New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1876-04-18

| th6 said lines OF railroad to Shreveport,
and to said point in tho parish Of West
Baton Rouge - shall be surveyed. located
and constructed within i've years from tho
acceptance of this act by said company;
and said provisions of said act shall be ap-
plicable to such parts or portions of the
said last mentioned line of road ~ shall be
surveyed. located and constructed within
the time last aforesaid"
But what are the provisions Of the act of
seventeenth of February, 1863, which re-
late to the guarantee of the second mort
gage bonds of said companyl As they are
made applicable to the branch road to be
extended to Shreveport it is important to
determine the obligation of the State aris-
ing from said provisions. Section one OF
said act provides THAT the New Orleans,
Mobile and Chattanooga Railroad Com,
pany. . corporation of the State Of Alaba-
ma, be and is hereby authorized to make
and issue from time to time, as hereinafter
provided, its bonds to be known As second
mortgage bonds of the New Orleans, Mobile
and Chattanooga Railroad Company,
guaranteed by the State of Louisiana Of
such denominations as the company may
elect, but to an amount not exceeding in
| mile in length OF the main line of its rail-
road westerly from tho city Of New Orleans
and within the State of Louisiana. which
said company shall construct"
Section seven provides that the said
mortgage after it has been executed shall
be delivered to the Governor and if the
same be in conformity with the provisions
| writing thereon and cause the said mortgage
thus approved to be recorded in the office
of the Secretary of State. Section eight
| provides shat when the said second mort.
gage shall have been delivered aud ap-
proved and recorded, and one continuous
portion or section of forty miles IN length
of said main limo of railroad, within the
State of Louisiana, shall have been con-
structed by the company aud the rails laid
thereon, the company may deliver to the
Governor of the State of Louisiana $500 900,
or 100000, Of such second mortgage bonds,
| and the Governor shall thereon subscribe o
Certificate, to be written or printed on each
of said bonds, in the following words: The
pay ment of the principal Of the within
bond when due, aud Of the interest thereon
when it accrues, is guaranteed by the
visions of the act OF the General Assem-
bly, OF said State authorizing such
guarantee and shall affix the great seal of
| the State of Louisiana to such certificate,
| and the said seal shall be attested by the
signature of the Secretary of State, and the
bonds shall then be delivered to the COM
pany for its general uses and purposes, au-
| CnOrlZeu ny It's CudrtcT.
| Section nine provides "that upon the con-
struction OF each additional! section, or por
| ton of forty miles in length OF said main
line of railroad within the State of Louisi-
ana, the company may execute and deliver
| to the Governor of the State Of Louisiana q
| further amount of such second mortgage
bonds, equal to ST., OF f2.O0, as the
company may elect, Tor each and every mile
| in length Of said main line of railroad"
and thereupon the Governor shall subscribe
| q certificate Of guarantee, etc.
| The obligation of the State under the
acts of 1869 and 1870 adverted to was to
guarantee the second mortgage bonds Of the
New Orleans, Mobile and Chattanooga
| Railroad Company on each section Of forty
miles (which said company shall construct"
| within the time mentioned in said acts after
the act OF mortgage on said section so con-
| structed shall have been delivered to the
Governor, approved by him, and recorded
in the office of the Secretary of State.
This was the subsisting obligation of the
| State when the constitutional amendment
limiting the State debt to 81, 900 900 went
into operation in November. 1870. As the
amount of that limitation has already been
reached. the General Assembly could not
| create debt thereafter. Notwithstanding
the existence of this constitutional limit a
| ton, the General Assembly passed act No
95, approved April 20, 1871, which provides:
"SEC1IoN l That the Governor of the
| State be and he is hereby authorized to
subscribe for $1,000 shares, OF $1,000 each,
| of the capital stock Of said corporation
on behalf of this State, and to receive the
| certificate of stock therefor as payment
shall be made for the same, which certiti
cate shall be deposited Dy him in the office
| of the Treasurer Of this State. and shall
l not be assignable or transferable except by
the authority of the General Assembly.
That whereas, the subscription for stock
and the issue of bonds therefor. herein pro-
vided tor, are intended to extinguish the
| obligation of the State to indOrse or guar
antee the second mortgage bonds of said
corporation, under the act of the General
Assembly relative to said corporation, ap-
proved February 81. 1870, and as a dis
charge Of either party from all obligations
for the issue, ndorsement, guarantee and
security of said mortgage bonds, as pro-
vided 10 the fourth section OF said act, the
| said corporation shall be required, at or be-
fore the complete issue of the said bonds,
| to file with the Secretary of State full re-
lease and acquittance of the obligation of
the State 80 created to guarantee said mort
| gage bonds, and for which the provisions
of this act are designed as substitute and
discharge; and the said corporation shall,
by it's express agreement, made and entered
into by the vote of its board Of
signature Of its secretary, obligate itself to
commence that part OF its railroad from
Vermllionvi!le to Shreveport within six
| months, and to complete the same with
| in the time limited therefor in the said
act of the General Assembly on the twenty
fourth day OF April, 1871. Four days after
the passage of this act the Governor issued
| to said company bonds of the State
amounting to $4,000 900, notwithstanding
the fact that the railroad from Vermilion
| Vile to Shreveport had not been located,
and rot particle of work had been done
by said company. Indeed, the record shows
that there never has been survey
aud location of that branch of the railroad
as contemplated by the act, and all the
| work that has ever been done by said CON-
paDy thereon consists of a ditch 29l feet
long, six feet wide, and one and half feet
deep, proved to be worth $12, or that is the
| extent of the labor of eaid company on the
road from Vermilionville to Shreveport. AT
ter the expiration of five years, the period
within which they were required to finish
the whole liEe to Shreveport, the obligation
OF the State to guarantee the second mort
gage bonds of the New Orleans, Mo bile and
Chattanooga Railroad Company has lapsed,
because the said company failed to COM
plete the fret section Of forty miles OF the
main line by the eighteenth day of January,
1871. They ia isd to complete any of the
other sections OF the said main line within
three years after the survey and location,
and they failed to survey, locate, construct
and put in running order any part of the
branch road running from Vermilionville
to Shreveport within five years, as speci-
fed in the said act of 1870. Under the cir
cnmstances, was not the act of April 20.
1871, and the issue Hereunder by the Gov
ernor of bonds to the amount of 1880 900,
the creation Of q debt in contrOventiOn of the
1 1:~~~s< ., 81,
| opinion it was. When the constitutional linn
ifafinn went intn fnrca in NnYamhar 1870