the reason why the subsequent assessment ordinance was objection! able and invalid: First, that the council had not indicated by the earlier ordinance an intention to assess these items upon the property; and, secondly, that no opportunity was given to the parties assessed to be heard on or in opposition to the same. We do not understand it to be true in this case that the parties were not given an opportunity to be heard in opposition to this assessment of $10,521.47; and so far as appears from the petition the council proceeded in the ordinary way to publish notice of the assessment, and property owners were given an opportunity to come in and be heard upon it. Does the mere circumstance then, that in the earlier ordinance the council had resolved upon a course which would result in less burden to property ownei’s, forestall and hinder or prevent the council from afterward making an assessment which, it must be conceded, would be a lawful assessment if the steps taken were regular?
    Upon looking into the statutes, we do not find that it devolved upon the council, or that it is required of the council that it shall, by these earlier ordinances under circumstances like those set forth in the petition, declare the amount or the proportion that is to be assessed against the property owners. • It should be remarked' that there is no element of contract or estoppel here. The resolution and ordinances were passed by a sufficient vote of the council, so that no petition for the improvement was needed, and no petition was in fact presented. The council proceeded upon its own initiative. The property owners were bound to submit to any lawful thing that the council might do in the premises.
    Under certain circumstances, as set forth in Section 61 of the code recently adopted, passed on October 22, 1902 (96 O. L., 42; Revised Statutes 1536-221), a petition would be required. Section 50, 96 O. L., 39 (Revised Statutes 1536-210), provides that the cost of such an .improvement may be assessed by either one of three distinct methods:
    “First. By a’percentage of the tax value of the property assessed.
    ‘ ‘ Second. In proportion to the benefits which may result from the improvement; or
    “Third. By the foot frontage of the property bounding and abutting upon the improvement. ’ ’
    We understand that the assessment was made in this case upon the basis set forth in the second paragraph, i. a., in proportion to the benefits. Section 51, 96 O. L., 39 (Revised Statutes 1536-211), provides, among other things, that there shall be a resolution declaring the necessity, of the improvement and that—
    “Not earlier than two weeks after the passage of said resolution, and before any such improvement is begun, council shall by ordinance, * * determine the general nature of the improvement, what shall be the grade of the street, alley or other public place to be improved, as well as the grade or elevation of the curbs, and approve the plans, specifications, estimates and profiles for the proposed improvement.”
    And then this:
    “Council shall also determine in said ordinance the method of the assessment, the mode of payment therefor, and shall declare whether or not bonds shall be issued in anticipation of the collection of the same.”

      The methods of assessment are required to be set forth in such ordinance, but we do not understand that the setting forth of the amount or proportion to be assessed ag’ainst the abutting property, is any part of the method of assessment. The methods are what are mentioned in this statute, i. e., by a percentage of the tax value of the property assessed, or in proportion to the benefits which may result from the improvement, or by the foot frontage of the property bounding and abutting upon the improvement. Those things must be declared by such ordinance, but the matter of declaring- the amount of the whole cost to be assessed upon the abutting- property may be deferred.
    Section 53, 96 O. L., 40 (Revised Statutes, 1536-213), provides a limitation of assessments. First comes the general provision that in all cases of assessment the council shall limit the same to the special benefits conferred upon the property assessed. Then follow the provisions applicable to the case under consideration :
    “In all municipalities the corporation shall pay such part of the cost and expense of improvements for which special assessments are levied as council may deem just, which part shall not be less than one-fiftieth of all such cost and expenses; and in addition thereto, the corporation shall pay the cost of intersections; provided, that whenever special assessments have been levied and paid, for the improvement of any street or other public place, the property so assessed shall not again be assessed for more than one-half the cost and expense of repaving or repairing such street or other public place unless the grade of the" same is changed. ’ ’
    This was a. case coming under this last provision, a case where the street was being reimproved, where the property owners had already been once assessed for an improvement of this character. It seems that it was within the power of the council, under the circumstances shown here, to have made this assessment $306.67, and, as we construe the two ordinances mentioned, they set out with that purpose and intention; but we do not understand that in so doing they had exhausted their power in the premises, but we hold that they might lawfully do subsequently what they did, i. e., resolve upon putting more of this cost, but not exceeding $10,521.47, upon the abutting property; that they might do that without formally repealing or amending any part of the ordinances theretofore adopted, and by the passing of ordinances that are irreconcilable therewith and which declare a different intention. That is the way they appear to have proceeded here.
    After they passed this assessing ordinance,- for aught that appears, they proceeded regularly under Section- 68, 96 Ó. L., 44 (Revised Statutes 1536-228), to appoint a board to report estimates of the assessment, and under Section 69, 96 O. L., 44 (Revised Statutes 1536-229), to fix a day for the equalization of assessments, and Section 69, 96 0. L., 44, provides that when the assessment is confirmed by the council it shall be complete and final and shall be recorded in the office of the clerk of the council. Among these sections we do not find any provision for the publication of a notice to -the parties interested or for the filing of objections to the assessment, but those provisions are found in Revised Statutes, 2278, 2279 (Revised Statutes, 1536-259; 1536-260) and by Section 94, 96 O. L., 51 (Revised Statutes, 1536-257), of this code they are preserved and kept in force, to-wit:
    “All assessments provided for in this act shall be subject to the provisions of Sections 2278, 2279 (1536-259, 1536-260).”
    We think that under the circumstances this legislation of the council whereby the change of proportion of the assessment to be paid by the abutting owners was made which resulted in their being assessed $10,521.46, instead of $306.67, was regular and legal and should stand. For that reason we hold that the petition fails to set forth a cause of. action, and that the judgment of the court of common pleas should be affirmed, and it is affirmed accordingly.

      B. A. Hayes, for plaintiff in error.

      G. S. Northrup, City Solicitor, and O. W. Nelson, for defendants in error.

       Affirmed by the Supreme Court without report (Lippert v. Parker, Treasurer), February 19, 1907.


source: Caselaw Access Project

license: Public Domain

text:
    LIMITATIONS ON MUNICIPAL BONDING POWER..
    [Circuit Court of Mercer County.]
    J. F. Smith, a Tax-payer, v. The Village of Rockford et al.

    Decided, December 21, 1906.

      Corporations, Municipal and Village — Authority of, to Issue Bonds — For Street and Sewer Improvements — Limitation of Indebtedness tohieh may be Incurred in One Fiscal Tear — Without Authorization by the Electorate — Sections 2835 and 28356 — Auditor's Certificate not Ground for Reliance on Validity of Proceeding.s — Bonds under an Excessive Authorization Valid to What Extent.

    1. Bonds for payment of a municipality’s portion of street and sewer improvements are governed entirely as to the amount of issue by the provisions of Section 2835, Revised Statutes, et seq., and amendments thereto, and are subject to the limitations therein prescribed, and especially to the limitation for any one calendar year of one per cent, of the valuation of taxable property within the corporation and on the tax duplicate; and this limitation refers to the amount of bonds issued, and not to the amount becoming payable within any one calendar year.
    2. Bonds not authorized nor issued until after the date on which the amendments to Sections 2835, 28356, 2836 and 2837 went into effect, April 4, 1906, do not come within the curative provisions of Section 2837 as then amended, notwithstanding the ordinance providing for such issue of bonds directed that they be dated back to April 1st of that year, and further declared that the indebtedness so provided for was an existing, valid and binding obligation of the village.
    3. Persons contracting with a municipality for the construction of street or sewer improvements are bound to use reasonable diligence and business caution to ascertain the validity of the proceedings and authority of council to enter into such contracts; and where a gross disproportion is apparent between the amount authorized to be so expended and the amount legally applicable thereto in view of the taxable valuation of the property included within such municipality, such contracting parties can not rely merely on the clerk’s certificate that the requisite funds are in the treasury and unappropriated for any other purpose.
    4. Where the total amount of bonds authorized by council exceeds the one per cent, limitation, but the contracts entered into and partly executed on the faith of such issue will not require an amount in excess of that limitation, the issue, to the extent of the amount required to meet such contracts so in part executed, will be upheld as binding on the municipality.
    Hurin, J.; Norris, J., and Donnelly, J., concur.
    On appeal from Common Pleas Court of Mercer County.
    The plaintiff, a citizen and tax-payer of the village of Rockford, brings this action on behalf of the corporation of Rockford and prays for an injunction, restraining said village, its council and officers from executing and delivering certain bonds of said village for street and sewer improvements and from borrowing money and pledging the credit of the village for the payment thereof. He asks also that defendants be enjoined from tearing up the streets of said village in furtherance of said improvements.
    The case was- heard in the common pleas court and a permanent injunction granted as prayed for. The defendants thereupon appealed the ease to this court.
    We have heard the evidence and it thereby appears that on March 16, 1906, the village council passed certain ordinances for the improvement of Main and Market streets in said village by grading, draining, curbing and paving the same. These ordinances provided in the usual way for the assessment of the cost, less one fiftieth (1-50) part thereof and the cost of intersections upon the abutting property, and on or aboiit May 8, 1906, other ordinances were passed providing for issuing the bonds of the village in anticipation of the collection of these assessments and for the payment of the village’s share of the cost.
    The bonds so authorized for the Main street improvement amounted to eight thousand ($8,000) dollars. For the Market street improvement the bonds amounted to five thousand ($5,000) dollars. For the Main street sewer they amounted to two thousand ($2,000) dollars, and for the Market street sewer they amounted to two thousand ($2,000) dollars, making a total indebtedness thus created of seventeen thousand ($17,000) dollars.
    These ordinances passed May 8, 1906, declared that these various amounts of money were existing, valid and binding obligations of said village and provided that the bonds thus issued should bear date of April 1, 1906.

      The question of issuing said bonds was never submitted to the vote of the qualified electors of said village. It appears further that on June 5, 1906, other bonds of the village amounting to two thousand ($2,000) dollars were issued and sold for the purpose of improving the water works plant of the village, and these bonds are now outstanding obligations of the village; and that the income from the water works plant is not sufficient to cover the costs of all operating expenses, interest charges, and to place a sufficient amount to the credit of the sinking fund to retire said bonds as they become due; that on June 12, 1906, the contract for the water works improvement was let to Earl Lewis for three thousand and ninety-four ($3,094) dollars, being one thousand and ninety-four ($1,094) dollars in excess of the amount of bonds sold for that purpose (it appears, however that this excess was paid out of the revenue for 1905); that the total value of all property listed and assessed for taxation in the village of Rockford, Ohio, is three hundred and eighty-one thousand ($381,000) dollars, of which one per cent, amounts to three thousand eight hundred and ten dollars ($3,810); that the bonds for said improvement have been sold to the firm of Briggs & Company, but have not yet been executed or delivered.
    That the village’s portion of the cost of said improvements is as follows:
    For the Main street paving ...................... $8,605.87
    For the Market street paving ................... 4,471.66
    For the Sewer No. 1 ............................ 557.53
    For the Sewer No. 2 ............................ 768.65
    $14,403.72
    Making a total village indebtedness in excess of the amount to be raised by special assessment of fourteen thousand four hundred and three dollars and seventy-two cents ($14,403.72).
    That there is no money in the treasury of said village with which to pay the indebtedness thus sought to be created, except certain funds which appear to have been borrowed on the credit of the village in anticipation of the bonds for said improvements which have been enjoined in this case,- but that the clerk of the village certified in due form that the money required for said improvements was in the treasury of said village to the credit of the fund from which it was to be drawn and not appropriated for any other use. ,
    That at a public letting of the contracts for said improvements the defendant firm of IToagland & Gibney obtained the contracts for the paving of the two streets, and that the defendant firm of Campbell & Ausman obtained the contracts for the sewers on these streets, and that the latter firm have entered upon 'the execution of its contract and has completed a portion of said sewers and torn up the streets of said village for a considerable distance.
    It further appears that the contracting firms entered upon their respective contracts and attempted to execute them in reliance upon the regularity and validity of the proceedings of the village council and upon the certificate of the village clerk that the’ money was in the treasury applicable to these purposes and unappropriated for any other purpose, and by reason of these facts the firm of Campbell & Ausman pleads an estoppel and claims the right to proceed with the construction of the sewers in accordance with its contracts.
    The power of a'municipal corporation to make improvements of the kind here to be considered is purely statutory, and the Legislature at its last session materially changed the statutes, Sections 2835 to 2837, inclusive, which control in this case.
    Section 2835 as now. amended provides that the council of any municipal corporation of the state of Ohio shall have power to issue and sell bonds for certain specified purposes, among which are enumerated the construction of sewers and the improving of streets, and it further provides that “the bonds herein authorized may be issued for any and all purposes enumerated herein, but the total bonded indebtedness hereafter created in any one fiscal year under the authority of this act by any township or municipal corporation shall nol exceed one per cent, of the total value of all properly in such township or municipal corporation, as listed and assessed for taxation except as otherwise provided in 'this act.”
    Then follows a provision for assessment of more than one per cent, of such total value of property after a submission of the question to a vote of the qualified electors of such township or municipal corporation.

      There is a further provision that the net indebtedness incurred by any township or municipal corporation after April 29, 1902, shall never exceed four (4) per cent, of the total value of all property in such township or municipal corporation unless such excess is authorized by vote of the qualified electors of the township or corporation. And it is provided by Section 2835Z), that the limitations of one per cent, and four per cent, provided in Section 2835 shall not be construed as affecting bonds issued under authority of said Section 2835 upon the approval of the electors of the corporation, nor shall bonds which are to be paid for by assessments specially levied upon abutting property, nor bonds issued for the purpose of constructing, improving and extending water works when the income from such water works is sufficient to cover the cost of all operating expenses, interest charges, and to pass a sufficient amount to a sinking fund to retire such bonds when they become due; nor shall any bonds issued prior to the passage of Section 2835, Revised Statutes, as amended April 29, 1902, be deemed as subject to the provisions and limitations of said section or be considered in arriving at the limitations therein provided.
    There is a further provision contained in that act (98 O. L., 66), and that is that—
    “No township or municipal corporation shall hereafter create or incur a net indebtedness under the authority of this act in excess of eight per cent, of the total value of all property in such township or municipal corporation as listed and assessed for taxation. ’ ’
    And finally there is added to this section a curative provision ■that—
    “All bonds heretofore issued in good faith under the authority of Section 2835, Revised Statutes, as amended April 29, 1902, and April 23, 1904, which at the time of issue were within the limitation provided, shall be valid obligations of the township, city, village or other-municipal corporations which issued them, and in arriving at the limitations of eight per cent, herein provided, and of 4 per cent, in Section 2835, Revised Statutes, provided, all such bonds, except those excluded by the provisions of Section 2835b, Revised Statutes, shall be considered.”
    This act was passed March 22, 1906, but was not signed by the governor or by him returned to the house where it originated within ten days, but was filed with the secretary of state April 4, 1906, and took effect on that date.
    It will be observed that the date of the ordinances involved in this case are of importance in determining the laws applicable.
    The original ordinances passed March 16, 1906, provided for the improvements and approved the plans, profiles and specifications, determined how the assessments should be made and how paid and that bonds should be issued for the payment of the cost of the improvements, but did not authorize the issuing of the bonds. This was done by separate ordinances passed May 8, 1906, which declared that the indebtedness so provided for was an existing, valid and binding obligation of the village, and provided further, that these bonds should be dated April 1, 1906.
    The statutes which we have recited went into effect April 4, 1906, and were -therefore in full force at the times these bonds were authorized, and as the bonds had not been issued or authorized at the time these statutes went into effect they are not within the curative provisions of Section 2837 as thus amended, notwithstanding the fact that the ordinances provided for dating them back to April 1, 1906, and declared that the indebtedness so provided for was an existing valid and binding obligation of the village. As no contract had at that time been entered into and no bids had been authorized or received, we are unable to see how a binding indebtedness could be held to exist.
    It also appears that they have never been authorized by a vote of the qualified electors of the village, and are not therefore within the exception- made by the statute in favor of such bonds as are thus voted for; nor are the bonds under discussion in this case, at least such of the bonds as are authorized to be issued to pay the village’s portion of the indebtedness to be incurred, within the other exceptions to the statute provided for in Section 2835b, for they are not to be issued for the purpose of constructing, improving or extending the water works -of the village, nor were they issued prior to the amendment of April 29th, 1902. Such of the bonds, however, as were to be paid for by assessments specially levied upon abutting property would of course come within the protecting limits of this section provided they were not in excess of the eight per cent, limitation of Section 2837. It is evident then that these bonds for the costs assessed against the village must be governed entirely by the provisions of Section 2835 and subject to its limitations, and especially to the limitation of one per cent, of the total value of all property in such municipal corporation.
    If it be urged that as all of the bonds are not payable in one year, the net indebtedness for that year may not exceed one per cent, of the total property valuation, it is a conclusive answer that the statute expressly provides that the total bonded indebtedness hereafter created in any one fiscal year shall not exceed the one per cent, limit.
    The indebtedness to be evidenced by these bonds was all created at one time, and that time we must conclude was not when the ordinance was passed declaring that there should be improvements made, but when the bonds were authorized and the contract, signed, and hence that this indebtedness was all created within the fiscal year 1906, and that all this occurred after the passage of the new statute, Section 2835, and after it was in force. The total valuation of the property of the village was found to be three hundred and eighty-one thousand dollars ($381,000). One per cent, of that amount is $3,810. Four per cent, of that amount is $15,240.
    The bonds authorized to pay the proportion of the cost of said improvements assessed against the village amounted to seventeen thousand ($17,000) dollars, an amount greatly in excess of both the ione per cent, limitation and the four per cent, limitation, and it therefore follows that their issue was totally unauthorized.
    If it be urged that the village clerk had, by his certificate, declaring that the money for the payment of the contracts was in the treasury and unappropriated for any other purpose, caused the contractors to rely on this as a fact, we must say in reply, that that alone was not sufficient to justify such a reliance.
    The contractors were bound to examine into the facts and especially where there is so great a disproportion between the amount of the contract price and the amount legally applicable thereto under the property valuation of a village of the size of Rockford, the contractors were bound to use due business caution and such reasonable diligence as would have disclosed to them the facts of the case.
    But 'there is a difference in the position of the two contracting firms. Each one of the contracts taken for the paving improvement exceeded the one per cent, limit, and was therefore illegal.
    But the total cost of the two sewer improvements did not together equal the one per cent, limit.
    The sewer No. 1, contract called for................ $557.53
    The sewer No. 2, contract called for................ 768.65
    Total......................................$1,326.18
    An amount considerably less than one per cent, of the total valuation.
    While the total amount of four thousand ($4,000) dollars authorized to be issued for sewer construction would have exceeded the one per cent, limit, yet as this was not all needed for the construction of the sewers as shown by the contracts, these contracts being kept within the one per cent, limitation were valid, and to the extent of the amount thus called for the bond issue is valid.
    The finding of the court will therefore be in favor of the plaintiff as to all except the amount of bonds necessary to be issued in payment of the two sewer contracts, and in favor of the defendants Campbell & Ausman as to the bonds for such amounts.
    A perpetual injunction will be allowed restraining the defendants from executing and issuing' all bonds for the paving improvements and from tearing up the streets and alleys of Rockford for such paving improvement.
    The injunction heretofore granted as to the bonds to be issued for the sewer improvements will be dissolved.
    Judgment against the defendants, the council and officers of the village of Rockford for costs. Execution awarded and cause remanded for execution.

      Layton & Son and John W. Loree, for plaintiff.

      JS. E. Jaclcson, J. T). Johnson, C. S. Maulc and Conn & Balyeat, for defendants.

       Affirming Smith v. Rockford, 4 N. P.—N. S., 476, and Smith v. Rockford, 4 N. P.—N. S., 513.