New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1882-02-12
THE TENNESSEE DEBT BILL INVALID.

NASHVILLE Tenn. Feb. 1l.-The Funding
Act of 1881 which compromised the bonded Indebtedness
OF Tennessee at par and three per cent Interest," ana
made the coupons vable for taxes was declared un
constitutional by the state Supreme Court this morning
Two OF the five udges-Ewng and Deadericls-disscnt
from this decision Reviewing the suit Judge Iuriiey,
in delivering his opinion. said of the Circuit Judges
Of the State had granted fiat enoining the Funding
Board Its hearing The Chancellor OH his own mo-
ton, dismissed the bill and complaint The taxpayers
appealed The argument that the taxpayer is bound by
honor and words 10 pay under the existing law, the
debt and per cent interest and therefore can sustain
injury compulsion pay half that interest and
therefore ought be heard complain cannot avail
with the cors The debtor ask The intervention OF
courts to prevent enforcement in part of the agreement
TO pay well the whole. IT, when the act Is com
pete executed contract and is being directly enforc a.
he may not strike at the threshold and destroy s half
grown ife The Legislature, Judge Iurney continued ~
the creature Of the Constitutions and cannot rise above it,
andwhen the lawmaking violates he Consltu lon
its act Is nulIiy and being nuy Is NOT an &
AID can only be changed by the people Ihc FUNDING
Act being unconstitutional this suit against officers
brought into being by II not suit againsl inc Oncrrr
Of the State bu is suit against citizens attempting 10
commit wrong, and may bc maintained
In conclusion Judge rurney says the creditors OF thc
State have not a righ, TO demand first mortgage
upon the life of the ate. its taxes and taxing power
He holds that the Funding Acts uneonsutu lOnai an
void and that the njunc ion properly granted ana
should he perpetual The two other Jud!es OF the ma
Ori Y hold substantially the same views, but their
opinions are expr ssed al greater length .,.,.
thefJus DcadcrlCk opinion OF me MI
norty held that the Funding Act was not void ana that
the courts have power 90 review reverse the action
of the General Assembly unless such action violates the
Constitutions; and II II Is "uhin the coHHtltltlOhhi
power or the General Assembly, il cannot he questioned
by the courts upon allie -atiOns of bribery or fraud
He holds that the Legislature ha- The power TO pass he
funding act, there being constitutional hib ion that
the act is constitutional and not void and ha the Chan
cclors decree dirinisens the injunction should he ar
firm d. This opinion is concurred i'll by Special Justice
The decision of the Court made the sole ground
that the Legislature could not make valid contract
making coupons receivable Tor taxes Tor hiney-nne
situtiona and the majority held that charg' OF corr
the judicial depar ment There not question In
the touching the liability OF Tennessee railroads. to
lien in favor OF holders Of bonds Issued by the state ia
aid Of railroads.
The news of the decision caused great sur
prise in this city among those persons interested in Ten
neSscc bonds Nothing definite in regard to the text OF
the d cieon was known at the Stock Exchange until
after the close business and then the dispatches were
confused The only fact that appeared clear that the
decision of the Court adverse to the Legality OF the
Funding Act generally inferred from this that the
ground OF objection the provision making the
pOns receivable for ixes There has been lately heavy
decline in these bonds at the stock Exchange They cold
rs Tuesday, and since that day have steadily de-
clined, until yesterday they sold at j02 The members
of the Bondholders Committee had received no inf0rna-
ton from Tennessee in regard TO the decision OF the
Court which not expected until yesterday, and it
generally believed that the decline was wnolly
speculative
Eugene Kelly, who is chairman OF the Bondholders'
Committee said last night that he knew nothing more
about the decision than made know in the general
dispatches He added: q" perfectly amazed at tho de-
cison Of the Court The committee felt CONFIDENT that 1t
would he in of the bondhodcr5 The snit brought
by committee against the railroad companies is pend
ing in The United States supreme Court and now of
the committee viii press that suit 10 hnol hear
ing. IL will br probably long time before decision OF
the question will be reached In regard TO special
sion OF the Tennessee Legislature, have information
think lelv that the Governor may call an extra ss-
sion The Legislature is the that passed the law
which is declared CONSTITUTIONAL, but cXaciY
what action it would take. If called together cannot
saw presume the Governor will be interested in having
the Legislature take some further action because his
term will piTe, think, this year There has been no
meeting OF the BondhOdeTs' Committee since the de
cison made public and do not know that there is
now anything for the committee to do OF course the
purpOrt of the decision was known by some people in
wall street several days The decline i'll the bonds
the result OF knowledge and not of mere fear Tho
Tennessee have beaten Us for The third time. They
knew undoubtedly that the decision 10 be against us
and used their knowledge TO their advantage.