Texas
Secession Comes to Supreme Court, in a Way
http://blogs.wsj.com/washwire/2011/08/19/texas-secession-comes-to-supreme-court-in-a-way/
By Jess Bravin-WSJ
Texas Gov. Rick Perry has insisted that his state,
unlike the other 49, holds a unique right to secede from the Union. Legal
authorities disagree, citing Texas
v. White, a 1869 Supreme Court decision rejecting
that claim.
Mr. Perry, who is seeking the Republican
presidential nomination, now has a chance to see one of his favorite judges
offer vindication of sorts. In November, Justice Antonin Scalia will
preside over a mock retrial of Texas v. White at an event sponsored by the
Supreme Court Historical
Society.
Texas was admitted to the Union in 1845,
under a statute placing it “on an equal footing with the original states, in
all respects whatever.” In 1861, however, Texas decided it wanted out. The
secession ordinance complained about the “imbecility of the Federal Government,” saying
Washington failed to protect Texas from Mexican “banditti” and insisted on “the
debasing doctrine of equality of all men, irrespective of race or color—a
doctrine at war with nature.”
After the Civil War, constitutional
amendments abolished slavery and empowered Washington to prevent state
governments from trampling individual rights. Texas v. White posed the question
of whether the acts of the state government after secession—in particular, its
sale of some assets—were legal.
Chief Justice Salmon Chase said the
asset sale was invalid, as was the whole concept of secession, because Texas’s
annexation by the United States was final and indissoluble. The Constitution
itself says its aim is “to form a more perfect Union,” which the newly
independent states already had declared to “be perpetual,” the chief justice
wrote. “It is difficult to convey the idea of indissoluble unity more clearly
than by these words. What can be indissoluble if a perpetual Union, made more
perfect, is not?” he wrote.
Jennifer Lowe, the Historical Society’s program director, said Justice Scalia and the
participating attorneys have been sent the 1869 records to study in preparation
for the arguments. Each side will get 20 minutes and Justice Scalia will render
a decision that very evening.
In a 2006 letter to a screenwriter who
proposed writing a farce about the secession of Maine, Justice Scalia suggested
he didn’t see any right to secede. Still, as Mr. Perry would be the first to
say, Texas is a long way from Maine.
TEXAS
Perry stands by secession comments
Governor says Texas is one state that could leave
union, though he's not pushing it.
Gov. Rick Perry on Thursday stuck by his
earlier statement that Texas can secede from the United States — a
far-reaching, legally questionable prospect that nevertheless drew Perry a
fresh favorable mention by Rush Limbaugh, one of the nation's leading
conservative voices.
The idea of secession — which Perry did
not endorse — surfaced suddenly Wednesday after Perry appeared at an anti-tax
"tea party" at Austin City Hall, where some in his U.S. flag-waving
audience shouted, "Secede!"
According to The Associated Press, Perry
suggested in response to a reporter's question that Texans might at some point
get so fed up with Democratic-led actions in Washington that they would want to
secede.
"There's a lot of different
scenarios," Perry said. "We've got a great union. There's absolutely
no reason to dissolve it. But if Washington continues to thumb their nose at
the American people, you know, who knows what might come out of that? But Texas
is a very unique place, and we're a pretty independent lot to boot."
On Thursday, Perry called potential
secession a "side issue of Texas history. ... We are very proud of our
Texas history; people discuss and debate the issues of can we break ourselves
into five states, can we secede, a lot of interesting things that I'm sure Oklahoma
and Pennsylvania would love to be able to say about their states, but the fact
is, they can't because they're not Texas."
A Perry spokeswoman said Perry believes
Texas could secede if it wanted.
Sanford Levinson, a professor at the
School of Law at the University of Texas at Austin, said that between the Texas
Constitution, the U.S. Constitution and the 1845 Joint Resolution Annexing
Texas to the United States, there is no explicit right for the state to return
to its days as a republic.
"We actually fought a war over this
issue, and there is no possibility whatsoever that the United States or any
court would recognize a 'right' to secede," Levinson said in an e-mail.
Levinson noted that the 1845 resolution
allows for Texas to break itself into five states but doesn't specify whether
that would require congressional approval — and forming new states still
wouldn't constitute secession.
Limbaugh said on his program Thursday
that Perry's speculation on the possibility of secession might awaken
conservatives to actions by the federal government that he described as abusing
citizens.
"This is not insignificant when the
governor of Texas talks about 'we could secede,' " Limbaugh said,
according to audio of his comments and a transcript posted online by Media
Matters for America, a liberal group that says it corrects conservative
misinformation in the media.
Also Thursday, Perry fielded a warm
response from more than 800 members of the Texas Federation of Republican Women
lunching at the Austin Convention Center.
The group also heard from his expected
2010 GOP primary challenger, U.S. Sen. Kay Bailey Hutchison.
Both drew ovations, though Perry
appeared to have the upper hand with audience members who gave him an
additional ovation after he reminded them of his desire to see a change in
state law requiring voters to present a photo ID at the polls.
Referring to three anti-tax "tea
parties" he attended Wednesday, Perry said he felt invigorated and proud
of Texans.
"We're fed up with what's coming
out of Washington," he said.
He also said that one reason Democrats
succeeded nationally last year is that "a lot of us who have worn the
jersey of the Republican team have been playing like Democrats"— almost
certainly a stab at Hutchison, a senator since 1993.
Perry also saluted state Rep. Brandon
Creighton, R-Conroe, the author of a nonbinding resolution to remind Congress
of the 10th Amendment to the U.S. Constitution.
"I'm talking about states'
rights," Perry said.
The governor drew little attention last
week when he endorsed Creighton's resolution. But by Tuesday, the online Drudge
Report had posted a Perry news release on the proposal. Talk show hosts
including conservatives Limbaugh, Sean Hannity, Michael Savage and Laura
Ingraham shortly picked up the story.
And the governor's Web site has been
visited more than 300,000 times since Tuesday, compared with 5,000 times on a
typical day, while a video of Perry's appearance with Creighton and other
legislators made the top 100 watched videos on the YouTube site.
Hutchison fired an arrow in Perry's
direction at the lunch, reminding the red-jacketed activists that Republicans
have lost ground in the Texas House as well as local offices in what had been
GOP-leaning Harris, Bexar and Dallas counties.
"We have got to regear,"
Hutchison said.
Referring to grass-roots Republican
women, Hutchison said: "We built the Republican Party, and we are going to
have to save it."
wgselby@statesman.com; 445-3644
Syllabus
SUPREME COURT OF THE UNITED STATES
74 U.S. 700
Texas v. White
ON ORIGINAL BILL
Argued: --- Decided:
1. The word "State"
describes sometimes a people or community of individuals united more or less
closely in political relations, inhabiting temporarily or permanently the same
country; often it denotes only the country, or territorial region, inhabited by
such a community; not unfrequently, it is applied to the government under which
the people live; at other times, it represents the combined idea of people,
territory, and government.
2. In the Constitution, the term
"State" most frequently expresses the combined idea, just noticed, of
people, territory, and government. A State, in the ordinary sense of the
Constitution, is a political community of free citizens, occupying a territory
of defined boundaries and organised under a government sanctioned and limited
by a written constitution, and established by the consent of the governed.
3. But the term is also used to
express the idea of a people or political community, as distinguished from the
government. In this sense, it is used in the clause which provides that the
United States shall guarantee to every State in the Union a republican form of
government, and shall protect each of them against invasion.
4. The Union of the States never was
a purely artificial and arbitrary relation. It began among the Colonies, and
grew out of common origin, mutual sympathies, kindred principles, similar
interests, and geographical relations. It was confirmed and strengthened by the
necessities of war, and received definite form and character and sanction from
the Articles of Confederation. By these, the Union was solemnly declared to
"be perpetual." And, when these Articles were found to be inadequate
to the exigencies of the country, the Constitution was ordained "to form a
more perfect Union."
5. But the perpetuity and
indissolubility of the Union by no means implies the loss of distinct and
individual existence, or of the right of self-government by the States. On the
contrary, it may be not unreasonably said that the preservation of the States
and the maintenance of their governments are as much within the design and care
of the Constitution as the preservation of the Union and the maintenance of the
National government. The Constitution, in all its provisions, looks to an
indestructible Union composed of indestructible States.
6. When Texas became one of the
United States, she entered into an indissoluble relation. The union between
Texas and the other States was as complete, as perpetual, and as indissoluble
as the union between the original States. There was no place for
reconsideration or revocation, except through revolution or through consent of
the States.
7. Considered as transactions under
the Constitution, the ordinance of secession, adopted by the convention, and
ratified by a majority of the citizens of Texas, and all the acts of her
legislature intended to give [p701] effect to that
ordinance, were absolutely null. They were utterly without operation in law.
The State did not cease to be a State, nor her citizens to be citizens of the
Union.
8. But in order to the exercise, by
a State, of the right to sue in this court, there needs to be a State
government, competent to represent the State in its relations with the National
government, so far at least as the institution and prosecution of a suit is
concerned.
9. While Texas was controlled by a
government hostile to the United States, and in affiliation with a hostile
confederation, waging war upon the United States, no suit instituted in her
name could be maintained in this court. It was necessary that the government
and the people of the State should be restored to peaceful relations to the
United States, under the constitution before such a suit could be prosecuted.
10. Authority to suppress rebellion
is found in the power to suppress insurrection and carry on war, and authority
to provide for the restoration of State governments, under the Constitution,
when subverted and overthrown, is derived from the obligation of the United
States to guarantee to every State in the Union a republican form of
government. The latter, indeed, in the case of a rebellion which involves the
government of a State, and, for the time, excludes the National authority from
its limits, seems to be a necessary complement to the other.
11. When slavery was abolished, the
new freemen necessarily became part of the people, and the people still
constituted the State, for States, like individuals, retain their identity,
though changed, to some extent, in their constituent elements. And it was the
State, thus constituted, which was now entitled to the benefit of the
constitutional guaranty
12. In the exercise of the power
conferred by the guaranty clause, as in the exercise of every other
constitutional power, a discretion in the choice of means is necessarily
allowed. It is essential only that the means must be necessary and proper for
carrying into execution the power conferred, through the restoration of the
State to its constitutional relations, under a republican form of government,
and that no acts be done, and no authority exerted, which is either prohibited
or unsanctioned by the Constitution.
13. So long as the war continued,
it cannot be denied that the President might institute temporary government
within insurgent districts, occupied by the National forces, or take
provisional measures, in any State, for the restoration of State government
faithful to the Union, employing, however, in such efforts, only such means and
agents as were authorized by constitutional laws. But the power to carry into
effect the clause of guaranty is primarily a legislative power, and resides in
Congress, though necessarily limited to cases where the rightful government is
subverted by revolutionary violence, or in imminent danger of being overthrown
by an opposing government, set up by force within the State.
14. The several executives of
Texas, partially, at least, reorganized under [p702] the
authority of the President and of Congress, having sanctioned this suit, the
necessary conclusion is that it was instituted and is prosecuted by competent
authority.
15. Public property of a State,
alienated during rebellion by an usurping State government for the purpose of
carrying on war against the United States, may be reclaimed by a restored State
government, organized in allegiance to the Union, for the benefit of the State.
16. Exact definitions, within which
the acts of a State government, organized in hostility to the Constitution and
government of the United States, must be treated as valid or invalid need not
be attempted. It may be said, however, that acts necessary to peace and good
order among citizens, such, for example, as acts sanctioning and protecting
marriage and the domestic relations, governing the course of descents regulating
the conveyance and transfer of property, real and personal, and providing
remedies for injuries to person and estate, and other similar acts, which would
be valid if emanating from a lawful government, must be regarded in general as
valid when proceeding from an actual, though unlawful, government, and that
acts in furtherance or support of rebellion against the United States, or
intended to defeat the just rights of citizens, and other acts of like nature,
must, in general, be regarded as invalid and void.
17. Purchasers of United States
bonds issued payable to the State of Texas or bearer, alienated during
rebellion by the insurgent government, and acquired after the date at which the
bonds became redeemable, are affected with notice of defect of title in the
seller.
The Constitution ordains that the
judicial power of the United States shall extend to certain cases, and among
them
to controversies between a State
and citizens of another State; . . . and between a State, or the citizens
thereof, and foreign States, citizens or subjects.
It ordains further, that in cases
in which "a State" shall be a party, the Supreme Court shall have
original jurisdiction.
With these provisions in force as
fundamental law, Texas, entitling herself "the State of Texas, one of the
United States of America," filed, on the 15th of February, 1867, an
original bill against different persons; White and Chiles, one Hardenberg, a
certain firm, Birch, Murray & Co., and some others, [n1]
citizens of New York and other States; praying [p703] an
injunction against their asking or receiving payment from the United States of
certain bonds of the Federal government, known as Texan indemnity bonds; and
that the bonds might be delivered up to the complainant, and for other and
further relief.
The case was this:
In 1851, the United States issued
its bonds -- five thousand bonds for $1,000 each, and numbered successively
from No. 1 to No. 5,000, and thus making the sum of $5,000,000 -- to the State
of Texas, in arrangement of certain boundary claims made by that State. The
bonds, which were dated January 1st, 1851, were coupon bonds, payable, by their
terms, to the State of Texas or bearer, with interest at 5 percent
semi-annually, and "redeemable after the 31st day of December,
1864." Each bond contained a statement on its face that the debt was
authorized by act of Congress, and was "transferable on delivery,"
and to each were attached six-month coupons, extending to December 31, 1864. [n2]
In pursuance of an act of the
legislature of Texas, the controller of public accounts of the State was
authorized to go to Washington, and to receive there the bonds; the statute
making it his duty to deposit them, when received, in the treasury of the State
of Texas, to be disposed of "as may be provided by law;" and
enacting further, that no bond, issued as aforesaid and payable to bearer,
should be "available in the hands of any holder until the same shall have
been indorsed, in the city of Austin, by the governor of the State of Texas."
Most of the bonds were indorsed and
sold according to law, and paid on presentation by the United States prior to
1860. A part of them, however, -- appropriated by act of legislature as a
school fund -- were still in the treasury of Texas, in January, 1861, when the
late Southern rebellion broke out.
The part which Texas took in that
event, and the position [p704] in which the close of it
left her, are necessary to be here adverted to.
At the time of that outbreak, Texas
was confessedly one of the United States of America, having a State
constitution in accordance with that of the United States and represented by
senators and representatives in the Congress at Washington. In January, 1861, a
call for a convention of the people of the State was issued, signed by
sixty-one individuals. The call was without authority, and revolutionary. Under
it, delegates were elected from some sections of the State, whilst in others no
vote was taken. These delegates assembled in State convention, and, on the 1st
of February, 1861, the convention adopted an ordinance
to dissolve the
union between the State of Texas and the other States, united under the compact
styled "the Constitution of the United States of America."
The ordinance contained a provision
requiring it to be submitted to the people of Texas, for ratification or
rejection by the qualified voters thereof, on the 23d of February, 1861. The
legislature of the State, convened in extra session, on the 22d of January,
1861, passed an act ratifying the election of the delegates, chosen in the
irregular manner above mentioned, to the convention. The ordinance of secession
submitted to the people was adopted by a vote of 34,794 against 11,235. The
convention, which had adjourned immediately on passing the ordinance,
reassembled. On the 4th of March, 1861, it declared that the ordinance of
secession had been ratified by the people, and that Texas had withdrawn from
the union of the States under the Federal Constitution. It also passed a
resolution requiring the officers of the State government to take an oath to
support the provisional government of the Confederate States, and providing,
that if
any officer refused to take such
oath, in the manner and within the time prescribed, his office should be deemed
vacant, and the same filled as though he were dead.
On the 16th of March, the convention
passed an ordinance declaring that, whereas the governor and the secretary of
state had refused or omitted to take the oath prescribed, their offices were
vacant; that [p705] the lieutenant-governor should
exercise the authority and perform the duties appertaining to the office of
governor, and that the deposed officers should deliver to their successors in
office the great seal of the State, and all papers, archives, and property in
their possession belonging or appertaining to the State. The convention further
assumed to exercise and administer the political power and authority of the
State.
Thus was established the rebel
government of Texas.
The senators and representatives of
the State in Congress now withdrew from that body at Washington. Delegates were
sent to the Congress of the so-called Confederate States at Montgomery,
Alabama, and electors for a president and vice-president of these States
appointed. War having become necessary to complete the purposed destruction by
the South of the Federal government, Texas joined the other Southern States,
and made war upon the United States, whose authority was now recognized in no
manner within her borders. The oath of allegiance of all persons exercising
public functions was to both the State of Texas, and to the Confederate States
of America, and no officer of any kind representing the United States was
within the limits of the State except military officers, who had been made
prisoners. Such was and had been for several months the condition of things in
the beginning of 1862.
On the 11th of January, of that
year, the legislature of the usurping government of Texas passed an act --
"to provide arms and ammunition, and for the manufacture of arms and
ordnance for the military defences of the State." And by it created a
"military board," to carry out the purpose indicated in the title.
Under the authority of this act, military forces were organized.
On the same day, the legislature
passed a further act, entitled "An act to provide funds for military
purposes," and therein directed the board, which it had previously
organized,
to dispose of any
bonds and coupons which may be in the treasury on any account, and use such
funds or their proceeds for the defence of the State;
and passed an additional act repealing
the act [p706] which made an indorsement of the
bonds by the governor of Texas necessary to make them available in the hands of
the holder.
Under these acts, the military
board, on the 12th January, 1865, a date at which the success of the Federal
arms seemed probable, agreed to sell to White & Chiles one hundred and
thirty-five of these bonds, then in the treasury of Texas, and seventy-six others
deposited with certain bankers in England, in payment for which White &
Chiles were to deliver to the board a large quantity of cotton cards and
medicines. The former bonds were delivered to White & Chiles on the 15th
March following, none of them being indorsed by any governor of Texas.
It appeared that, in February,
1862, after the rebellion had broken out, it was made known to the Secretary of
the Treasury of the United States, in writing, by the Hon. G. W. Paschal, of
Texas, who had remained constant to the Union, that an effort would be made by
the rebel authorities of Texas to use the bonds remaining in the treasury in
aid of the rebellion, and that they could be identified, because all that had
been circulated before the war were indorsed by different governors of Texas.
The Secretary of the Treasury acted on this information, and refused in general
to pay bonds that had not been indorsed. On the 4th of October, 1865, Mr.
Paschal, as agent of the State of Texas, caused to appear in the money report and
editorial of the New York Herald, a notice of the transaction between the rebel
government of Texas and White & Chiles, and a statement that the treasury
of the United States would not pay the bonds transferred to them by such
usurping government. On the 10th October, 1865, the provisional governor of the
State published in the New York Tribune, a "Caution to the Public,"
in which he recited that the rebel government of Texas had, under a pretended
contract, transferred to White & Chiles "one hundred and thirty-five
United States Texan indemnity bonds, issued January 1, 1851, payable in
fourteen years, of the denomination of $1,000 each, and coupons attached
thereto to the amount of $1,287.50, amounting in the aggregate, bonds and
coupons, to the sum of $156,287.50." [p707] His
caution did not specify, however, any particular bonds by number. The caution
went on to say that the transfer was a conspiracy between the rebel governor
and White & Chiles to rob the State treasury, that White & Chiles had
never paid the State one farthing, that they had fled the State, and that these
facts had been made known to the Secretary of the Treasury of the United
States. And
a protest was filed with him by Mr.
Paschal, agent of the State of Texas, against the payment of the said bonds and
coupons unless presented for payment by proper authority.
The substance of this notice, it
was testified, was published in money articles of many of the various
newspapers of about that date, and that financial men in New York and other places
spoke to Mr. Paschal, who had caused it to be inserted in the Tribune, about
it. It was testified also, that after the commencement of the suit, White &
Chiles said that they had seen it.
The rebel forces being disbanded on
the 25th May, 1865, and the civil officers of the usurping government of Texas
having fled from the country, the President, on the 17th June, 1865, issued his
proclamation appointing Mr. A. J. Hamilton, provisional governor of the State;
and directing the formation by the people of a State government in Texas.
Under the provisional government
thus established, the people proceeded to make a constitution, and reconstruct
their State government.
But much question arose as to what
was thus done, and the State was not acknowledged by the Congress of the United
States as being reconstructed. On the contrary, Congress passed, in March,
1867, three certain acts known as the Reconstruction Acts. By the first of
these, reciting that no legal State governments or adequate protection for life
or property then existed in the rebel States of Texas, and nine other States
named, and that it was necessary that peace and good order should be enforced
in them until loyal and republican State governments could be legally
established, Congress divided the States named into five military districts
(Texas with Louisiana being the fifth), and made it the duty [p708]
of the President to assign to each an officer of the army, and to detail a
sufficient military force to enable him to perform his duties and enforce
authority within his district. The act made it the duty of this officer to
protect all persons in their rights, to suppress insurrection, disorder,
violence, and to punish, or cause to be punished, all disturbers of the public
peace and criminals, either through the local civil tribunals or through
military commissions, which the act authorized. It provided, further, that
when the people of any one of these States had formed a constitution in
conformity with that of the United States, framed in a way which the statute
went on to specify, and when the State had adopted a certain article of
amendment named, to the Constitution of the United States, and when such
article should have become a part of the Constitution of the United States,
then that the States respectively should be declared entitled to representation
in Congress, and the preceding part of the act become inoperative, and that,
until they were so admitted, any civil governments which might exist in them
should be deemed provisional only, and subject to the paramount authority of
the United States, at any time to abolish, modify, control, or supersede them.
A State convention of 1866 passed
an ordinance looking to the recovery of these bonds, and, by act of October of
that year, the governor of Texas was authorized to take such steps as he might
deem best for the interests of the State in the matter, either to recover the
bonds or to compromise with holders. Under this act, the governor appointed an
agent of the State to look after the matter.
It was in this state of things,
with the State government organized in the manner and with the status above
mentioned, that this present bill was directed by this agent to be filed.
The bill was filed by Mr. R. T.
Merrick and others, solicitors in this court, on behalf of the State, without
precedent written warrant of attorney. But a letter from J. W. Throckmorton,
elected governor under the constitution of 1866, ratified their act, and
authorized them to prosecute [p709] the suit. Mr. Paschal,
who now appeared with the other counsel, in behalf of the State, had been
appointed by Governor Hamilton to represent the State, and Mr. Pease, a
subsequent governor, appointed by General Sheridan, commander under the
reconstruction acts, renewed this appointment.
The bill set forth the issue and
delivery of the bonds to the State, the fact that they were seized by a
combination of persons in armed hostility to the government of the United
States, sold by an organization styled the military board, to White & Chiles,
for the purpose of aiding the overthrow of the Federal government; that White
& Chiles had not performed what they agreed to do. It then set forth that
they had transferred such and such numbers, specifying them, to Hardenberg, and
such and such others to Birch, Murray & Co., &c.; that these transfers
were not in good faith, but were with express notice on the part of the
transferees of the manner in which the bonds had been obtained by White &
Chiles; that the bonds were overdue at the time of the transfer; and that they
had never been indorsed by any governor of Texas. The bill interrogated the
defendants about all these particulars; requiring them to answer on oath, and,
as already mentioned, it prayed an injunction against their asking, or
receiving payment from the United States, that the bonds might be delivered to
the State of Texas, and for other and further relief.
As respected White & Chiles,
who had now largely parted with the bonds, the case rested much upon what
precedes, and their own answers.
The answer of CHILES, declaring
that he had none of the bonds in his possession, set forth:
1. That there was no sufficient
authority shown to prosecute the suit in the name of Texas.
2. That Texas by her rebellious
courses had so far changed her status, as one of the United States, as
to be disqualified from suing in this court.
3. That whether the government of
Texas, during the term in question, was one de jure or de facto,
it had authorized the [p710] military board to act for it,
and that the State was estopped from denying its acts.
4. That no indorsement of the bonds
was necessary, they having been negotiable paper.
5. That the articles which White
& Chiles had agreed to give the State, were destroyed in transitu by
disbanded troops who infested Texas, and that the loss of the articles was
unavoidable.
The answer of WHITE went over some
of the same ground with that of Chiles. He admitted, however,
that he was informed and believed
that, in all cases where any of the bonds were disposed of by him, it was known
to the parties purchasing for themselves, or as agents for others, that
there was some embarrassment in obtaining payment of said bonds at the treasury
of the United States, arising out of the title of this respondent and his
co-defendant Chiles.
As respected HARDENBERG, the case
seemed much thus:
In the beginning of November, 1866,
after the date of the notices given through Mr. Paschal, one Hennessey,
residing in New York, and carrying on an importing and commission business,
then sold to Hardenberg thirty of these bonds, originally given to White and
Chiles; and which thirty, a correspondent of his, long known to him, in
Tennessee, had sent to him for sale. Hardenberg bought them "at the rate
of 1.20 for the dollar on their face," and paid for them. Hennessey had
heard from somebody that there was
some difficulty about the bonds' being paid at the treasury, but did not
remember whether he heard that before or after the sale.
Hardenberg also bought others of
these bonds near the same time, at 1.15 percent, under circumstances thus
testified to by Mr. C. T. Lewis, a lawyer of New York:
In conversation with Mr.
Hardenberg, I had learned that he was interested in the Texas indemnity bonds,
and meditated purchasing same. I was informed in Wall Street that such bonds
were offered for sale by Kimball & Co., at a certain price, which price I
cannot now recollect. I informed Mr. Hardenberg of this fact, and he requested
me to secure the bonds for him at [p711] that price.
I went to C. H. Kimball & Co, and told them to send the bonds to Mr.
Hardenberg's office and get a check for them, which I understand they did. I
remember expressing to Mr. Hardenberg the opinion that these bonds, being on
their face negotiable by delivery, and payable in gold, must, at no distant
day, be redeemed according to their tenor, and were, therefore, a good purchase
at the price at which they were offered.
My impression is that, before this
negotiation, I had read a paragraph in some New York newspaper stating that the
payment of the whole issue of the Texas indemnity bonds was suspended until the
history of a certain portion of the issue, supposed to have been negotiated for
the benefit of the rebel service, should be understood. I am not at all certain
whether I read this publication before or after the date of the transaction. If
the publication was made before this transaction, I had probably read the
article before the purchase was made. My impression is that it was a
paragraph in a money article, but I attributed no great importance to it. I
acted in this matter simply as the friend of Mr. Hardenberg, and received no
commission for my services. I am a lawyer by profession, and not a broker.
Kimball & Co. (the brokers thus
above referred to by Mr. Lewis), testified that they had received the bonds
thus sold, from a firm which they named, "in perfect good faith, and sold
them in like good faith, as we would any other lot of bonds received from a
reputable house." It appeared, however, that, in sending the bonds to
Kimball & Co. for sale, the firm had requested that they might not be known
in the transaction.
Hardenberg's own account of the
matter, as declared by his answer, was thus:
That he was a merchant in the city
of New York; that he purchased the bonds held by him in open market in said
city; that the parties from whom he purchased the same were responsible
persons, residing and doing business in said city; that he purchased of McKim,
Brothers & Co., bankers in good standing in Wall Street, one bond at 1.15
percent, on the 6th of November, 1866, when gold was at the rate of $1.47 1/4,
and declining; that when he purchased the same, he made no inquiries of [p712] McKim, Brothers & Co., but took the bonds
on his own observation of their plain tenor and effect at what he conceived to
be a good bargain; that afterwards, and before the payment of said bonds and
coupons by the Secretary of the Treasury, and at the request of the
Comptroller, Hon. R. W. Tayler, he made inquiry of said firm of McKim, Brothers
& Co., and they informed him that said bonds and coupons had been sent to
them to be sold by the First National Bank of Wilmington, North Carolina; that
he purchased on the 8th of November, 1866, thirty of said bonds, amounting to
the sum of $32,475, of J. S. Hennessey, 29 Warren Street, New York City, doing
business as a commission merchant, who informed him that, in the way of
business, they were sent him by Hugh Douglas, of Nashville, Tennessee; that he
paid at the rate of 120 cents at a time, to-wit, the 8th of November, 1866,
when gold was selling at 146 and declining; that the three other bonds were
purchased by him on the 8th of November, 1866, of C. H. Kimball & Co., 30
Broad Street, brokers in good standing, who informed him, on inquiry
afterwards, that said bonds were handed them to be sold by a banking house in
New York of the highest respectability, who owned the same, but whose names
were not given, as the said firm informed him they could "see no reason
for divulging private transactions," and that he paid for last-mentioned
bonds at the rate of 120 cents, on said 8th day of November, 1866, when gold
was selling at 146 and declining.
Further answering, he saith that he
had no knowledge at the time of said purchase that the bonds were obtained from
the State of Texas, or were claimed by the said State; that he acted on
information obtained from the public report of the Secretary of the Treasury,
showing that a large portion of similar bonds had been redeemed, and upon his
own judgment of the nature of the obligation expressed by the bonds themselves,
and upon his own faith in the full redemption of said bonds, and he averred
that he had no knowledge of the contract referred to in the bill of complaint,
nor of the interest or relation of White & Chiles, nor of any connection
which they had with said complainant, or said bonds, nor of the law of the
State of Texas requiring indorsement.
The answer of White mentioned, in
regard to Hardenberg's bonds, that they were sold by his (White's) broker; [p713] that he, White, had no knowledge of the name of the
real purchaser, who, however, paid 115 percent for them;
that, at the time of the sale, his
(White's) broker informed him that the purchaser, or the person acting for the
purchaser, did not want any introduction to the respondent, and required no
history of the bonds proposed to be sold; that he only desired that they should
come to him through the hands of a loyal person who had never been identified
with the rebellion.
Another matter, important possibly
in reference to the relief asked by the bill, and to the exact decree [n3] made,
should, perhaps, be mentioned about these bonds of Hardenberg.
The answer of Hardenberg stated,
that,
on the 16th of February, 1867, the
Secretary of the Treasury ordered the payment to the respondent of all said
bonds and coupons, and the same were paid on that day.
This was literally true, and the
books of the treasury showed these bonds as among the redeemed bonds, and
showed nothing else. As a matter of fact, it appeared that the agents of Texas,
on the one hand, urging the government not to pay the bonds, and the holders,
on the other, pressing for payment -- it being insisted by these last that the
United States had no right to withhold the money, and thus deprive the holder
of the bonds of interest -- the Controller of the Treasury, Mr. Tayler, made a
report, on the 29th of January, 1867, to the Secretary of the Treasury in which
he mentioned that it seemed to be agreed by the agents of the State that her
case depended on her ability to show a want of good faith on the part of the
holders of bonds, and that he had stated to the agents that, as considerable delay
had already been incurred, he would, unless during the succeeding week they
took proper legal steps against the holders, feel it his duty to pay such bonds
as were unimpeached in title in the holders' hands. He accordingly recommended
to the secretary payment of Hardenberg's and of some others. The agents, on the
same day that the controller made his report, [p714] and
after he had written most of it, informed him that they would take legal
proceedings on behalf of the State, and were informed in turn that the report
would be made on that day, and would embrace Hardenberg's bonds. Two days
afterwards, a personal action was commenced in the name of the State of Texas
against Mr. McCulloch, the then Secretary of the Treasury, for the detention of
the bonds of Hardenberg and others. This action was dismissed February 19th. On
the 15th of the same February, the present bill was filed. On the 16th of the
month, the personal suit against the secretary having at the time, as already
above stated, been withdrawn, and no process under the present bill having
then, nor until the 27th following, been served on Hardenberg, Mr. Tayler,
Controller of the Treasury, and one Cox, the agent of Hardenberg, entered into
an arrangement by which it was agreed that this agent should deposit with Mr.
Tayler government notes known as "seven-thirties," equivalent in
value to the bonds and coupons held by Hardenberg, to be held by Mr. Tayler
as indemnity for Mr. McCulloch,
against any personal damage, loss, and expense in which he may be involved by
reason of the payment of the bonds.
The seven-thirties were then
delivered to Mr. Tayler, and a check in coin for the amount of the bonds and
interest was delivered to Hardenberg's agent. The seven-thirties were
subsequently converted into the bonds called "five-twenties," and
these remained in the hands of Mr. Tayler, being registered in his name as
trustee. The books of the treasury showed nothing in relation to this trust,
nor, as already said, anything more or other than that the bonds were paid to
Hardenberg or his agent.
Next, as respected the bonds of
BIRCH, MURRAY & Co. It seemed in regard to these, that, prior to July,
1855, Chiles, wanting money, applied to this firm, who lent him $5,000 on a
deposit of twelve of the bonds. The whole of the twelve were taken to the
treasury department. The department at first declined to pay them, but finally
did pay [p715] four of them (amounting with the coupons to
$4,900) upon the ground urged by the firm that it had lent the $5,000 to Chiles
on the hypothecation of the bonds and coupons without knowledge of the claim of
the State of Texas, and because the firm was urged to be, and was apparently, a
holder in good faith, and for value, the other bonds, eight in number,
remaining in the treasury, and not paid to the firm, because of the alleged
claim of the State of Texas, and of the allegation that the same had come into
the possession of said White and Chiles improperly, and without consideration.
The difficulty now was less perhaps
about the four bonds than about these eight, whose further history was thus
presented by the answer of Birch, one of the firm, to the bill. He said in this
answer, and after mentioning his getting with difficulty the payment of the
four bonds:
That afterwards, and during the
year 1866, Chiles called upon him with the printed report of the First
Comptroller of the Treasury, Hon. R. W. Tayler, from which it appeared that the
department would, in all reasonable probability, redeem all said bonds; and
requested further advances on said eight remaining bonds, and that the firm
thereupon advanced said Chiles, upon the said eight bonds, from time to time,
the sum of $4,185.25, all of which was due and unpaid. That he made the said
advances as well upon the representations of said Chiles that he was the bona
fide holder of said bonds and coupons, as upon his own observation and knowledge
of their legal tenor and effect; and of his faith in the redemption thereof by
the government of the United States.
The answer said further, that:
At the time of the advances first
made, the firm had no knowledge of the contract referred to in the bill, nor of
the interest or connection of said White & Chiles with the complainant, nor
of the law of the State of Texas referred to in the bill passed December 16,
1851; and that the bonds were taken in good faith.
It appeared further, in regard to
the whole of these bonds, [p716] that, in June, 1865,
Chiles, wanting to borrow money of one Barret, and he, Barret, knowing Mr.
Hamilton, just then appointed provisional governor, but not yet installed into
office, nor apparently as yet having the impressions which he afterwards, by
his caution, made public, went to him, supposing him well acquainted with the
nature of these bonds, and sought his opinion as to their value, and as to
whether they would be paid. Barret's testimony proceeded:
He advised me to accept the
proposition of Chiles, and gave it as his opinion that the government would
have to pay the bonds. I afterwards had several conversations with him on the
subject, in all of which he gave the same opinion. Afterwards (I cant't
remember the exact time), Mr. Chiles applied to Birch, Murray & Co. for a
loan of money, proposing to give some bonds as collateral security, and, at his
request, I went to Birch, Murray & Co. and informed them of my
conversations with Governor Hamilton, and of his opinion as expressed to me.
They then seemed willing to make a loan on the security offered. In order to
give them further assurance that I was not mistaken in my report of Governor
Hamilton's opinion verbally expressed, I obtained from him a letter [letter
produced]. It reads thus:
NEW YORK, June 25th, 1865.
HON. J. R. BARRET.
DEAR SIR: In reply to your question
about Texas indemnity bonds issued by the U.S., I can assure you that they are
perfectly good, and the gov't will certainly pay them to the holders.
Yours truly,
A. J. HAMILTON
The witness
mentioned the conversations had
with Governor Hamilton, and also spoke of the letter, and sometimes read it to
various parties, some of whom were dealing in these bonds,
and, as he stated, had "reason
to believe that Governor Hamilton's opinion in regard to the bonds became
pretty generally known among dealers in such paper." The witness, however,
did not know Mr. Hardenberg.
The questions, therefore, were:
1. A minor preliminary one: the
question presented by Chiles's answer as to whether sufficient authority was
shown [p717] for the prosecution of the suit in the name
and in behalf of Texas.
2. A great and principal one: a
question of jurisdiction, viz., whether Texas, at the time of the bill
filed or now, was one of the United States of America, and so competent to file
an original bill here.
3. Assuming that she was, a
question whether the respective defendants, any, all, or who of them, were
proper subjects for the injunction prayed, as holding the bonds without
sufficient title, and herein -- and more particularly as respected Hardenberg,
and Birch, Murray & Co. -- a question of negotiable paper, and the extent
to which holders, asserting themselves holders bona fide and for value,
of paper payable "to bearer," held it discharged of precedent
equities.
4. A question as to the effect of
the payments, at the treasury, of the bonds of Hardenberg and of the four bonds
of Birch, Murray & Co.
Confederate States of America - A
Declaration of the Causes which Impel the State of Texas to Secede from the
Federal Union
The government of the
United States, by certain joint resolutions, bearing date the 1st day of March,
in the year A.D. 1845, proposed to the Republic of Texas, then a free,
sovereign and independent nation, the annexation of the latter to the
former, as one of the co-equal states thereof, The people of Texas, by deputies in convention assembled, on the fourth day of July of the same year, assented to and accepted said proposals and formed a constitution for the proposed State, upon which on the 29th day of December in the same year, said State was formally admitted into the Confederated Union.
Texas abandoned her separate national existence and consented to become one of the Confederated Union to promote her welfare, insure domestic tranquility and secure more substantially the blessings of peace and liberty to her people. She was received into the confederacy with her own constitution, under the guarantee of the federal constitution and the compact of annexation, that she should enjoy these blessings. She was received as a commonwealth holding, maintaining and protecting the institution known as negro slavery-- the servitude of the African to the white race within her limits-- a relation that had existed from the first settlement of her wilderness by the white race, and which her people intended should exist in all future time. Her institutions and geographical position established the strongest ties between her and other slave-holding States of the confederacy. Those ties have been strengthened by association. But what has been the course of the government of the United States, and of the people and authorities of the non-slave-holding States, since our connection with them?
The controlling majority of the Federal Government, under various pretences and disguises, has so administered the same as to exclude the citizens of the Southern States, unless under odious and unconstitutional restrictions, from all the immense territory owned in common by all the States on the Pacific Ocean, for the avowed purpose of acquiring sufficient power in the common government to use it as a means of destroying the institutions of Texas and her sister slaveholding States.
By the disloyalty of the Northern States and their citizens and the imbecility of the Federal Government, infamous combinations of incendiaries and outlaws have been permitted in those States and the common territory of Kansas to trample upon the federal laws, to war upon the lives and property of Southern citizens in that territory, and finally, by violence and mob law, to usurp the possession of the same as exclusively the property of the Northern States.
The Federal Government, while but partially under the control of these our unnatural and sectional enemies, has for years almost entirely failed to protect the lives and property of the people of Texas against the Indian savages on our border, and more recently against the murderous forays of banditti from the neighboring territory of Mexico; and when our State government has expended large amounts for such purpose, the Federal Government has refuse reimbursement therefor, thus rendering our condition more insecure and harassing than it was during the existence of the Republic of Texas.
These and other wrongs we have patiently borne in the vain hope that a returning sense of justice and humanity would induce a different course of administration.
When we advert to the course of individual non-slave-holding States, and that a majority of their citizens, our grievances assume far greater magnitude.
The States of Maine, Vermont, New Hampshire, Connecticut, Rhode Island, Massachusetts, New York, Pennsylvania, Ohio, Wisconsin, Michigan and Iowa, by solemn legislative enactments, have deliberately, directly or indirectly violated the 3rd clause of the 2nd section of the 4th article [the fugitive slave clause] of the federal constitution, and laws passed in pursuance thereof; thereby annulling a material provision of the compact, designed by its framers to perpetuate the amity between the members of the confederacy and to secure the rights of the slave-holding States in their domestic institutions-- a provision founded in justice and wisdom, and without the enforcement of which the compact fails to accomplish the object of its creation. Some of those States have imposed high fines and degrading penalties upon any of their citizens or officers who may carry out in good faith that provision of the compact, or the federal laws enacted in accordance therewith.
In all the non-slave-holding States, in violation of that good faith and comity which should exist between entirely distinct nations, the people have formed themselves into a great sectional party, now strong enough in numbers to control the affairs of each of those States, based upon an unnatural feeling of hostility to these Southern States and their beneficent and patriarchal system of African slavery, proclaiming the debasing doctrine of equality of all men, irrespective of race or color-- a doctrine at war with nature, in opposition to the experience of mankind, and in violation of the plainest revelations of Divine Law. They demand the abolition of negro slavery throughout the confederacy, the recognition of political equality between the white and negro races, and avow their determination to press on their crusade against us, so long as a negro slave remains in these States.
For years past this abolition organization has been actively sowing the seeds of discord through the Union, and has rendered the federal congress the arena for spreading firebrands and hatred between the slave-holding and non-slave-holding States.
By consolidating their strength, they have placed the slave-holding States in a hopeless minority in the federal congress, and rendered representation of no avail in protecting Southern rights against their exactions and encroachments.
They have proclaimed, and at the ballot box sustained, the revolutionary doctrine that there is a 'higher law' than the constitution and laws of our Federal Union, and virtually that they will disregard their oaths and trample upon our rights.
They have for years past encouraged and sustained lawless organizations to steal our slaves and prevent their recapture, and have repeatedly murdered Southern citizens while lawfully seeking their rendition.
They have invaded Southern soil and murdered unoffending citizens, and through the press their leading men and a fanatical pulpit have bestowed praise upon the actors and assassins in these crimes, while the governors of several of their States have refused to deliver parties implicated and indicted for participation in such offenses, upon the legal demands of the States aggrieved.
They have, through the mails and hired emissaries, sent seditious pamphlets and papers among us to stir up servile insurrection and bring blood and carnage to our firesides.
They have sent hired emissaries among us to burn our towns and distribute arms and poison to our slaves for the same purpose.
They have impoverished the slave-holding States by unequal and partial legislation, thereby enriching themselves by draining our substance.
They have refused to vote appropriations for protecting Texas against ruthless savages, for the sole reason that she is a slave-holding State.
And, finally, by the combined sectional vote of the seventeen non-slave-holding States, they have elected as president and vice-president of the whole confederacy two men whose chief claims to such high positions are their approval of these long continued wrongs, and their pledges to continue them to the final consummation of these schemes for the ruin of the slave-holding States.
In view of these and many other facts, it is meet that our own views should be distinctly proclaimed.
We hold as undeniable truths that the governments of the various States, and of the confederacy itself, were established exclusively by the white race, for themselves and their posterity; that the African race had no agency in their establishment; that they were rightfully held and regarded as an inferior and dependent race, and in that condition only could their existence in this country be rendered beneficial or tolerable.
That in this free government all white men are and of right ought to be entitled to equal civil and political rights; that the servitude of the African race, as existing in these States, is mutually beneficial to both bond and free, and is abundantly authorized and justified by the experience of mankind, and the revealed will of the Almighty Creator, as recognized by all Christian nations; while the destruction of the existing relations between the two races, as advocated by our sectional enemies, would bring inevitable calamities upon both and desolation upon the fifteen slave-holding states.
By the secession of six of the slave-holding States, and the certainty that others will speedily do likewise, Texas has no alternative but to remain in an isolated connection with the North, or unite her destinies with the South.
For these and other reasons, solemnly asserting that the federal constitution has been violated and virtually abrogated by the several States named, seeing that the federal government is now passing under the control of our enemies to be diverted from the exalted objects of its creation to those of oppression and wrong, and realizing that our own State can no longer look for protection, but to God and her own sons-- We the delegates of the people of Texas, in Convention assembled, have passed an ordinance dissolving all political connection with the government of the United States of America and the people thereof and confidently appeal to the intelligence and patriotism of the freemen of Texas to ratify the same at the ballot box, on the 23rd day of the present month.
Adopted in Convention on the 2nd day of Feby, in the year of our Lord one thousand eight hundred and sixty-one and of the independence of Texas the twenty-fifth.
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