Court Opinion

ID: 7192066
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:58:12.993634+00
Date Added: 2024-06-11T16:16:12.988676
License: Public Domain

On the Merits.
Todd, J.
The relator alleges substantially that by virtue of a final judgment rendered in the Fifth District Court of the parish of Orleans, in a case entitled “Jacob Meyers vs. Board of Liquidation,” the said *127board provided to exchange the warrants mentioned in the judgment for consolidated bonds of the State under Act 3 of 1874.
That the board, by resolution, did fund the said warrants and ¡receive them from relator, and then and there cancelled them, and gave to the relator a certificate to that effect annexed to and made part of the petition.
It was further alleged that the relator was entitled to receive the ■consolidated bonds under said acts, and that it was the duty of the 'board to deliver them, but that the board refused to deliver them, and •declared that it would not do so. Whereupon a mandamus was prayed for to compel the board to perform this alleged duty.
The return or answer made by the board is substantially to the following effect:
It denied that the bonds in question were legal and valid obligations ■of the State, but averred, on the contrary, that they were illegal, unconstitutional and void, and had been so declared by the highest judicial tribunal of the State. It was further denied that the relal or had any final judgment requiring the Board of Liquidators to fund said warrants, and averred that such final judgment could only be rendered by the Supreme Court of the State; and that such judgment of the Supreme Court establishing the validity of such warrants was an essential prerequisite to their funding.
The court a qua refused the mandamus, and the relator has appealed.
There has been a question raised as to the sufficiency of the evidence in the record to authorize a review of the ease by this Court; and there is an issue between the parties, extensively discussed, as to what is or is not in evidence. From the conclusion we have reached touching the merits of the controversy, we deem it unnecessary to decide this question.
■The Board of Liquidation was established by Act No. 3 of 1874, commonly known as the “ Funding Act.” It was through this board that the bonded debt of the State was to be consolidated, and the holders of the bonds or warrants were required to present them to this board for examination and exchange.
Section third of this act provided, that “if any member of said Board of Liquidation shall knowingly audit and fund any illegal obligation against the State he shall be guilty of a misdemeanor and shall, on conviction, be fined not less than five thousand dollars, and be imprisoned not less than two years, at the discretion of the court.”
Act 11 of the extra session of 1875, supplemental to Act 3 of 1874, in its first section provides:
“ That the Board of Liquidation constituted by the second section *128of Act No. 3, approved January 4, 1874 entitled an act for funding obligations of the State by exchange for bonds, etc., is hereby prohibited from issuing any bonds in exchange for any outstanding bonds of the State, or warrants drawn previous to the passage of said act by the respective Auditors of Public Accounts of the State on the treasury 'thereof, forming items of State indebtedness, the legality or validity of which may have been, or may be hereafter questioned, until said bonds or warrants shall first, by final decree of the Supreme Court of Louisiana, have been delared legal and valid obligations against the State of Louisiana, and that the same were issued in strict conformity to law, and not in violation of the Constitution of this State or of the United States, and for a valid consideration.”
In the case of the State ex rel. Forstall vs. Board of Liquidation, where the construction of this last act was before the Court and the required judgment on the bonds not rendered, the Court said that the board “ had the right to refuse to fund any and all bonds and warrants. Its duty is to refuse to fund all that come to them tainted, without regard to the fact whether they are in the questioned list or not.” The questioned list mentioned being the list of bonds and warrants that by the second section of the Act of 1875 are specially designated and declared “ questioned and doubtful as to their legality and validity.”
The object and intent of the act seems manifest. It was to afford the surest protection to the State against outstanding invalid or fraudulent obligations, many of them known to have been issued in times of misrule and maladministration of our State officers, by requiring that their validity should be recognized and declared by the highest judicial tribunal of the State, and at the same time protect the holders of bonds and warrants of the State against any unjust exclusion of the claims by the board.
But what is meant by the words “ that may have or may be hereafter questioned ” employed in the Act of 1875 ? By the terms of the Act of 1874 establishing-the Board of Liquidation, it was required to exchange the, bonds to be prepared under the provisions of the act “ only for valid outstanding bonds of the State and valid warrants drawn previous to the passage of the act; ” and the members of the board were declared guilty of a crime, and subjected to heavy fine and imprisonment, if they funded any other kind of bonds or warrants except valid ones.
This looks like investing the board with a very large discretion touching the character of the bonds that might be presented to them for funding, and conferring on them, in no stinted measure, the right to “question” such bonds which, in its judgment, did not meet the requirements of the act.
*129The Board of Liquidation in this case did question the validity of the relator’s warrants, and took a very summary and effective way to make its questioning felt, and it is its acts, in this respect, that are complained of by the relator in this proceeding. And the answer or return to the mandamus, in which the validity of these warrants is so vigorously assailed, was made by the then Attorney General, the highest law officer of the State. It seems, therefore, that these warrants have been " questioned,” and seriously questioned, by very high authority, and, we think, by competent authority, and in a manner to meet and satisfy the requirements of the law. Nor does the act prescribe the time within which such bonds or warrants may be questioned. Its language, in this respect, is of the broadest description, and allows an indefinite term for contesting their validity. The counsel for the relator, however, contends that the judgment of the District Oourt, upon which his proceeding is based, is conclusive as to his right to have the warrants funded and exchanged, inasmuch as the judgment was not appealed from, and the delays for an appeal had expired, and urges that the judgment is, therefore, final, and has the force of res adjudicata. We think otherwise. It is only to a judgment rendered in a proper suit by a court clothed with complete jurisdiction over the subject matter thereof, between the proper parties, and after regular proceedings, that the force of the " thing adjudged ” can be ascribed where the lapse of time required therefor has made it final.
Do these requisites concur with respect to this judgment 1 By the express terms of the act, bonds and warrants “ questioned ” may be funded, but it is only after a final decree'of the Supreme. Court has pronounced them legal and valid obligations, “ issued in strict conformity to law, and for a valid consideration.” This is the prescribed authority to the board, and the only authority that is sufficient to empower it to fund the bonds or warrants in such contingency. By language the most explicit, and which cannot be misunderstood, such decree is made a prerequisite, a sine qua non to any action of the board looking to the funding or exchange of such obligations.
The effect of a decree of any other court, a District Court for instance, ordering the funding of such warrants, is not to be judged according to rules applicable to ordinary cases. The State cannot, as a rule, be sued in her own tribunals. No one has a legal right to prosecute or enforce a claim against the State except by her permission, and in the manner she may prescribe. The establishment of the Board of Liquidation for the purpose of determining the liability of the State, and adjusting demands against her, and the investing the board with the necessary authority to determine and fix her obligations, was an act of grace on the part of the State towards her creditors. So, too, was *130the privilege given them to prosecute their demands against the State by proceedings in her highest judicial tribunal. The State in her sovereign capacity had the power to prescribe the manner of the proceeding, and to designate the Court whose decree should be respected, and whose authority should be acknowledged as paramount and controlling over the subject, with respect to which her power was exercised and permission granted. And she has done so. And the State having thus determined and declared her will through her legislative department, the privilege conceded could be exercised in no other way than that prescribed, and the end in view reached through no other tribunal than that designated and appointed.
It is not for us to say how the proceedings should be conducted and how the required decrees be obtained in all cases. The relator’s counsel may think that it would be a very irregular and novel proceeding for him to bring a case before the Supreme Court from a judgment in his favor in the court of the first instance. We reply, “ita soripta est less.” We fail, however, to perceive any insurmountable obstacle in the way of obtaining a decree of this Court, even where a favorable judgment has been rendered by an inferior court, and why, in such case the proceeeding could not be transmitted to this Court to meet the express and special requirement of the statute in a manner conformable to the letter and spirit of the act. The question relating to the mode of procedure is, however, not now before us. It is sufficient to say that the right to bring the judgment up for review by this Court, even by the party in whose favor rendered, existed; and in a proper case would have been enforced.
The warrants of the relator having been questioned as to their validity, and the same not having been declared legal and valid obligations of the State by a final decree of this Court, we cannot grant the relief sought and compel the Board of Liquidation to exchange them for consolidated bonds, as provided by the act invoked; but we reserve all the rights of the relators otherwise.
It is, therefore, ordered, adjudged and decreed that the judgment of the lower court refusing the mandamus be affirmed with costs.
Levy, ¿T., absent.