New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1876-02-24
$4,000
$4,000

az above stated, for railroad
bonds matured and thus ex-
tended. o|2,UV'
Seven per cent bonds of 1869, be-
longing to the McDonogh and
Fink funds, sold as above stated
by Thomas Layton, Esq, under
authority of the city govern
ment like all other city bonds,
afterward given in payment to
SAID funds. .............. OIL UUl
| Total. Observation-Disclosures. ..... sc. 49,, 900
These items are said to be necessarily be
yend any question, even if the clause OF
the act of 1852 receives the scope contended
for by the majority of the committee, be-
cause the mum cipality bonds were author
lied to be issued iu 1851, before the consoli
although issued in 1869, were authorized by
the act No. 40 of 1888; because the Pont-
chartrain bonds and the railroad bonds
issued in 1854 were submitted, by the pro
visions of the acts authorizing their issue. to
vote of the people, and because the gold
consolidated stand in the place of the rail
road bonds for which they were issued;
bonds result from debts contracted by
them respectively, and not by the city of
New Orleans, and because the Fink and
McDonogh funds, as well IS the bonds held
by said funds represent an obligation due
by the city under the condition OF the lega-
ces constituting in no sense the contrac-
ton of a debt. Thus, even granting the
correctness Of the legal views of the con-
mistee, they have actually recommended
the Reputation of over six millions Of debt
equally as sacramento as the consolidated,
the payment of which last the committee
seems to think imperative.
Your minority, however, can not agree
| with the majority in their construction
Of the act OF 1852, and while differing he
does not desire to express settled opinions
on matter which he considers as solely
properly determinable by judicial cOnclu-
sion. He however thinks:
|. That the restriction in the act of 1852
| forms no part OF the consolidated bonds, and
| was simply restriction on the power OF the
| city. which the Legislature was competent
| to remove and did remove by subsequent
acts.
2. That although the consolidated bonds
were necessarily contracts as regards the
provisions for their payment, the restrain
ing clause in the act was q limitation on the
city which engendered no privity of con-
tract between the city and the consolidated
creditors in that regard.
g. That the limitation in its terms was ap-
plicable only to bonds issued by the city
of New Orleans under her own authority,
and not under the authority OF legislative
acts.
This view of the matter was certainly the
one entertained cOntempOraneously with
the passage OF the act of 1872, and subse-
queDtly by the consolidated bondholders
themselves. We have already shown that
the issue of 1869 was made by the Southern
Bank, itself large holder OF consolidated
bonds. Your committee is under the i'm
hat of Ind
Woods has settled this question; but in this
they are mistaken. The suit in which the
decree was rendered asked the recognition
of the consolidated bonds, the nullity of ali
other bonds, and the recognition OF the con-
sOlidated creditors right to a sum of money
on deposit to the credit of the interest due
on the consolidated bonds. Before judg-
ment all but the right to claim the interest
was withdrawn by the plaintiffs and de-
cree was rendered recognizing the right of
the consolidated creditors to the interest
fund deposited to their credit, the Judge
expressly saving that 80 much of
the act of 1852 as provided for the levy
OF interest was contract" excluding by
implication all expression OF opinion on the
clause in the act now relied on and claimed |
BY the committee to have been decided. |
In this connection, the minority deems it
well to say that in a large number of suits |
Instituted by the city against taxpayers, |
the defense that no tax to pay interest was |
legal except the interest tax on consoli- !
dated bonds has been expressly negatiyed |
by the Supreme Court of the State; that |
judgments have been rendered against the |
city on other than consolidated bonds, both |
in the Circuit Court of the United States
and in the State courts, to large amount. |
Your minority has examined this ques-
ton simply because of what he deems
erroneous views expressed by the major
ity of the committee. Granting all the
of law come to by the major
ity, they furnish no valid objection to
the act, because it proposes to give
than it now has. The debt being already
authorized by legislative act, if null, be-
cause these legislative acts were not sub
Mitted to a vote OF the people, will be
equally SO if transformed under the pro-
posed bill. Thus the act will simply secure
the people from too great taxation and the
,ity from embarrassment without impair
ing any defense existing or supposed to be
existing. The majority OF the Commute
seem TO admit this proposition. but predi-
cate their objection on the fact that pay
nent will continue to be made under the
bond act, until the legality of any
Questioned may have been decided. This
8 at once answered by the statement that if
he act be not passed the city must con-
|
Until final decision rendered, and will thus
,ay out in five years four or five times the
amount required under the premium bond
,lan The committee moreover say Nat
he act propOs.- to pay the consolidated |
'reditOrs in tul' The act furnishes no war
ant for this as rtion. l. proposes to pay
Ill the creditO! I'll Ike. True, the consoli-
lated creditor have a claim to interest,
nut so have IT,. others. True, the consoli-
hou n1, |
# this right; bat go also have the others.
he act calls upon all for a like sacr;-
ice in the int rest of ultimate payment. |
The majority l. we been entirely negative
L their actions. tut the policy pointed out
nay be summr. " d as follows: Repudia-
ion first, and le- al examination afterward.
his policy, in the opinion of the minority,
you'd be fatal, because
i. 1t would c, npel the exact:on from the
of the present enormous bur
ems. allow the accumulation of interest
t the rate of $4,000 a day, and thus so in
rease the debt should final decision be in
avor OF the creditor, as to render all set
cement hopeless.
., Because it would hurry the city into
opeless litigat 81, during the existence OF
Thich all prosp; :ty would be bl!ghted
3. Because; during its existence
roperty would depreciate, and pros I
Gritty depart under the fear of
he burden, to result from the possible I
sue of the legal struggle.
4. Because Of the moral obloquy attend
lg so gross a violation of good iaitb.
5. Because it would entail in the conf,l-
on following the practical cessation of the ,
lunicipal government, the closing of :
,hools, thus prostrating the present, and
to the future possible relief,
ut probable bankruptcy and ruin. |
In opposition the act proposes f
|. TOconvert the debt at once into such
,rm as to enable the city, without undue
FACTIONS. to carry on her government and b
,lieve her people. q