The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1905-07-01

decision Article 1. Section 6 of our
present State Constitution.
| Thus we see that not only the Leg
| islature, but the people, refused to
recognize these bnods, and so no Gov
ernor, or not even the General Assem-
| bly,, could order their payment, as
| long as the above article of the Goa
stitution remains in force.
| 'Schafer Brothers and a few others,
refused to accept the compromise of
1879. and ten thousand dollars of the
bonds incluedd in the second class
were donated to South Dakota by
| Schafer Brothers, and suit was
| brought in the Supreme Court of the
| United States, and by divided court
of five to four, the court held. that as
North Carolina had always recognized
| the validity and honesty of these bonds
which were also secured by mort
gage on the States stock in the North
Carolina Railroad Company, that the
same could be collected, at least TO
| the amount of the security In view
of their decision, acting under the ad-
vice of the Governor, the Council or
State and q joint committee of the
Senate and House of Representatives
the last General Assembly compro-
missed the Schafer Indebtedness by
|
| cipal (the amount offered in 1879
| with interest on same to the present
| time While these bonds did not
| bring par when sold. still we regarded
them as honest, and therefore were
willing to pay what the commission
of 1879 found the State realized from
their sale, with interest on the amount.
THE Special Tax Bonds, however,
issued by the Legislature of 1S6S-'69,
not being honest, but. fraudulent,
should for the following reasons, never
be paid:
list. They were issued by a Legis-
lature not legally organized or con-
stituted.
END. They were part of conslar
acy and plot to defraud the State.
"3rd. They were placed on the mar
ket, sold for a mere bagatelle and tie
State never received any value for
them.
"4th They are now past due, the
original purchasers knew of their
fraudulent character, they have been
repudiated by both Legislature ana
people, and anyone now buying them,
would take with notice, and could not
claim to be an innocent purchaser for
value. Conceived in sin and brought
forth in inquiry neither in law or
good conscience should these bonds
ever be paid. and acting under the
authority vested in me, | would OPP
pose their collection If attempted, TO
the utmost limit of the law. In read
ing the decision of the court in the
suit of South Dakota VS.. North Caro-
lima, you will see that the Supreme
Court laid great stress on the fact,
that these bonds were honest, and a
State should not refuse to pay its
honest obligations, but no such rule
would apply, when on account of thcir
dishonesty, both the General Assem-
bly, and people Of the State had de-
clared the Special Tax Bonds of
1SeS-'69 fraudulent and void. The par
ties holding these bonds cannot bring
suit themselves, as this is positively
prohibited by the Constitution of the
United States. Their only hope there
fore is to induce some state to buy
or accept as a donation, some of these
bonds, and in the capacity of SOW
ercign State, sue North Carolina. To
this end it is said that syndicate
having gotten hold of these bonds are
trying to induce the State of New York
to institute this suit, under the an
thorty of an act allowing that state
subject to the approval of its Governor
to buy, or receive as donations, bonds
of other States, etc. Under Such an
act. New York can obtain these bords
and sue us but | cannot believe such
q great State will ever contemplate
lending itself to designing men to help
them harrasS another sovereign state,
especially when the additional safe
guard is thrown around the act, that
the Governor must approve the bonds
before purchased or donated. If thee
are any bonds belonging to either of
the first three classes, still outstand-
ing against the State, and they arc
presented for payment, ] will gladly
recommend to the Legislature to set
tie them upon fair and honoi able
terms, as our State shorId rat and
will not repudiate any honest debt
but as to these Special TAX Bonds so
illegally and fraudulently issued !! any
attempt is made to collect them. en-
ploying the best legal talent in the
state to assist our able Attorney-Gen-I
eral, and rendering personally my as
sistance, in every honorable and legal
way, in the courts and otherwise. the
collection and payment of these bonds
will be fought and | feel assured,
that even if any State could be found,
so low as to make of itself a .jnnk
shop to aid these fraudulent bond
holders, no court Will ever give jude
ment against us, or enforce the pay
ment of such illegal and void bonds.
The people. may rest assured, tina.
nothing short OF judgment ana exc
cution from the the Supreme Court
of the United States. shall ever compel
the payment of a cent of these bones,
and l have no fear of such a Judgment
and execution ever being rendered.
Thanking you for the kind refer
ence you make to the part L took III
debtedness, and with kind regards.
| am,
Very truly yours,
"R Is. GLENN.
Governor"