Evening star. [volume] (Washington, D.C.) 1854-1972, 1914-05-13

ttS iSptdl Oh tIt olSdHlC aCt II ihdst. "a
course. be paid on the half-and-haif
basis as provided in that act and in the
sinking fund legislation OF 1879.
Discharged In Bankruptcy.
In the interval between 1874 and 1873
the Districts affairs. taken away from
the previously existing territorial form
Of government. were in the hands of Of
ticials of the United States. receivers in
bankruptcy. the so-called temporary
Commissioners OF the District. 20 wind
up the affairs OF the prc-exlsting mu-
nicipal government. The moneys of the
District We're in the possession of the
Secretary of the Treasury. subject 10 the
direction of Congress. As we have seen,
the United States had conceded in 1874
its obligation. to pay an unsettled per-
centage of the so-called District debt
The four years between 1874 and 1873
were spent by Congress as constitutional
legislature of the District in working
out an equitable readtustment of the So
called District indebtedness (which was
in truth national Indebtedness. in fixing
as a part OF this readjustment the per
centage Of payment to be made by the
United States on experimenting eN-
penses past and future. and in establish
ing for the future wise permanent
form of government of the District.
Final action was taken by Congress in
1878 on the facts reported by the ma
tonal receivers placed in temporary con-
troll of the affairs OF the bankrupt Dis
trict. Pending the permanent readiust-
ment OF the Districts affairs. attained in
1878, Uncle Sam. In absolute control as
receiver of the District. and under ohli-
CATION by the legislation OF 1874 to meet
some portion Of this so-calied District
debt, including the 365 bonds. could have
paid all of the 3.65 bonds interest or
none Of 1t. as he pleased. under strict
construction Of the statute and its literal
application in accordance with the facts.
In either case the final division of this
interest expense would naturally be set
tied in the final adjustment OF the Dis
trict'S finances. and In accordance with
the terms OF proportionate contribution
then fixed. 1t is alleged that in respect
to a portion Of this interest the United
States advanced not merely one-half, but
nearly all; in doing SO even violating its
own law, which contemplated a primary
advance from the revenues OF the Dis
trict, after a few specified municipal eX-
penseS had been deducted.
Our contention is that in 1878, through
the reports of the national receivers OF
the bankrupt District, the so-called Dis
trict Commissioners. and through the
reports of the Secretary of the Treasury,
who had the custody of the Districts
Investigations. Congress was in posses
sion Of all the facts concerning pre-ex-
listing claims and equities Of all descrip-
tons on both sides. and that by the COM
promise settlement Of 1878 the slate was
wiped clean.
Claiming Technical Exemption.
II the evidence that still remains of the
merger of this claim in the settlement of
oI ~ vat
proof, the question arises whether Uncle
Sam In violation of the equitable prin-
ciple in which the statute Of limitations
is rooted will compel the production of
this direct proof. II he were not Uncle
Sam he would be barred from attempting
to collect this stale claim by the statute
of limitations. This statute could not be
pleaded against him by an ordinary
debtor, but in this case the alleged debtor
has had nothing whatever to do with
failure to pay the alleged debt and has
no voice in determining whether it shall
now be treated as debt and paid. Uncle
Sam, as trustee has had the District
funds in his exclusive possession and
control at all times since 1874. and has
had the power to decide how they should
be disbursed. The question is not whether
the statute of limitations could be plead
ed against Uncle Sam by the ordinary
litigant- but whether Uncle Sam, having
advantage of his exemption from this
statute; whether 1t will be fair. manly.
equitable and honorable to take this
course and to visit the penalties of his
own sin as neglectful. law-violating
trustee on the local taxpayers of 1913.
who are not responsible directly or in
directly either for the creation Of this
alleged debt or for the failure to pay II
in the seventies IN accordance with the
law when Uncle Sam had the District
h ovnHo to
failure to pay it since They are not re-
spons1ble for its existence and derive nc
benefit from it.
The House District committee chal-
lenges the production of direct legal
proof that this claim was thus Cancelled
in 1873. 1t is in connection with this de-
mand, made in Uncle Sans name. for
legal proof that he treated this debt In
1879 as offset by some surrendered equity
of the District or discharged in bank
apply to himself the equitable principle
which lies at the base of the statute of
limitations. We do not plead the statute
to avoid, simply on the ground of lapse
of time. a conceded debt. but to escape
the demand that We produce legal evil
dence of fact of 1878 which we have be-
lieved to exist and which Uncle Sam has
treated as If it existed for thirty-tive
years, this fact being the settlement. ex-
press or implied. of this interest claim
which has caused Uncle Sam to refrain
from making any claim against the Dis
trict on this account for thirty-f1ve years
has been in his possession since 1873 If
in the lapse of years it has been de-
stroyed Uncle Sam cannot. We think. in
common decency take advantage of this
loss Of evidence By his acts and by his
inaction for thirty-tive years Uncle Sam
has declared every year of that period
that this claim was Cancelled in 1878.
hon, LODI first
cred this mares nest in 1886 and reported
to the controller of the Treasury that Of
fetal. the precedent established by
Uncle Sam, treated the claim as merged
in the settlement of 1878 and refused to
consider claims prior to that date.
And so matters rested until 1913, when
Accountant Mayes, with his own version
of Accountant Hodgson's discovery. in
diets the Secretary of the Treasury in
1S76-1S7S for violation of the law in max
ing advances of United States money for
payment of interest on 1865 bonds when
conditions existed which forbade such adj
vances and made them unlawful.
8.