The herald and news. [volume] (Newberry S.C.) 1903-1937, 1907-10-01

Of the state officers to comply cannot
be treated as a circumstance Of no
consequence, for the absence of
marks Of cancellation make it posi-.
BILE for the thief to put the bond in
circulation
Justice Jones considers the authori-
ties cited, and especially notices the
Virginia case quoted in the respond
ent's argument, and then goes on to
say: "The real point Of inquiry is,
admitting valid and strictly negotia-
bic paper in the hands of bona fde
holder before maturity. now far can
intervening circumstances affect the
title of the holder? The general rule
is that payment before maturity is
no defence against a subsequent bona
fide holder for value before maturity.
It is the duty Of the maker paying
the commercial paper before maturity
to take reasonable precaution to pre-
vent its restoration to circulation by
accident to fraud.' Numerous cases
on this line are cited.
State Responsible for Agents Acts.
Further on Justice Jones says:
"Tae principle that bona fide holder
cannot acquire title where there is
absolute want Of power in the state
or its officers to issue negotiable pa
per has no application in this case,
the bond in question having been orr
ginally issued by due authority. The
holder is not claiming by any reissue
of the bond after its redemption, but
by virtue of the original issue and
mis- relation to it as a bona fde holder
unaffected by intervening facts. The
claim is not that the treasurer or any
one in his Office had power to reis-
sue the bond, but that he was charg-
ed with the duty to keep out of circu-
lation by cancellation and that ais
failure to do so was the states fail
ure. It is true the doctrine of estoppel
in Pals does not apply to a sovereign
state, and that the state can only act
under it's constitution and through
the legislative enactments, and that,
therefore, contracts cannot be Great
ed against the state except under sane
tions. But here we nave bond of
the state issued by due authority of
the legislature which the representa-
tives of the state failed to cancel, as
directed by statute, and which is now
under the law merchant the property
of the relator. It may be further said
that the right Of the bona fide hold
ers of commercial paper under cir
cumstances like these does not rest
wholly upon the law Of estoppel, but
is grounded upon nigh public policy
! which is subserved by making him
secure in his title"
The argument that to recognize the
bond will be to increase the debt of
the state illegally is noticed in the
opinion and disposed Of as follows:
cit is urged in behalf of the res
pondent that the recognition Of the
bond in question as a valid debt Of
the state, when it has already been
redeemed by the issue of stock in
exchange, would result in increasing
the debt of the state in violation Of
the constitution, Section II, Article
10, which forbids the general assem-
bly, from creating any further debt
or obligation without first submitting
the question to the qualified electors,
etc. As declared in Whaley VS. Gail
lard, the obpect Of the similar pro-
vision in the constitution Of 1868 was
to place restrictions upon the power
of the legislature to contract debts. It
has no application to a case like this.
The bond in question in the hands Of
the relator is no new debt attempted
to be created by the unauthorized act
of some officer or even by the judg-
ment Of court, but represents the
old debt provided for in the statute,
authorizing the issue Of that series of
bonds.'' >~>~
Having thus established the rela-
tors title to the bond, the opinion
considers the method proposed to COM
pei the recognition Of the bond and
holds that there is no other adequate
legal remedy than mandamus. 1t is
therefore ordered that the writ should