The New Orleans Democrat., 1876-04-18


1859 and 1870. advered to, was. 70 guarantee the
secnnd mortgage bonds of the New Orleans, Mo
bile aud Chattanooga Railroad Company on , cacn
section Of forty miles we, saiu IN said
prts after the act Of mortgage on siih s''ion -
| constructed shall have been delivered 70 the the
Governor approved by him. and rennficd III the
| ot1iee ot the Secretary Of State. This was the
subssting obligation Of the state, when the con
stituona amendment lni,ing Ne a ,In ,,egs s-o -
As sthe amount of that Limitation had aifeuay oeth
! reached, the General Assembly could hpt creale
! n debt thereafter Notwithstanding the exist
\ opce og this constitutional Limitation. the 'ieh-
1 cral Assembly passed act % approved April ~,
/ ls7I which provides section one, that the Gov
nrnor of this state be- and IL is hereby author
iznd to subscribe for 25.0oo shares OF 800 enoh,
of the capital stock Of said corporation on h"hali
stock therefor as payment shall hc In1de Iof
the same which certificates shall l,o depoSi,ed
10y him IN the office Of the Treasurer nl this
State and shall not ho assgnabc or transfer
able. except by the authority Of the General as
sembly That, whereas the subseription ior
stock and tho issue OF bonds thhta,or nI,,lo
aro intended 70 extnguish tho obliga-
tion Of tho State to ndorse or guarantee the
second mortgage bonds OF SAID r2fpnta1.iioun, ulll
under tho act Of the General Assembly remtlV9
| To said corporation, approved feb. ~, lSiu anu
NJ discharge of either party IRON ai opil@eh @
tions for the issue ndoIsenon, guarant,n ',Io dn ~
security of said mortgage bonds. hs prpVi1ed III
the fourth section Of said act, the said corpora
ton shall be required ut or bniore tha M "oi1piao
isaIe of the said bonds 10 He with thh 'ccTe-
inry of State full release and acvuIttanao OF the
obligation of the State SO created 70 guarantee
said mortgage bonds, and Tor whIch the proVis,,
| ions Of this act aro designed as substitute anu
discharge; and the said corporation shall, ny us
express agreement. mado and entered lnt9
bv Tho vote of its board Of directors, ana
attostod by its seal and tho signature OF its See,
rotary objgate itself to commence that part OF
lis railroad from Vermilionvilo to shreveport
| within ak months, and to complete the same
within the time limited therefor II the Sald a't
OF tho General Assembly. On Apri, y, I'll Tour
days after tho passage Of this act. tho Governor
|
amouuting to ~ 100000, notwithstanding the tact
that tho railroad irem Vermilionvile to Shreves,
port has not been located and not q particle OF
Work has been done by said company.
Indeed. the record shows that there never has
beon survey and location Of the railroad US
has ever been done by said company thereon,
consists of n ditch 2gi feet long. feet wide and
II, deep proved to be worth sl2.
That Is the extept of the labor of said com
many on the road from NerlniliOnviile To SlireVe-
port after the expiration of five years. the period
within which they wero required 10 linlsh tie
whole limo to Shreveport.
The obligation OF the state 70 guarantee tho
second mortgage bonds OF tho New orleans' pro Pro-
lapsed because the said company Jailed to com
plete tho first section of forty miles OF the main
fine by the 18th day Of January. 1871; they failed
,o complete any Of tho other SECTIONS OF the
said main line within three years after the sur
vey and location. and they failed to survey To-
cate construct and put in running order any
part OF the branch road from NerInillonvile "
Shreveport within five years. ms specified IN the
said act OF 1870.
Under the circumstances. was not the act OF
April 30 1871 and the issue thereund"r 10y the
Governor Of bonds to the amount ot s2,5oo.ooo
tho creation Of debt i'm contravention of the
constitutional limitation then in force In our
opinion it was. When tho constitutional
limitation went 9. into force: In a,,,N.o No'
ton TO guarantee two mortgage bonds on sec
tions Of forty miles. If properly completed. on
the main line and on the branch line to Shreve-
, port. II was under no obligation 70 guarantee
second mortgage bonds on uncompeted sections
or portions Of said lines Of railroad; If tho see
tions should be completed and the rails LAID
within the time and manner specified IN SAID
, acts OF 1869 and 1870. and the mortgage to th9
state should b. h ny me GovSf5or f ae ahe
then the State would be under obligation t.
guarantee said second mortgage bonds.
The conditions precedent have not happened
tho conditional obligations of the state resulting
from the legislation ~ 1863 and 1870 has
ripened into an unconditional obgation-it can
! never ripen into an unconditional obligation
because the periods within which 1t might
become so by the performance Of the conditions
by said haye Tho aca"a .s Se bs
ton resulting from tho issue by the Governor
under acts Of 2sth April. 1871 of bonds
amounting to 81 100000, in cOntravontlon OF the
= constitutional amendment then in force.
As there is now no obligation resulting IRON
the acts Of 1869 and 1870 in regard to the Statt
I guaranteeing second mortgage bonds OF saio
company there is no debt duo said company oi
4 those holding under It, As tho bonds in suit dc
+ not represent debt incurred prior to the con
stitutional amendment, for there was none
They merely evidence debt contracted sine.
then. and in violation Of such amendment
Neither the Governor nor the General Assembly
had authority in 1871 to issue S2.500.001 OF stat,
{ bonds in payment Of subscription for stock
+ then made. Nor had they authority to substi
I tute bonds of the state, unconditional obllga-
tions for the conditional obligation arising from
tho legislation Of 1869 and 1870. prior to the hap
? pening of tho conditions precedent in said acts
. AS these bonds bear date subsequent to th'
a adoption of the constitutional amendment. al
9 persons acquiring them are charged with notice
l.1,.s dina hrf
they are charged with notice that in 1871 1t wa;
0 not in the power Of the General Assembly ant
II the Governor to bind the State By the issue 2
n these bonds as substitute for the obligation {
$ indorse the second mortgage bonds Of the New
d Orleans Mobile and Chattanooga Railroad Com
/ pany because said obligation was conditional
o and 1t could only become binding on the Stat
II upon the happening of the conditions precoden
o and they might never happen. The issue Q
l. those bonds as a substitute for debt that di
.. not exist and that might never exist. and to al
u intents and purposes the creation of u debt il
d 1871 in contravention of the constitutions
y amendment.
- 1t is therefore, ordered that the judgment per
7 petuating the injunction and declaring void tn
/ bonds issued under act 95 Of the acts OF 1877
1t amounting to 81 500 600. be affirmed appellant
'r paying costs OF appeal.
$ The Chief Justice dissents. and reserves tn
\, right to file his reasons hereafter.
Mr. Justice Talliaferro concurring.
r The bonds were issued without the authorit
y and against the authority oi the state which n ha
It prohibited the increase of the public debt. Th
\. State. through its amendment TO tho constitu
. ton in 1870. peremptorily forbade such in
II crease. The Legislature issued these bonds, |
Q violation OF the constitutional provision pre-
: hibitng an increase Of public debts. The issu
q Ing the bonds was an increase of tho debt If tn
70 payment of them could be enforce,
: But whatsoever is done in, violation Of
2 prohibitory law. is null and can have n
b effect, G. c. article u. 2sd An. State OK re
h they were null. and no vitality or force could
infused into them by their falling into the hand
J, OF thoir holders. instruments OF tho kind hav
n not the essential properties of promissory note
S under the law merchant. and even securities Z
@ the latter kind are vitiated in the hands Of bon
y nde holders before maturity. and without motto
/ when the consideration is unlawful. Parson
, on Notes and Bills. vol. !, pages 212 and 213.
!, | concur in the decree Just read.
n No. 5000 Mrs. Widow J. C. de st. RomcS. appel
q liant. vs. the Levoe Steam Cotton Press ct ais
Q Appeal from the Superior District Court paris
q of Orleans.-In the absence OF the Judge Of on
OF the District Courts for the parish of Orleans
another District Judge for tho same parish i
Il compelled to grant an appeal from ludgmen
u rendered by the absent Judge. Motion to dsmis
denied
d The Chief Justice and Justice Taiafcrro dis
Q sent.
g No. $500 Felix Gottschalk vs. Henry Meyer
appellant. Appeal from the Sixth District Cour
" parish Of Orloans.-Motiont to dismiss denied.
l. No. 473o Succession OF Mary Carroll wife c
70 ]. Nj. Schafer.-Appeal from Second DistriC
9. Court. parish Of Orleans. In nuncupative Wi
5 by public act, not signed by the testator til