Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1874-05-14
TENNEssEE'S RAILROADS.
How the state Proposes 20 settle with
the GoVerninent@The RiIls Passed
by the House Last wet

How the state Proposes 20 settle with
the GovernfHfenf-The RiIls Passed
by the House Last week.
In the House, last Friday, when the bill
s.for the relief Of Tennessee came nm Mr.
Frye, of Maine, reported from the Com
mittee on the Judiciary the following sub
stitute:
That the Secretary of War, by and with
the advice OF the Attorney General of the
United States, be, and he is hereby, author
lied and directed to compromise, adjust.
and settle all demands LEGAL and equitable
between the United States and the State of
Tennessee IN relation to railroads and rail
road property and obligations growing out
OF the same, on such terms as NAV be
equitable and just and best calculated 10
protect the interests Of the United States.
And III ascertaiaiDg the liability Of the
State Tor the property purchased by
the Edgefield and Kentucky, and the
Memphis, GAINESVILLE and Louisville
Railroad, he will charge only the
actual market value Of the property to the
date OF the purchase with legal interest;
that value to be ascertained by proof or by
agreement with the officers and agents Of
the State OF Tennessee; Provided only, that
said settlement shall be made and execu-
ed besJrt the meeting of the next teaisia
ture OF Tennessee in session, or II MT az
'''"''" ""d executed then that this act snail
be approved by the said Legislature at its
nest meeting In session."
During the discussion thst ensued, Mr..
Frye ssia' a.,
"Now, what is the result, sufPostns you
make them pay? Why it is this you cOii-
fiscated all their railroad property when the
State went into secession and you oyerTan
il. That was as much punishment as you
nieted ont TO anybody In the South, and
more than yUu melted Ost TO ninety-nire in
ole hundred. The stock in these railroad
companies was owned by Union men and
disunion men, by women South and women
Moth: their bonds were owned largely az
the North by loyal men. In that condition
of things you confiscated the whole rolling
stock, worth six or seven million dollars;
and then you turned around and sold it to
them at your ora valuation, valuation
which your own officers admit to be ex4
cessive by at least one-third and Compelled
them to take it, thus cOnfiscating one-half or
one-third more.
sNow, the Secretary Of War, with the
Attorney General. was authorized to settle
certain suits with Southern railroads, COM
menced some three years ago, to collect
this very class Of securities. In connection
with two or three distinguished lawyers,
all on cur sid5 in tic matters they made an
examination. They found that in the
s., 900 there ought to be reduction,
by reason Of the generalization, of 81, 400,
600; in other words, that You had compelled
a sale Of these railroads for Just wv &c what
the property was worth when you sold il,
thus making that other confiscati0n of one
half
''The State OF Tennessee practically own
ed four of these railroads; it held mort
gage of theih for a great deal more than
they were worth. Therefore your officers
would not take the securities of the stock
holders Of the corporation, but they said TO
the State OF Tennessee that II must give US
its bonds for the property So the State Of
Tennessee, having already given millions
to these railroads, gave its bonds TO the
United States for this additional sum.
What Tennessee now desires is this, that
you shall not ask 1t 10 pay any more for
this rOlling-stOck than it was worth when
it took il. That is all the State asks, and
there is no difficulty az ali in getting at
that value-nOt the slightest. Is that ask
ing any too much?
Il desire TO 20 one step further. The
State Of Tennessee has a defense; first,
that she was compelled By your officers TO
give these bonds and take this property;
tlleS vert shta:Ded from her nv d0ress.
70 nv mind It presents very serious ques-
tion whether ar nos -.nu can collect these
bonds. Again. the law of the ctasS ~
IL Il. 81 -.
est should be 6 per cent and no more, and
that any Contract made in violation OF that
law should be absolutely void: Now, your
officers took from the Governor OF Tennes-
see bonds bearing IS per cent interest. To
be sure the Government Of the United
States would not be answerable on the
ground of usury. But did not the Cover
nor of the State Of Tennessee. in executing
those bonds, exceed the authority which
the Legislature had given hifns Did the
Legislature give him authority to make an
illegal contract? To me it is clear that it
did not
"Then when you 90 into court to collect
the bonds aud that defense is put in, think
it Would present a very serious question in
deed: And if that defense was pit in and
the court Should rrfle that there was no au
thority on the part Of the GotefnffsT.t to do !
that, where would You be? You would |
have to 90 on the quaIltl1n meTld ground, |
and recover from the State Of Tennessee |
the actual value of the property at the time |
i: Was tasen- and that is lust exactly what |
this bill provides"
Convinced by Mr.. FTye's fOrcible state
ment of the facts, after adopting an amend
ment striking out ~or by agreement with
the officers or agents Of the State Of Ten
nessee," the House passed the bill.
The House then took up and passed the |
bill for the "c.iIec,ioB of debts from South
ern railroads" which prosides; .HTllt the
of War be, and he is hereby, aJl
thOrized, by and with the advice of tie At
torney General of the United States, 10
adjust, and settle the same
upon such terms as may be equitable and
just, and best calculated to protect the in
terssts of the United States.n Before the
passage Of the bill, however, the following
amendment was adopted; "And; in so do
ing, he will charge and exact the actual
value Of the property at the date of pur-
chase; that value to be ascertained by