Antoni v. Wright
| Decision Date | 13 December 1872 |
| Court | Virginia Supreme Court |
| Parties | ANTONI v. WRIGHT, sheriff, & c. WRIGHT, sheriff, & c. v. SMITH. |
Absent, MONCURE P.[a1]
1. The act of March 30, 1871, entitled " An act to provide for the funding and payment of the public debt," provides that the coupons attached to the bonds to be issued under that act " shall be payable semi-annually, and be receivable at and after maturity, for all taxes, debts, dues and demands due the State; which shall be expressed on their face." The act constitutes a contract on the part of the State, which can not be repealed by the General Assembly, and the contract follows the coupons in the hands of the holders thereof, though purchased after an act repealing the said act.
2. The act is not repugnant to § 7 of article 8, nor to § 9 of article 10 of the constitution of Virginia.
3. The act of March 7, 1872, which directs what shall be received in payment of taxes, dues, & c., to the State, and repeals all acts inconsistent with it, so far as it respects the provision of the act of March 30, 1871, in relation to the coupons of bonds issued under this last act, is repugnant to the provision of the constitution of the United States, which forbids a State to pass any law impairing the obligation of contracts.
These cases were heard together in this court. They involve a single, and the same question; and that is whether the act of March 7th, 1872, which provides " that hereafter it shall not be lawful for the officers charged with the collection of taxes or other demands of the State, due now or that shall hereafter become due, to receive in payment thereof any thing else than gold or silver coin, United States treasury notes, or notes of the national banks of the United States," is repugnant to the provision of the constitution of the State or of the United States, which forbids a State to pass any law impairing the obligation of contracts. And this question depends upon the question whether the act of March 30th, 1871, entitled " An act to provide for the funding and payment of the public debt," which provides that " the coupons attached to the bonds to be issued under that act, shall be payable semi-annually, and be receivable at and after maturity, for all taxes, debts, dues and demands due the State, which shall be so expressed on their face; " constitutes a contract on the part of the State, which cannot be rescinded, and follows the coupon into the hands of any holder for value.
The first case is an application to this court by Andrew Antoni for a writ of mandamus to John Wright, sheriff of the city of Richmond, to compel him to receive from Antoni a due coupon of one of the bonds issued under the last mentioned act, in payment of taxes due from Antoni to the State; upon which Wright made a return the same as set out in the next case. The other was a similar application by A Austin Smith, to the Circuit court of the city of Richmond. The sheriff made his return to the rule upon him, and set up several objections to the issue of the mandamus. 1st. That the mere legislative declaration, that such coupons shall be receivable in payment of taxes, does not authorize him to receive them, they not having been tendered before the repeal of that provision of the act of March 30th, 1871. That the act of March 7th, 1872, forbids the receipt of the coupons in payment of taxes; and repealed the provision of the act of March 30th, 1871, authorizing them to be received 2d. That if the holder of the coupons had the imperative right to demand that they should be received in payment of taxes, then the act was in conflict with the 5th section of article 10 of the constitution of Virginia; and the General Assembly had the right to repeal it. 3d. That the auditor had instructed the respondent, in writing, not to receive the coupons issued under the act of March 30th, 1871, in payment of taxes. That if the act created a mode of appropriating the State revenues different from that ordained by the constitution of the State, it was in violation of the constitution; or if it was intended to make them bills of credit, then it was in contravention of the constitution of the United States. And that said Smith was never the owner of the bonds from which the coupons were taken; and he became the owner of the coupons tendered by him after the passage of the act of March 7, 1872. 4th. A mandamus will not lie when the party has other adequate remedies.
To this return Smith demurred, and the court sustained the demurrer, and directed that a peremptory mandamus be awarded, directed to the said John W. Wright, sheriff of the city of Richmond, commanding him to receive from the plaintiff matured coupons issued by the State of Virginia under the provisions of the act of March 30, 1871, to an amount equal to the sum due from the plaintiff for taxes due to the State for the year 1871. And thereupon Wright applied to a judge of this court for a writ of error, which was awarded.
The cases were argued by the attorney-general for the sheriff and Ould & Carrington and B. T. Johnson & Royal for the petitioner and appellee.
The first of these cases is before the court on an original application by Antoni for a writ of mandamus to Wright as sheriff of the city of Richmond, and the other, on a writ of error to a judgment of the Circuit court of the city of Richmond, by which a peremptory writ of mandamus was awarded against the same sheriff. The object of the proceedings in both cases was to compel the sheriff to receive from the parties respectively, in payment of taxes due the State, certain matured interest coupons issued by the State of Virginia, under the act of the General Assembly approved March 30th, 1871, known as the funding act; which coupons had been duly tendered to said sheriff in payment of taxes, and were as is agreed by the parties in form and substance as follows;
" Receivable at and after maturity for all taxes, debts and demands due the State.
The Commonwealth of Virginia will pay the bearer three dollars interest, due 1st July 1872, on bond No. 3501.
GEO. RYE,
Treasurer of the Commonwealth of Virginia.
The sheriff refused to receive them, because as he alleged, he was prohibited from so doing by the act of March 7th, 1872. Sess. Acts 1871-'2, ch. 148, p. 141, entitled " An act declaring what shall be received in payment of taxes, or other demands of the State." There being no conflict of fact, the case was submitted to the court on the legal questions arising on the record, and the Circuit court awarded a peremptory writ of mandamus requiring the sheriff to receive the coupons aforesaid in payment of taxes due the State; and the cases are now before this court on a writ of error to the judgment aforesaid of the Circuit court, and on the original application of Antoni, to which the sheriff makes the same defence.
The questions involved in the two cases are identical; and as was said by Judge Davis, of the United States Supreme court, in a similar case, Furman v. Nichol, 8 Wall. U. S. R. 44, are of much greater " importance than difficulty."
They are the following:
1. Was there under the act aforesaid of March 30th, 1871, a valid contract between the State and such of her creditors as accepted and complied with the terms of the act, that the interest coupons issued thereunder should be " receivable at and after maturity for all taxes, debts, dues and demands due the State?"
2. If so, was the obligation of this contract impaired by the act aforesaid of March 7th, 1872, which substantially declares that the collecting officers of the State shall not receive the coupons aforesaid in discharge of any " taxes or other demands of the State now due or that shall hereafter become due?"
The first and all essential question is, was there a valid contract between the State and her bondholders?
To consider this question intelligently, a brief reference to the substance of the funding act, and to the facts and circumstances under which it was passed, is proper and perhaps necessary.
We know as matter of history, that prior to the late war between the United States and the Confederate States, and before her violent dismemberment, the State of Virginia for the common benefit of the whole and every part of the State, had contracted a very heavy debt, amounting at the date of the funding act, to about $40,000,000 of principal. During the war, and by an act of violence she was powerless to resist, about one-third of the territory and population of the State was cut off, and formed into a new State called West Virginia; and by that name that portion of the State of Virginia has been acknowledged as a State by the constituted authorities of the Federal government, and admitted as a member of the Federal Union. Both States in their constitutions and by legislation have acknowledged their respective liability for a just and equitable proportion of the old debt; and efforts had been made from time to time, to adjust that liability; but very little progress towards a settlement of any kind seems to have been made. In the meantime, the payment of interest on the debt was for a time wholly suspended, and afterwards only partially resumed by the State of Virginia alone; whilst West Virginia had not, and has not to this day, paid any part of the debt, principal or interest; and the entire debt standing in the name of the State of Virginia, and her bonds being held for the whole amount, much anxiety was felt and manifested on the subject as well by the State as by her creditors.
Under these circumstances, and hopeless of any early settlement with West Virginia, the State of Virginia proposed to her creditors, by the act aforesaid of...
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