The New Orleans daily Democrat. [volume] (New Orleans, La.) 1877-1880, 1878-03-27
THE CONSOLIDATED BOND CASE.
THE COURT DECIDES IN FAVOR OF THE
CONSOLIDATED BONDHOLDERs.

THE COURT DECIDES IN FAVOR OF TIL
CONSOLIDATED BONDHOLDERs.
The Writ Of Mandamus Made Peremp
tory and the Application for an
INJUNCTION Refused.
State OF Louisiana ex rel Southern Bank vs.
Court No. as.o7s %a'of' 81 AA'N
The REALTORS. IS the holders Of some six hun,
bonds Of the city Of New Orleans pray that Q
writ OF mandamus issue directing inc mayor
and Administrations OF said city 10 assess ana q
said bonds, princit al and interest, as PROVIDED
by section 81 of act u OF 1852. and act ~ supp
mental thereto, special Tax OF seoV ags 1or eaSn
coupons paid for 1874 and 1885, ana that writ
Of Injunction issue. restraining these officers
to the special tax In favor Of the consoli-
dated loan debt under said section 81 to the
prejudice Of said eo n debt. and with
The history OF these bonds and of the tax
thus sought TO be enforced is briefly as follows
as it appears from the pleadings and evidence
The city of New Orleans was Incorporated by
the first Legislature which assembled under the
leans. In 1904 S. and the charter thus provided
continued in force until 1886. when an act was
passed dividing the city into three municipai-
ties ae 81 ass 2scn OF which was ere
ali the powers and liabilities Incident thereto.
except such as were expressly reserved to what
was called the General or City Council.
Provision was made In this act for, the. city
debt existing at the time. which was placed un-
der the control Of board to consist Of the
Mayor and six commissioners composed of
two members from each corporate council-th
quota to be paid by each municipality being
fixed upon The basis OF the taxes and oher
BY Q supplemental act. approved few days
after the one first referred to. 1t was expressly
provided lto quote the language): That Il the
any future legislature. be repealed or so
amended as to reunite the said three munich
palities, created by said act into one corpora
ton, all the debts created by each OF the said
municipalities shall first be fully paid and sat
isfed by each municipality respectively etc.
This form OF government endured until II, 1872 s5;
ties was effected and their individuality de-
stroyed by an act approved February % OF that
The act In question was entitled AN act to
consolidate the city of New Orleans, and to pro.
vide for the government and administration Of
act that the REALTORS have, founded their action.
This section reads as follows, to wit:
Sec. 81. That the debt OF the general sinking
debt ii The three municpeIities. .' Whether in the
form Ofbonds. notes interest coupons. cast war
rants. or any other species of oh igation whatev-
Orleans and sad city is hereby declared liable
therefor. The Mayor. controller and treasurer,
and the chatrmansof the finance cOmmitteesoftbe
boards of the Common Council shall constitute
q commission to be called the commissioners of
the consolidated debt Of New Orleans. and they
shall have power to issue bonds of the city Of
to run. with interest. payable at such place as
may be agreed on between said commissioners
and the parties to whom the bonds are issued.
bonds. obligations or other debts Of the old cor
poratton. or OF any OF the municipalities.
whether matured or not: or to. sell the new
nd lu tn thn nrf r,f
the matured debts OF the old corporation, or Of
any OF the municipalities but to no other pur-
aa s ds thus shall dt form Ns
Orleans. At the time this act goes
Int eper re exact and detailed
and Of each be
the board Of liquidation and, the municipal
Of tie eepsodatsd G debt shall e proceed to
divide the debt Of the old corporation between
the several municipalities. In proportion to the
Of each according to the eH Stale " me- roll
of 1861. The amount thus apportoned to EACH
together with its individual indebtedness at the
tute the separate debt Of each Municipality,
and shall Be known as the debt of NUM-
sDa Mo- 1 No a. and No r. f The Conn
OF January, pass an ordinance to raise the
sum of $500, 600 by a, special tax on real
gstatY and slaves. TO- b9 called the eeaseH
portion to the q each a All n o gt8
said Council alter the first day Of January !? ia
each year shall be null and void, unless the or
dtnance imposing the consolidated loan tax
sna nave been a. Inc END q eaeh and
tax remaining In thetreasury after the payment
of all the interest and expenses of the manage
chase. from the lowest bidder, Of such u bonds
Issued under this act as have the shortest
period to run; and the Common Council
manding more than the face Of the bonds;
given by The Controller ' in the Sn oflca ii
from bondholders for the sale to the city of
the bonds herein described. From and after
the passage OF this act no obligation or evil
cept those herein authorized. shall be issued by
the city Of New Orleans, or under its authority:
nor shall any loan, be contracted, unless the
same DO authorized by vote of majority of
the qualified voters of said city, which shall be
taken IN the manner prescribed by the City
Council. after ten days proclamation by the
Mayor In the newspaper chosen by the Common
Council; and no ordinance creating q debt or
loan shall be valid unless for some single OBJ ect
or work distinctly specified therein, and unless
such ordinance shall provide ways and means
Tor the punctual payment OF running interest
during the whole time for which such debt or
loan shall be contracted. and for the full and
borrowed or debt incurred and such ordinance
shall not be repealed until principal and inter-
estof the capital borrowed or debt incurred are
fully paid and discharged"
By act No. 70 Of the same year. the city of La
fayette was added to the city of New Orleans:
the city Of New Orleans assumed its debt and
IN additional $4,000 per annum was required
to be raised. thus making the total annual levy
1856. 900.
The relator. as free bank. was compelled by
law to invest in the bonds issued in pursuance
Of the foregoing section to secure its circula-
tion, and. as 1t appears, owns over six hun
1red Of them.
No complaint is made of the manner in which
The provisions Of the section quoted were com
piled with until 1874 when an act was passed.
entitled An act to postpone the levy and collec.
lion by the city of New Orleans of a tax for sink
ing fund for the purchase of it's bonds; to au-
thorize the administrators to modify the last
budget and tax levy. and to repeal conflicting
laws and penalties"
This act was No. 6S of 1874 and its object was
to relieve the city of New Orleans until Deem
Der. 1876. from levying or collecting any tax for
a sinking fund for the purchase of bonds issued
under section thirtyseven of the act of 1852
By act No. 81 of le76 however. entitled An act
to adjust, regulate and provide for the bonded