Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1869-11-18
OUR RAILROADS.
Can They be soIdr If So, How

Can They be SOIdl If So, Howl
To the Editors of the Union and American
Can the railroads of the companies that
fail to pay their interest be sold by the
State! Without legal proceedings in the
courts they cannot be sold. The State
does not own the roads, but has only
lien or statutory mortgage upon them.
The companies are the mOrtgagers and the !
State the mortgage of the roads and to
secure valid sale and good title to the
purchaser, bill must be filed in court
of chancery to fOreclOse the mortgages
by sale Of the roads to pay the lien of
the State Hence all acts that look to
sale by the Governor or other officers of
the State by direction of the. Legislature
would amount to nothing because they
would accomplish nothing. The State
may, under legislative action, sell its in
terest in the roads and transfer its liens,
but can directly do no more.
But NAV not the roads be sold by prop
er legislation and legal proceedings in the
courts2 If not, then why not The
case is Sin nutshell" By the act of the
18th of Feb, 1852, usually termed the
internal Improvement Act a remedy is
provided for the benefit of the State in the
event of default in the payment of in
terest, to-wit by the appointment of
Receiver, etc; and q remedy is also
provided for the State in the event of a
failure to pay the bonds at maturity, to-
wit A bill in equity by the Attorney
General, etc The position that the Legis-
lature cannot authorize judicial sales of
these railroads for failure by the compa-
MES to pay the interest on these bonds as
it falls due, is not sustained by any ex-
press provision of the law. And the
assumed prohibition against the exercise
of such authority by the Legislature is in
ferential only. Because the law provides
for Receiver when the interest is not
paid, when due, and for bill in equity,
when the bonds are not paid at maturity,
to sell the property, it is inferred that the
Legislature cannot authorize a bill in
equity also for sale in the case of the
nOn-payment of interest. 1t is a mere in
ference, and hardly sustained in view of
the settled law in analogous cases, and by
a proper consideration of the act itself in
connection with its subject matter.
Dut III Nlth VI lllt IN SOULFUL VI AAiS
actreferredto there is little left for infer
ence. Ii provides that the estate er-
pre8sly reserves to itself the right to
enact by the Legislature all such lars
as mag be deemed necessary to protect
the interests Of the State, and to Sc
cJTe the State from loss in cOnSe-
ggeHce OF the issuance Of such
| bonds: but so as not to impair
the rested rights Of the respective com
| 1OGnieS" The question arises at once, is
it necessary for the Legislature to author
ize bills to be filed by the State against
| these companies, TO sell their roads, IN
view of the stubborn facts before it, in
| order to ''prOtect the interests of the
| State, or to ''secure it from loss in con
| sequence of the issuance of the bonds -
Is not The State irretrievably bankrupt il
it cannot he done Can its ''interests be
protected" without it, or can it in any
other way ''be saved from loss" by rea-
son of the issuance of the bonds? Let
us see. Take one case and run it to It's
certain result and we will see. A rail
road owes the State 81, 800, 900. II has
an unfinished road, about - miles I'm
ished, about as much partly finished, anc
and almost One-fifth of the whole
untouched. 1t pays no interest. Il
can pay no interest. Itcan never pay any
interest, for one reason among many others
that it can never finish its railroad, no
even the part that has been begun. III
cross-ties will rOt-its bridges and trestle
will decay and fall to pieces, and It's lrOl
rails if used, will wear out by the time tn
bonds advanced To the company matur
and there will be but little, if any OF 1t
left, and by the accumulation of interes
on the 81, 500, 600 for over % years, tina
company will owe about 1000, 900 an
will have no means with which to pay II
But in the mean time, the State will haV
To paw the semi-annual interest on tn
81, 500, 600, and would be entitled to hay
it compounded, and that would make tn
debt too large TO consider at al
Take any nOn-paying company an
whether finished or unfinished, and ru
its debt with interest until the maturity {
its borrowed bonds, and you will find thu
| its debt will be more than doubled, an
take all of these debts of all the non-pay
, ing companies and aggregate them, charg
a them interest as paid by the State, an
You will find that in 20 years these con
panies will owe the State higher $50 900
, 600 than SIS, 900, 900, which latter sum
f about their present debt in the aggregate
In the face of such facts and figures, WI
4 will saw that an act of the Legislature, al
3 thoriZing legal proceedings to be institute
= against these companies for the sale I
= these railroad, isnot "deen3ednecesSG
to protect the interest of the State and
save it from loss in this matter!
AS to the provision in the 18th Sc
ton, in regard to impairing the vestt
rights of the stockholders, it is suggestt
that the same provision is understood to
added to every law passed by the Legi
= lature. 1t cannot, in any case, pass, co
stitutionally, any act that lmpairs or q
a vests vested rights, and the fact that SUI
provision is added to the act, by prOvi
d or otherwise. adds nothing to its force.
:, itbe unconstitutionaltop pass an act authori
l. ingbiIlsto be filed against the companies,
e the 18th section stands with the proyis
5, it would be equally unconstitutional in IL
(, absence of such provisO. But wherein
l. such legislation unconstitutional VIII
vested right would it impair If there
! an answer, what is it Is it any viOl
ton or infringement of a contract? H
! the State, in the act of 1852, or anyThe
> else. bound itself to pay the interest d
,, by these parties and wait with them f
25 years!
sr A WEDDING in Memphis, last week, W
d spoiled by the failure of the bridegroo
IS to appear The bride and her fair bride
/ ---... f..llr- lrosanl The r1lGsts q