Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1869-11-04


curing him to receive the notes of
the Bank of the State of Ar
kansas in satisfaction of the
| Judgment, or show cause why
he should refuse to do so. On the return
of the writ, the Attorney General admitted
the tender of the notes of the Bank of
the State of Arkansas, but alleged that he
was not bound to receive them, because
the twenty eighth section of the charter
of the bank, under authority of which
the Treasurer could claim the right to pay
the judgment in the notes of that bank, had
been repealed by an act of the Legisla-
ture, which was approved Jan. 10,
1915. The Supreme Court of Arkansas
held that the Attorney General showed suf-
ficient cause for arefusal to obey the man
damus, and the case was taken by appeal
to the Supreme Court of the United
States The question submitted for the
consideration and decision of the court
was, whether the repeal of the twenty
eighth section of the charter of the bank,
brought the case within the constitution of
| the United States, which prohibits a State
from impairing the obligation of a con-
tract The bank was located at Little
Rock, with capital of one million of dol
lars, to be raised by a sale of the bonds of
the State, just as large portion of the
capital of the Bank of Tennessee was
raised And it was to be conducted by
officers and directors appointed in the same
| manner as were those for the Bank of
Tennessee. In delivering the opinion of
the court Justice Mclean said:
''The entire stock of the bank is owned
| by the State. 1t furnishes the capital and
receives the profits And in addition to
| the credit given to the notes of the bank
/ by the capital provided, the State declares
| in the charter they shall be received in all
/ payments of debts TO it. Is this a con-
| tract2 A contract is defined to be an
agreement between competent persons to
do or not to do a certain thing. The I'M
dertaking on the part of the State is to re-
ceive the notes of the bank in payment
from its debtors. This comes within the
definition of a contract 1t is contract
| founded upon a good and valuable
consideration; q consideration bene-
fetal to the State, as its profits are in
creased by sustaining the credit, and con-
sequently extending the circulation of the
paper of the bank. With whom was this
contract made2 We answer, with the hold
ers of the paper of the bank. The notes are
made payable to bearer, and consequently
every bona tide holder has a right, under
the 2Sth section, to pay the State any
debt he may owe it in the paper of the
bank 1t is a continuing guarantee by
the State that thenotes shall beso received.
Such contract would be binding on an
individual, and it is no less so on State.
''The guarantee includes all the notes of
the bank in circulation as clearly as if on
the face of every note the words had been
engraved: This note shall be received by
the State in payment of debts And that
the Legislature could not withdraw this
| obligation from the notes in circulation at
the time the guarantee was repealed, is a
position which can require no argument. "
''The power of the Leg
islature to repeal the section, the stock of
the bank being owned by the State, is not
/ cOntroyerted, but that act cannot affect the
notes in circulation at the time of the re-
peal. 10 Ho1Odrd'8 Rep. 2O5.
Here, we doubt not, we have a very
clear insight into what the Supreme Court
decided in the case of the Bank of Ten
nessee. There can scarcely be a doubt
that the court decided that the repeal of
the twelfth section of charter could mot
affect the notes in circulation at the time
of the repeal. The question of the
States responsibility for the "new is
sues is yet an open one, but We can
not see when it comes to be tested, how it
can be decided otherwise than that the
State is responsible for these issues as well
as the old. The Supreme Court of the
United States decided case the other day
which has some bearing, though perhaps
remote, upon this question. 1t was the
case of ThoringtOn against Smith & Has
ley, from Montgomery, Ala The court
ruled Chief Justice Chase delivering the
Opinion) that contracts STIMULATING for
| payments in Confederate Treasury notes
"cannot be regarded as made in aid of
foreign invasion in the one case, or of do
nestle instruction in the other" and
that "they have no necessary relations
to the hostile government, whether in
vading or insTgent; they were transac-
tons in the ordinary course of civil sOci-
ETY., and though they may indirectly and
remotely promote the ends of the unlaw-
full government, are without blame, ex-
cept when proved to have been entered
into with actual intent to fur
Their the invasion or instruction.
The notes of the Bank of Tennessee,
| which are known as the "new issue, "
were issued and paid out in the ordinary
and legitimate business of the bank.
They were not issued and paid out with
actual intent to further invasion and in
suTection," any more than were the older
issues which were received and paid out
in the daily transactions of the bank.
The issuing and paying out of these notes
"were transactions in the ordinary course
of civil society,"" and therefore the States
responsibility for them must be equal with
that for the old issues. We can see no
escape from this conclusion, unless the
court should hold that the "new issue "
should be scaled TO accord with the value
of Confederate Treasury notes, in con-
fomity with the decision of Chief Justice
Chase in "a recent case decided against
the Petersburg Railroad. This would,
however, make but little difference in the
result, for Confederate Treasury notes
were, previous to the fall of Fort Donel-
son, almost equal to gold, while the notes
of the Bank of Tennessee, new as well
as old issues were equal to gold.
|
ACCORDING to a statement in the New
York EUeaiHg Post, published when the
gold conspiracy first exploded, Gen.
Grant told Mr.. Jay Gould that all he had
I