Morrison Waite

“ To hold other wise would be to decide that the legislature, while providing for a loan of the bonds of the state to corporations engaged in works of internal improvement, required the corporations to secure by liens on their own property, not only the payment to the state of the interest on the loan, but also the redemption by the state of its own pledges of faith to the future holders of the state bonds that were lent. ”

“ The comptroller of the state shall keep a regular account against each company or corporation, charging them with the amount of bonds originally issued to or indorsed for said company or corporation by the state, and crediting them by the amount of sinking fund paid, and shall furnish the treasurer of state a statement of the amount due by each company or corporation on the first of June and December of each year, that he may know how much interest each company or corporation has to pay. ”

“ As the statutory remedy for the enforcement of the statutory lien must be presumed to have been intended to be commensurate with the lien itself, and this remedy was confined to cases of default in making deposits, there cannot be a doubt that it was the understanding of the legislature that a deposit for interest was a payment of interest on the bonds, so far as the company was concerned, and released the company as well as its property from all further liability to the state, or to any one else, which had been assumed for interest. ”

“ Be it further enacted, that railroad companies issuing their own mortgage bonds, under the provisions of the act which this is intended to amend, be allowed to fix the rate of interest which the said bonds of the railroad company are to bear, and all laws in conflict are hereby repealed: provided, that when said railroad companies owe interest already due, coupons past due shall be taken by the comptroller or treasurer in discharge of such indebtedness for interest. ”

“ Under the act of 1856 the payments were required to be made in money, and, in case of default, proceedings for foreclosure and sale were to be instituted to collect the amount to be paid, as in cases of non-payment of bonds at maturity. If the statutes of 1852 and 1856 stood alone, it would be clear to our minds that payments into the sinking fund were to be treated as a release pro tanto of all the liability of the company on, or an account of, the bonds. ”

“ Hence this reservation of power by the state was made broad enough to allow the state to deal with the securities which were taken from the companies at its own discretion, and in any way that might be deemed just. No such power could be exercised if the bondholders held an interest in the securities adverse to the state. ”