The morning call., 1893-07-06
ARE THEY VALID p?
TIE Oakland School Bond
Question.
The Supreme Court Will Decide
Whether the City Had Any Right
to Issue the Bonds.

he supreme court SlttlnB IN Dank yes
terday, heard the appeal of j. l.. Wetmore
of Oakland against decision of Judge
Greene of Alameda County in favor of tn 9
city of Oakland.
1t appears that some time ago the city,
desiring 60 erect new schoohouses, issued
bonds to the extent Of 100000 for the pur-
pose, which bonds were approved, sold
and delivered to Blair & Co. of New York,
who are the present holders of the bonds.
But a recent decision of the court in San
Diego case has made the bondholders
anxious. as that decision raises the ques-
ton OF the difference between munich
pality aud a. scho oil district. Further
more. Wetmore refused to submit to the
taxation proposed by the city for the pay
ing off of the bonds.
The whole question touched upon the
right Of the city TO pay out the proce eds
If the sale of the bonds to school build
ing contractors, and to enforce taxation to
raise means to meet the coupons. The
coupons, as we'll as one-twentieth of the
value OF the bonds, are due on the 10Th of
the present month.
Victim ore was the first to protest. He
formally notified all city officers not to
pay any money accruing from the bonds
to either school contractors oil bOndholders.
and intImated that he would hold each Of
fetal Individually as we'll as officially re-
spOnsible for any action he might take.
And Blair &c Co.. the holders of the bonds.
notified all city officers not to disburse any
more of the funds until the court had
passed upon the question of the validity
of the issuance of the bonds.
This action placed the City Treasurer in
jeopardy, so that In following the example
Of similar case cited in the law reports,
he simply refused to pay money to con-
tractor, bondholder or anv one at all.
Meanwhile contracts had been let against
the 100000. and part, amounting to
$780, paid up. other payments falling
Que within week. And the one-twentieth
of the bonds and all interest falls due July
10, 1898.
1t was claimed on behalf Of the city of
Oakland that the city did not want her
bonds to 60 by default, as her credit would
be materially injured thereby. So the case
was hurried before Superior Judge Greene
Of Alameda County. who decided in favor
of the validity of tile bonds. From this
decision Wetmore appealed, and on repre-
sentation to the Supreme Court that it was
matter for immediate decision, on ac-
count of the payments falling due so soon,
terday morning.
The main question debated was, can the
city issue bonds under the act of 1889 for
school buildings, or must the city go to the
County Supervisors for authority to issue
its own bonds for that purpose?
A case was cited where the City Treas
urer of San Diego sued the County Treas
urer to recover possession of the State
school moneys apporti0ned to the city of
San Diego in proportion to its school-cen-
SnS children. In this case the court held
that the County Treasurer was the proper
custodian.
Following this the appellants claimed
that The bonds issued by the legislative
body of Oakland were void, because it ad
no power to issue the bonds. The City
Board of Education was the right body to
ply to on the ground that the city of
Oakland was "a corporate school district"
Attorneys f. C. Robinson for the tax
payers and w. r. Davis and Hill for the
city made brief arguments to the coutt,
and the case was submitted. A decision
is expected in few DAYS