The Anderson intelligencer. [volume] (Anderson Court House, S.C.) 1860-1914, 1879-01-09


without any discretion such as the act
/ confers. His power is special and lie
cannot modify or enlarge his instructions.
The lender thus has it in his power, by
referring to the legislation of the State,
! to understand the exact term. &C the
offer, the agent with whom he has To
deal, and the result of his acc c.ptance.
He should bear in mind that upon de-
Walton from the legislative offer. which
no one unless empowered can assent to-,
the State is not bolnd. In word, a
! bond issued under an net Of Assembly is
! 80 connected with it rs to make substan-
tally one contract. A boud nf the State
/ issued without legislative sanction is n
nullity.
a state rs q borrower of money may
become bound as an individual, though
not responsible in the same mode. But
1t Ii to be remembered that there cen be
no equality between the State and its
officer and agent who acts as under a
mandate. AN iudividual is liable TO the
extent of the power apparently conferred
on his agent; but the government is
liable only to the extent of the power
actually conferred. Pierce VS.. the Uni
ted States, N. and H., 27O.
This principle is specially applicable
to the over issue of bonds under cover VI
the Act of 1867, to raise funds to pay in-
tercst on the public debt. In relation TO
these bonds issued for payment of inter
est on the public debt, it appears that
the first issue ur der the power conferred
ny said act WAS for one million of dol
lars. The purpose of this issue as ex-
pressed was TO procure loan to pay in.
tcrest on the public debt. On the face
of the bonds Of the first Issue the title of
the act is set forth in full, the date of the
act also being stated iii the body of the
bond. Waving the question whether
more bonds than amounted to 81 900, 900
on their fnce could be issued until mil
lion of dollars was realized from their
sale, it is apparent that there was an un-
authorized excess Of issue in number and
amount. The issue Of the second mil
lion of bonds WIS made under the same
net, the bonds similar in every respect,
except that instead of the title of the act
being inserted in the bond, there was
substituted for it the words, Issued un-
der an act approved August 26, 1865"
There is no disputing the fact that
bonds were issued purporting to he under
this act, which produced more than a
/ million of dollars. This appears from
the act Of A d. 1873, which au,ho f;zes
! the funding Of S197 900 more than the
million of dollars authorized by the act
Of the 26th August, 1868 Is the State
responsible for this over issue of the
bonds for 81 10000 on their face-or for
| the over issue i'll excess of homda neccs-
| sary to be sold to produce one million of
dollars? In either case there was pos
tive want of authority or power in the
| agents of the State TO issue bonds beyond
| certain humber or for more than q GER
| tain amount. This is not the case of
power lrregularly exercised, but the total
want OF power. 1t is radical defect of
title which will avail against bona fidc
holder OF the bond.
! The officers OF the State issuing these
bonds and selling them were agents for a
| special purpose, aud could not bind the
State beyond the power expressed. 2
Kent, 325, note A Wilkinson vs.. King.
Comp. r, 1926; Hartop VS.. Home, 5
Akin, Al.
A special agent has no discretion. All
government agents (unless otherwise en-
pcwered) are special agents Anderson
w. Kornley, 81 Kendell, 275; 2 Kent.
620, 6Zl, note A j; Gordon w. Buchanan.
8 Yerger's, Tenn, Rep. II.
70 say the least, the bonds over-issued
no above are without authority of law.
N. Y. and N. II. r. r. vs.. Schuyler, "a
N. Y, Rep. 80; Devass VS.. City of Rich
mond, 18 Grafton, Va, 1862.
The conclusion is that the bonds of the
second issue under the act Of 26th of
August, A. d. 1868, in excess of one
million of dollars, were not issued in ac-
cordance with law. and authorized to be
consolidated by the A. A. 1873.
The question of greatest Importance
raised by the report Of the Bond Com
mission, at least involving tha largest
sum of money, is that called "The Hy-
pothecated Bonds and Coupons" The
plan adopted by the officers of the State
III the wreck OF its credit was the COM
mon one OF borrowing from Peter to pay
Paul. Had the credit of the State been
good and its bonds at par slight loss
might have resulted from this OPERATION.
But In this scheme not only must the
agents effecting the exchange of credit
be paid, but there was superadded con-
stant!y increasing volume of debt. arising
from the difference between the market
and the par value of the bond, which
the purchaser could claim. The multi
tnde of South Carolina securities O.. The
| market was so great or the credit of the
State 40 low that in November, 1871, the
Orr Bonds, regarded as the best, sold for
2S3 per cent. N. Y. Test %. To con-
tinue the sale of the bonde at such rate
was to bankrupt the State, and the poli.
cy was preferred of obtaining loans by q
pledge of the securities
The two acts of Assembly, of 26th
August, 1868, gave no power 10 pledge
the State bonds for loans. A. A. 1868.
p. 1878. This power was first given by
the act OF 1869. approved 18th of Febru-
ary, A. A, p. 1872, as to the loan contem-
plated by this act, which was required to
| be made within twelve months from the
time Of lis passage. BY q subsequent
act, 26th March, 1869, p. 258, the power
was given to pledge for loans all the
bonds of the Slnte in its possession, and
extending the time for the loans for two
years from 26th August, 1868. 1t may
be inferred the value of these securities
did not improve--probably il decreased.
The financial agent could sell or pledge ;
yet, although the face value Of the bonds
pledged WAS nearly four times the amount
of the loans, he never sold :" -,,ief of
the pledged securities, the evidence show.
ing increasing iistrust of the colaterals
as sufficient indemnity. Mills Evil,
N. Y, Is.
These pledged bonds were never re.
lieved or released except in one or two
INSTANCE" in small quantities, and were
sold or otherwise disposed of by. the
pledges. rs appears by the testimony
Government bonds, payable ut future
day, especially when the day is distant
have been savorite mode of investment
for those not actually engaged in trade