Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1869-11-21


took from those persons who did not at
the time hold the paper of the bank, the
right to acquire it afterwards, and use it
to discharge their debts to the State.
This construction of the contract would
limit the obligation to the person, and
withdraw it from the paper. If, as we
have endeavored to show, the guaranty
attached to the paper itself, and could not
be withdrawn from it, then it followsthat
the notes in circulation at the time of the
repeal are not affected by it, and carry
with them the pledge of the State to be
received in payment of taxes by every
bona fide holder.
1t would seem to be unnecessary to
discuss, any further, the principles which
lie at the foundation of this case, as they
were settled in Woodruff VS.. Trapnall,
heretofore decided by this court.
The mere statement of that case viii
show its similarity to this
In 1886, the State of Arkansas, in the
charter of bank, (owned and controlled
by the State declared that the notes of
the institution should be received in pay
ment of all debts due the State Some
years afterwards this provision of the
charter was repealed. After its repeal,
Trapnall, acting in behalf of the State,
sued out an execution upon judgment
which the State had obtained against
Woodruff, defaulting treasurer. Wood
ruff met the demand of the writ by ten
der (Which was refused of the notes of
the bank, but whether he got these notes
before or after the repeating act was
passed, did not appear.
On this state of things, Woodruff, to
test his right to pay his debt in the paper
of the bank, applied for writ of manda-
mus against Trapnall, which was denied
him by the State Court.
The case was brought here, as this
is, under the 25th section of the
judiciary act, and this court held that
the undertaking of the State to
receive the notes of the bank, constituted
contract between the State and the hold
ers of the notes, which the State was not
at liberty to break and that the tender of
notes issued prior to the repeating act was
good. Ii was also held, that 1t made no
difference whether the debtor had the
notes in his possession when the repeating
act was passed or not.
1t will thus be seen that Woodruff vs..
Trapnall, and this case, in all important
features, are alike.
An attempt has been made tc distinguish
the cases, because in the Tennessee Bank
trust funds were embarked in the enter
prise; but if the State thought proper to
use them in this manner, it took care to
pledge its faith to supply any deficiency
that should arise through the mismanage-
ment of the bank 1t is difficult to see
how the employment of these funds made
the bank any less a State institution, for
it was created expressly for the benefit of
the State, who had the exclusive manage
ment of it, and agreed to support it. But
if we concede that the State did wrong in
using these funds in banking, can that
tend, even, to justify her in breaking her
promise to the note-hOlders of the bank
Enough has been said to show, as the
result of our views, that section u of the
| charter of the Bank of Tennessee consti-
tuted contract with the holders of the
notes of the bank, and that it was not in
the constitutional power of the Legisla-
ture to repeal the section, so as to affect
the notes which, at the time, were in cir
| culation.
1t is ordered that the judgment of the
Supreme Court of Tennessee be reversed,
and this cause remanded TO that court,
with directions to enter judgment award
inc the writ of mandamus
D. w. MIDDLETON,
Crk Sup. Court L. 5.