The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1900-03-10
BOND CASE ARGUMENT
GENERAL HARRISON APPEARS FOR
THE CITY AND BONDHOLDERs.
The Constitutional Debt Limit In
~oIved-Case Against a Dentist
-Other Court Cases.

The ease OF Eddy Morris Campbell eft al.
VS.. The City of Indianapolis and Board of
school Commissioners. an action brought
by the appellants, a firm of brokers, doing
business under the name of Campbell. Wild
e. Co., to restrain the school commissioner
from issuing $780, 900 of school bonds to take
up other bonds that were issued in 1850,
was argued before the Supreme Court yes
terday.
The complaint alleged that at the time
the bonds were issued the combined debt
of the city and the school debt exceeded 2
per cent. of the value of the axable prop
erty of Indianapolis, and the old bonds, is
sued in 1890, were, therefore, illegal, and the
new bonds should not be issued for the
purpose of taking them up. The complaint
was held to be insufficient in the lower
court and an appeal was filed in the SUI
preme Court Feb. q.
Because of the Importance Of the case
the hearing was advanced and set for oral
argument yesterday. The bonds were sold
in Cincinnati and Chicago. The Chicago
bondholders were represented by EXPIRES
ident Harrison and Judge Hiram d. Peck
represented the bondholders Of Cincinnati.
The argument in favor of the appellants
was made by w. H. H. Miller and w. A.
ketcham and the appellees were repre-
scented in the argument by Benjamin Har-
rison and Albert r. Baker.
TIL question argued was: docs the pro-
vision of the State Constitution forbidding
any municipal incorporation mourning a
debt in excess Of 2 per cent. of the value
Of the taxable property therein restrict two
- -. A.
same territory from mourning debts to ex-
coed 2 per cent. % The attorney for the
appellants also argued that the act of 1871,
creating the Board of School Commission
ers, was unconstitutional because 1T was a
special act. The act provides for the cleo
ton of such commissioners in the cities Of
the State OF $4,000 or more inhabitants ac-
cording to the United States census of 1870.
The attorney maintained that Indianapolis
might just as we'll have been mentioned spe-
officially. They said that If it was assumed
TO be true that IL was a local act Ii vio-
lated two provisions of the State Constftu-
ton. The first of these prohibits the Leg
islature from passing any local or special
laws providing for supporting common
schools and for the preservation of school
funds, and the other provision or the Con-
stitution violated is that which forbids the
Legislature to create, by special act, any
corporation other than banking corpora
lions. 1t was also maintained by counsel
for the appellants that any ruling which
would permit two corporations formed out
of the same territory TO contract debts in
excess of the 2 per cent. allowed by law
would be In direct contradiction Of the con-
stitutional amendment of 1881.
| The of the appellants was
opened by Mr.. Miller, who insisted that
the letter of the law should be enforced.
without reference to the consequences. He
said the debt should not be laid upon the
city of Indianapolis merely because 1t
would work a hardship to the bondholders.
Mr.. Baker opened for the appellees. He
said the question of fastening a debt upon
the city was not involved. TIL question
was the refunding Of bonds at a little more
than 8 per cent. interest.
Mr.. Baker was followed by General Har-
rison, who, after reading a number of au-
thorities. said that the debt limit of 2 per
cent. did not apply to the school corpora
ton, for ii was entirely separate and dis
tinct from the civil corporation. He said
ii had all the powers incident to a corpora
ton. and. therefore, it must be distinct.
Said he: eff we have no existence as a dis
tinct corporation they should have brought
the suit against the city of Indianapolis
alone" He said the school system in In
~dianapolis was a State affair and public
schools were in no sense a city function.
Said he: "Are we to impute to the trainers
of our Constitution a scheme by which a
common debt limit Is to apply to two cor
porations without apportioning the limit
between the two corporations? Ii would
leave the question as to which would first
grab this debt limit to a scramble. 1t would
make 1t against the interest of the city OF
Indianapolis to pay its debts, because IL 1t
pays the School Board may jump in and
take up that part of the debt remaining
within the limit. 1t would practically close
the market for municipal bonds, as a buyer
would have to run around among all these
and add them together to see whether each
debt is valid, and that would close the
market"
The closing argument in the case was
made by Mr.. Ketcham.