New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1871-05-24
THE COURTS,
Supreme Court-The Limitation of the
state Debt.


state Debt.
We present the recent decision of tn
Supreme Court in the case of the State e,
rel, solomon and Simpson VS.. James Ora
ham, State Auditor, in which is decided tn
question of the limitation of the State debt
The State of Louisiana ex rel, Solomon
and Simpson VS.. James Graham. Auditor O
the State.-The REALTORS pray for writ o
mandamus 10 compel the State Auditor q
issue warrant to them for $50. 33I 46
They sue as the assignees of the rights of J
o. Nixon, under an act of the Genera
Assembly of the State passed March |, 1871
and numbered thirty-two. The Audito
alleged as cause for refusing to issue tn
warrant that the Act No 81 is unconstitu
tional.
And the State, represented by the Attor
ney General, interviewed in the suit anC
denied the right of J. o. Nixon to war
rant, on the ground that act No. 81 il
unconstitutional, inasmuch as at the date
of its passage the debt of the State exceeded
SIS, 100000, and the General Assembly was
prohibited by the third amendment to the
constitution of the State, promulg gated in
December, 1870, to increase the debt Of the
State after it had reached that sum.
To this Intervention the REALTORS excepted,
on the following grounds, to-wit:
|. That this is not such a case as author
lied the Intervention of the State 10 pre- vent
the issuance of the warrant demanded under
act No. 81.
2. That the State is estopped by the terms
of the act itself, for appearing herein for
the purposes set forth in the petition of in
Prevention. and in law is estopped from dis
putting the validity of its acts, duly passed
according to law, and binding upon all Off
GERS of the government
g. That the intervention discloses no cause
of action.
Tristan intervention is a demand by
which a third person requires to be per-
mitted TO become party TO a suit between
other persons, either by joining the plain
tiffs in claiming the same thing, or some
thing connected with it, or by uniting with
4he defendant in resisting the claim of the
plaintiffs. Code of Practice, 3S9 In order
to be entitled to Intervention it is enough to
have an interest in the success of either of
the parties to the suit. Code of Practice,
389.l
Is the proceeding instituted bv the rela-
tors against the Auditor a suit! We think
it is. Has the State an interest in the sue
cess of either parties to the suit! Unques-
fionably she has. We can perceive no rea-
son why the State should be denied the
right to intervene to prevent her agent from
being compelled to do an act which she
AYERS is unauthorized by law: % An. 800.
State ex rel Burbank, etc, VS.. Dubuclet.
State Treasurer.
Second-If the doctrine contended for by
the REALTORS be correct. the amendment of
the constitution fixing the limit of the State
debt would practically be without effect
whenever the Legislature inadvertently or
designedly disregarded its provisions. The
doctrine OF estoppel is entirely inapplicable
TO case like this.
Third-The State is interested in enforcing
the provisions of the constitution. and in
resisting the claims of REALTORS The Judge
II 9tto correctly overruled the exceptions
and permitted the intervention Ii is upne-
cessary, therefore, to decide whether the
Auditor had any discretion relative to issu-
ing the warrants in question. On the merits
the question presented is the constitution
atty or unconstitutionality of act No 81.
The solution of this question depends upon
two facts: Did the State debt exceed S25-
100000 at the date of that act and did the
said act create debt! The evidence in the
record leaves no doubt that the debt of the |
State exceeded that sum on or before March !
|, 1871.
The total amount of the bonds of the State |
issued at that date was 50, $50 2}:3: the total
amount of debts other than bonds on De- |
cember 81, 1870, was g, 46I .j0l 40: total debt
December 81. 1870, SIS, 02I IA 49,
Between December 81, 1870. and March |. |
1871, the increase of warrants and certif- !
Gates was 1852, ia II. But if we concede.
what is not true, that the uncollected back
taxes would absorb the warrants and GER
titicates of Indebtedness. still there is no
room to doubt that the debt OF the State
largely exceeded the limitation of the con-
stitutiOn on the first day of March. 1871
The remaining bonds of the State in favor
of the Mississippi Mexican Gulf Ship Canal
Company, to be issued under act No. II6 of
the General Assembly of 1869, amount to
Sl26,0O0. The remaining bonds of the State
in favor of the North Louisiana and Texas
Railroad Company, to be issued under No.
los. of 1868, is not less than 1894 900 The
bonds of the State in favor Of the New Or
leans, Mobile and Chattanooga railroad. 10
be issued under the seventh section of act
No. 81, Of 1870, equal $3OOO,OO0 Total
amOHnt of bonds to be issued 1920 900 |
Total amount of bonds issued so 100000 |
Total amount of bonded debt. s26. $50 900.
Beside this, the State has obligated itself
TO lndorse the bonds of the New Orleans
Mobile and Chattanooga railroad. and the
New Orleans, Baton Rouge and Vicksbnrp
railroad, to the extent Of $l2, 500 per mile
Of each railroad as they are completed.
1t is cOntended that the bonds issued in IA I
vor of the property banks, amounting TO I
; A. 1898 80, should not be computed as '
lebts of the State, because they are amply
secured by the assets of the banks, and {
because the accrued interest thereon has [
been promptly paid by the banks. 1t is
well know n, especially i'll this country. that t
persons, natural and artificial, frequently 7
ail in business, and from affiuence they o
ire suddenly reduced to insolvency. The o
present ability of the property banks to V
meet thelr liabilities is no guarantee that
he State will not eventually have TO nav d
Ter bonds issued to said banks: and much {
ess Is 1t reason to say that the said
'tate bonds should not be computed as Il
art OF the debt OF the State. If it had L
een intended to exclude these bonds ar 81
theirs in the computation of the debt of X
he State, limited by the constitution II Il
7ould have been done in express terms t.
In the case of the city of Baltimore VIC p
ill, 81 Md, the court held that n temno. s
airy loan to the city, made on a PLEDGE of II
abroad stock owned by the city. was a st
ebt, Notwithstanding it was stipulated in
he contract that the city was exempted II
rom all personal liability, and that the p,
ender should look alone to the pledge for +
ayment. In that case the city Of Bati- ::
lOre lad attempted to evade cOnstitu-
onal provision by which the debt Of the II
ty could not he increased except Oh the al
INT assent of the Legislature and the peo-
lie by vote. 1t is also insisted by counsel o.
lat the Indebtedness of the State can only Ill
G ascertained from the amount of its out W
anding liabilities, for the payment of p;
hich part Of the principal and annual in III
rest the authorities must provide and b,
Use a revenue; but obligations, or prom cl
cs, to issue, hereafter, bonds to railroads ca
hen they are built and which, perhaps. IN
Ill never he built, do not constitute an in 10
ebtedness, because the State need not pro We
de to pay part of the principal and the al
ltercst on the bonds, which do not exist" tn
ha al ic LII ti,