Morrison Waite

“ The wide departure which Arkansas made in this statute from the accustomed form of proceeding, both at home and elsewhere, is strongly indicative of an intention to waive security any further than it was embraced in the reserved power of sequestration. The constitution of the state gave authority to issue bonds in aid of such works of internal improvement if assented to by the people. If the people gave their consent, then the bonds when issued became a debt of the state, and there was power in the general assembly, under the constitution of 1868, to levy taxes for their payment, if necessary. ”

“ Be it further enacted that the legislature shall from time to time impose upon each railroad company, to which bonds shall have been issued, a tax equal to the amount of the annual interest upon such bonds then outstanding and unpaid, which tax may be paid in money or in the past due coupons of the state at par, and after the expiration of five years from the completion of said road the legislature shall impose an additional special tax of two and one-half per cent. ”

“ We agree with counsel for the appellants that if, on an examination of the statutes, read in the light of the circumstances which surrounded the legislature at the time of their enactment, it appeared to have been the intention to charge the road of the company as a road with a liability for the repayment of the loan to be made, it would be the duty of a court of equity to do everything in its power which was necessary to enforce that charge. ”

“ An exaction by the state under such circumstances and for such purposes is not made a lien on the property of the person who is to pay the money by simply calling it a tax. To create a charge there must be something more than the mere giving of a name to the requisition that is made. ”

“ The taking away of the franchises may, under some circumstances, affect the value of the property in the hands of a purchaser, but it cannot ordinarily deprive him of his title. A forfeiture of the charter does not necessarily transfer the road built under it to the state, or give the state any rights therein. ”

“ Authority was then given the company by the state to issue more bonds for that purpose, to be secured by a first mortgage on a part of the line, which should be superior in lien to that already existing in favor of the state as security for the original loan. ”

“ Under this legislation a fund commissioner was appointed, who had acquired, by authority of the statute, for the security of the state, 'complete control of the earnings and income arising from the property.' In this condition of affairs the state was invaded by armed forces during the late civil war, and while the invasion continued much of the property belonging to the company, including bridges, depots, machine-shops, and track, was destroyed. To raise the money to repair these damages, and put the road again in a condition for use, the company applied to the county of St. ”