Evening star., 1915-03-29

WASHINGTON, ID. O..
refund by the District to the
United States of one-half of ad-
vances made by the United States
to the District for the payment of
the interest on the 3.65 bonds be-
tween 1876 and 1873, amounting
to over half a million dollars.
This provision purports to be
based on Controller Downey's
decision, but the controller did
not recommend that Congress
take this action. He decided that
congressional action was an es-
sential prerequisite of such re-
fund, and suggested that Con-
gress in legis1ating on the subject
would not be bound by teehni-
calities, but could take into con-
sideration the equitable defenses
urged by the District and decide
the case on broad principles of
justice and fair play.
Controller Downey's decision I'm the
matter Of the million-dollar claim
against the District to reimburse the
United States in full for advances to pay
interest ON the 3.65 bonds i'm 1877 and
1878 was rendered December IS, 1914,
and was based on Representative john
sons contention that this million dol
lars, In accordance with the terms Of
the law under which 1T was advanced
by the United States, sheula be new re-
paid In full by the District. and that
this Reimbursement could lawfully be
made By the Secretary sf the Treasury
from District funds In his hands with.
out further legislation By CsnEresa.
The Districts response to the con-
tenti0n of Representative J0hnson was
% that If anything was collectible ON
this account 1t was only 0ne-half and
not the whole OF the million claimedI (2)
that this clair, Of the United States was
offset by claims OF the District arising
under the half-and-half arrangement
during the four years between 1874
and 1878, and that in full adjustment
of the account for these years On the
half. contribution basis the United
States would be indebted to the Dis
tricts and (3) that II old claims and
equit, prior to 1873 are to be revived
In favor of the United States then they
must also In consistency and fairness
be revived In favor Of Warrington. The
old claim of the District against the
hRNE
merged in the bankruptcy settlement
of 1873 amounts to more than $4,000.
600.
The controller decided % that the
half-and-half principle applies to the
debt and that only one-half is collect
ible. II any, and CD that Congress must
legislate ON the subject before any
thing is paid. In regard to the Dis
trict's contention OF q merger OF the
claim in the bankruptcy settlement Of
1873 and Of an intention On the part OF
Congress not to collect this advance,
because 1t was Offset by claims of the
District against the United s.ates aris-
ing ON the half-cOntri: ION basis dur
ing the four years fro-1 1874 to 1873.
the controller says the whole question
of the equities In the case must be
bound by technicalities and which can
decide the issue on broad principles Of
equity.
The claims and equities of the Dis
trict In this connection VIII. h are to
be considered by Congress in deciding
this question were unmarried in edi-
torial correspondence In The Star Of
December e, 1913, as follows:
Any claim of the United States agains,
the District or advances on interest Of
the 3.65 bonds between 1876 and 1878
would, in view CT the undertaking of the
United States in 1874 to contribute pro-
portionateiy in payment of these bonds
and the fixing OF that proportion in 1878
at one-half be only for the surplus over
one-hal Of this interest. thus advanced
by the United States.
Irrespective of the conditions under
which 1t was created. this claim. IL it
survived the bankruptcy settlement OF
1873. survived as an ordinary debt Of the
District to be met like other interest
and sinking fund payments on the bonded
debt an expense OF the District and
paid as such under the half half
provision of the organic act. II through
neglect of the nations agents this claim
was not collected In full prior to 1878 II
could only be collected after that date
on the hale-and-half principle as an ex-
pense under the organic act. Since 1873
the nation has been under obligations to
pay one-half of the interest and sinking
fund on all the Districts debts, includ-
ing this debt: and If the nation collects at
ali in 1918 it can equita bly, collect from
the District only cne-haf of this debt; or
1t must contribute one-half to the nav
ment of the debt. which amounts to the
same thing.
II
Between 1874 and 1873 the District
was in the hands of national receirers
in bankruptcy. The District had been
rendered bankrupt by the failure Of
Uncle Sam, debtor in many millions.
to meet his capital-making obligations.
were settled by compromise agree
ment affecting both past and future
Uncle Sans debt to the District was
DISCHARGED by these proceedings In
bankruptcy. except as carried over into
the az cement of 1878. and so were all
claim of the United States for any
amount on this 1s7G-7s interest ad
vance account was thus cancelled BY
the equitable compromise or bank
ruptcy settlement or 1878. 1t has been ,
treated as thus settled or wiped out
nv every Congress and every national
executive administration in the thirty
five years since 1873. It was treated as
thus settled by the Treasury Depart
ment in 1856. when the possibility of
making such claim Tor the United
States was pointed out.
If direct legal proof of such cancel
lation and settlement be lacking after
the lapse of thirty-tiye years Uncle
Sam, against whom the statute of limi-
sations may not be pleaded by a hostile
spirit of the statute of limitations and
tine eouita BILE princiDle in which it is