Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1879-03-07
Mouth Piece, Declare that there are No
Valid Bonds, and are CORcOcting Il
Scheme TO Accomplish Their
Purpose of Running the
State Can They do
u!-Let Democrats
Answer.
Special to the Appeal. |


of the State bonded debt, submitted the fol-
lowing report from the minority of that COM
mttee, which he read from the cler ks desk.
The members of the senate, generally, Grew
their chairs closer and gathered near the
reader, and listened to the report with
marked attention and interest.
CLAPP AND SMITHS MINORITY REPORT.
Mr.. sPEAKER-It Is a matter of unfeigned regret
with me. that upon a subject OF such profound ara
may say painful concern to the public both within
and outside OF our State, the joint committee ap-
pointed By the two houses or the general assembly to
investigate the alleged indebt 3dness of the state,
could not be unanimous In their report and had
hoped that might Do abe 10 give at least qutll-
hed assent to the conclusions reached by tue major
OF TIE report, ma our views SO u!Nefgent upon
many material points, that at the risk of incuTring
the mputation OF egotism or facCusness leel con
strained TO submit minority report and IL Is due
alike the majority of the committee and TO myself
dissent should be fully and fairly stated An oblec
TO the report that lies on the threshold Is as 10
the vague and indefinite manner In which the com
mlttee undertake 10 classify and characterize the
different items OF cur inde btednesS THE State debt
proper" as 1t is termed, consisted OF bonds issued
for the stock OF the state IN turnpike companies III
railroads and banks for the construction or the cap
itol, for the purchase OF the Hermitage ana 10 the
agricultural bureau These ponds were Issued under
different acts ranging In point OF time from 1882 10
1860, and constitute an aggregate OF 648l amount
ing to S164S1 600. and or these there are now out
standing 2IO5 bonds, amounting to S2.105 900, as
stated by the committee. Deducting this from the
leaves SOq3 bonds amounting to SIS, 9O3,OO
which were issued before and since the war in aid
OF railroads under various acts ranging from Janu-
arr 80, 1850, to 1873. The report further states
that OF what called raroad bonds there are ROW
and S2636 600 since, and of that the Item of s18,
953,00O is made up as follows;
Total ................... ............. S2lOlO3OO
Ante-war railroad bonds. .............. SS,G530O0
Postwar railroad bonds. .-..---.--. 2,63S,O0O
Funded under act OF 1868 2,24b OOO
Funded under act OF lSbS....-.......- 5bgOOU
Funded under act Of 1S13.......-....- 4,S6IOOU
S18,a58,OOO
Leaving balance. INSTRUMENTATION. S2,OOI ,3OO
And of the above items the first two, amounting 70
SIl ,27l 900, are railroad bonds issued uaaer inc
Internal Improvement act OF February II i S52 ana
It's amendments which as the committee say, III a
charge at all against the State, so sec0ndarlly
The committee then assume the position that the
bonds issued subsequent to the war under the act OF
or criminal Ignorance, and that the bonds issued
under the acts OF 1863 and 1913 SO 1ar as they rep
resent bonds not legally Issued interest compounded
Or Inter est on past-due bonds ana coupons, were
also illegally issued and constituted no ooiigatloh
upon the State The committee admit tnat IL IS mn
possible to identity the exact bond or bonds out
standing of those issued under the funding acts OF
ming di ing the war or since 1855 entered from
the fact that Until the present comptroller came mo
office no account showing 1t was Kept. FROM this
sitting of the report Of the committee the infer
ence seems to be that after dsductlug the Sll52li
coo outstanding rarOaJ bonds and the bones IS,
sued under the funding acts OF 1865, 1905 ana
1873 there remain but 50 Q5l 900 OF the toto! out
puted; that for 27 900 the state Is only secGn-
darby liable II liable at ALL and for the remaining
81 BSS, 300 no liaOilty whatever Is admitted As
ali OF these bonds are upon their face the most
solemn evidence of debt, being sealed negotiable in-
struments, they must be regarded as constItuLng
1Jr1td Cdcts liability the pant OF the state ana
throw the burden upon her to inVaudate the Donass
or make some other legal defense that VIII exempt
her The question of Indebtedness is one or law
and fact to be judcially determined, and the well
recognized doctrine is that the same rules OF evil
dence and principles of law applicable when
State is party as in contract between lndlVidualS
ard while citation of legal authority Is moi uSua.
in Committee reDOIt the nature of the matter under
consideration and its mpoI lance Is scn as 10 Feuuef
a Uroper that shall refer 10 the authorities sustain
ing me positions assume, and quote the language
when necessary as this is not professional paper
Intended for courts or lawyers, but Tor the puOnc
on the point now referred TO, Vattel, well known
writer on the law OF nature, says page 20 ana
226l: "a sovereign State is subject 10 the same
miles as private individuals in matters q contrast
SO, also, the supreme court OF the umtSt Stiltes
laws down the rule: when the United States by
their authorized officers, become party to negoll-
able gaper, they have all the rights anu incur me
sponsibiiity OF individuals who are parties to such
ibstruments limited States MetTopoi; 10 Peters.
377.l ,,,.,--,u,,, ,obnson roz utssis-
sippi rem 764l when the validity OF bonds issued
nv he State OF Mississippi was the question before
the court; o3inio6 Of the court: The me
principles which govern IN nattes q contiact W
tween private Individuals apply to al! CONTRACTS 10
/ winch a state has become party This Tule IS
founded upon the presumption that sovereign states
ther 1pdeTtakinss and to discharge their just obl
cations could desire no better rules by when y as
CERTAIN tneif own obligations and rights and toost
according to which they dispense Justice TO their cit
asns.S Assuming, hen, tat the liability of the
state upon the bonds issued In heI name Is quSs
tIon kat rests upon the law and the facts OF The
| case as in controversy between private persons
| nroeeed to examine the grounds uOon which the
ppoSm ttse exonerates her No question is made as
to the power of the legislature 10 oruef ne iss ~
DENY this power is 10 deny the ability
OF the State to contract at al. 81 si ne
Ss1aItment of the government and to deny he
the power Of making contracts Is TO wltiboto A9iI
her the means of 6elI-preseTvatiOn Further, IL The
| laofs
tracts It cannot communicate such power 10 th5 COZ
sofaSions. private and public that 1t creates Tn
SeIeDses tha Is Understand the report Of the N
| mIttee, may be slated as follows:
as th Ta are a. eas ss he SITE aDs It a. on
3 That the bonds ISSUED in funding interest q
.he bonds of the State accTuing during the war an
| past- due Interest coupons are void .-, a..
g. That the acts of the legislature authorizing IN
issuance of war bo4.ds ere void, having been pro
| cured by fraudulent or Other CORRUPT means, or a
having been enacted hen the mass CT he peopt
J voice in the legislation OF the state. -, l.,
| a. That the provisions OF the various laws unue
| which tbe bonds were issued ana which were cor
| ditlons precedent 10 their Issuance, were hs
| complied with. and the. were therefore improper
anu :. Thai as tue bonds referred upon their lace
the several acts under which they we're respectYel
issned. these Teciigls made it the duty of every pu
| chaser TO that the requirements nad Deen con-
| piled with, and excludes the plea or " lnhocei
IS Tnat the Legislature of 1S697O instituted i
| ouiIies into the circumstances under Whlcn IN
60nds and especially those In aid OF railroads. wei
med with view TO declare them Illegal and y0!'
| and we're deferred from so doing by apprehension
Of TsconsirIction and menares on the paIt OF tn
| Federal government, amounting TO duress.
Z That the State IS not estopped py any fsGogL
tlon or notification OF these bonds by the le2lsIalu
or by any officers or agents OF the state rom mo-
denying the validity OF the bones espeeiatty az
those that were referred TO IN the seveTdl lunuH
| and other acts, as 4" not legally Issued" 49,
| 8. Another ground assume q By the c0mmlttee
the validity OF the bonds as loose equity on beha
; OF the State resulting from sacrifice OF her lte
e | which sale, It is intimated If not charged, wi
. | brought about for fraudulent and speculative pu
Reisr.ing to these various positions assumed
the COMMITTEES, IL the order in which they are STATE
sIrSfnAll the bonds issued, bejeys. without e
ceDion. are the bonds Of the state The Stie Is,
| legal contemplation, so far as the bonds lndicai
ths ntimaEy and only party liable. As to the sever
raiIroads in aid OF Which the bonds were issued Il
9r@yS aISntOr and took occasion in every Instance
}, p oect herself against ultimate iiaDulty " sun
l. cent statutory mortgage, under which Lhe ROAD wa
i Eli ia fixtures and appuTtenances, was liable 10
II sold. whether the holders % the poIil9 cd ~
g themselves OF the benefit OF TINS ihoftsaSe NJ +
n force the lien acquired DJ lne 2tdtT5 10 .
h now in process of judicial Investigation anu y
e bear TO express any opinion on the subject: bu
% ] cannot as a legal proposition, understand 10
what ground the state expects 10 escape Haunt!
II the maker Of a negotiable instrument
e, | Second-As TO the Inyaldty OF bonds issued
| funding interest accfulng SUlng the war ana lnu
est coupons can only say that rs" % no ~ ~
pie OF International war that suspehas l.ltsS ,
,f an interest bearing debt due by one OF the bes
ents 10 the other, or by belllgerenI 10 lnlfu y
Il ! son Public policy requires that during the war
citizens or subjects of beliHerant shall not g
tract with or pay money 20 citizen or subiect oT
Il other belligeTenti but this IS dutJ that each
:" iIgerent Imposes upon It's own citizens or subie
Y Tor rs own protection and as Il thus becomes
., iS1ful 10 pay interest 1t is regarded suspend
IL drIrluy the war But this rule certainly has no
~ DIcatloh to the payment CT Interest Ly the belly
; sut itself AS 10 interest coupons II IS guest
q now too well settled to admit o. argument that Y
draw interest after maturity the same as any Cti
i debt. q ,.,.- a.. a.,