The Valley Virginian. [volume] (Staunton, Va.) 1865-1895, 1883-03-15
The Old Debt OF Virginia
lThe N. Y. Times, March O.


At the close OF the war of the rebellion the State
Of Virginia found itself with debt incurred before
tne war, which, with accumulated interest, amount
ed to about $45,OO0,UO0 West Virginia had been
made state from It's territory, new State taking
from the parent State about third of its wealth,
territory and population. AS West Virginia had
enjoyed portion Of the benefits of the money
raised by the Virginia bonds it was held that the
new State should assume proportion OF the debt
Of the mother State. This the political fathers of
both States agreed Virginia set aside one third
OF the debt as West Vrgin1as share. West Virginia
denied that this was her proportion because one
third OF the amount had not been expended within
her borders. Nevertheless, when Virginia funded
her debt In 1871, under the refunding bill she
funded only tWo-thtrds, and for the other third
which was assumed to be West Virgin1as share
certificates were issued which soon came to be
known as virginia deferred certificates. The pay
ment OF these certificates was to be made upon the
basis OF such settlement as shall hereafter be had
between the States OF Virginia and est Virginia In
regard to the debt Of Virginia existing the time
OF It's Acknowledgement" These were accepted upon
an understanding that Virginia would take steps
TO bring about a settlement, and that the amount
assumed by West Virginia should be divided pro
rata among the holders of the certificates The
Wheeling Convention of 1861, which created the
State of West Virginia agreed to accept such pro-
portion OF the dept as should be shown to be hers
upon an accounting between the two States. Such
an accounting has never been had. The holders of
the Virginia deferred certificates have never seen
any prospect of settlement OF their claims.
In order to force West Virginia to pay her share
Of the debt the holders OF the certificates have
by somewhat novel method. Steps are to be taken
to induce Virginia to bring a suit against West
virginia In the United States Supreme Court for
accounting, TO compel West Virginia to assume
under such accounting her share of the debt and
settle with Virginia by giving her bonds for the
amount. These bonds are to be accepted by the
creditors in lieu Of their deferred certificates In
order that these proceedings may be properly car.
ried out, the Fist National Bank of this City is
made the agent of the holders of the certificates
and the Farmers Loan aud Trust Company the
Shareholders The certificates are to be deposited
with Farmers Loan and Trust Company, and the
owner of the certificate receives in exchange a me-
gotiable receipt therefor. These certificates are
TO be exchangeable for the West Virginia bonds II
that State accept the accounting of the Supreme
Court and issues such bonds. The holders Of GER
uhcates who agree to this plan to receive case
or settlement, l3 cents the dollar of the face
value of their certificates, and so per OF any
sum above that amount that may be secured on the
dollar from that state. For example, II the state
agrees to pay so cents the dollar, holders OF GER
tifcates will receive 164 cents, the remaining 81
cents going the projectors Of the plan. The con-
summation OF this plan Messrs. soutter Co.. of No.
10 Broadway, have attempted to undertake at their
own risk, depending for reimbursement upon what
would accrue to them from the so per over and
above the ID cents the dollar insured holders
or upon payment of a 10 per cent. commission to
cate holders. The plan which is proposed has been
accepted by holders of nearly $2,OOO,OOO of these
certificates, and many thousands of dollars OF the
certificates are daily received from English hold
ers for exchange for the Farmers Loan and Trust
Company's negotiable receipts, whose holders are
anxious to participate In the novel pooling scheme
to get something out of what is virtually, as 1t
stands, arepudiated debt The steps which Messrs.
Soutter Co have agreed to undertake to bring the
scheme to successful conclusion the collection
of the certificates in the hands of stakeholder
which is now being done-to induce Virginia To
bring suit against West virginia: to manage the
case before the United States Supreme Court to in
duce West Virginia to issue bonds to pay the judy
ment which may be rendered, and to distribute the
West Virginia bonds, which will be received by the
Farmers Loan and Trust Company, In exchange
to receive Them 1t is expected that all this can be
accomplished by April, 1887. The most singular
sary part-the education Of the people Of the vir-
gfntas up to point which will make them willing
to pay their just debts, and elect Legislators who
will take such steps as will result In this much-to
be-desired result.
THE COUPON CAsE-THE DECISION CLAIMED TO BE A |
VICTORY FOR THE STATES CREDITORS.
The recent decision Of the United States Supreme
Court In the Virginia coupon case of Antont against
Greenhow, was accepe ed by the Readjusters Of Vir
ginia as victory. Cannon were fired In Richmond
on receipt of the newso their supposed victory
copy Of the decision OF Chief Justice Waite received
In this City yesterday, gives new phase to the |
case however, and seems to afford the creditors |
virtual victory over the Readjusters TO the bonds
issued under the Refunding act of 1871 were at |
tached coupons, which were made receivable for ali
taxes, debts, and demands due the State. 1t was by
such legislation as this only that the State could
induce the holders of the ante bellum bonds to ac
cept the new ones, as the coupon clause seemed to
make the bonds source Of some income because |
lature of 1872 however, rendered these coupons use
less by passing law prohibiting Tax Collectors |
OF the State from receiving in payment of taxes any
thing else than coin or treasury or national bank
notes. 1t was the question OF the legality of this
a
has just been rendered. The abstract of this de.
cision furnished by the Associated Press and pub-
lished throughout the country gave an erroneous
impression. The court has decided that the state
has entered into contract to receive the coupons
for taxes, and that any act which forbids the Col
lectorsof Taxes to receive the coupons Is void
"Any act of the State which forbids the receipt of
these coupons for taxes is violation of the con-
tract, and void as against the coupon holders" ia
the the language Of the court Again, the court says:
The right OF the coupon holder Is to have his CON
pom received for taxes when offered. The Question
here is notas to that right but the remedy the
holder has for It's enforcement when denied"
Mr.. William l.. Royal of this City ia counsal for
pool Of English bOndholderS, and appeared hefora
the supreme Court In behalf of the creditors IN |
speaking of the decision yesterday he said: MThe
OF this decision Is this When the tay |
payer has rendered to the Tax Collector the States
coupons In payment of his taxes he has done all his
duty. IL 1s OF no consequence to him whether the |
State gets any revenue or not. II she chooses to |
refuse his coupons and be of her revenue 1t is
no concern This. H. however, he wants TO do a
work OF supererogation and make her take her
coupons and place them In her Treasury, the court
decides that he must proceed under the act of 1882
The vital point settled is that the State
erate collectors from erresponsibilites when
hey refuse coupon of the State. II the Tax Col
ector attempts to levy for taxes after coupons have
rendered in payment of taxes he does so at his
PERIL He can also be restrained from leyytng by
IN Injunction. Under such circumstances the
state must PROVIDE Tor It's coupons or else be with
)ut revenue for the next two years." Mr.. Royal
states that there about of these bonds
with taxreceivable coupons, for which the State is
'esponsible Under this decision the holders Of
hese Donds Will tender their coupons in payment
taxes and In case of the refusal of Collector
sccept them, legal proceedings will be taken against
he Collector III the decision of the Supreme Court
8 folloWed up, said Mr.. Royal, "Vfrginta Will
hen be left without any income unless she makes
ome provisions for taking care Of these coupons.
mean great relief to hundreds of people who have
nvested In bonds, who have been crippled by such
IA investment, and who have had no means
Il disposine OF or using their coupons any way