LEWIS, Circuit Judge.
This is a proceeding in mandamus. The petition for the writ alleges that relator, Harriman National Bank of New York, recovered a judgment for $25,000 against Poinsett County, Arkansas, on warrants issued by the County prior to the adoption of Amendment No. 11 to the Arkansas Constitution; that Caplinger is the Judge of the county court of that County and that court in June, 1925, determined of record and published the amount of the county indebtedness as of the time of the adoption of said amendment; that in April, 1926, relator petitioned said eounty court and Caplinger as judge thereof to issue interest-bearing bonds of said county in an amount sufficient to pay said judgment and either sell said bonds for that purpose or deliver them to relator in satisfaction of said judgment; that the county has no funds with which to pay said judgment and will have none unless said amendment and the statute passed pursuant thereto are complied with by the county; that on the issuance of said bonds said county is authorized to make a special annual tax levy, not exceeding three mills, on taxable property within the county for the purpose of raising a fund applicable to the payment of its bonded indebtedness only, as in said amendment and statute provided; that otherwise the maximum tax levy [899]*899is five mills for county purposes which, is all needed for current county expenditures and will continue to be so needed and applied and no part of relator’s judgment can be paid therefrom; that unless said bonds are issued and said special levy is made for their payment relator’s judgment will remain wholly unpaid; that said county court and the judge thereof have wholly failed to comply with said amendment and statute and with relator’s petition therefor and the writ was prayed for commanding the county court and the judge thereof to enter an order for the issuance of bonds or a certificate of indebtedness to relator in payment of its judgment bearing the legal rate of interest or that said bonds be sold and the proceeds applied in payment of the judgment, in compliance with said amendment and statute. They are copied in full in the margin below.1
A demurrer to the petition was sustained on the ground that Amendment No. 11 and the statute did not make it mandatory on the county court and the judge thereof to refund the county’s indebtedness, but left it optional — that it was a matter wholly within the discretion of the county judge. We think the point not well taken, and that the court erred in sustaining the demurrer. The record does not disclose the reason for the court’s action in this case; but it seems apparent, in fact it is agreed, that its action in the prior ease of United States ex rel. v. Paschall, County Judge of Lincoln County, a like ease, was followed. Two reasons were given for denying the writ in that case (see United States ex rel. v. Paschall [D. C.] 9 F.[2d] 109), the basis for one of which does not exist in this ease — that is, the total amount of the indebtedness of Lincoln County outstanding at the time of the adoption of [900]*900Amendment No. 11 had not been declared of record by the county court, as bad been done in this case; so, as to the soundness of that reason, we need not and ,do not express an opinion. The other reason there assigned for denying the writ, was the court’s conclusion that a refunding of the county’s indebtedness was not made mandatory by the amendment or the statute, and that each county was left free to exercise its discretion whether it would or would not avail itself of the extended power and privilege. Both amendment and statute say that counties “may issue” interest bearing bonds for the purpose of paying or funding their indebtedness, and these terms were accepted in their literal sense, as merely permissive. As to the amendment, there would be no occasion to hold otherwise if we regard only those words; for it was a grant of power that did not previously exist. The conditions under which the power should be exercised might well be left to the legislature. But the first section of the amendment is strongly persuasive that the people in adopting it intended that the power should he exercised by counties heavily in debt, as is Poinsett County. Its purpose was to put such counties on a sound financial basis, to es[901]*901tablish their credit, provide ways and means to pay their indebtedness and to prevent further contracting debts for which no revenue could be provided. Under the Constitution taxpayers in the county could pay their county taxes with discredited warrants. There is no priority in payment of warrants when it came to tendering them for county taxes, hence, as alleged, there was no way in which holders of warrants who were non-taxpayers in Poinsett County could ever realize any thing. It was the undoubted purpose of the amendment to have such counties as this pay their indebtedness in the method provided and to put a stop to further repudiation. So much for the amendment, but let us take it as a mere grant of power, reasonable conditions for the exercise of which should be left to the legislative branch, notwithstanding the Supreme Court of the State has held the amendment self-executing. Cumnock v. City of Little Rock, 168 Ark. 777, 271 S. W. 466; Lucas v. Reynolds, 168 Ark. 1084, 272 S. W. 653; Matheny v. Independence County, 169 Ark. 925, 277 S. W. 22. Dillon on Municipal Corporations (5th Ed.) § 246, says, it is always a question of legislative .intention, and, 'therefore, of construction to determine whether a duly imposed by law is imperative or discretionary. United States ex rel. Siegel v. Thoman, 156 U. S. 353, 359, 15 S. Ct. 378, 39 L. Ed. 450. The statute prescribes the procedure to be taken by the county court, that the bonds to be issued shall be negotiable coupon bonds payable serially through a period of not exceeding forty years and shall'bear interest not exceeding six per cent, per annum, and that a tax not exceeding three mills on the dollar shall be • levied to meet the maturities of the bonds with interest. The revenue so to be raised shall be used only in payment of said indebtedness, it must be preserved as a separate fund for that purpose and its diversion is made a felony. These and other provisions of the statute fully supplied the county courts with the means of executing the power conferred by the amendment. Under the amendment and statute, if carried out, benefits would accrue to the county’s creditors; and plainly it was so intended. Not only so, but the legislature found that it would be beneficial to the publie to refund the indebtedness. The title of the act is: “An act to facilitate the funding of the debts of counties, cities and incorporated towns,” and its last section recites that.many counties, cities and towns are so heavily indebted that they cannot obtain the necessary funds to carry on their ordinary functions; police and fire protection, safeguard the publie health, maintain public buildings, roads and bridges and provide for police officers in maintainance of the publie peace. This, it was found, created an emergency, and because thereof the Act was put into immediate effect on its passage. A municipality, like an individual who has no intention of paying his debts, becomes reckless in issuing its obligations and then finds it has no credit. That is what the Legislature found'in this Act, and it directed the only way out, which when followed will be beneficial not only to the publie, but to the county’s creditors also. Reverting to the section, supra, in Dillon, it is said: “The words that a corporation or officer may act
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LEWIS, Circuit Judge.
This is a proceeding in mandamus. The petition for the writ alleges that relator, Harriman National Bank of New York, recovered a judgment for $25,000 against Poinsett County, Arkansas, on warrants issued by the County prior to the adoption of Amendment No. 11 to the Arkansas Constitution; that Caplinger is the Judge of the county court of that County and that court in June, 1925, determined of record and published the amount of the county indebtedness as of the time of the adoption of said amendment; that in April, 1926, relator petitioned said eounty court and Caplinger as judge thereof to issue interest-bearing bonds of said county in an amount sufficient to pay said judgment and either sell said bonds for that purpose or deliver them to relator in satisfaction of said judgment; that the county has no funds with which to pay said judgment and will have none unless said amendment and the statute passed pursuant thereto are complied with by the county; that on the issuance of said bonds said county is authorized to make a special annual tax levy, not exceeding three mills, on taxable property within the county for the purpose of raising a fund applicable to the payment of its bonded indebtedness only, as in said amendment and statute provided; that otherwise the maximum tax levy [899]*899is five mills for county purposes which, is all needed for current county expenditures and will continue to be so needed and applied and no part of relator’s judgment can be paid therefrom; that unless said bonds are issued and said special levy is made for their payment relator’s judgment will remain wholly unpaid; that said county court and the judge thereof have wholly failed to comply with said amendment and statute and with relator’s petition therefor and the writ was prayed for commanding the county court and the judge thereof to enter an order for the issuance of bonds or a certificate of indebtedness to relator in payment of its judgment bearing the legal rate of interest or that said bonds be sold and the proceeds applied in payment of the judgment, in compliance with said amendment and statute. They are copied in full in the margin below.1
A demurrer to the petition was sustained on the ground that Amendment No. 11 and the statute did not make it mandatory on the county court and the judge thereof to refund the county’s indebtedness, but left it optional — that it was a matter wholly within the discretion of the county judge. We think the point not well taken, and that the court erred in sustaining the demurrer. The record does not disclose the reason for the court’s action in this case; but it seems apparent, in fact it is agreed, that its action in the prior ease of United States ex rel. v. Paschall, County Judge of Lincoln County, a like ease, was followed. Two reasons were given for denying the writ in that case (see United States ex rel. v. Paschall [D. C.] 9 F.[2d] 109), the basis for one of which does not exist in this ease — that is, the total amount of the indebtedness of Lincoln County outstanding at the time of the adoption of [900]*900Amendment No. 11 had not been declared of record by the county court, as bad been done in this case; so, as to the soundness of that reason, we need not and ,do not express an opinion. The other reason there assigned for denying the writ, was the court’s conclusion that a refunding of the county’s indebtedness was not made mandatory by the amendment or the statute, and that each county was left free to exercise its discretion whether it would or would not avail itself of the extended power and privilege. Both amendment and statute say that counties “may issue” interest bearing bonds for the purpose of paying or funding their indebtedness, and these terms were accepted in their literal sense, as merely permissive. As to the amendment, there would be no occasion to hold otherwise if we regard only those words; for it was a grant of power that did not previously exist. The conditions under which the power should be exercised might well be left to the legislature. But the first section of the amendment is strongly persuasive that the people in adopting it intended that the power should he exercised by counties heavily in debt, as is Poinsett County. Its purpose was to put such counties on a sound financial basis, to es[901]*901tablish their credit, provide ways and means to pay their indebtedness and to prevent further contracting debts for which no revenue could be provided. Under the Constitution taxpayers in the county could pay their county taxes with discredited warrants. There is no priority in payment of warrants when it came to tendering them for county taxes, hence, as alleged, there was no way in which holders of warrants who were non-taxpayers in Poinsett County could ever realize any thing. It was the undoubted purpose of the amendment to have such counties as this pay their indebtedness in the method provided and to put a stop to further repudiation. So much for the amendment, but let us take it as a mere grant of power, reasonable conditions for the exercise of which should be left to the legislative branch, notwithstanding the Supreme Court of the State has held the amendment self-executing. Cumnock v. City of Little Rock, 168 Ark. 777, 271 S. W. 466; Lucas v. Reynolds, 168 Ark. 1084, 272 S. W. 653; Matheny v. Independence County, 169 Ark. 925, 277 S. W. 22. Dillon on Municipal Corporations (5th Ed.) § 246, says, it is always a question of legislative .intention, and, 'therefore, of construction to determine whether a duly imposed by law is imperative or discretionary. United States ex rel. Siegel v. Thoman, 156 U. S. 353, 359, 15 S. Ct. 378, 39 L. Ed. 450. The statute prescribes the procedure to be taken by the county court, that the bonds to be issued shall be negotiable coupon bonds payable serially through a period of not exceeding forty years and shall'bear interest not exceeding six per cent, per annum, and that a tax not exceeding three mills on the dollar shall be • levied to meet the maturities of the bonds with interest. The revenue so to be raised shall be used only in payment of said indebtedness, it must be preserved as a separate fund for that purpose and its diversion is made a felony. These and other provisions of the statute fully supplied the county courts with the means of executing the power conferred by the amendment. Under the amendment and statute, if carried out, benefits would accrue to the county’s creditors; and plainly it was so intended. Not only so, but the legislature found that it would be beneficial to the publie to refund the indebtedness. The title of the act is: “An act to facilitate the funding of the debts of counties, cities and incorporated towns,” and its last section recites that.many counties, cities and towns are so heavily indebted that they cannot obtain the necessary funds to carry on their ordinary functions; police and fire protection, safeguard the publie health, maintain public buildings, roads and bridges and provide for police officers in maintainance of the publie peace. This, it was found, created an emergency, and because thereof the Act was put into immediate effect on its passage. A municipality, like an individual who has no intention of paying his debts, becomes reckless in issuing its obligations and then finds it has no credit. That is what the Legislature found'in this Act, and it directed the only way out, which when followed will be beneficial not only to the publie, but to the county’s creditors also. Reverting to the section, supra, in Dillon, it is said: “The words that a corporation or officer may act in a certain way, or that it shall be lawful to act in a certain way, may be imperative. On this sub: ject some of the cases declare the doctrine that what public corporations or officers are empowered to do for others, and that which is beneficial to them or to the public to have done, the law holds they ought to do, especially if the law specifically or adequately supplies them with the means of executing the power. The power in such case is conferred for the benefit of others or of the publie; and the intent of the Legislature, which is the test in such eases, ordinarily seems, under such circumstances to be to impose a positive and absolute duty. But under other circumstances, where the act to be done does not affect third persons, and is not clearly beneficial to them' or the public, and the means for its performance are not supplied, the words, may do an act, or it is lawful to do it, do not mean must, but rather indicate an intent in the Legislature to confer a discretionary power.”
In Rock Island County v. United States ex rel., 4 Wall. 435, 18 L. Ed. 419, an Illinois statute was up for consideration. It provided that “the board of supervisors under township organization, in such counties as may be owing debts which their current revenue, under existing laws, is not sufficient to pay, may, if deemed advisable, levy a special tax,” etc. There the relator, a judgment creditor, sued out the writ of mandamus to compel the board to make the levy as the means of paying his judgment. The board appealed, and contended that the words, may, if deemed advisable, imposed on it only a discretionary duty which they were to discharge, or not, as the judgment of the board might dictate, and that judgment could not be coerced and enforced by the, writ. But the Supreme Court after reviewing the authorities answered the contention thus: “The conclusion to be deduced from the author-
[902]*902ities is, that where power is given to public officers, in the language of the Act before us, dr in equivalent language — whenever the •public interest or individual rights call for its exercise — the language used, though permissive in form, is in fact peremptory. What they are empowered to do for a third person the law requires shall be done. The power is given, not for their benefit, but for his. It is placed with the depository to meet the demands of right, and to prevent a failure of justice. It is given as a remedy to those entitled to invoke its aid, and who would otherwise be remediless. In all such eases it is held that the intent of the Legislature, whieh is the test, was not to devolve a mere discretion, but to impose ‘a positive and absolute duty.’” Unless the power is exercised in this ease the county will go on with the maximum levy of five mills all of whieh will be applied to payment of current county expenditures, and relator will receive nothing on its judgment. It is entitled to have that judgment paid, it is the duty of the county to pay it, and the amendment and the statute have provided a method for its payment. A remedy is given by whieh that end may be accomplished, and relator is entitled to have it enforced. In City of Galena v. Amy, 5 Wall. 705, 18 L. Ed. 560, judgment was recovered by Amy on bonds issued by the City, whieh remaining unpaid, he applied for and obtained writ of mandamus to compel a levy of not exceeding one per cent, on the dollar of the assessed value of taxable property in the city. The statute relied on provided that the city council “may, if tfie said city council believe that the public good and the best interests of the city require,” make the one per cent, levy and collect the tax to be applied in payment of the City’s funded debt. Of this statute the Supreme Court said: “They [the city authorities] have no other means of payment, in possession or prospect. Under such circumstances, the discretion thus given cannot, consistently with the rules of law, be resolved in the negative.
The rights of the creditor and the ends of justice demand that it should be. exercised in favor of affirmative action, and the law requires it. In such cases the power is in the nature of a trust for his benefit, and it was the plain duty of the court below to give him the remedy for whieh he asked, by awarding a peremptory writ to compel the imposition of the tax, as was done.”
This court in City of Little Rock v. United States ex rel. Howard (C. C. A.) 103 F. 418, had presented to it for determination the right of a judgment creditor to demand and to have issued to him City warrants in payment of his judgment, there being no other way in whieh he could collect or realize any thing on his judgment. The statute under whieh the warrants could be issued for that purpose was permissive, not peremptory, in its terms; and we said: “As this was the only way in whieh the plaintiffs in error could provide for the payment of this judgment, and as they had ample power to provide for it in this way, it was their plain duty to do so, and the court below properly commanded them to discharge that duty. Where a municipality and its officers have the power to pay a judgment against a city by the issue to the owner of the judgment of city warrants which are receivable for city taxes, and have no other way to pay it, it is their duty to issue the warrants, and the writ of mandamus will be granted to compel them to discharge that duty.” See also Mason v. Fearson, 9 How. 248, 259, 13 L. Ed. 125; Chase v. United States (C. C. A.) 261 F. 833; Boswell v. Coal Co. (D. C.) 217 F. 822, 827; Ralston v. Crittenden (C. C.) 13 F. 508, 512; 36 Cyc. p. 1160.
We are not impressed with the contention that the statute imposes discretion in the county judge in the several steps to be taken in the procedure. They are madé fairly definite in the Act, when the purpose and character of the whole subject is brought under consideration. Business and financial considerations will readily dictate reasonable dates for bond maturities, and if sales at par cannot be made of the bonds on a basis of six per cent, or less they may be offered to creditors, whieh relator has signified its willingness to accept. The county judge took the • first step and stopped, no reason is shown why he should not go on and compelled to do so, if necessary. The issue here is with the relator. Its rights will not be sacrificed on the claim, that defendant in error does not know what should be done as to other creditors. If it be necessary to consider them in adjusting relator’s rights let him proceed to do so. The duty is imposed and it cannot be evaded by non-action on the assertion of counsel that it may seem difficult to plaintiff in error in proper performance. If the matter be taken up with a serious purpose to comply with the Act, we have no doubt the procedure will seem plain and simple.
The judgment dismissing relator’s petition is reversed with directions to reinstate it, overrule the demurrer thereto and then proceed in accord with the views herein expressed.