Standard Oil Company; Trusts, Industrial -- United States
The amount of bonds originally authorized was $750,000. The trustees,
in consequence of the delays and enhanced cost caused by lawsuits and
other tactics of opposition, had to incur a floating debt of $300,000.
The council by ordinance directed the issue of bonds by the city to
the amount of $120,000 to pay off part of this floating debt. The
State Circuit Court refused to sustain this action of the council,
but pointed out that all the city lacked was the authorization of the
Legislature. This was the only decision against the city in all the
litigations, and in this the State Court was afterwards overruled by
the United States Circuit Court. A bill was accordingly introduced,
giving the city the right to issue $300,000 in bonds for the floating
debt, and $100,000 for the extension of the gas plant: wells, pipes,
pumps--whatever was needed. A strong lobby immediately appeared in the
State Capitol to defeat the bill. As part of its ammunition a pamphlet
was circulated among the legislators, giving "Facts and Reasons" why
the Legislature should not authorize the new issue of bonds. This
pamphlet illustrates the easy virtue with which some lawyers dispose
of themselves to those who have the money to pay them. Two of its
strongest points were that the contracts for which the floating debt
had been incurred were let without proper competition, and that the
trustees had no power to make the contracts. This pamphlet was signed
by two lawyers, one of whom, before these contracts were let, had
given the trustees his written opinion supporting such contracts
unqualifiedly. The representatives of the people were able to exhibit
to the Legislature his written opinion stating that the trustees had
the power to make the contracts, and had let them in compliance with
the requirements of the statute as to bids. The pamphlet declared that
the court, in granting the injunction against the issue of the $120,000
of bonds by the Common Council, had declared the claims which were to
be paid by the proceeds of the bonds to be "illegal and invalid." This
was untrue. The court had held only that the city had not the power to
issue the bonds, and pointed out that the remedy was in new legislation
by the State to remedy the want of power.
Public-domain text, read in full here on John Shaqi.
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