Ottawa v. Carey

Citations

• 108 U.S. 110
• 2 S. Ct. 361
• 27 L. Ed. 669
• 1883 U.S. LEXIS 1012

Syllabus

<p>Municipal Bonds — Municipal Corporations.</p> <p>1.. Municipal corporations, being created only to aid the State government in the legislation and administration of local affairs, possess only such powers as are expressly granted, or as may be implied because essential to carry into effect those which ar^ expressly granted.</p> <p>2. Bonds issued by a municipal corporation, but not under either a general authority to. borrow for corporate purposes, or a special legislative authority to borrow for purposes within the power of the legislature to confer, are void in the hands of a person who is not an innocent Iona fide holder without notice.</p> <p>3. A municipal corporation authorized by its charter “to borrow money on the credit of the city and to issue bonds therefor,” and by special act to borrow á named sum “ to be expended in developing .the natural advantages of the city for manufacturing purposes,” is not thereby authorized to issue bonds by way of donation to an individual to aid in developing the water power of the city, and is not liable to an action upon such bonds by one who takes them with notice of the facts.</p>