The weekly pioneer and Democrat. [volume] (Saint Paul, Minn. Territory) 1855-1865, 1858-11-18

-
with the respective Companies therefor"
Then follows u provision that the moneys
arising from such sales are TO be held by the
State authorities, TO be applied 10 the payme M
OF the interest OF the State Bonds. in case Of
the default OF the companies, and TO make a
sinking fund to meet any future defaults of
interest, aud TO pay the principal when due.
After which comes the provision for further
security TO the state, upon the construction OF
which the parties TO this action differ. Il is
in these words: " Ind as further security
an amount IF first mo fgags binds The road
lands and tranchisss ot the Tsspsrtrs compI, les.
corresponding 10 The State Bonds issued shall be
fanftrsd 10 the Treasurer OF The STATE al the
time Of hs issue ii the Sta q Bonds" Does ia Is
latter provision for the security of the state
mean that the FIRST mortgage bonds to be trans
ierred 10 the Treasurer shall be an sIciasirs
fist hen on the roads lands andiranchises Of the
Company, or merely . lien to he shared equally
by the holders Of similar bonds to the amount
OF twenty three millions. of dollars. which the
Minnesota and Pacific Railroad Company alone
propose to issue
The term first mortgage bond, certainly in
its ordinary aeeept,uon. means an instrument
by which the holder shall enjoy a krst lien upon
the property covered by the mortgage which
secures the bond. And we're there but one
bond issued and one mortgage given TO secur Q
IL, there could be 40 possible doubt on this sub
Jttt, NAs uau company
TO negotiate loan from one individual. there
would be no necessity for issuing more than
one bond TO him secured by mortgage, I'm
less II was for the convenience OF the lender.
should he desire 10 dispose of part OF ii to
others,
The custom which Railroad Companies
have adopted Of issuing series of bonds OF
small denominations IN negotiating loans, has
grown out of the necessity of distributing the
loan among many where 1t cannot be taken by
one, as well a. for the convenience of the lend
er, In putting the security IN more market
able shape.
The character OF the security, therefore 10
be taken by each loan which Railroad may
negotiate, is subject To the arrangement
of the contracting parties. and the adjudication
the term first mortgage bonds must depend en-
tirey upon the condition aud circumstances of
the contracting parties At the time OF making
the contract IN which that term Is used For
example, il Railroad Company desired TO Dor.
row the sum Of twenty three millions of dollars
and had issued bonds to that amount scared
by first mortgage On their roads lands and
franchises, and were then To offer ~ security
Tor n loan of twelve hundred ana iity thousand
dollars from the State Of Minnesota or an iudi.
vidual, an amount Of first mortgage bonds OF the
Company corresponding to the loan 10 he re.
ceved, the party lending would know exactly
what the term slgnied when used In that oou.
Deciion, and the value Of the bonds he was to
receive, and he would admit all subsequent
purchasers Of those bonds to an equality II
len with himself, as ho would have entered
into the contract IN express reference 10 that
issue of bonds. al !, IL equally clear TO my
mind that Il the same company should apply
10 make the same loan before II had issued any
bosds at all, and thnyOEet an amount of fret
mortgage bonds Of the company corresponding
10 the loan asked, tho torn ouii mean an entire.
10 Al ia ltaan
greater issue OF that character Of bond than sui
icjent 10 secure the particular loan under con
shieration. And IA the latter case the b0Gds
would be cigtovu times more valuable than IN
tho former. Any other view wonld leave the
value of the security Discretionary with the
t0rrGwcr, a position which To sAy the lsast II
new feature ia commercial transactions.
1t Is evident, there ure, that the expression is
a relative and not an absolute one. and depends
almost entirely Tor its Specification upon the
cucufn stances Ne der hiCh II "a used, and never
c8u have that pos tive aud anAlterAbIo standing
which the applicants 10 tha case claim iur IT,
Having HAtI upon this term hFa mon tgJge
toads Il, proper totce and import and having
shown that Il must always be proper subject
# interpretation depending ~ Il docs foi its
mraaiEQ more Upou tie circumstance under
which ~ j. uAeJ than upon aty definite iara
conveyed by the words themselves, VIII "a
anime some of the rules by winch the i0lenti0n
81 sw makers and contracting parties II to De
arrived At. when EUrh terms are mace use 81.
The character of the parties, ami The relation
they sustain To- each other, maferia' y insueure
the ruie- by which Their sets are 10 be Deasp
red. iH grants between mdiYiJ dual. where suah
terms appear, the Rtati IL genei ally 10 he con
-ttucd Iao.t strictly against the RtsHtog. story
on contracts, Src. GG2 John, \. T. Rep.
315. : John. 5ai But on te contrary
"pubbc grants ere 10 he construed most favor
~ = H. ft.r 4 Ia
tee of the public, nn alienation should he pre-
s1mgd That s bot clearly expressed. ' IIsgan
~. lampbcH, =. Port. ., see also the case 81
the United states ~. ArfeJ0ndo, ct 81. q fetsts.
on page 10, rhefe this d ctfigc il fully Discus
sed aud all the cases collected: also Jackson
=. Lsmphire, , Peters, Z .. These case. all
sustain the doctrine tbsi nothing can pass ia
grant from The sovereign 20 subject by im
picaton. & follow, therefore. HAT The word
tfsf mJtfgass bJnd' ~ gsed 10 this contract,
being doubtful IA THEN msa1ing II subjected 20
tins test Of cDustrg Ton, must feGeiye tAat Ia.
t.rprsta'.on most favorable 60 the state, aud
the value 81 the securities She is TO receive for
her bonds caanC. be deprecated ~ Impii.
cation.
IN congtfg,ug tbs provision Of Tie Cous,itn
ton. SO may aihp look - Tie reason " .4irh eN-
isted for a. the motives which led ~ IL. pas
-aga. the objects contsmP ated ~ II, aud tie
ere ufu.tauCe* SURROUNDING IL. laetpii on, a.
channels through ~hi,h W. are 60 srfIve 81 the
mention ~ 1t. tram -. Ia The TIRE, pisce. IN"
Constitution was traneJFo On the 2bih Of hugu,t,
lriI. and xss rstiiisd on the Iith day 81 Deia-
Der ~ the same ysAr, aud clsariy expressed
the viii ~ ihr people ~ adverse tp lDanlns the
credit 81 the state ubter any cTeurn sispees.
which rrfaaai VA embodied IN tar lGih section
Of Article = ~ that Instrument. IL the following
words: The credit 81 the state shs never
h~ given ~ ,0@Eea lB a ! u any individual. a.
spciaiisu or crrruysiI"G.' These uT Raj
rnAi Companies bal been previously iprofnD.
rated. ana were then "a existence. they had
? e~i7"3 hy gr-rt from the Territory. The land.
When Congress TAI donated Ia u. tn all Il
Railroads, ami 10 reason esj ted at the sigp.
tan II 'A' Epn-t'ut an. nor haf sny iHtimsti.n
been mad" that Trey expected al from Tho
AT he Ihe prp.~r Ui.ab re- h~T enterprises.
tn'ofescsH obsfae % shorty after Neris pre-
-sD'sd themse., rs, ~asb embarfa-sea Ale
negotiation 81 ipa1s On their ssEgf.t.es. Nod
resort va hi1 - tHa ~gr dent ~ G1ta.aiuy
STATE al ~ q a. ~ that rfsaf. wH.sb ns ! 80
recently bs-n Gai 81 :, Hi. Il 80. under tb4.
coGdt'}oa - tAiaRs .Ha' tts u ilrosi farupa1i-s
al Sue gps*fE.Hest safsrej iats meg yt4tsuus.
Aud 10 hk.H{ ta- rt'4'41e stand H8 %: lie sJa
tracing pHgttsA "a rtgf navel gyf az tta etp-