The New Orleans bulletin. [volume] (New Orleans [La.]) 1874-1876, 1875-12-21
THE MAENHAUT CASE.
Judge Woods's Decision.
Important to City Bondholders.

United States Circuit Court, District of
LouisiaI a-Rosalie Maenbaut and Oilers vs..
The City Of New Orleans and OthefS-ln
Eduity.-This cause was heard upon the mo-
ton of complain ants for q preliminary IN
junction and for the appointment OF re-
ceiver. l. WIS submitted upon the Dill, sup
Elemental bill, answer, afhdAvlts, and argu-
ments of COUNSEL
Mes rs. John A. Campbell and L. Bermu-
DEE for the mo ION.
Messrs. r +. Jonas, City Attorney, L j.
Semmes, W, W. Howe and John Finney,
CONTRA
Woods, Cireuit Judge. The facts as they
appeer from the pleadings and atiidavits, are
Substantially as follows: Previous to the 23d
Of February, 1852, the city Of New Orleans
WAS composed OF one general municipal Or
eanizatiou which comprised municipalities,
each If which had government OF It's own,
and each of which, as well. as the general
municipal body, had contracted debts ior
which they were respectively liable. Az 'he
date first named an act Of the General Assem-
bly, Of louisiana WAS approved, Which estao,
Iished q municipal corporation to he called
the city of New Orleans, to be composed OF
the several municipalities, and to be gov
erend by Mayor and Common Council
The act declared that the estate and title Of
tbe several municipalities in lands, bridges,
ferries. streets, roads, Wharyes, markets,
stalls landing places, buildings and other
nroperty. should be vested III the city OF New
Orleans
s .ction thirty-seven of this act provided
that the debt Of the general SINKING fund,
commonly called the old city debt and the
debts of the three municipalities, should be
assumed and paid by the city OF New Orleans,
and the city was declared liable therefor.
&c ba ttu O MQynr
were constituted Commissioners of the Con
solidated Debt OF New Orleans, and they were
author zed to issue the bonds of the city,
having not more than forty years to run with
interest parable semi-annuay The commits
siorers were authorized to exchange these
bonds for any bonds obligations or debts OF
the old corporation, or any OF the munlclpali-
Ties. or to sell the same, and with the pro-
ceeds pay off said debts. 1t was provided
that the bonds thus issued should form a
stock to be called the Consolidated Debt OF
New Orleans.
II was further provided ns follows "The
Common Council shall annually, in the month
of January. pass an ordinance to raise the
sum of 100000 by special tax on real
estate and slaves, to be called the consolid
ated loan tax, and the rate per cent OF said
fax in each municipality shall be in proper
ton to the debt of EACH All ordinances,
resolutions, or other acts passed by said
Council, after the first day Of January in each
wear. shall be null and void, unless the ordi-
nance IMPOSING the consolidation loan tax
shall have been previously passed. AT the
end of each and every year any surplus OF the
consolidated loan tax remaining IN the treas
ury after the payment of all the interest shall
be applied to the purchase, from the lowest
bidder, of such bonds issued under this act
No baua tho ahprtagt pprIOt to run,
The section fourth provides: "N )r shall
any loan be contracted unless the same b
authorized by vote of the majority of the
qualified voters of said city; and no ordinance
creating debt or loan shall be valid unless
for some single object or work distinctly
specified therein, and unless such ordinance
shall provide ways and means for the punctual
payment OF running interest during the
whole time for which said debt or loan shall
be contracted" BY an act passed the same
dav as the act Just mentioned the amount to
be levied in January of each year TO pay the
principal and interest on said bonds was IN
creased to S650,O0O
Under authority of this act and upon the
faith thereof, about ten millions OF bonds were
issued, which were negotiated above par and
sold in the money markets OF Europe and the
United States.
1t further appears that, beginning with the
wear 1869 the Ci of New Orleans has issued
several series Of bonds In violation of the re-
strictions imposed by the act OF 1852, At the
extra session OF 1870 an act WAS passed
changing the form OF the city government,
and repealing the act of 1852, retaining IN
force, however, some OF lis clauses ana Sec
tons
la 1874 the act No. So was passed, which
POSTPONED the levy and collection of any tax
for the sinking fund for the purchase OF the
bonds of the city until December, 1876
There is now outstanding about 81, l42, 600
of the consolidated bonds.
1t appears further, by the averments in the
supplemental bill, that on the 18th of July,
1875, the city of New Orleans adopted an or
dinance whereby it was, provided that the
commss oners of the consolidated debt were
authorized to pay, with delay not exceeding
ten days, fifty per cent OF the following past
due interest coupons, and that such pro rata
payments be continued out of all interest col
lections up to January, 1876 provided that
the holders of such coupons shall indicate
their acceptance of this arrangement by their
respective signatures at the time OF payment.
The said coupons shall be stamped thus !:
"Half paid.
Consolidated 1852, due July, 1875. Rail
road, up 10 July. 1915 Pontchartrain Rail
road, due July, 1875, etc.
The paper to be signed by the coupon mold
ers under this ordinance is as follows: I" We,
the undersigne holders of city bonds, here
by acquiesce in and approve ordinance No.
1890 Of the City Council, providing for the
payment of fiji y per cent. OF the interest col
lecied and TO be collected up to the first Of
January, 1876, the balance to be used for the
general relief OF the city government, reServ-
ing our right to be hereafter paid by the city
the balance due on said coupons.
The supplemental bill charges that the
City Council, since the passage of the orii-
nance aforesaid, has allowed no bondholder
to participate in the payments OF interest who
did not consent to the ordinance, and that it
has excluded number, among whom were
compliments, because they did not do 10.
The complainants are the holders of seven Of
the consolidated bonds OF the city.
There has been deposited by the city in the
Louisiana National Bank to the credit OF the
consolidated loan, during the six months end
fng July 80, 1875. the sum OF Sill 4o9 ", and
there is now on deposit in the bank to the
o.oI;t nf that trrd or sum nearly II not Qil e