Rolston v. Missouri Fund Commissioners - 120 U.S. 390 (1887)
U.S. Supreme Court
Rolston v. Missouri Fund Commissioners, 120 U.S. 390 (1887)
Rolston v. Missouri Fund Commissioners
Argued December 1-2, 1886
Decided March 7, 1887
120 U.S. 390
The State of Missouri having loaned its credit to the Hannibal and St. Joseph Railroad Company for $3,000,000, upon a first lien of the road and property of the company, the legislature, on the 20th February, 1865, authorized that company to mortgage its road and property to trustees to secure an issue of bonds to that amount, and further enacted that whenever those trustees should
"pay into the treasury of the state a sum
of money equal in amount to all indebtedness due or owing by said company to the state, and all liabilities incurred by the state by reason of having issued her bonds and loaned the same to said company as a loan of the credit of the state, together with all interest that has and may at the time when such payment shall be made have accrued and remain unpaid by said company, and such fact shall lave been certified to the governor of the state by the treasurer,"
the governor should "make over, assign, and convey to the trustees aforesaid all the first liens and mortgages now held by the state." The act further required the state treasurer to receive of the trustees in payment of the $3,000,000 any outstanding bonds of the state, bearing not less than six percent interest, or any of the unpaid coupons thereof at their par value. Held that this meant that if payment was made in money, and not in state bonds or coupons, it must be of an amount equal to the face value of the bonds issued to the company and the accrued interest thereon to the time of payment, together with such further sum, if any, as would be necessary to enable the state to cancel then, or within a reasonable time thereafter, $3,000,000 of its outstanding liabilities, bearing interest at the rate of six percent per annum.
The Act of the General Assembly of Missouri of March 26, 1881, to provide for the transfer to the sinking fund of surplus money in the treasury, recognized the Act of February 20, 1865, providing for the reduction of the state indebtedness, and constituted an agreement on the part of the state that all moneys paid into the treasury by the railroad company should be put into the state debt sinking fund, and that all option bonds should be called in and paid as soon as it could lawfully be done, and the use of the money so paid in taking up six percent bonds of the state operated to discharge the company from liability for the payment of either the principal or interest of an equal amount of the bonds which had been issued for its benefit.
The provisions of the Constitution of the State of Missouri which went into effect November 30, 1865, relating to the lien held by the state upon any railroad, or to the release of the indebtedness of any corporation to the state, do not prevent the state authorities from complying with the requirements of the acts of February 20, 1865, and March 25, 1881, respecting the lien upon the Hannibal and St. Joseph Railroad and the debt of that company to the state, when the company has performed the acts required by the statutes to be done upon its part.
This suit is brought to compel state officers to do what a statute of the state requires them to do, and is not a suit against the state, but against the officers. Louisiana v. Jumel, 107 U. S. 711, distinguished.
This was a bill in equity to restrain the Fund Commissioners of the State of Missouri from selling the Hannibal and St. Joseph Railroad. Both parties appealed. The case is stated in the opinion of the Court.