The Abbeville press and banner. [volume] (Abbeville, S.C.) 1869-1924, 1879-10-08
THE STATE AND HER DEBT.
FULL
COURT DECISION IN TILE
BOND CASES..

BOND CASESs
The State Cannot Take AdVan-
tage of the Irregularities Of its
Own Agents, but Cannot Incur.
an Obligation Not Raised Ac-
. cording to its Fundamental Law
and Laws made IN Pursuance
ThercOf-The State Cannot Owe
Debt the Authorities are not
Competent to Contract, and
Cannot be Required to Pay what
it does not Owe.
G. NJ. Walker, cashier, plaintiff. appellant, vs..
the State of South Carolina, defendant, respon-
dcnt.-In Supreme Court. April Term, 1879.
r. J. Pclzer, plaintiff, appellant, Va. the State OF
Soutl, Carolina, defendant. respondent.-1n
Supreme Court, April Term, 1879.
Edward Sebring, plaintiff, appellant, W. the
State of South Carolina, defendant, rcsDon-
dent. III Supreme Court, April Term, 1879.
The Bank Of Charleston National Banking Az
ISOLATION. plaintiff, appellant, vs. the State Of
South Carolina, defendant, rospondcnt.-ln
Supreme Court, April Term, 1879.
+. J. Heron. plaintiff, appellant, vs.. the State Of
SOulQ NRTOllfltt, uCitlllluIll3 JpSlOIiuCllt'- -
Supreme Court, April Term, 1879.
The w. l.. I. Charitable Association. plaintiff, ar-
pellant, vs.. the State of South Carolina. de-
PENDANT, respondcnt.-In Supreme Court,
April Term, 1879.
OPINION By MoIvER, A. j.
For n proper understanding Of the que 'tions
raised by this appeal, as well as to show how IT.
is that these actions nrc brought against the
state in one OF her own tribunals. 1t will
be necessary to make n briefstatcment of the
legislation which gave rise to the cases.
On the sth of june. Isl, lG stat. 3lS9 the Cen
Which. after reciting that great uncertainty
existed In the minds of the taxpayers as to the
real amount OF The valid Indebtedness OF the
State. provided for the appointment Of n Com
mission, consisting Of three member OF the
Senate n four member Ofthe House of Rep
rcsentntiveS, whose duty. in general terms, 1T
should be to investigate and report upon such
Indebtedness. This commission. when. Tor
! mated. the Bond Commission. were, amOngst
other things, specially directed to inquire and
report: First, What was the entire amount OF
consolidated bonds and certificates of stock
which had been issued under the provisions OF
nm Act entitled "An Act to reduce the vol
ulne of the puDlic debt and provide for the pay
mcnt ofthe same hP5rovsea i Z MiI, t ha dn,IeG
throughout this opinion the Consolidation Act.
Second, "Whether there Is In the state treas
urer's office on file as vouchers cancelled bonds,
commons anu CeTJlllCallCS vi SIoShS vi LIlo lSSuCS
described, issued In accordance with law and
authorized to be consolidated by the Act above
recitcd to the amount required by said Act"
These duties involved, therefore, the 1nStitu-
ton of four inquiries: First, What was the en-
lire amount of CONSOLIDATION bonds and stocks
issued? Second, Whether there were vouchers
in the Treasurer's Office In the shape OF cancel
led bonds, coupons and certificates Of stock for
which the Consolidation bonds and stocks were
issued to the amount required by the terms of
the Consolidation Act? Third, Whether such
vonchers-cancelled bonds, coupons and ccrtifi-
cafes of stock-had been issued in accordance
with law Fourth. Whether such cancelled
bonds. &c, were amongst those which were
authorized to be consolidated by the terms OF
the Consolidation Act: Tor II VIII DC remem-
bered that the bonds, coupons and certificates
of stock authorized TO be consolidated are
srecially mentioned In the Act, while others
are not mentioned Mt all and others again, a
Conversion bonds. are specially excepted from,
tho operation of the Act. because they were
issued "without any authority OF law"
in due time the Bond Commission submitted
nm elaborate report, accompanied with various
schedules-that called No. q being intended to
renresent the consolidation bonds and ccrtifi-
Gates AFFECTED by vouchers which, In the judg..
ment Of the Bond Commission, were not issued
in accordance With law and authorized to be
consolidated under the "Act to reduce tho VOL
nmc of the public debt and provide for the pay.
ment of the same Thereupon the General
Assembly. without either affirming or or dis
N bIC COIICllSloitS Vi VIZ bStho
sion. so far rs the validity Of the bonds ard
stocks mentioned In schedule No @ were con.
cerned. passed n Joint Resolution providing q
mode of ascertaining tle aeDt OF inc Sia,e a ss5d
March. 1878, 10Th Statutes, G60. That resolution,
in its first Section, provides for the establish
me + of q court claims which shall huVe Jurls-
djction to hear and determine any case or cases
made ND or brought to test the validity OF any
of the consolidated bonds. coupons and certili-
Gates of stock, or ofa OF the various classes or
T.. 4i.~ -.lt ,nr,rf ~ elm nNp,1
the mentioned in The SAID report OF INC Bone
Commission rs resting on vouchers not Issued
in accordance with law and authorized TO be
consolidated by the Act OF the General Assem-
bly,, approved 22d December, 1873. entitled An
Act TO reduce the volume OF the public debt and
nroylde for the payment OF the same and. also.
As not issued In accordance with law and fur
ther designated and described in schedule 6 OF
said report" In Section . It Is provided .tnaI
the Acknowledgement and his said associates.
with the consent Of the creditors OF this State,
or so many of them as shall be necessary, may
make up o case or cases TO be heard ana DC
termined IN sa,a o G2u hc III l1ate wn,Gnii ~ 70 p test thc
validity of the said consolidated bonds and
coupons and certificates OF stock mentioned
in said schedule &, bringing before inc Gourt
legged in the report OF the said Commissions
impair the validity Of the said consolidated
bonds, coupons and certificates OF stock, or any
of Ihem."' The tenth Section directs that
there shall be levied for the current fiscal year
a tax sufficient to pny the coupons and Interest
orders maturing on the outstanding. consoliua-
ton bonds AM certlllcateS OF stock curing tne
| said fiscal YEAR" The eleventh directs the
pavment of such interest on those consoiida-
! lion bonds and certin ates OF stock mentioned
In schedule 5 as subject TO no valid objection,
and then Section II provides for the paymen
! ofthe interest for that and the preceding fiscal
! year on the several classes OF consolidation
! bonds and certificates of stock mentioned IN
schedule 9 "whencVer there sliai DC II hhal au,
| iudic ton as TO the validity of tlc several
classes of bonds and certificates ofstock in the
manner hereinafter provided and none other
In pursuance of the provisions OF this .reSolu-
lion. the cases which we are now called upon
to determine, being actions on coupons Of the
various classes OF bonds mentioned in SAID
schedule 6, were brought before the court OF
claims, and the majority OF that court have
rendered their Judgment IN favor o. the State
from which these appeals have been taken TO
this court, as provided for In the Second Sec
! ton of the said Joint Resolution. ,
The Judgment of the court o. claims Is based
mon n construction OF the provisions Of the
Joint Resolution constituting 1t, by which they
held that MISREPRESENTATION is limited TO the In
curry: "Were the vouchcrs-that Is the cam
celled bonds, coupons and certificates OF stock
be consolidated by the Act OF the General AS
scmbly approved December E,loI3?' But they
carefully avoid the inquiry, as not, In their
Judgment, within the scope of their jurisdiction
whether assuming this to be so, the bonds and
certificates ofslcck issued under the provisions
of the consolidation Act are, nevertheless valid
! 0r lnV.)Us OF. 10 ucc lltll "bStliSi
"the co. tsolidation bonds issued under the Act
ofIS73 are valid or invalid In other respects
II is very clear, from the grounds upon which
that court base their conclusions, that they use
the words mot in accordance with law" not N
the sense that there was no Act OF the General
Assembly authorizing the issue OF the bonds IN
question, but that the various proVlsi ms OF the
Acts authorizing their Issue were not compili'
ed wi h, and for that reason they were not is
sued sin accordance with law" But, as we
! shall see. the real question IN these cases Is,
whether there were any Acts authorlHlnS tIie
issue, and that whether the bonds were issued
In accordance with the various provisions OF
%pOrtant. An Act may fully authorize the is
sue Of bonds dnd yet the bonds may, not nave
been issued in strict conformity to The proV1S-
ions of such Act-"nOt In accordancc with
law Hence thc fundamental inquiry IS, "HaS
tho power TO issue the bonds been conferred" 2.
not whether such power has been exercised
"in accordance with" the various PROVISIONS Oh
the law comforting the power.
We think 1t plain that the object or the res
olution was to provide for "a final adjudlca-
ton" Of The veXcd question as TO what vas the
real debt OF the State, not simply to i1stitute an
inquiry into The consideration Of that which
purported to beSTch debt; for 1t Is too plain
to which class it will be seen the bonds IN qucs-
ton belons-whether issued by Is private indl-
vidunl. u corporation or Il State, may constitute
q valid debt, even though originally based
upon an insufficient or fraudulent considera-
ton, or upon no consideration at all, 10 sup
which passed this resolution, could be ignorant
oft. Hence when the declared object, OF the
Legislature, us evidenced by the title OF the reSo-
tion. was TO provide "a mode OF aScertain1ny
the debt of the state and OfliquidatiDg and set
Ting the same we cannot suppose, that they