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

COntraCC OelWeell ClllLelS UuL lHc clc
simply is submitted for consideration
awaiting acceptance or rejection; ant
here, also, the agent for the State i
without any discretion such as the &C
confers. His power is special and h,
cannot modify or enlarge his instructions
The lender thus has it in his power, b.
referring to the Legislation of the State
to understand the exact terms of th,
offer, the agent with whom he has tt
deal, and the result of his acceptance
! 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 bound. In word, .
bond issued under an act of Assembly il
so connected with it as to make substan
tally one contract. A bond of the State
issued without legislative sanction is
nullity.
4 State as borrower of money may
become bound as an individual, though
not responsible in the same mode. Blu
it is to be remembered that there can bt
no equality between the State and it:
officer and agent who acts as under 8
mandate. An individual 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 ol
the Act of 1867, to raise funds 10 pay in'
terest on the public debt. In relation tc
these bonds issued for payment of inter
est on the public debt, it appears that
the first issue under the power conferred
by said act was for one million of dol
lars. The purpose of this issue as ex'
pressed was to procure q loan to pay in
terest 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 in the body of the
bond. Waving the question whether
more bonds than amounted to 81 900, ,00C
on their face 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 was made under the same
act, 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 be under
this act, which produced more than 8
million of dollars. This appears from
the act Of A. d. 1878, which authorizes
the funding of $4,000 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, 100000 on their face-or for
the over issue i'll excess OF bonds neces-
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
a certain number or for more than Ger
tain amount. This is not the case OF
power irregularly exercised, but the total
want of power. 1t is radical defect ot
title which will avail against bona fde
holder of the bond.
The officers of the State issuing these
bonds and selling them were agents for q
special purpose, and could not bind the
State beyond the power expressed. 2
Kent, 925, note A; Wilkinson VS.. King
2 Comp. r, S25; Hartop VS.. Home,
Akin, Al.
a special agent has no discretion. All
government agents (unless otherwise EN-.
powered are special agents. Anderson
vs. Kornley, 81 Kendell, Pts; 9 Kent
620, Cpl, note A Gordon vs.. Buchanan
Yerger's, Tenn, Rep. II.
To say the least, the bonds over-issued
rs above are without authority of law
N. Y. and N. H. R. R. VS.. Schuyler, 81
N. Y, Rep. go; Devass vs.. City of Rich.
mond, 18 Grafton, Va, 3G2.
The conclusion is that the bonds of the
second issue under the act Of 26th o.
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 the largest
sum of money, is that called "The Fly,
pothecated Bonds and Coupons" The
plan adopted by the officers of the State
in 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 n con-
stantly 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.
tude of South Carolina securities on the
market was so great or the credit of the
State 30 low that in November, 1871, the
Orr Bonds, regarded as the best, sold for
PSI per cent. n. Y. Test %. To con.
tinue the sale of the bonds at such rate
was to bankrupt the State, and the poll
cy was preferred of obtaining loans by a
pledge of the securities.
The two acts of Assembly, of 26th
August, 1868, gave no power to pledge
the State bonds for loans. A. A. 1868
p. 1873. This power was first given by
the act of 1869, approved 17th Of Fcbru.
ary, A. A., p. 1872, MS to the loan contem'
plated by this act, which was required tc
be made within twelve months IRON TIE
time of its passage. BY a subsequent
act, Goth March, 1869, p. 25S, the power
was given to pledge for loans all the
bonds of the State 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 securitie:
did not improve--probably it decreased
The financial agent could sell or pledge
yet, although the face value of the bond:
pledged was nearly four times the amount
of the loans, he never sold in relief o
the pledged securities, the evidence show
ing increasing distrust of the collateral:
as a sufficient indemnity. Mills Evi.
n. Y, IS.
These pledged bonds were never re
lieved or released except in one or two
| inStanras in small nuantities and wer,