Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1869-10-14
THE SCHOOL FUND.
Report of the Treasurer as TO the
Lost FuEd-ReccmmendatiOns of the
Treasurer and Attorney smith.

Treasurer and Attorney smith.
The following report from State Treasurer
Rust was laid before the House on Tuesday:
TREAsuRER's OFFIos, NASHVILLE. Tens. Oc-
| tober u. 1S69.-TO the General Assembly Of
| Tennessee-GEETIRMEN Herewith l transmit
| to your honorable body report of tbs, proceed
( ings of the State Treasurer in regard to the
| settlement of the school fund, under resolution
Febt1sry 'r 10. 1853 and section q Of the hppro-
| priation Bill of the Thirty: fifth General Assem-
/ bly, of Tennessee. The only hindrance TO the
obtaining of between fifty and sixty thousend
| whole available assets Of the bank, which
amount to considerable sum. is, that the notes
| of George R. Rutter. President OF said bank.
are in the hands of Judge John Norman. of
| Carroll county, Tennessee, who refuses to de"
| liver them to any one until there is
| some action on ths subject by this
attention to this matter. SIS the longer the set
| Element remains unfinished the less will be
| obtained. as the expense OF the Receiver and
FINALLY going o. ! would recommend that
| the Legislature demand the evidences Of debt
from said John Norman, and that they be
placed in the hands of the Attorney for the
State. Mr.. Thomas X. Smith. of Memphis. in
structing MIN to settle with the Comptroller of
the Currency at W Washington. When the settle
ment is effected. the Comptroller will turn over
the cash on hand due the bank to the State, to
the amount of ffty-five thousand dollars, also
all claims and property that belonged to said
bank. Yours. etc, J. u, RUsF,
State Treasurer.
REPORT FROM Tsos. r. SMITH.
To the General Assembly of the State of Ten
nessee-Gentlemen The Legislature at its last
session authorized the STATE Treasurer to prose-
cute unpaid claims held by the State, and espe.
essary to secure the payment of so much of the
school fund as still remained due and unpaid.
etc. by resolution of February 10. 1862
The undersigned was designated IN said reso-
Iution tn aid the Treasurer.
To carry out the objects of this resolution it
seemed proper that the affairs Of the Tennes ga
National Bank, of Memphis. Tin which the State
Treasurer. Stanford. had deposited the school
fund.- should be closed up SO far as to enable
the State to obtain entire control of its assets.
l had suggested plan for eiteetng this to the
Legislature in the winter of 1867 8, and again in
1868 9, in accordance with the following letter
of the Comptroller Of the Currency, filed as q |
part of this communication marked No. /:
II seemed to me evident that the sooner the |
State obtained exclusive possession of those as
sets, the more she would be enabled to realize
from them, especially as the expensive process |
of settling everything through a receiver would |
The State had no source from which to recover
this fund, except the assets of the bank. the
bond of State Treasurer Stanford, and the bond
of the bank as fiscal agent, and it has been evil
dent for some time that these sources are wholly
inadequate to make the fund good. |
The committee of the Legislature expressed
their approval OF the plan. but no decisive scs
ton was taken until The resolution above re
fOrred to, which Mr.. Rust, your Treasurear, and
/ both construed to be an authority to close up
the affairs of the bank as suggested. l
Accordingly. acting under my advice. Mr..
Rust purchased on favorable terms for the
State, all the claims against the bank which had
been audited and allowed by the Comptroller of |
the Currency. thereby presenting the State in
the attitude OF the only creditor of the bank.
We then went to Washington te effect the neces-
srry arrangements with the Comptroller for |
winding up the receivershiD and enabling the |
State to purchase the assets.
We arranged with the Comptroller to allow
the States claims as follows:
Notes of the 1873 90
Certificate Of dsposit.-....... ...... 1912 3 l
$376, 931 90 l
Then in order that the State might buy at |
Receivers sale. the Comptroller agreed TO /
declare dividend Of what was already in his 1
hands. i. c., upwards of fifty thousand dollars,
and upon such dividend being credited on the /
obligations of the bank held by the State. the /
amount was to be subject to the state Trea-
surers order, in payment of any sum bid at the /
sale or for payment into the State Treasury.
The Comptroller declared the dividend |
agreed upon. The Receiver of the bank acting
under said agreeme emit and by virtue of de- /
cree ofthe Chancery Court of Memphis, offered /
for sale at public auction5 on the I'D and |
Oath of September last all the assets real and /
personal of the bank. Acting in accordance
with said resolution and at the request of the /
State Treasurer. / bid for all the assets which /
were likely TO go Tor lees than their value. and Il
most of them were struck off to me for an ag- /
gregate of about ten thousand dollars. In /
making these bids | announced that was bid
ding for the State.
Upon consultation with the Treasurer, and 1
upon application to his EXcellency the Gov
ernOr. have ascertained that the obligations
referred to, given by the bank. are in the hands
of Hon. John Norman, of Carroll county, and
that no State officer feels authorized to receive
them from him. even to obtain paymen. of a !
portion OF them. have, therefore, been una
bic TO carry out our arrangement with the l
Comptroller, as he cannot pay the State her
dividend until the amount is credited on the
evidences of debt. The State Treasurer has no
funds to pay for the assets | purchased for the
State, therefore they have not been delivered
TO the State. l am personally bound for my
bids, and the delay and expense of tho Receiver
bids fair to be indefinitely continued.
l think have made good purchase for the
State, if the assets are properly managed, and
desire the Legisls ture either to ratify my pur-
chase and authorize the matter to be consum-
mated, or to disafirm it, and, IN the latter
event, will pay the purchase money and take
the purchase to my own account.
The State ought, In justice to herself. as well
as me, TO make the choice st as early day as
practicable, as the assets require speedy set
tlement in order that their full value may be
realized.
If the State shall decide TO take the assets at
my bid, some one should be vested with dis
cretiOnary powers to compromise and secure
the claims on the best practicable terms.
By this arrangement the State will secure all
money that has already been realized from the
assets Of the bank, and all the assets ming
on hand.
In case the State does not take the assets,
she will receive all the money already collected
and the proceeds of the sale, without in either
case, losing her right of action on the bonds
mentioned above. Respectfully, etc,
MRNPHIs. October 4, 1862
lNO. 1, COPY
TREASURY DEPARTMENT, OFFICE OF CoIP-
TROLLER or CURRENCY. WASHINGTON, Nov. IA,
lS57.-Dear Sir: l would like to have your Opin-
ion as to whether the affairs Of the Tennessee
National Bank can not be brought to some sat
isfactOry settlement without much delay, and if
so. how such settlement could be effected
The State is the principal creditor, and it has
occurred to me that if some authorized
agent of the State could settle the claims of the
few individual creditors, so that the State should
present itself as the sole creditor the rem aiming
assets. consisting of miscellaneous claims and
rights of action, might be sold under order Of
| the court. and be purchased by the State. l
| could then legally make dividend. that is to
l say. could turn over TO the State all the pro-
ceedS in my hands.
would be glad to have the affairs of the bank
| so far closed up that the Receiver may be dis
| charged. Yours respectfully,
| II. A. HULBURD, Comptroller.
| Thomas r. Smith. Attorney at Law, Memphis.
NUES1C TCU0NNGSEDu0