Nashville union and dispatch. [volume] (Nashville, Tenn.) 1866-1868, 1867-02-28

| Arkansas, or that il received the profits
thereof But it has been argued that the
| principles Of the case of Woodruff rs. Trap
nall have been recognized and rcafiirmed
in the cases of Paup ct al, rs Drew, and Of
Trigg ct al, as Drew. 10th Howard; Curran
rs. the State Of Arkansas, 18th Howard, and
| Hawthorne rs Calef, ID Wallace. The
cases Of Pagp as. Drew and Trigg as Drew,
were decided at the same term of the court
the case of Woodruff as Trapnall was de-
cided, and although in the former
/ the latter is referred to, we think
it may well be doubted whether
| the conclusions arrived at in the differ
| ent cases can be harmonized upon the prin-
ciples Of the case of Woodruff rs. Trapnall
but, be that as it may, Judge Mclean, who
also delivered the opinion of the court in
the cases of Paup rs. Drew and Trigg as
] Drew, in the former case SAYS: In the
case Of Woodruff as Trapnall, 10th How
| ard. l9O decided at the present term, this
] court held that the 18th section in the
| charter constituted contract between the
| State and the holder of the bills Of the bank
that the pledge of the State to receive the
| notes of the bank in payment Of debts, was
a standing guarantee which embraced all
the paper issued by the bank, until the
| guarantee was repealed and that this con
| struction was founded upon the fact that
| the bank belonged exclusively to the State,
was conducted by its officers, and for lis
| benefit"
Although it does not so distincy appear
| in the opinion in the case of Woodruff rs.
| Trapnall, upon what ground the conclusion
| in that case was arrived at, still il is dis
| tinCtly stated by the same Judge, at the
| same term of the court, that the construc-
| ton given to the contract was founded upon
the fact the bank belonged ercIusirelg to the
| State, was conducted by its officers, and for
| its benefit
Here there is a broad distinction be-
! tween that case and this. They rest upon
/ different principles. And were we to give
| ty upon the questions involved therein, it
cannot have the effect contended for in this
case, if the case of Paup ct. al. u.s. Drew is
to be regarded rs authority.
In the case of Curran rs. the State of Ar
kansas, 18th Howard, the charter of the
bank contained a pledge, or assurance that
certain funds deposited therein should be
devoted to the payment of its debts. These
funds were Withdrawn by acts of the Leg
islature bill was filed against the State
Of Arkansas, and the Bank of the State
of Arkansas, and the officers of the bank,
by a creditor of the bank. The court held
that the pledge, or assurance, constituted a
contract with the creditors, and that the
acts Of the Legislature Withdrawing these
funds were void As imparing the obligation
of the contract.
The case in I'd Wallace, relied ON in ar
gument, sustains the opinion of the court
in the foregoing case, and also in the case
Of Woodruff rs. Trapnall, as it was under
stood in the case Of Paup ct a. Is. Drew.
We do not conceive that any of these cases
conflict with this opinion.
in the case of Curran rs. the State of Ar
kansas it is said, THAT State by becoming
interested with Others in a banking corpO-
ration, or by owning all the capital stock,
does not impart to that corporation any of
its privileges or prerogatives, that it lays
down its sovereignty 50 far as the transac-
tons Of the corporation are concerned, and
exercises no power or privilege in respect
to those transactions, not derived from the
charter, has been repeatedly affirmed by
this court"
But the transactions of the corporation
do not form the subject matter involved in
this controversy, and the question here is
not, TO what extent is the State liable be-
cause of its interest in the banking corpora
tion but it is 10 what extent is il bound by
an act of the Legislature which provides
that the notes Of the corporation shall be
receiV able by the State in payment of taxes
and other dues ?
The provisions of the first section of
the bank charter, by which the faith and
credit of the State are pledged for the sup
port of the bank, can exercise no influence
in determining the rights Of the petitioners
in this application. The question as to the
ultimate liability of the State for the issues
of the bank cannot be determined in this
proceeding, or in any proceeding between
the parties now before the court.
We regard it as well settled that State
can no more impair the obligations of its
own contract by legislation, than it can inn
pair the obligation of contracts between
individuals, and that all legislation, the
effect of which is TO impair the obligation
of contract, is un constitutional and void.
But the question whether there was
ers in this case, must be determined bv the
same rules which would determine SINH
lar question between individuals, and when
the fact of the contract is once ascertained,
the action of a sovereign State should be
characterized by a more scrupulOus regard
to justice, morality and promptness, than
belong to the ordinary transactions of in
diyiduals.
But what contract between the State and
the petitioners was impaired by the repeal
in 1865 of the 18th section of the bank
charter? We answer none. They do not
aver that at that time they were the bona
fde holders of the notes of the bank which
they have since rendered in the payment
of taxes due the State
1t has been insisted that TO hold the debt
OF to the State has the right to pay his
debts in the issues of the bank, when they
are greatly below par, would he equivalent
to holding that Legislature has the power
to tie up or destroy the revenues of the State
so as to defeat the ends of the government
itself We do not think so. While it is
true that, while on questions of general
policy, one Legislature cannot bind those
which shall succeed it, still one Legislature
may undoubtedly make 4 contract which
shall bind those that shall come after it.
No one will question the general power OF
the Legislature 10 declare by law, in what
the revenues Of the State may be paid this,
however, is under the control of the Legis-
lature, and may be changed at any time.
The power 10 levy taxes is a power be
longing to sovereignty, which can never be
exhausted as long ~ sovereignty itself con-
tinues the exercise of which is regulated
and restrained by the discretion of the
Legislature. As a matter Of necessity, the
right to exercise this power must be lodged
somewhere; and with this right we must
confer a confidence that At will be exercised
solely with a view to the accomplishment
Of the legitimate purposes Of revenue.
Suppose it was necessary TO carry on the
affairs Of the government that the sum Of
one million dollars Of par funds be raised
by taxation, and there were one million
dollars Of the issues Of the Bank of Tennes-
see in circulation which was worthless, and
which the holders had the right to pay in
discharge Of their taxes looking to these
facts, the Legislature certainly would have
the right as il would be its duty to levy
taxes with a view TO the raising two mil.
lions OF dollars Of revenue thus raising