The Memphis appeal. [volume] (Memphis, Tenn.) 1886-1890, 1888-11-24
Mr.. w. M. Sneed Holds That There
is Mistaken Impression.
Relation OF tho 1888 Bond Issue to
That Of 1877.
How Holders of the Latter Securities
Waived Their Claims and Removed
tho City's Obligation-Presiden
Hadden's Verbal Contract.


time the attorney OF the bondholders and
having actively participated in the settle
ment, was able to so into the history OF
past issues, and on that account his state
ments form, in some respects, the most
important contribution TO the literature Of
the subject As he addresses himself par
ticularly TO the question whether or not
the city is inhibited against the issue OF
more bonds, his views have special interest
at this time. In response to questions,
Mr.. Sneed said:
''In 1881 there was an effort on the part
of some of the citizens and many of the
bondhoders to have the Legislature pass
an act authorizing the city TO settle its
debt at 30 cents on the dollar. Represent
ing bondholders, | assisted in drawing
such IN act as was stated by some OF our
creditors would be acceptable TO them.
This act proposed settlement at 80 cents
on the dollar, interest for the first six
1 years TO be 3 and 4 per cent, and alter
ward per cent, the loss to bondholders
in this reduction OF interest TO be borne by
themselves and not capitalized into the
new bonds, Ms was done under the act OF
1883, and thus assumed by the city. This
act. ms remember. had the clause pro-
viding that no other bonds should be
issued until all provided by that act pro-
posed should DO redeemed. The bond
holders generally agreed to compromise
under this net il passed, and some OF our
citizens favored IL, but IL was opposed by
others and an act substituted Offering a
compromise at S3i cents on the dollar,
which was passed.
"rhc representatives OF the bondholders
stated to the Committee OF the Legislature
before which the act Of 1881 was pending
that they would not accept the 33i per
cent act il passed. and, ms | remember,
only n few thousand dollars were funded
hereunder, aud that Of the old passed due
Indebtedness, which was long since barred
10y the statute of limitations, and which
the city could not have been forced 10 pay.
There was another act passed at the extra
session Of the General Assembly IN 1882
authorizing settlement OF so cents on the
dollar, at the option OF the city authorities,
but they passed a resolution opposing 4
compromise under the same. About the
converting OF the Legislature in 1883
there were some OF our people favored
and others opposed q settlement
| Of the indebtedness on about the terms pro-
posed by the bondholders in 1881. After
considerable discussion OF the subject Mr..
4. IL Turley, rs ! remember, drew a short
| memorandum briefly stating the terms upon
| which lac and others thought settlement
could be had. This memorandum, think,
was signed by some home creditors, "a sig
niiyiug their willingness 10 compromise on
lis terms.
at mass mectinghch by the people q
committee was then appointed 10 confer
with the creditors Of the city as to terms OF
settlement This committee reported back
TO the meeting the terms Of settlement,
which are now ON the records of the city,
aud contains no promise prohibiting a iur.
thcr issue Of bonds This citizens com.
miltcc further recommended that another
committee bo appointed TO confer with
creditors In the preparation Of an act 20 be
passed authorizing a settlement. After this
there was committee OF i've selected,
three representing the city aud two the
hondholdcrs, 10 try and agree upon and
draft a bill, To DO passed 10y the Icgis.
nature then In session, that would prove
acceptable 10 both city aud creditor
was one Of that committee, and We met
and agreed upon the act rs passed in 1855,
and under which the present bonds were
issued. As ! remember, the net was read
and discussed by this committee section by
section. and, M agreed upon, published In
pamphlet form, With blank lines at tho
cnd oi thc pamphlet 10 br signed by cred.
itors who agreed to compromise undcr IL.
These pamphlets, two Of which are signed
by about ninety crclitors, arc now on fila
in the city's vault. anl they contain no
prohibition NJ TO other issue Of bonds.
am positive that no such intention existed
on the Part OF this committee toincorporltc
such clause IN the act; aud consequently
the assertion made some time since that
the act had been changed after reaching
the Legislature is a mistake.
Again, after this act was agreed upon
rs the one proposed 10 be- enacted by the
Legislature committee consisting OF ia lgc
EllclL Mr.. u. 4. MADDEN, Mr.. w. VI.
harrington and myself were appointed %
20 on and confer with the creditors aud
learn II they would scitlc on the term.
named. We carried with ~ and mailed
10 each creditor before leaving these
pamphlets containing the oct ~ proposed,
aud one signed on ia blank lines by
many Of our homo creditors aud ON or.
rival n New York, Baltimore, Washing.
ton. Louisville, Richmond and Lynchburl,
presented TO each creditor copy OF the
pamphlets. In many instances the
creditors In the named cities called meet.
ings 10 hear our Presentation ol the
proposition, and the said pamphlet con-
tanning the act WAS before us aud was very
fully discussed both from the cruditor.
aud debtors standpoint Had thcc been
any agreement ur understanding that a
CLAUSE prohibiting a further issue 81 bonds
was t1 be- Incorporated In the act, | am
satisfied that it would not have escaped
the committee who Pm thoroughly dis
cusacd each SECTION. and would most ccr-
talniy have byuu noticed hy thc various
creditors, 40 70 whom bad The act before
them and fully considered and discussed
u with our committee. AZ regards the a.
aDrIuu that O verbal promise 10y the CON.
W.iiDc Wus made % the creditors that no
other issue oi bonds should be- made until
IIp present Wcrc taken up think there y
IL mistake. A committee ui citizens and
creditors had ngrccd upon and dawn
the act which can hf seen contains no
such prohibition. This act had been Az.
proved by mass meeting OF our people,
aud can IL be- pltaumcd that this commit
tp' OF four would. with this act before
them. which WIS their guide. have In
violation OF the terms thereof agreed ~
promised the creditors thnt mother bonda
I should hV Issued when such promise WAS
Inconsistent with the aci2 And again, u
the settlement bad been prvdicaiod and
based on this agrr mcnt or assurance,
would not the creditors have Insisted ON
Us bcing inserted In The act before It's
passage
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