Rensselaer Semi-Weekly Republican, Volume 34, Number 42, Rensselaer, Jasper County, 24 January 1902 — Fowler Hit Hard In The U. S. Court [ARTICLE]

Fowler Hit Hard In The U. S. Court

Judge Baker, of the United States Court, at Indianapolis, Tuesday handed down an opinion in the suit brought by the Fidelity Trust and Guaranty Company of Buffalo, against the Fowler Water Company and the town of Fowler. The suit was to foreclose a mortgage for $30,000, securing bonds of the water company to that amount. The principal contention was whether the franchise of the water company, containing an agreement of the the town of Fowler to pay a specified rental for forty-nine ‘fire hydrants was valid and enforcible. The town attempted to defeat the hydrant rental contract on the ground that the franchise was passed as a part of an unlawful , scheme to buy the water works by having a company organized to build the works, have the company issue bonds and then convey the works to the town subject to these bonds The town claimed this was an unlawful attempt to evade the constitutional limitation forbidding the creation of a debt in excess of 2 per cent of the taxables of the town. Judge feaker holds that the ordinances of the town cannot be modified by oral evidence of such a scheme if one existed; that the Town Trustees had authority to make the contract for hydrant rentals, and that this contract was not affected by the act of the town in taking a deed for the water works promptly after the mortgage and bonds were issued. The effbet of the decision is to compel the town of Fowler to pay rental for the hydrants. A foreclosure of the mortgage is ordered by J udge Baker and the works will probably be eold. The amount of the mortgage with interest will be in the neighborhood of $35,000.