The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1898-11-03
Opinion Of Attorney General On
New Bonds.
RIGHT OF THE GOVERNMENT
Replies to a Number of Questions
Law and the Resolution-Con-
fidence is Shown.

The number of tenders received on
short notice of The sale of Hawaiian
! bonds, coupled with the fact that pre-
MUM was offered, established quite
| satisfactorily that generally there is d
| question of the legality of the issue.
There came to Attorney General Smith
a request for an opinion on the legality
| OF the issue and a number of questions
| touching on prospective transactions.
| Mr.. Smith, who is of the opinion Uhat
| if the Government could not borrow
| money to carry on its functions, it
could not exercise the taxing power.
, replied as follows TO questions pro-
pounded:
Honolulu, H l., Nov. !, 1898.
Sir:-In reply to yours of this day
relative 70 the legality of the issue OF
bonds by the Minister of finance
under his advertisement for tenders Of
September 80, 1898, l would state:
You ask, "woud you kindly give me
your official opinion upon the legality
OF the issue, the right of the present
Government TO make the issue, the
OF this Government to the United
States, and what would, in such an
event be the security of the bonds and
who the responsible party to pay the
same when due"
AS to the legality of the issue, l
would state that it is proposed to issue
these bonds under the provisions CT
Act II, of the Republic OF Hawaii. ap-
proved June IS, 1896, and Act g. ap-
proved Juy Z, 1898.
Act II of 1896 provides for the issu-
ing of these bonds to an amount not
exceeding in the aggregate, two mil
lion dollars. The said Act also pro-
vides that tSec. y, the said bonds, or
the proceeds thereof, shall be eXclus-
lively devoted to the purposes for which
the same are ISSUED as expressed in
the Act of the Legislature under VIII ch
authorized" Section II of said Act
provides: The power to issue bonds
conferred by any Act passed in cCn-
fOrmity with this Act shall not lapse
or become void as the result of the
first issue, but may be exercised from
time to time until the limit OF the
amount authorized has been reached.
The amount of bonds issued und =
this Act thus far has been $685.. 900
(See report of Minister of Finance of
December 81, 1897, page 43)*
*Note: Since December 81. 1897. no
other bonds have been issued under
this Act.
Act 63 of 1898, provides for the APP
preparation for specific sums. amount
ing to 81 349, 3162S for specific Public
improvements 'out of any money
| which will be received by the Treasury
during the biennial period ending De-
cember 81. 1899. from the loan author
| lied by an Act passed by the Legisla-
ture of 1896, entitled An Act TO pro-
| vide for Public Loans" being Ac.
| II Of 1896, above referred to-
Under the Joint Resolution OF the
! Senate and House of Representatives
OF the United States. approved July Z
| 1898. the cessiOn of the Hawaiian
Islands was accepted. ratified and con-
! firmed and on the 18th day of August
| following. the formal transfer was
| made at Honolulu.
In that Act of Congress it is provid-
| ed that 'the municipal legislation oil
| the Hawaiian Islands not enacted fol
| the fulfillment of the treaties so eX-
tinguished, and not inconsistent Will
| this Joint Resolution, nor contrary K
the constitution of the United States
nor of any existing treaty CT tbs
United States, shall remain in force un
til the Congress Of the United Sta.e
shall otherwise determine
Upon the occasion of the transfer o
the sovereignty of the Hawaiian
| Islands to the United States on tn
| 18th day of August 1898. Mr.. Harol,
| NJ. Sewall. Envoy Extraordinary ant
Minister Plenipotentiary of the United
| States. on behalf OF the President o
| the United States, presented a com
| munication to the President Of the Re
public of Hawaii, stating. among Othe
| things. that the president (of tn
United States) hereby directs that tn
civil. judicial and military powers il
question shall be exercised by the Of
ficers of the Republic OF Hawaii, as /
existed just prior to the transfer o
| sOvereig nty," and after referring Z
other matters, concluded with tn
statement: Under these various pro
visions, the Government of the Island
will proceed without interruption
Under these provisions and all Of tn
| circumstances of the case, l am o
opinion that the present GOvernmel
of the Hawaiian Islands is authorized
10 issue the bonds in question, an,
that the legality Of such bonds VII
be sustained.
AS TO the status of these bonds,
would state that they will be the bond
Of the Government of the Hawaii a,
Islands, and their security will be Tn
good faith of such Government. il
recenUes and taxing power. The part.
10 pay these bonds will be the Govern
men of the Hawaiian Islands.
The Act of Congress above r5ferre
TO provides for the assumption by IN
United States of the public debt OF tn
Republic of Hawaii. but not 10 eXCe=1
100000. The debt already exceed
that amount. so the United State