Opinion ID: 1672216
Heading Depth: 1
Heading Rank: 7

Heading: whether the statute of limitations would run against the mississippi bondholders when they have never made demand or had a right to make demand for payment upon a state officer authorized to allow or disallow payment of the bonds.

Text: The bondholders claim that from the date of maturity of these bonds until 1871, actions against the State of Mississippi were not authorized. In 1871, a statute was enacted authorizing suits against the State, but only after demand had been made of the Auditor of Public Accounts. § 1573, Code of 1871; Miss.Code Ann § 11-45-1 (1972). According to the bondholders, demand against the Auditor of Public Accounts was a condition precedent before the statute of limitations could begin to run. The Mississippi Legislature passed as part of the Codes of 1892, what eventually became § 15-1-51 of Miss. Code Ann. (1972), the following: The statutes of limitations shall begin to run in favor of the state, the counties, and the municipal corporations at the time when the plaintiff first had the right to demand payment of the officer or board authorized to allow or disallow the claim sued upon. Id.; See Grenada County v. Nason, 174 Miss. 725, 165 So. 811, 812 (1936). The bondholders claim that the statute of limitations could not run prior to 1892 because they did not make a demand for payment. Nor did the statute of limitations run subsequent to 1892 because the present-day § 15-1-51 stated the plaintiffs first had to make a demand for payment of the officer authorized to allow or disallow the claim sued upon. The bondholders argue that when the State amended its constitution to specifically prohibit payment of any indebtedness claimed to be due on the Union Bank and Planters' Bank bonds, there was no state officer authorized to allow or disallow payment on the bonds. Further, because there was no state officer authorized to allow or disallow payment, the bondholders, who had never made demand up to that time, did not have the right to demand payment of any state officer authorized to allow or disallow payment. The bondholders claim that not until December 16, 1993, was there a state officer authorized to allow or disallow payment of the bonds. That was the date the chancellor declared Section 258 of the Mississippi Constitution of 1890 to be unconstitutional as an impairment of contracts in violation of Art. I, § 10 of the United States Constitution. However, the bondholders fail to carefully and fully read § 15-1-51. The language clearly states that demand must be made when the plaintiff first had the right to demand payment of the officer or board authorized to allow or disallow the claim sued upon. Id. (emphasis added). At the time the rights of the bondholders accrued (i.e. when the State repudiated the bonds), they had at the latest seven years from 1873 in which to make such a demand or bring suit to protect those rights. No demand or suit was filed when the plaintiff[s] first had the right to make such a demand. Also, the bondholders seek refuge in the fact that no officer was authorized to allow their claims if the demand was made. The statute clearly states that demand must be made on an officer who is authorized to allow or disallow their claim. The bondholders fail to comprehend the entire statute. They want the statute to be tolled because the amendment to the Mississippi Constitution authorized the officer to disallow their claim. This Court holds that the statute of limitations began to run in favor of the state at the time when the plaintiffs first had a right to make demand on the officer authorized by the state to allow or disallow their claim. In other words, the statute of limitations began running in 1873 and expired seven years later after no demand was made. Therefore, this argument is without merit.