Page:A History of Banking in the United States.djvu/407

 The Governor said: "I am unable to state accurately the amount of the liabilities of the State, owing in part to the deranged condition of the books in the office of the State Treasurer, caused by the neglect, defalcation, and embezzlement of the late State Treasurer, and to the fact that no account has heretofore been kept at the Treasurer's office of the State bonds issued on account of the Planters' Bank, and the interest accruing thereon; such account having been kept by the Planters' Bank." The Planters' Bank had made an assignment. The Governor feared that the State's interest would be lost if the bank was liquidated in that way. He also was very sure that the Mississippians proved their high nobility by repudiating the Union Bank bonds; but as to the Planters' Bank bonds, the preservation of a high moral principle called on the State to pay them at every sacrifice, and it would do it.

February 23d, the Planters' Bank and the Mississippi Railroad were put in liquidation by act of the Legislature. All sums which should be realized, after the circulation and certificates of specie deposit should be paid, were to be applied to pay the State bonds. If the banks did not surrender voluntarily, the Attorney-general was to file a bill in chancery. Proceedings had already been begun against the Planters' Bank under the law of 1843. That institution refused to submit to the law of 1844, whereupon the proceedings under the act of 1843 were completed and were held valid by the Supreme Court in 1846. The act for winding up these banks was amended by providing that the creditors of them should get nothing until the seminary fund, the sinking fund, and the literary fund should be restored. Debtors of the banks might redeem their securities from the assignee or holder within two years, by paying twelve and a-half per cent. per annum and costs.

We learn from the Governor's message of 1848 that the will and purpose to repudiate the Planters' Bank bonds had then become well-developed, and we learn the ground for it which was then alleged. It was that, in the charter of the old Bank of Mississippi, it had been promised that no other bank should be charted until the charter of that bank should expire. In violation of this stipulation, the Planters' Bank had been founded. The Governor said that the Bank of Mississippi had compounded this wrong to itself in 1830. He argued against repudiation, and proposed that the income from State lands should be set aside to pay these bonds. Such a law was passed. At an informal meeting of members of the Legislature a large majority were in favor of paying the Planters' Bank bonds.

In a case which was decided by the Supreme Court in 1852, it was explained that the State never took any stock or issued any bonds under the original charter of the Planters' Bank. By the supplementary act of December 16, 1830, the Governor was to subscribe for stock and issue bonds for a loan; in 1833, the amount was increased. There was nothing behind these bonds but the pledge of the faith of the State. The sinking fund which was to be formed was pledged by the first charter, but not by the