Court Opinion

ID: 7983793
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:22:50.819211+00
Date Added: 2024-06-11T16:35:07.815717
License: Public Domain

Mr. Justice Yerger
delivered the opinion of the court.
By the act of 4th March, 1848, the legislature appropriated the amount of the “ sinking fund ” then in the treasury, and whatever thereof might afterwards come into the treasury to the payment of the “ coupons of interest due on the bonds of the State, issued on account of the Planters Bank.”
The act declared that the appropriation' of said funds was made expressly for the “ payment of the coupons of interest on said bonds, according to their priority of majority.” The third section of the act prohibited the treasurer from paying, unless the bond, with the coupon attached, was presented to him, and on payment he was required to cut it from the bond.
The defendant in error, holding one of these bonds with coupons attached, presented it to the auditor and demanded a warrant on the treasurer, which was refused. He then applied for a mandamus, which was made peremptory. From that judgment, the auditor has appealed.
It is contended by the attorney-general, that the “sinking fund'” was intended to pay all the bonds issued on account of *476the Planters Bank and the interest thereon, as well those which had no “ coupons ” attached as those which had, and that when the legislature declared, in the act of 1848, that “ payment of the coupons of interest on said bonds, according to their priority,” &c. should be made, it intended to provide that the payment should be made out of the “ sinking fund,” according to the “ priority of the maturity ” of the bonds themselves, and not of the coupons.
The original act incorporating the Planters Bank, was passed on the 10th February, 1830.
By the seventh section of that act, the governor was authorized to subscribe for ten thousand shares of stock, amounting to one million of dollars, to be paid for in bonds bearing five per cent, interest. The bonds were to be made payable at four different times. Each set of bonds was to be for $250,000.
The eighth section of the act “ pledged the faith of the State of Mississippi, and also the stock of the State in the payment of the principal and interest of the bonds, upon the falling due thereof.”
The tenth section of that act provided for the establishment of the “ sinking fund,” for the redemption of the said bonds, and provided “ that until full payment and extinguishment of the bonds, which shall first become due, amounting to $250,000, no' part of that fund should be applied to any other purpose than the extinguishment of the principal and interest of said bonds.
The State never took any stock, and never issued any bonds under the provisions of this act. On the 16th December, 1830, a supplemental act was passed, by which the governor was authorized to subscribe for 5,000 shares of the stock of the-bank, and to negotiate a loan for $500,000. For this loan, he was authorized to issue the bonds of the State, bearing interest at the rate of six per cent, per annum, payable half yearly. For the payment of the principal and interest of these bonds, upon the falling due thereof, the faith of the State, and the stock of the State in the bank, was pledged. Nothing was said in this supplemental act on the subject of the “ sinking fund; ” but it is known that the surplus of the profits accruing to the State from the dividends declared on its stock, remaining after pay*477ment of interest on the bonds falling due from time to time, was allowed to accumulate according to the provisions of the original charter, and constituted the “ sinking fund.” It was a part of this fund remaining in the treasury, which the act of March 4th, 1848, appropriated to the payment of the coupons of interest.
Bonds were issued according to the provisions of the act of 1830, and, by the statement in the return of qhe auditor to the mandamus, are still outstanding and unpaid.
In February, 1833, another act of the legislature was passed, which authorized the governor to subscribe for an additional amount of stock of $1,500,000, and to issue the bonds of the State for the loan of money to pay for the stock. For the payment of these bonds and the accruing interest thereon, the faith of the State, and the stock of the State in the bank, were pledged.
In March, 1833, a portion of the bonds authorized by the last act were issued, with coupons of interest attached thereto; and the petitioner for the mandamus in this case, is the admitted holder of one of these bonds, with “ coupons ” attached.
The auditor in his return admits that there are no coupons of interest attached to any bond or bonds falling due at an earlier period than the first day of March, 1841.
The bonds for the sum of $500,000, which were first issued by the State according to the provisions of the act of December, 1830, have no coupons of interest attached thereto, but bear an interest of 6 per cent, per annum on the face. Those bonds mature at an earlier day than the bonds to which the coupons are attached; and as before stated, the attorney-general contends for the auditor, that, as those bonds mature earlier, the “ sinking fund ” should be first applied to the payment of interest on them; no part of which interest, it is admitted, has been paid since 1840.
Neither the act of December, 1830, nor of February, 1833, pledged to the holders of the bonds issued according to the provisions of those laws, the “ sinking fund ” as a trust fund, for the payment or redemption of the same. No bond was ever received on the pledge that that fund should be applied in pay*478ment thereof. The only pledge given in the acts of December, 1830, and February, 1833, was the faith of the State, and the stock of the State in the Planters Bank. The dividends which were declared from time to time were the property of the State. The surplus of dividends that remained after the payment of the interest on the bonds, and which made the “ sinking fund,” was under the control of the legislature, and could have been appropriated to any purpose that it suited the wisdom of that body to have directed. We do not find any act which makes an appropriation of it, except the act of March 4, 1848. That act expressly appropriates it to the “ coupons ” of interest on the bonds issued on account of the Planters Bank. It is true we cannot see any reason why the “coupons” of interest should have been paid in preference to the interest on the bonds which had no coupons. It may be that the legislature supposed all the bonds had been issued with coupons, or a different provision would have been made; but, however that may be, it is very clear that, by the act of 1848, it has declared that the “ sinking fund ” shall be appropriated to the payment of the “ coupons of interest; ” and though equal justice would seem to have dictated that it should have been applied pro ráta to the payment of the interest due on all the bonds, that was a subject solely for the consideration of the legislature, which had the right to direct the payment in the manner'fixed by this act.
To give the construction to the act contended for by the attorney-general, would render it entirely inoperative, because it provides that no payment of any interest shall be made until the bond, with the coupon attached, shall be presented to the treasurer. We cannot do such violence to what was evidently the legislative intention, as declared in express words, to wit, “ the payment of the coupons of interest.”
This payment was to be made according to the “ priority of majority,” that is, according to the priority of the “ coupons” maturing or falling due.
It appears from the petition and the return, that none matured and remained unpaid prior to March, 1841; and we think for that “ coupon,” the petitioner is entitled to a warrant from the auditor. With reference to the “coupon” maturing in Septena-*479ber, nothing is said in the petition or admitted in the answer. It may be that there are “ coupons ” unpaid for interest falling due in March outstanding, which would absorb the whole of the “ sinking fund ” in the treasury; and if so, they would be entitled to priority of payment before the “ coupons ” maturing in September, 1841. In the absence of any statement in the petition, or averment in the answer, on this subject, we do not think it would be proper for us to direct the auditor to issue his warrant. We have no doubt that will be done without.a mandamus, if the facts entitle the party to it, according to the provisions of the law, as we have here construed them. As the judgment of the circuit court directed a mandamus to issue for a warrant for both “ coupons,” that judgment must be reversed, and a judgment rendered in this court for a mandamus, in accordance with the views expressed in this opinion.