The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1891-03-16
SCRIP NOT A DEBT.
Judge Jacobs Opinion on the
Mayors Veto.
THE BLAINE BOND ORDINANCE.
Renewal by the City Of IN Obligatieu
Not the Creation Of Fresh In-
debtednesS.

Not the Creation Of Fresh 1n-
dsbtedness.
At the next meeting Of the board Of aldermen
the question viii be put - 70 whether the ordi-
nance, which has come to be most readily recog-
nixed BIZ the name Of the Blaine ordinance, shall
be passed Notwithstanding the mayors veto.
The mayors objection was based upon the ap-
prehension that the fvc-year maturity clause
would make the bonds part OF the city's gen.
eral Indebtedness
Judge Jacobs had not been consulted g 70 the
grounds Of the veto, and at the Last meeting OF
the board Of aldermen expressed the hope that
he ought not be called upon TO express an opln-
ion. Yesterday, however, he was found enjoy
ing the retirement Of his library and In pleas
ant humor. The conversation turned to the
Blame ordinance, and the Judge subjected 70 IN
interview, which he afterward, with some re-
luctance. CONSENTED to have published.
"Judge." he was asked, ibid you examine and
PASS upon the ordinance which the mayor We
toed before it was submitted to the city coun-
cir"
II did," replied the Judge, .and came
to the co 1clusion that no legal objection could
be urged against the ordinance. have been
asked this question gres. manS me he D ct1
council aud since its veto. NOW, let me De
clearly understood, ii is not my business to de-
termine upon the policy or iIponcy, the expe-
wisdom of the provisions OF any ordinance sub
mitted to me for examination NY province -
to determine whether the ordinances is In con-
fiict with the constitution or laws OF the state,
and OF the charter OF the city OF Seattle, and
whether the city council has any authority or
power to pass such ordinance. Acting on the
principle stated above did. a. have said, care
FULLY examine this ordinance and found no
valid objection to II"
ssI3ut you are aware, Judge, that the mayor
that an indebtedness could not be Created
against the city without the authority OF
three-fifth vote Of the people of the city in ex-
cess 81 ~ per cent o. me asSe:sea on, 2.
"The principle 10 correct enough, but what ap-
plication it has to this ordinance and it, pro.
visions am wholly unable to zee. Let me call
your attention to . fact or two: First, the con.
stitution of this state has nothing to say about
the issue Of bonds by. municipal corporations;
the constitution does, however, prohibit the Gre
alton in excess OF one and one-half per cent
without the vote OF three-fifths OF the voters Of
the city. Second, the mode OF payment Tor such
thing. On general principles, ] may owe John
Doe II 600: II should give John Doe note for
that 81 600, strictly speaking the note would not
evidence of that Indebtedness. Instead Of CIV
ing him note might give him . bond payable
in ten years, with interest payable semf-annu
ness ' for that existed before, and the bond
would provide the means and mode of payment
II the city owes debt which is valid legal OBJ
legation, she can give an order Tor the payment
other evidences Of that indebtednes.; but this ID
on the supposition that the debt exists and II .
binding and legal obligation:
eBut it is said that IL the city issues these i've.
year coupon notes or bonds, she loses her right
to enforce suits against property owners who
are primarily liable for the payment OF the sums
81 do not acknowledge thacorrectness Of any
such doctrine. In making improvements the
city issues its scrip to the contractor and pays
city is not liable ON this scrip unless It fails
neglects to collect 1t from the property owners--
in other words, the citys liability ID fixed BY
Doe gives ii. note 70 John Stiles, or order psya
BILE six months from date. Before the note falls
due, A, B, C and d become endorsers on that
ss and ere g
for payment and they have been duly notified.
In this last instance 1t 10 the notice that fixes
Or e nat IS 4 re
city fixes the liability of the city: Now, will
any lawyer say that II A, one Of the endorsers
OF that note. should make arrangements for the
holder, that therefore he would lose his right
TO sue the maker Of the note? To AK the ques-
ton 10 to answer 1t.
sued under this ordinance were not to be nego-
tiated as bonds, but were simply to be substi-
tuted for the evidences of indebtedness already
of this improved scrip, which was to be deliv-
cred up and cancelled upon the receipt Of the
bonds. The holders OF this scrip were not
them if they did not desire to do 50; it was en-
tirely q friendly and satisfactory arrangement
made between the city and those who held the
provement scrip is either part OF the indebted
ness of the city before any neglect the part of
the city il judicialiy determined or it Is not.
dd,, from its very inception Il 4 an in
exceeded the "a per cent. limit, no indebt-
edness can ne legally incurred for the improve
ment OF the streets, either under the bonded
system or the payment by the other mode, with
out having an election for each street improve
ment and the authority OF three ffths of the
voters of the city in order to be able to create
ment Immediately; bonds cannot be issued BY
the city as mode OF payment for such i'm
provement as provided in the charter. There 10
these local street improvements are part Of the
citys indebtedness before any neglect upon the
part of the city has been shown. 1t cannot be
the law applicable to this subject
1.-THE provisions of the constitution are not
reactionary, much less do they expressly or BY
leave the indebtedness of municipalities lust
as they were at the time of Its adoption. The
existence of such indebtedness ia only taken
into acconnt in determining the limits Of flu
ton If il is adiudged desirable to increase it for
corporate purposes.
s.As l said before, the constitution 10 silent on
the subject of municipal bonds. Bonds are but
a mode of payment for existing or proposed in
debtedness.
"The freeholders' charter, however. provides
for the issue of two sets of bonds The first in
provided for by section 80 Of article 4. These
bonds are issued as q mode of payment for
'loans'-for money borrowed. These bonds re-
Quire the Endorsement of three-ffths of those
voting at an election clearly called for that pur
pose. 1t has always been serious question
with me as to whether the provisions of this sec
ton applied at all TO an Indebtedness already
existing and when the object was to fund that
Indebtedness on long time bonds ct q low rate
OF interest
.'You will find this language in this section:
Nor unless the proposition for creating such in
debtedness, etc. Now the Indebtedness Ia not
created by compliance with the provisions Of
this section, strictly speaking. for it existed
before. The object 10 to fund an existing in
debtedness- Section of article of the state
constitution limits the indebtedness of cities to
10 per cent of the assessed valuation of the
property therein AZ shown by the preceding
assessment roll. II an Indebtedness is desired
to be created in excess OF lia per cent OF such
the additional Indebtedness is expressly limited
by the per cent. on such valuation of the exist
ing Indebtedness. hence il may be argued at
least that this new or proposed indebtedness
which must have the authorization OF the
voters, is additional to that already existing
Therefore IL is the creation of a debt Yet
while this 10 my view, have yielded to the OBJ
posing view a. being possibly the safer course
III But section of article s of the freehoiders'