Guaranty Company v. Board of Liquidation - 105 U.S. 622 (1881)
U.S. Supreme Court
Guaranty Company v. Board of Liquidation, 105 U.S. 622 (1881)
Guaranty Company v. Board of Liquidation
105 U.S. 622
The State of Louisiana provided for funding her bonds at reduced rates and on certain terms. A subsequent statute prohibits the funding of all questionable obligations, among which are specially designated those issued in aid of the construction of a certain canal, until, by a final decree of the Supreme Court,
"they have been declared legal and valid obligations against the State of Louisiana, and that the same were issued in strict conformity to law, and not in violation of the constitution of this state, or of the United States, and for a valid consideration."
A., a holder of the canal bonds, filed his bill praying for such a decree. The court decided that the statute did not allow them to be funded, they not being valid obligations in the hands of the first taker, and that the latter occupied as good a position as a bona fide holder. Held that this not being an action to recover the contents of the bonds, and A. having the same right to enforce payment as he ever possessed, the statute as thus construed does not impair the obligation of any contract.
The case is stated in the opinion of the Court.