Abilene weekly reflector. [volume] (Abilene, Kan.) 1888-1935, 1890-03-06

National Bank of Chicago. and put It IN
the hands of Joseph Wiltshire, of Cincin-
natl. who delivered it 10 c. j. Kershaw,
who placed 1t on deposit The Fidelity
Bank also issued a letter of advice to
the American Exchange National Bank,
stating that Wish re- ~ Go. had depOs-
tied in the bank $500, 900 to the credit of
the American Exchange National Bank
for the use of c. J. Kershaw & Co. The
last named were depositors of the Ex-
change Bank and the bank put the
money to their credit and they drew
checks against it. Harper, who was the
vice-president of the Fidelity Bank.
was using his banks money in his
deal and issued these papers without
any consideration to his bank When
he saw his deal was hopeless he wired
the Chemical Bank of New York to
stop payment The Fidelity Bank
failed. and. on the refusal of the receiv-
or to allow the claims of the Exchange
Bank for the documents which it had
cashed in absoiuf good faith, the lat
ter sued the former to recover. The
lower court gave judgment in favor OF
the Exchange Bank. and the Supreme
Court affirmed that Judgment holding
that the bank WAS an innocent pur-
chaser for value and that the Fidelity
Bank was estOppcd from setting up the
falsity of the representations made.
The Exchange Bank did not take the
paper under such circumstances
as would lead them to suspect any
thing wrong. 1t could not refuse to
honor the drafts on the ground that
rumors on the Board of Trade intimated
that money was To be used to cover
antecedcnt losses in gambling and
speculation. 1t was therefore ordered
that the receiver allow the claim of the
Exchange BANK in winding up the FL
deity Banks affairs and as the former
has not received any part of the divi-
dcnd heretofore awarded by the receiver
that t be allowed interest on its share
of these dividends. There is an
other draft for 500, 900 on which the
Exchange Bank W II be under the terms
of this decision entitled to credit, max
ing 800, 900 in all. The bank will not
receive all this amount, but its share OF
the losses of the Fidelity Bank will be
computed upon the basis of this amount
and the total amount it will receive will
depend upon the percentage the Fidelity
Bank can pay upon the total amount OF
claims outstanding against it.
TWO BoSD CASES.
WASHINGTON, March 1.-THE Supreme
Court rendered a decision yesterday in
the case OF Is. b. Haus VS.. the State Of
Louisiana. brought here on appeal from
the Western distr ct of Louisiana. 1t
is said that from $l0,0 900 600 to 81, OOo,-
600 are involved in the case, the decision
OF which turns upon the important con-
stitutional right Of citizen to sue his
own State.
iIaus Is the owner of a considerable
amount of consolidated bonds of the
Statc OF Louisiana. When the State is
sued The bonds it made provision for the
levy Of Il special tax to meet the inter
est Ind principal of the bonds. 1t
furthermore declared the bonds to create
a contract between the State and the
bondholders nh ca should not be i'm
paired and also dcuand>d that the ju-
dicial power should be exercised
whenever necessary to SECURE the
levy and collection Of tho tax
and the payment OF the bonds.
The State Constitution adopted
in 1879. however, partly repudi'
ated this agreement. and directed that
the revenue received from the special
interest tax should be diverted to pay
the expenses of the State. Haus, who
is citizen of Louisiana, brought suit
to have the new State Constitution de-
clared invalid so far as it impaired the
contract between the State and tbs
bondholders on the ground that it vio'
lated the Constitution of the United
States. The State set up plea that 1t
could not be sued by one of its own citi-
zens without its consent. The Circuit
Court decided in favor Of the State and
the case came here for final review.
After a long review of the charges
that the State had impaired the contract
obligation stated on the coupon the
court said that the whole question came
to this. that the obligations of a State
for their performance rested upon honor
and good faith unless it consented to be
brought into court. 1t was true that
where property or rights were injured
under the contract made by the State
they could not be invaded. Whilst the
State could not be judicially compelled
to perform its contracts any attempt on
its part to violate property or rights ac-
CURED under contract might be iudicially
resisted and any law impairing these
rights was void. IN conclusion the court
says: ia Is not necessary to enter upon
an examination OF the reasons which ex
empt sovereign STATE from prosecution
in court of justice by one of its own
individuals. It is enough GeAeelare its
existence. The legislative Department
of State represents its policy and is
will AID is called upon by the highest
demands of divine and natural law ia
preserve justice and Judgment and tc
hold inviolate &se obligations of the
State. Any departaFs tom this rule,
except for reasons most cegeR6 E9f which
the Legislature alone can jBdgeJ AeTeF
fails in the end TO incur the odium of tbs
world and TO bring lasting injury upon
the State itself. But to deprive the
LegislaOS&e of the power of judging
what the henS& Spd safety of the State
may require, even SC the expense Of a
temporary failure to diseG4Fge the pub
lie debts, would be attended witR greater
evils than such failure could cause. "A
would in fact deprive the State of that
sovereignty and management Of its af-
fairs which are essential TO its aatoRop9y
Snd which is always understood to be It's
pnerST1tive by all private parties that
deal vita t. p
The court reversed the Judgment in