possessor. The contract of the creditors would be fully met, on failure of payment of the stipulated debt, by subjecting to sale the property pledged for its payment, with such rights, franchises, and privileges only as were necessary for its beneficial use and enjoyment. The immunity from taxation, as we have already said, was not necessarily included in that designation. The debtor corporation, and its creditors combined, could not confer upon the purchasers any rights which were not assignable; and, as no consideration moved to the state for a renewal of the grant, there is no motive for finding, by mere construction and implication, what the words of the law have failed to express. That certainly is not a reasonable interpretation for which no sufficient reason can be assigned.

We conclude, therefore, that the act from which the plaintiff in error derives its corporate existence and powers in West Virginia does not contain a renewal of the grant by exemption from taxation, which, in the seventh section of the act of March 1, 1866, applied to the Chesapeake & Ohio Railroad Company. Were it otherwise, so that we should be constrained to hold that the language of the act of West Virginia of February 18, 1871, as amended by that of February 20, 1877, had the force of a grant to the plaintiff in error of the exemption of taxation vested by the seventh section of the act of March 1, 1866, in the Chesapeake & Ohio Railroad Company, nevertheless we should be compelled also to hold, on distinct grounds, that the exemption thus conferred did not take effect as a contract, protected from repeal by the constitution of the United States. On the supposition now made, it would still be true that all the rights of the plaintiff in error, as a corporation, other than the title to the property it acquired by the judicial sale, had their origin in and depended upon the acts of 1871-77, under and by which it was created a corporation. It can, in no sense, be regarded as the identical corporate body, of which it became the successor, merely discharged by a process of insolvency from further liability for past debts, which is the view pressed upon us in argument by counsel for plaintiff in error. The language of the statutes expressly contradicts this assumption. The old corporation in terms is dissolved. The purchasers are as explicitly declared to become a corporation, and its corporate powers are conferred by reference to those which had belonged to their predecessors. The language of the law, the reason involved in its provisions, and the precedents of cases heretofore decided by this court, foreclose further controversy on this point. Shields v. Ohio, 95 U. S. 319; Railroad Co. v. Maine, 96 U. S. 499; Railroad Co. v. Georgia, 98 U. S. 359; Louisville & N. R. Co. v. Palmes, 109 U. S. 244; S. C. 3 SUP. CT. REP. 193. That being the case, all grants of corporate powers, rights, privileges, franchises, and immunities are taken, subject to existing laws, remaining unrepealed. At the time the plaintiff in error became a corporation, chapter 53, § 8, of the Code of West Virginia of 1869, which took effect April 1, 1869. was in force, and has never been repealed. It enacted, among other things, as follows: "* * * And the right is hereby reserved to the legislature to alter any charter or certificate of incorporation hereafter granted to a joint stock company, and to alter or repeal any law applicable to such company." The constitution of the state of West Virginia of 1863, article 11, § 5, also provides as follows:

"(5) The legislature shall pass general laws whereby any number of persons associated for mining, manufacturing, insuring, or other purpose useful to the public, excepting banks of circulation and the construction of works of internal improvement, may become a corporation, on complying with the terms and conditions thereby prescribed; and no special act incorporating or granting peculiar privileges to any joint-stock company or association, not having in view the issuing of bills to circulate as money or the construction of some work of internal improvement, shall be passed. No company or association, authorized by this section, shall issue bills to circulate as money.

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No charter of incorporation shall be granted under such general laws, unless the right be reserved to alter or amend such charter at the pleasure of the legislature, to be declared by general laws. No act to incorporate any bank of circulation or internal improvement company, or to confer additional-privileges on the same, shall be passed, unless public notice of the intended application for such act be given under such regulations as shall be prescribed by law."

The incorporation of the plaintiff in error comes within the provisions, both of the constitution and of the Code of 1868. Its charter is the law of 1871 as amended by that of 1877. Its certificate of incorporation is the conveyance to it, by the name it has chosen, as a purchaser at the judicial sale, or set forth in some writing signed by such purchaser, and recorded as required. It is a charter granted under a general law, which the constitution declares to be subject to legislative alteration and amendment. The laws subjecting its property to taxation, and which form the subject of the present controversy, are but the exercise of that legislative discretion, which, as it became the law of the contract itself, cannot be complained of as a breach of the contract.

The conclusion is not weakened by the suggestion that the rights of the plaintiff in error originate in the provisions of the Code of Virginia, referred to in the act of March 1, 1866, incorporating the Covington & Ohio Railroad Company, and of which the acts of 1871-77 are re-enactments. For even then they would not antedate the provision of the constitution of 1863, nor avoid the effect of the reasoning of this court in the case of St. Louis, I. M. & S. Ry. Co. v. Railroad Com'rs, 113 U. S. 465; S. C. ante, 529. The rights of the plaintiff in error, as a corporation, are determined by the law in force when it came into being, although there is no ground on which it can be contended that there was any legislative contract in the act of March 1, 1866, for the further creation of any corporation in favor of possible purchasers at judicial sales under decrees of foreclosure of deeds of trust or mortgages. In either view the result is the same, and for the reasons given the decree of the supreme court of appeals of the state of West Virginia is affirmed.

(114 U. S. 190)

CITY OF LITCHFIELD V. BALLOU and others.
(April 6, 1885.)

CITY BONDS-RIGHTS OF HOLDer of Bond, ILLEGALLY ISSUED, TO RECOVER THE AMOUNT
PAID.

The constitution of Illinois forbidding any city within that state to become indebted to an amount exceeding 5 per centum of its taxable property, a party, who has purchased bonds of a city issued in defiance of the prohibition, must, in order to recover the money paid, clearly identify such money, or the fund, or other property that represents that money, in such a manner that it can be reclaimed and delivered without taking other property with it, or injuring other persons, or interfering with others' rights.

Appeal from the Circuit Court of the United States for the Southern District of Illinois.

John M. Palmer, for appellant. D. T. Littler, for appellees.

MILLER, J. This is an appeal from a decree in chancery of the circuit court for the Southern district of Illinois. The suit was commenced by a bill brought by Ballou against the city of Litchfield. Complainant alleges that he is the owner of bonds, issued by the city of Litchfield, to a very considerable amount. That the money received by the city for the sale to him of these bonds was used in the construction of a system of water-works for the city, of which the city is now the owner. He alleges that one Buchanan, who was the owner of some of thes bonds, brought suit on them in the same court, and was defeated in his action in the circuit court and in the supreme court

of the United States, both of which courts held the bonds void. He now alleges that, though the bonds are void, the city is liable to him for the money it received of him, and as by the use of that money the water-works were constructed, he prays for a decree against the city for the amount, and if it is not paid within a reasonable time, to be fixed by the court, that the water-works of the city be sold to satisfy the decree. The bill also charges that he was misled to purchase the bonds by the false statements of the officers, agents, and attorneys of the city, that the bonds were valid. Other parties came into the litigation, and answers were filed. The answer of the city denies any false representations as to the character of the bonds; denies that all the money received for them went into the water-works, but part of it was used for other purposes, and avers that a larger part of the sum paid for the waterworks came from other sources than the sale of these bonds, and it cannot now be ascertained how much of that money went into the works. The case came to issue, and some testimony was taken, the substance of which is that much the larger part of the money for which the bonds were sold, was used to pay the contractors who built the water-works, while a very considerable proportion of the cost of these works was paid for out of taxation and other resources than the bonds. There is no evidence of any false or fraudulent representations by the authorized agents of the city. The bonds were held void in the case of Buchanan v. Litchfield, 102 U. S. 278, because they were issued in violation of the following provision of the constitution of Illinois:

"ARTICLE IX.

"Sec. 12. No county, city, township, school-district, or other municipal corporation, shall be allowed to become indebted in any manner, or for any purpose, to an amount, including existing indebtedness, in the aggregate exceeding five per centum on the value of the taxable property therein, to be ascertained by the last assessment for state and county taxes previous to the incurring of such indebtedness."

It was made to appear as a fact in that case that at the time the bonds were issued the city had a pre-existing indebtedness exceeding 5 per cent. of the value of its taxable property, as ascertained by its last assessment for state and county taxes. The bill in this case is based upon the fact that the bonds are for that reason void, and it makes the record of the proceedings in that suit an exhibit in this. But the complainant insists that, though the bonds are void, the city is bound, ex æquo et bono, to return the money it received for them. It therefore prays for a decree against the city for the amount of the money so received. There are two objections to this proposition: (1) If the city is liable for this money, an action at law is the appropriate remedy. The action for money had and received to plaintiff's use is the usual and adequate remedy in such cases where the claim is well founded, and the judgment at law would be the exact equivalent of what is prayed for in this bill, namely, a decree for the amount against the city, to be paid within the time fixed by it for ulterior proceedings. In this view the present bill fails for want of equitable jurisdiction. (2) But there is no more reason for a recovery on the implied contract to repay the money than on the express contract found in the bonds.

The language of the constitution is that no city, etc., "shall be allowed to become indebted in any manner or for any purpose to an amount, including existing indebtedness, in the aggregate exceeding five per centum on the value of its taxable property." It shall not become indebted. Shall not incur any pecuniary liability. It shall not do this in any manner; *neither by bonds, nor notes, nor by express or implied promises. Nor shall it be done for any purpose; no matter how urgent, how useful, how unanimous the wish. There stands the existing indebtedness to a given amount in relation

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•193

to the sources of payment as an impassable obstacle to the creation of any further debt, in any manner, or for any purpose whatever. If this prohibition is worth anything it is as effectual against the implied as the express promise, and is as binding in a court of chancery as a court of law.

Counsel for appellee in their brief, recognizing the difficulty here pointed out, present their view of the case in the following language: "The theory of relief assumed by the bill is that, notwithstanding the bonds were wholly invalid, and no suit at law could be successfully maintained either upon the bonds or upon any contract as such growing out of the bonds, yet, as the city of Litchfield is in possession of the money received for the bonds,-or, which is the same thing, its equivalent in property identified as having been procured with this money, and having repudiated and disclaimed its liability in respect of the bonds, it must, upon well-established equitable principles, restore to the complainants what it actually received, or at least so much of what it received as is shown now to be in its possession and in its power to restore." If such be the theory of the bill, the decree of the court is quite unwarranted by it. The money received by the city from Ballou has long passed out of its possession, and cannot be restored to complainant. Neither the specific money nor any other money is to be found in the safe of the city, or anywhere else under its control. And the decree of the court, so far from attempting to restore the specific money, declares that there is due from the city of Litchfield to complainants a sum of money, not that original money, but a sum equal in amount to the bonds and interest on them from the day of their issue. Is this a decree to return the identical money or property received, or is it a decree to pay as on an implied contract the sum received, with interest for its use?

As regards the water-works, into which it is said the money was transmuted, if the theory of counsel is correct, the water-works should have been delivered up to plaintiffs as representing their money as property which they have purchased, and which, since the contract has been declared void, is their property, as representing their money. In this view the restoration to complainants of the property which represents their money, puts an end to obligations on both sides growing out of the transaction. The complainants, having recovered what was theirs, have no further claim on the city. The latter having discharged its trust by returning what complainant has elected to claim as his own, is no longer liable for the money or any part of it. But here also the decree departs from what is now asserted to be the principle of the bill. Having decreed an indebtedness where none can exist, and declared that complainant has a lien on, not the ownership of, the water-works, it directs a sale of the water-works for the payment of this debt and the satisfaction of this lien. If this be a mode of pursuing and reclaiming specific property into which money has been transmuted, it is a new mode. If the theory of appellee's counsel be true, there is no lien on the property. There is no debt to be secured by a lien. That theory discards the idea of a debt, and pursues the money into the property and seeks the property, not as the property of the city to be sold to pay a debt, but as the property of complainants into which his money, not the city's, has been invested for the reason that there was no debt created by the transaction.

The money received on the bonds having been expended, with other funds raised by taxation, in erecting the water-works of the city, to impose the amount thereof as a lien upon these public works would be equally a violation of the constitutional prohibition, as to raise against the city an implied assumpsit for money had and received. The holders of the bonds and agents of the city are participes criminis in the act of violating that prohibition, and equity will no more raise a resulting trust in favor of the bondholders than the law will raise an implied assumpsit against a public policy so strongly declared. But there is a reason why even this cannot be done.

•

Leaving out of view the question of tracing complainants' money into these works, it is very certain that there is other money besides theirs in the same property. The land on which these works are constructed was bought and paid for before the bonds were issued or voted. The streets through which the pipes are laid is public property into which no money of the complainants entered. Much, also, of the expense of construction was paid by taxation or other resources of the city. How much cannot be known with certainty, because, though the officers of the city testify that on the books a separate water-works account was kept, there is no evidence that the funds which went to build these works are traceable by those books to their source in any instance. If the complainants are after the money they let the city have, they must clearly identify the money or the fund, or other property which represents that money, in such a manner that it can be reclaimed and delivered without taking other property with it, or injuring other persons or interfering with others' rights. It is the consciousness that this cannot be done which caused the court and counsel to resort to the idea of a debt and a lien which cannot be sustained. A lien of a person on his own property, which is and has always been his, in favor of himself, is a novelty which only the necessities of this case could suggest. Another objection to this assertion of a right to the property is that the bondholders, each of whom must hold a part of whatever equity there is to the property, are numerous and scattered, and the relative amount of the interest of each in this property could hardly be correctly ascertained. The property itself cannot be divided; its value consists in its unity as a system of water-works for the city. Without the land and the use of the streets, the value of the remainder of the plant is gone. In these, complainants can have no equity.

The decree of the court is reversed, and the case remanded, with directions to dismiss the bill.

I am requested to say that Mr. Justice HARLAN dissents from the judgment and opinion of the court.

(114 U. S. 147)

Ex parte HUGHES, Petitioner.

(April 6, 1885.)

MANDAMUS-FUNDS IN COURT-AWARD OF.

A writ of mandamus cannot be had to compel an inferior court to pay over to the petitioner funds in such court involved in pending litigation, until the cause is de termined, so that it may be known affirmatively how such funds are to be disposed of.

Petition for a Writ of Mandamus.

John H. Mitchell, for petitioner. J. N. Dolph, for respondent.

WAITE, C. J. This is an application for a writ of mandamus requiring Matthew P. Deady, judge of the district court of the United States for the district of Oregon, to "forthwith sign and execute, by signing or countersigning, any and all such orders, matters, and things as may be requisite or necessary to enable your petitioner (Ellis G. Hughes, an attorney at law, practicing in the circuit and district courts of the United States for such district) to withdraw from the depositary of said court the sum of five hundred dollars belonging to him." The petition for the writ, which is sworn to by the petitioner, states that on and prior to May 3, 1882, there was pending in the circuit court of the United States for the district of Oregon a suit in equity for the foreclosure of a mortgage in which William Reid, manager, was plaintiff and H. McCallister and W. B. McCallister defendants, and that the plaintiff therein "recovered in said suit a certain decree as against the defendants, * and a certain order of sale, wherein and whereby it was or