Commonwealth of Virginia v. State of West Virginia
| Decision Date | 06 March 1911 |
| Docket Number | No. 3,O,3 |
| Citation | 55 L.Ed. 353,31 S.Ct. 330,220 U.S. 1 |
| Parties | COMMONWEALTH OF VIRGINIA v. STATE OF WEST VIRGINIA. riginal |
| Court | U.S. Supreme Court |
[Syllabus from pages 1-3 intentionally omitted] Messrs. Samuel W. Williams, William A. Anderson, Randolph Harrison, and John B. Moon for complainant.
[Argument of Counsel from pages 3-10 intentionally omitted] Mr. Holmes Conrad for the bondholders.
[Argument of Counsel from pages 10-14 intentionally omitted] Messrs. Charles E. Hogg, George W. McClintic, John C. Spooner, W. Mollohan, W. G. Mathews, William M. O. Dawson, and William G. Conley for defendant.
[Argument of Counsel from pages 14-22 intentionally omitted]
This is a bill brought by the commonwealth of Vir-
ginia to have the state of West Virginia's proportion of the public debt of Virginia, as it stood before 1861, as certained and satisfied. The bill was set forth when the case was before this court on demurrer. 206 U. S. 290, 51 L. ed. 1068, 27 Sup. Ct. Rep. 732. Nothing turns on the form or contents of it. The object has been stated. The bill alleges the existence of a debt contracted between 1820 and 1861 in connection with internal improvements intended to develop the whole state, but with especial view to West Virginia, and carried through by the votes of the represen tatives of the West Virginia counties. It then sets forth the proceedings for the formation of a separate state, and the material provisions of the ordinance adopted for that purpose at Wheeling on August 20, 1861, the passage of an act of Congress for the admission of the new state under a Constitution that had been adopted, and the admission of West Virginia into the Union, all of which we shall show more fully a little further on. Then follows an averment of the transfer in 1863 to West Virginia of the property within her boundaries belonging to West Virginia, to be accounted for in the settlement thereafter to be made with the last-named state. As West Virginia gets the benefit of this property without an accounting, on the principles of this decision, it needs not to be mentioned in more detail. A further appropriation to West Virginia is alleged of $150,000, together with unappropriated balances, subject to accounting for the surplus on hand received from counties outside of the new state. Then follows an argumentative averment of a contract in the Constitution of West Virginia to assume an equitable proportion of the above-mentioned public debt, as hereafter will be explained. Attempts between 1865 and 1872 to ascertain the two states' proportion of the debt and their failure are averred, and the subsequent legislation and action of Virginia in arranging with the bondholders, that will be explained hereafter so far as needs. Substantially all the bonds outstanding in 1861
have been taken up. It is stated that both in area of territory and in population West Virginia, was equal to about one third of Virginia, that being the proportion that Virginia asserts to be the proper one for the division of the debt, and this claim is based upon the division of the state, upon the abovementioned Wheeling ordinance and the Constitution of the new state, upon the recognition of the liability by statute and resolution, and upon the receipt of property, as has been stated above. After stating further efforts to bring about an adjustment, and their failure, the bill prays for an accounting to ascertain the balance due to Virginia in her own right and as trustee for bondholders, and an adjudication in accord with this result.
The answer admits a debt of about $33,000,000, but avers that the main object of the internal improvements in connection with which it was contracted was to afford outlets to the Ohio river on the west and to the seaboard on the east for the products of the eastern part of the state, and to develop the resources of that part, not those of what is now West Virginia. In aid of this conclusion it goes into some elaboration of details. It admits the proceedings for the separation of the state, and refers to an act of May, 1862, consenting to the same, to which we also shall refer. It denies that it received property of more than a little value from Virginia, or that West Virginia received more than belonged to her in the way of surplus revenue on hand when she was admitted to the Union, and denies that any liability for these items was assumed by her Constitution. It sets forth in detail the proceedings looking to a settlement, but, as they have no bearing upon our decision, we do not dwell upon them. It admits the transactions of Virginia with the bondholders, and sets up that they discharged the commonwealth from one third of its debt, and that what may have been done as to two-thirds does not concern the defend-
ant, since Virginia admits that her share was not less than that. If the bonds outstanding in 1861 have been taken up, it is only by the issue of new bonds for two thirds and certificates to be paid by West Virginia alone for the other third. Liability for any payments by Virginia is denied, and accountability, if any, is averred to be only on the principle of § 9 of the Wheeling ordinance, to be stated. It is set up further that under the Constitution of West Virginia her equitable proportion can be established by her legislature alone; that the liquidation can be only in the way provided by that instrument; and hence that this suit cannot be maintained. The settlement by Virginia with her creditors also is pleaded as a bar, and that she brings this suit solely as trustee for them.
The grounds of the claim are matters of public history. After the Virginia ordinance of secession, citizens of the state who dissented from that ordinance organized a government that was recognized as the state of Virginia by the government of the United States. Forthwith a convention of the restored state, as it was called, held at Wheeling, proceeded to carry out a long-entertained wish of many West Virginians by a dopting an ordinance for the formation of a new state out of the western portion of the old commonwealth. A part of § 9 of the ordinance was as follows: 'The new state shall take upon itself a just proportion of the public debt of the commonwealth of Virginia prior to the 1st day of January, 1861, to be ascertained by charging to it all state expenditures within the limits thereof, and a just proportion of the ordinary expenses of the state government since any part of said debt was contracted; and deducting therefrom the moneys paid into the treasury of the commonwealth from the counties included within the said new state during the same period.' Having previously provided for a popular vote, a constitutional convention, etc., the ordinance in § 10 ordained that when the general assembly should give
its consent to the formation of such new state, it should forward to the Congress of the United States such consent, together with an official copy of such Constitution, with the request that the new state might be admitted into the union of states.
A Constitution was framed for the new state by a constitutional convention, as provided in the ordinance, on November 26, 1861, and was adopted. By article 8, § 8, 'An equitable proportion of the public debt of the commonwealth of Virginia, prior to the first day of January in the year one thousand eight hundred and sixty-one shall be assumed by this state; and the legislature shall ascertain the same as soon as may be practicable, and provide for the liquidation thereof by a sinking fund sufficient to pay the accruing interest, and redeem the principal within thirty-four years.' An act of the legislature of the restored state of Virginia, passed May 13, 1862, gave the consent of that legislature to the erection of the new state 'under the provisions set forth in the Constitution for the said state of West Virginia.' Finally Congress gave its sanction by an act of December 31, 1862, chap. 6, 12 Stat. at L. 633, which recited the framing and adoption of the West Virginia Constitution and the consent given by the legislature of Virginia through the last-mentioned act, as well as the request of the West Virginia convention and of the Virginia legislature, as the grounds for its consent. There was a provision for the adoption of an emancipation clause before the act of Congress should take effect, and for a proclamation by the President, stating the fact, when the desired amendment was made. Accordingly, after the amendment and a proclamation by President Lincoln, West Virginia became a state on June 20, 1863.
It was held in 1870 that the foregoing constituted an agreement between the old state and the new (Virginia v. West Virginia, 11 Wall. 39, 20 L. ed. 67), and so much may be taken
practically to have been decided again upon the demurrer in this case, although the demurrer was overruled without prejudice to any question. Indeed, so much is almost if not quite admitted in the answer. After the answer had been filed the cause was referred to a master by a decree made on May 4, 1908 (209 U. S. 514, 534, 52 L. ed. 914, 915, 28 Sup. Ct. Rep. 614), which provided for the ascertainment of the facts made the basis of apportionment by the original Wheeling ordinance, and also of other facts that would furnish an alternative method if that prescribed in the Wheeling ordinance should not be followed; this again without prejudice to any question in the cause. The master has reported, the case has been heard upon the merits, and now is submitted to the decision of the court.
The case is to be considered in the untechnical spirit proper for dealing with a quasi international controversy, remembering that there is no municipal code governing the matter, and that this court may be called on to adjust differences that cannot be dealt with by Congress or...
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