The New Orleans daily Democrat. [volume] (New Orleans, La.) 1877-1880, 1877-04-11
The Great Maenlaut Bond Case.
Legality of City Bonds mt Issue.

Tho case OF Roaalie and Louise Maephaut,
who reside in Belgium, and others, against the
city OF New Orleans, the Louisiana National
Bank, New Orleans Canal and Banking Company,
Hibernis National Bank, Levee Steam Cotton
Press Company, Eager, Ellerman Il 20. and
VIM. Van Norden, was before the United States
Circuit Court Tuesday on the obancery side.
II will be recalled that in this case there
IL involved the question OF the legality OF the
issue OF pre- mum bonds by The city.
The bill In ehaheery acts forth that the COM
planants are the holders Of consolidated bonds
issued by the city under the authority OF an act Of
29d Feb nary, 1862, to consolidate the municipal.
tiles OF the city. This act required that obli-
CATION or evidence of indebtedness whatever ex-
cept those authorized In the act, was to be issued
by the city. nor should any loan BIO contracted
unless authorized by y vote OF the people
In violation of this it Ia alleged in the bill that
there is now outstanding u bonded oity debt Of
over twenty-five mons of dollats.
The compliments claim that they are entitled
TO specific the real estate of the city to pay
the interest on the consolidated bonds, and
that 1t be deereed that tho first and
paramount duty of the authorities each
year before any act be done, IL to provide ade-
duately the sum OF $780, 900 for The payment of
such interest, and that nh injunction be granted
to restrain the city from paying any Of the bonds
issued since 1860.
h. Bermudez, for tho plaintiff, presented the
case in an elaborate argument, contendirg that
the act OF 1852 having been decided by Judge
Wood to be n contract, the subsequent issues OF
bonds in disregard OF the conditions Of said act,
were violation thereof, aud especially the act Of
1876, authorizing the premium bonds and re-
peahng all previous acts, providing for the issue
OF bonds, and limiting the tax OF the city to II
This last act had been pasaed by the Legislature
after the commencement OF this suit, and after
the decision of Judge Wood that the act OF 1852
created n contract in favor OF the consolidated
bondh6ders; that the premium bond act was o
gross pervertion Of the tax which had been
Set ASIDE by THE ACT OF 1852.
to Day the interest on the consolidated bonds.
All such acts by the Legislature or the city gov
eminent were Illegal aud void, and the equity
powers Of the court were appealed to, to declare
such ilegality, to compel specific performance
OF the contract with the consolidated bondhold-
ers, and TO enjoin and prohibit the application OF
the taxes on real estate, imposed and collected
by the city, to any other object, until the $3.50 900
required to be set aside for the consolidated
bonds should be appropriated to satisfy that
debt. Mr.. Bermudez referred to and read from
the report OF the Master in Chsncery, Judge I.
Wharton Collens, to show that already the city
was delinquent to the amount Of over two mil
lions Of dollars, which were due to the consoli.
dated fund. He also read various authorities.
Henry L. Miller replied for the city, and argued
that the plaintiff, had obtained all the relief
which equity could give; that their claim to be
paid was not disputed, and the necessary fund
TO MEET ACCRUfNa COUPONS
would be provided for, and this was all their pro-
posed decree called for; no mandsmus was asked,
or could be granted by that court. But it was
impossible TO copcede that these plaintiffs could,
by vrtbe Of the act of 1852, forever tie up and
control the political discretion OF the State to
regulate the taxing power OF political corpora
lion. 49,
Mr. Miller argued these points at length, citing
several authorizes. At The close Of his speech,
tae conrt adj turned over until to-day, when Mr.
Jonas for the city, and Judge John A. Campbell
for the plaintiffs, will close the argument.