The representative. [volume] (St. Paul, Minn.) 1893-1901, 1895-08-07
l.
BLACK EYE FOR GOLD.
One Court Does Its Duty.-A DOL
lar Does Not Mean a Gold
Coin.
LATE DECISION IN CINCINNATI
Circuit Court Holds Municipality
Has Not the Right to Make Bond
Issues Payable In the Yel-
low Metal.

Among the bond and banking
houses there is much interest in the
decision just rendered by the circuit
court at Cincinnati with reference to
the right of a municipality to issue
bonds payable in gold without legisla-
tive enactment granting such permis-
sion, The court held the City of Gin
| cinnati had not such right, and en-
joined an issue of 81, 973 900 Of refund
ing bonds, principal and interest pay
| able in gold. The City of Chicago has
issued gold bonds, although the Illi-
nois statues, like those of Ohio, are
silent on the subject of the particular
kind Of money with which they may
be paid. The question has never
been raised in this state, and while it
is held no decision would invalidate
the bonds already issued the special
value of future gold issues would be
ques toned.
The head Of the bond department.
of one of the banks said the Cincin-
| natl decision would tend to make
houses timid about purchasing NUM-
cipal gold bonds, while other houses
thought currency bonds were good
enough anyway. There have been
fewer than a half dozen decisions on
the question, and the Cincinnati
court is almost alone in it's finding.
RULING ON THE GOLD QUESTION.
The decision is an exhaustive one,
involving other points, but on the
gold question the court says:
Have the defendants the power to
make the bonds payable, principle and
interest, in gold?
Spear, j., at page 121, in forty-fifth
0. S., in a few words defines the limits
of the powers Of municipal corpora
tions. He says: Indeed. it is con-
ceded by the learned counsel for
plaintiff that the power to pass the
ordinance does not exist unless it has
been expressly granted by the Legis-
lature or is clearly implied, and there
is no doubt that this is the law; pow
er to enact such an ordinance would
! not be inherent in the council. FIX
| cep6 as to incidental powers, such as
are essential to the very life of the
corporation, the presumption is that
u
mistakeable terms all it has designed
to grant at all; doubtful claims to
power are resolved against the cor
poration."
The law authorizes "the issue of
bonds to the extent Of 26,O00O00." 1t
does not in terms authorize the iSsu-
ing of bonds payable in gold.
| Is the power to issue bonds payable
in gold an incidental power essential
to the very life of the power granted
| therein to the corporation? If not,
the word gold cannot be read into
| the law.
The word dollar" the only word
used in the law, which limits the
word "bond," may be defined to be
| the unit value of the money, as indi-
Gated by the Congress of the United
| States, and at the time of the passage
| of the law in question as we'll as at
the present slime, the ''dollar'' Of the
| United States consisted Of legal ten
| der currency dollar redeemable in
gold or silver coin of the United
States, and the gold coin and silver
coin of the United States. SO that the
| bond of the City Of Cincinnati, pay
able In dollars" might be paid eth
er in legal tender currency or gold or
silver coin, and therefore bond pay
dUlS Ill SOlU uOlIdIS WOulu Dc d llml.
| tation on the "dollars" used in the
| statute, in that it would exclude the
| payment of said bonds in legal tender
currency or silver coin.
| That by inserting the word "gold"
| makes a material limitation on the
word ''dolIars" used in the statute is
not denied, the very object in making
the bonds payable in gold being to
| make the limitation, the claim Of the
defendants being that it would be
wise for them to do SO, as it would en-
able them to dispose Of the bonds to
better advantage. Whether it would
| be wise or not to make this limitation
| is a matter we haYe nothing to do
with The only question for our con-
| sideration being whether the Legisla-
| ture has granted the power to the de-
| PENDANTS to so act.
We are unable to see how it can be
claimed that it is essential to the
power to issue bonds that they should
be "gold' bonds. The court will take
notice Of the fact, which everybody
knows, that the City OF Cincinnati
can very readily sell its bonds payable
in ''dollars."
The power to issue "gold' bonds not
being expressly granted, and it not
being essential that the bonds should
be made payable in ''gold' in order
that they may be sold, it cannot be
an implied power to make them pay
able in gold. 1t therefore seems to US
hat there is no authority given in
the statute for the defendants to is