Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1903-08-10


owns no property; its trustees can
not contract debts except within the
limits of the appropriations made by
the legislature for its support, and
when such debts are contracted, they
are not debts of the institution but
are the debts of the state. The state
is charged with its support and nain-
tenance as one of the educationi.: in
stitutiOns of the state. This institu-
ton and the other state educational
ard charitable institutions are not It.
gal and Independent entities. but are
mere agencies or instrumentalties
through which the state promotes It's
educational and charitable interests
and for the support of which all of
the taxable property of the state is
chargeable; and the power of their
| trustees to contract debts S limited |
by the legislative appropriation"
Then comes the weighty part Of the
decision as follows:
1--WE now turn to the decisive ques-
tion in are case, that is, whether these
instruments are bonds of the state Of
North Dakota, and of course. by that
we mean valid and constitutional
bonds such as the board is authorized
by section 1862 to purchase as ar III
vestment for the permanent haol
fund 1t is proper first to inquire
whose obligation is evidenced by
them. This question must be answer
/ ed by the act authorizing their ;ssu-
ance AS we have seen they are not
the obligations of the normal school.
for there is no such legal entity. It
is apparent. therefore, that they evi-
dence the obligations of the state (
they evidence any obligations what
ever That they are state Obligations,
, is, We think. entirely apparent, and for
/ these reasons: First, the state au-
thorizes their issuance; second, they
: are given for money borrowed by the
: state; third, the money to be pro-
cured from the loan is for state pur-
2 poses that is, to erect buildings for
: the state for one OF its educational
l institutions; and finally, the promise
to repay the loan, both principal and
q interest, is made by the state 1t is
e strenuously urged by counsel for the
, treasurer that the instruments under
j. consideration are not bonds in any
sense of the word, either as under
j. stood when the constitution was
J. adopted in financial exchanges and
markets. or by the common people, or
0 at common law. or under the statute
j. of this state They are merely con
e tracts whereby the board of trustees
J. of the school, under the authority OF
e the legislature, undertakes to hypothe
J. cate the income of the institution.
d What merit there may be in this con
J. teution we shall not undertake, to de
t, termine. OF course. il the obligations
d in question are not bonds within the
v meaning Of section 162, Of the state
K. constitution, they are prohibited in
q yestments, for that section restrict!
,r the board to investing in bonds o.
:. the state of North Dakota. and doe!
n not authorize the purchase Of an!
D. other kind of state obligations. Fo
at the purpose of this case we shall as
,e sumo that these instruments ar
AZ bonds of the state of North Dakota, 81
d. far as the legislature had power Il
make them 80, and shall direct our in
,e| auiry to the validity Of the act au
d. thorizing their issuance. Is the &C
III constitutional? This question mus
at be answered unhesitatingly In tn
ne negative. 1t would seem that the In
Of validity of the bonds. and the uncor
IN stitutionality Of the act upon whic
ds their validity rests must be apparen
1gl to the legal mind as well as to tn
es mind Of the average layman from
al mere statement of the constitutions
on provision which we have previOrsl
m quoted. The act is invalid. 1t shOul
he require no argument to show that viz
ey lation of the following provisions {
of the constitution are manifest: Il
It authorizes the creation of stat
re debt in excess of the debt limit an
re contrary to section 1872 Of the const
he tuition. (2) It authorizes the creatio
lis Of q state debt and contains no prov
ty sion for levying an annual tax sun
Or. Client to pay the interest semi-annua
ysl ly and the principal within thirt
lotl years. contrary to the requirement