Union County courier. [volume] (Elk Point, Union County, D.T. [S.D.]) 187?-1913, 1909-01-21
FAILS TO SECURE
NECESSARY VOTE
Bill to Return North Carolina
Bond Money Defeated.
MATTER DEBATED IN SENATE

Proposition Turned Down BY a Vote
Of 81 to 1s, Thirty Votes Being Nee.
essary for Passaee-State Admins
tration Voluntary Guaranty Bank
Deposit Bill Appears in Both Houses
Of the Legislature.
Pierre, Jan. 18-But one ripple of
excitement has stirred the legislative
bosom since the inaugural. That was
In the debate upon Senator Dillon's
resolution to return the North Caro-
lima bond money. 1t will be recalled
that in 1901 agents of certain brokers
In New York secured the passage of
an act in this state authorizing the
made to the state and to do whatever
was necessary to protect property so
received, including the enforcement
of the payment of any bond received
as such gift, and for the further
protection of the state provided he
might employ counsel, when neces-
sary In any such case, who should ac-
cept a contingent fee for their serv-
ices, so that no liability would attach
to the state. All this seemed exceed
ingly innocent and to the members
seemed to be but prudent provision
against any gift that might come to
the state at any time for charitable
or educational object.
i + j.
A few months later, however, Scha-
fer Bros. of New York, wealthy He.
brew bankers, presented to the gov
ernor ten bonds of the state of North
Carolina of the denomination Of 81, 900
each and which, with interest then
accrued upon them, amounted to near
ly three times their face value These
bonds were part of a block of bonds
issued by North Carolina. In 1856 in
aid of the Western Carolina railroad
For each bond an equal amount of
the stock OF the road was taken by
North Carolina and held In trust as
security for the payment of the bond.
The bonds were sold in open market
at from IS to rs cents on the dollar
and the road built with the proceeds
and under good management became
q fine property, paying dividends upon
its stock, which for many years has
been at par The state continued to
hold the stock and draw the dividends
upon it. but it repudiated the bonds,
principal and interest. At the insti-
cation of Schafer Bros, under our
gifts and devises act. South Dakota
began an action in the federal courts
against North Carolina for the en-
forcement of the payment of the bonds
and secured Judgment in the supreme
court against North Carolina in rem.
the decree directing that the stock
pledged for the payment of the bonds
and held in trust by North Carolina
be sold and the proceeds applied to
the payment of the bonds. Rather
than surrender the stock North Caro-
lima paid the Judgment in cash and,
after deducting all expenses and fees
more than $4,000 was paid into our
treasury nearly four years ago and
still lies there intact Two years ago
Governor Elrod recommended the
money be returned to North Carolina
and Senator Dillon led strong but
unsuccessful fight to do so and he is
renewing the fight at this time.
The bill to return was supported BY
Dillon, Bates and Seward and op
posed by Curtis and Byrne. The argu
ment for return being that the whole
arrangement by which the none,
came into our hands is immoral, while
the opposition stands upon the legal
! ity Of the proceeding, the cupidity and
immortality of North Carolina in repu
dating the bonds and then failing tt
provide a court in which claims held
by individuals against the state could
be adjudicated. The debate occupied
all OF two days and late Friday even
Ing the bill was defeated by vote O.
81 to 16. thirty votes being necessar,
to its passage.
While Senator Arneson has intro
duced slightly modified Oklahom
bank guaranty bill the state admin
istration is giving its influence ant
support to voluntary guaranty bill
introduced in the house by MIR. IsseI
huth and In the senate by Senate
Byrne. This bill provides that whe
at least fifty state banks, having a
aggregate capital OF at least $5OO.O0t
have associated for the purpose the
may deposit fees graduated upon tn
capital Of each bank with the stat
treasurer, together with a premium
equal to 1 mill upon the dollar {
their average deposits and when thes
payments have been made and certai
formalities complied with the publ
examiner shall issue q certificate
, zach Of such associated banks cert
Continued on page q.