Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1922-02-13
Way OPENED
FOR SALE OF
HAIL WARRANTS
Court Unanimous in Opin,
ion That Commission Can
Sign Contract.

- 49, ICo 4Js" 1lC
North Dakota supreme court Saturday
afternoon without a dissenting voice,
held that the Industrial commission
had the right to fulfill contracts for
sale Of hail warrants.
Denial by the court Of an Injunction,
asked IN a test suit, to prevent con-
chase OF 1921 hail warrants of farm
ers of North Dakota, is expected to
clear the way for the completion Of
t t1st, Undertaking q the state admins
The contract has yet to be ap-
proved by attorneys for Minneapolis
financial houses, purchasing the war
rants.
Administration officials were con-
fdent that within a week the financial
houses would be in q position to begin
purchase Of the warrants under con-
tract.
Justice Christianson Of the SUI
preme court. giving the opinion OF
the court, held that no provisions in
the contract exceeded the existing
the hail insurance law giving the in
dustrial commission. with the aid of
a commissioner of insurance, au-
thority to negotiated loan to pay hail
obligations. as giving broad powers
to that body.
To Sell Large Amount.
The administration anticipates that
between 1000, 900 and 5000, 900 hail
warrants of the 1921 issue will be Of
fered for sale to the Minnesota Loan
and Trust company and Lane, Piper
and Jaffray> of Minneapolis, through
the arrangement in which the indus
buyer.o OF the warrants. The total issue
of 1921 hail warrants was about $3.-
100000. AS a part of the arrange
ment made for the sale Of warrants
In an effort to cut the discount rates,
which had been as high as 20 per
cent, the administration negotiated
the sale to former Governor J.. 3.
at 81 per cent of face value. Mr.,
Hanna had agreed to take $250,000.
but the amount offered within a week
Exceeded this figure by $4,000 and he
took these also.
The hail insurance law gives the
industrial commission and commits
sioner Of insurance power to negotiate
issued before sufficient taxes levied
for hail loss and the hail acreage tax
are collected to pay them, but pro-
vided no means The industrial com:
mission and the representatives of the
financial houses e~ndeavored to work
out a formt4of: contract which .woulo
1fbe legal, and after this was drawpSur
Lie was decided that the matter ought
to be tested in the supreme court.
Baner Brought Suit.
Otto Bauer. a taxpayer Of Morton
Il county and holder. Of a. warrant
drought suit to restrain the commits.
sion from carrying out the contract
i and Attorney General Johnson main.
~ fajnad ifa legality. E Sf
Under the term Of the contract the
financial houses would pay 80 per Scent
|Eof face value for warrants offered fol
sale in February: 90 IL. per cent IN
March, 80 per cent in April, 80 IL
in May, and 100 per cent in June. re-
Eserving right to purchasing then
Thy June 1t. The Industrial commits
sion and .com1ntssioner-of insurance
held this an advantageous price fol
the farmers, since some: had sold war
rants for as much as 20 per cent dis
count.
The state treasurer would hole
variants turned in by farmers fol
sale at these prices in trust; the in
dustrial commission would issue 8 pei
cent notes, with the hail warrants al
collateral security, and the firancia
houses would take the notes in blocks
OF 1000. The notes would be re
tired when the taxes are sufficient t.
retire the warrants. Both the war
rants and notes, would bear 8 per cent
The financial houses would pay con
siderable expense Involved in handiint
1.-The DEAL the industrial commission
would not. be forced to any expense
i the hail insurance department woult
pay whatever interest would be los
I'm the deal and the farmers would ge1
almost face yalue for their warrants