The Valley Virginian. [volume] (Staunton, Va.) 1865-1895, 1884-09-11

diousiy unprovided for, to vex the Treas
ury, to cumber the courts. and to fly-bloy
the reputation of the State in the monetar
centres of the world, is practical-may
not say ACKNOWLEDGEMENTS The re
suit must be that these coupons will com
| into the courts for gation-mosto of then
into this court. The evil of such q polio,
is, that it not only prevents the funding
of tax-receiyable coupons, but it create
| distrust, not to say disgust. in creditors a
| to the good faith of the State, and tends Il
prevent the funding Of the consol ant
| ten forty bonds themselves. 1t thus cut
up by the roots the scheme Of funding
! and makes the $50, 000, 900 Of tax-receiva
| bic coupons contingently maturing in til,
future u certain prospective debt, to bC
dealt with by the courts.
| do most earnestly deprecate the crea
ton of such a contingency. Thrusting
such mass Of litigation upon this court
and thereby forcing into exercise against
its desire, powers of jurisdiction whicl
had far better remain dormant. would opeT
q new chapter in the history Of the State
These powers are abundant to enforce the
payment of the coupons, not only in taxes
but in money, and can it be doubted that
they will be invoked? Can any public Off
Ger disguise the important truth from his
mind that if he willfully causes the State
to repudiate the obligation Of her con-
tracts" he thereby commits moral treason
against the Constitution and that if he
should proceed farther and undertake will
fully to obstruct the process of the court,
issued in execution Of its judgments, en-
forcing these contracts, he commits indi-
vidual rebellion against the government of
the country? Why should so perniciouS
q policy, the end of which no one can fore
see, be inaugurated by useless tampering
with those provisions of the legislation of
1882, which directed the funding of tax-re-
ceivable coupons?
Is this case to be dealt with by parti-
Zan methods, OF one which should call into
requisition the sober craftsmanship which
Virginia has been wont to bestoW ON ques-
tions of grave public moment?
The legal mind will have discovered that
the Riddleberger act was essentially pro-
posal of compromise by debtor-may [
not say an insolvent debtor ?-to his cred
itors. 1t differs from the ordinary cases
Of this class with which the dockets of the
courts are filled, only in the respect that
State is the debtor that, instead Of as
signing her assets to a trustee, she retains
control of them in herself and that, in
stead of executing deed dedicating her
assets to the use of her creditors, she has
passed an Act of Assembly pledging her
sovereign faith TO the honorable execution
Of the terms of the compromise. The le-
gal mind will recognize that these three
which render her act
themselves impose upon the
State the utmost good faith in administer
ing the trust, and establish the principle
that whenever III her Act of Assembly,
which stands in lieu of a trust deed a
doubt arises as to the true meaning Of any
clause, the doubt must be resolved against
herself. This principle of Interpretation
is so familiar and so obviously just that it
is useless to support it by q citation of au-
thorities. 1t is true that a grant er gratia
by a sovereign to subject must be con-
5trued in cases of doubt literally for the
sovereign ; but the proposal of compromise
by Virginia to her creditors was not made
in the capacity of sovereign to subjects.
but of debtor to creditors. many of them
residents of other sovereignties, and it
must be governed by the rules of construc-
tion applicable to contracts between equals.
If snch provision as clause (d), section
>, CT the Rlddleberger act were found in
the assignment of any ordinary corpora
ton, there is not a court in the land or
member OF the legal profession who would
not know what to do with it. No court
would hesitate, and no self-respecting law
yer would ask it to hesitate, to require all
coupons from consol bonds, irrespectively
of the date OF their maturity, to be funded.
But the interests OF State are involved
here and the established principles of jul
are discarded for State reasons,
on grounds of public policy. The gov
errors OF the Sinking Fund, in regard to
consol bonds and their coupons, when of
fered for funding, do one of two things,
l. Ii the consol bond is offered with the
maturing since July, 1882. at
tached, they give q new bond dated July,
1882. at the rate of SO for 100 as to the
bond and they leave attached 10 the bond
as many nOn-taX-receivable three-per-
cent. oupons as there were siX-per-cent.
coupons attached to the old
bond. By this method of funding they do
not, as to the coupons, give dollar for dol
lar, as the act directs, but they give three
per- cent. coupons for six-per-cent., and
that on principal already scaled down to
50 from 100 They give 264 cents for
\ dollar. The Riddleberger act will be
in vain fer authority for this
The execution of the eX-
press provisions of the act is refused, anG
\ rule of funding improvised which shares
the already Well-shorn creditor nearly
seventy-five cents in the dollar. What is
this but a mockery?
2. But if coupons from coupon bonds
Ire brought, detached from the bonds,
they are not funded at all. The Riddle
berger act contains not q word, patent or
latent, affording authority for such re-
fusal. The leading object of that act, as
before shown, was to provide for these
1t directs that ANY interest
meaning all coupons, shall be funded, dol
ar for dollar, whenever offered for ex-
change, and its express mandate in this
,egard is set at naught.
There is no authority in the Riddleber-
ser act for either of these two rules of
funding. In the light of the text of that
ict they are illegal, and considered from
lie standpoint of the States creditors,
hey are FRAUDULENT. 1t is far from my in
ention to reflect in any degree upon the
PRESENT officers of the Sinking Fund. They |
lid not originate the rules under consid-
ration. [ am not dealing with the subject |
personally. | am dealing with it imperson- |
lily. The question at issue involves large
ana grave public consequences, |
md am treating it in It's legal and pub
IL IGldUlOllS, lIUul bl6 oldlupUlUG Ol |
,ourt blind to persons and parties litigant |
md special circumstances.
There is no pretense of Justification for
he refusal to fund these coupons as di-
'ected by the act, so far as has yet been
developed, except the single one of neces-
it might best be character
zed as fright. This is but an example of |
he argumelstum db isconuenieBti which |
las no validity against the express terms
If statute, and is inadmissible in the
Eases at bar. But have no objection to |
them.
The hobgoblin in the case is the $780,
700, 900 of taX-receiyable coupons contin-
gently maturing in the future. We can
lot disguise the fact that they are all out |
in the hands Of creditors. |
They must be provided for OF repudiated |
Every consol, OF ten-forty bond, that is ]
funded in the honest execution of the |
Riddleberger act, cuts out Of this aggre-
gate an amount aqual on an average, to
more than 125 per cent. of the principal of
jhe bond. Not only is the principal bond
funded at So OF so per cent, but all it's
,uture interest for the next twenty
one years OF thirty five years, extinguished
n embryo. What policy could be more
wise, therefore, than one of good faith to
creditors, tending to inspire them with
confidence and to induce rapid funding
II the bonds according to the terms of the
1ct !? What policy cOul1 Inc more inilIri- |