Statewide County IL Archives Court.....People, V Skinner 1850
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Deb Haines http://www.genrecords.net/emailregistry/vols/00003.html#0000719 May 24, 2008, 12:15 pm

Source: Records Of Cases Illinois
Written: 1850

The People, ex relatione Mark Skinner, v. The Auditor.

Appication for a Mandamus.

It is the duty of the auditor to apportion the proceeds of the two mill tax, 
collected under the provisions of the fifteenth article of the constitution, 
upon such state indebtedness as shall be exhibited to him for the purpose, and 
draw his warrant on the treasury.

This provision of the constitution is complete, and can be executed without 
legislaive aid.

The proceeds of this tax shall be apportioned annually, on the first day of 
January, to the payment of the principal of such of the indebtedness provided 
for, as shall be preseted for that purpose. 

Neither the surplus revenue deposited with the state, by act of congress of 
twenty-third June, 1835, nor interest bonds, are indebtedness, within the 
appropriation of this tax. 

It is not competent for the legislature to direct that any portion of this tax 
shall be reserved for the benefit of such creditors as may fall to present 
their demands on the day named by the constitution. 

So much of the act of the twelfth of February, 1849, as requires that the 
surplus revenue deposited with the state, shall share in the proceeds of this 
tax, is unconstitutional.

This application is grounded upon the following petition: 

"That on the first day of January, A. D. 1851, your petitioner, being the 
legal holder of certain state indebtedness of the state of Illinois, other 
than the canal and school indebtedness of said state, to wit: New internal 
improvement stock, to the amount of one hundred and seventy-one thousand eight 
hundred dollars, did, on said first day of January, present the same to the 
auditor of the state of Illinois, Thomas H. Campbell, Esq., and demanded from 
him payment of the same, or so much thereof as your petitioner would be 
entitled to receive, from all moneys in the treasury of the state of Illinois, 
collected under and by virtue of a tax imposed under and by virtue of the 
fifteenth article of the constitution of the state of Illinois, and under and 
by virtue of the twenty-first section of an act entitled, 'An act to amend the 
several acts concerning the public revenue,' in force February 8, 1840, passed 
in furtherance of said section of the constitution. And your petitioner left 
with said auditor, at the time of making such demand, said state indebtedness, 
for the purpose of having proper credits entered thereon, in obedience with 
the provisions of said fifteenth article of the constitution, and of the said 
law passed in aid thereof. And your petitioner further shows, that on the 
second day of January, A. D. 1851, your petitioner applied to said auditor and 
demanded your petitioner's pro rata portion of all money then in the treasury 
of the state of Illinois, collected under and by virtue of said tax, to which 
the said auditor replied, that he doubted his authority to pay the same, or 
issue his warrant on the treasury therefor, and therefore refused so to do.

"And the said auditor further informed your petitioner, that his excellency, 
A. C. French, the governor of the state of Illinois, had preferred a claim, 
without presenting any legal evidence of indebtedness or vouchor therefor, to 
receive a portion of said tax moneys, upon and on account of some claim in 
favor of the United States, for certain money, amounting to about the sum of 
four hundred and seventy-five thousand dollars, heretofore loaned or deposited 
by the said United States, to or with the state of Illinois; and your 
petitioner further shows, that said governor preferred the said claim without 
any authority from the United States in that behalf, and not for the purpose 
of paying the same to the United States, but solely to use and employ any 
money he might receive on account of said claim, in the purchase of Illinois 
bonds, in manner and form as directed in the first section of 'An act 
concerning the public debt,' in force April 13, 1849.

"And your petitioner would further show, that said auditor informed him that 
certain interest bonds, or bonds given for interest on other state 
indebtedness, and which said interest bonds will and do not bear interest 
until from and after some time in A. D. 1857, have also been presented to said 
auditor for payment as aforesaid.

"And your petitioner further shows, that there is now collected from said tax, 
and in the treasury of the state of Illinois, one hundred and sixty-six 
thousand dollars, or thereabouts, which ought to be distributed and paid over 
to your petitioner and others, in conformity with the requirements of the 
constitution, and the law.

"And your petitioner prays that a writ of mandamus may be issued out of and 
under the seal of this honorable court, directed to said auditor, commanding 
him forthwith to apportion and pay to your petitioner, by his warrants on the 
treasury of the state of Illinois, the amount which your petitioner is 
entitled to receive from said tax money, excluding from the computation and 
apportionment to be made by said auditor, the said pretended claim on behalf 
of the United States, and the said interest bonds."

The answer of the auditor admits that the state indebtedness was presented, 
and that a demand was made on the first and second days of January, as stated 
in the petition, and that payment was refused. Admits also, that Governor 
French, acting under the provisions of an act, entitled "An act concerning the 
public debt," in force April 13, 1849, and with such authority as is solely 
derived from law, has presented a claim, on behalf of the state, for payment 
from the proceeds of said tax, of the amount of the money heretofore loaned by 
the United States to the state of Illinois, under and by virtue of the 
provisions of an act of congress, entitled "An act to regulate the deposits of 
the public money," approved June 23, 1836, and of an act, entitled "An act to 
postpone the fourth installment of deposit with the states," approved October 
2, 1837; or of so much thereof as a pro rata division of the proceeds of said 
tax among the persons presenting claims would pay. And further, that various 
persons have also presented for like payment, various bonds of the state 
issued for the interest that has accrued on the state indebtedness. Admits 
that there is in the treasury about the sum stated in the petition. States 
that he is not advised, whether he is the proper officer to whom such claims 
should be presented for payment, nor does he know that he is empowered to draw 
his warrant on the treasury for the payment of them. Also, that he is not 
advised, whether the claim presented by the governor, nor whether the interest 
bonds, are entitled to payment under the constitution.

An agreement was filed, consenting that if the court should be of opinion that 
the auditor should apportion the money, excluding from the computation the 
claim made by the governor, on account of the deposit fund due the United 
States, as also the interest bonds, or either of them, and that it was the 
duty of the auditor to pay the petitioner his pro rata proportion of said tax 
moneys, then a peremptory mandamus might issue accordingly. The relator made 
the following points in support of his petition:

The fifteenth article of the constitution imposes the tax, and specifically 
directs that the proceeds shall annually, on the first day of January, be 
appropriated and paid pro rata, on all state indebtedness other than the canal 
and school debts, presented on that day, by the holders, and credits shall be 
endorsed thereon, etc.

The twenty-first section of the revenue act of 1840, passed in the very words 
of the constitution, assesses the tax, and makes a specific appropriation of 
the proceeds. The law was unnecessary, but it removes all question as to the 
necessity of legislative action, to give vitality to the constitutional 
provision.

Neither the constitution, nor law in aid thereof, specifically appoints the 
officer or person to whom the claims are to be presented, and by whom the tax 
money should be apportioned and paid. But all general appropriations are paid 
under the order and direction of the auditor, to whom the claimant first 
applies in all cases, where the law does not specifically direct otherwise, 
and who issues his warrant on the treasury to pay, etc. In this case an 
appropriation is made, and the duty of carrying out the appropriation is 
devolved upon the auditor, and as clearly belongs to and is as incumbent on 
his office, as in the case of any appropriation: See R. S., chapter "Auditor 
and Treasurer." Nothing can be clearer than that all claims must be presented 
to the officer whose duty it is to pass upon them.

The constitution and the revenue act, specifically direct that the tax money 
shall be paid in reduction of the principal of the state debt. This 
necessarily and absolutely excludes interest. No one would pretend that 
payment could be made on the interest coupons if presented. An "interest bond" 
is but an amalgamation of several coupons, and is therefore in nowise 
different.

The law, entitled "An act concerning the public debt," in force April 13, 
1849, is clearly opposed to the letter and spirit of the constitution, in 
contemplating an appropriation of the moneys to the benefit of the state and 
not of her creditors, by pretending at the same time, and with the same money, 
to pay the state debt to the United States, and also to buy up the state bonds 
in the market! The legal holder of a debt is the creditor always, and not the 
debtor. In this case, the state attempts to appear as the holder of a debt 
against herself, to the immediate injury of her diligent creditors. But the 
United States deposit money was always considered a donation, made in the 
guise of a loan. And at any rate, the question is conclusively settled against 
the present claim of the state, by act of the twenty-fifth congress, chapter 
1, where it is directly and in terms enacted, that this money "shall remain on 
deposit with the states until otherwise directed by congress." No act altering 
or changing this disposition of the money has since been made, and therefore 
there is no officer or person now authorized by congress to present this 
claim. But again, $355,000 of this money has been by the state merged in the 
school fund, and is part of the school debt, which is in terms excluded by the 
constitution from sharing in the proceeds of the tax. And again, the 
constitution and the law (revenue act), both contemplate the presentation of 
some evidence of indebtedness, on which credits are to bo endorsed, etc. In 
this case, no legal evidence of indebtedness, issued by virtue of any law of 
the state, it pretended to be presented. The state has never executed any such 
evidence of indebtedness to the United States, the United States have no such 
evidence of indebtedness to present, have appointed no agent to present any; 
but on the other hand, congress, by the act above quoted, has in terms 
expressly prohibited the presentation of any such claim, until congress shall 
otherwise direct. 

The objection that no particular first January is named in the law, is 
scarcely worth replying to. It is as plain as a postulate that the law means 
the first of January of every year after a tax shall have been collected. In 
this case the tax money, or a principal portion of it, has been in the 
treasury for more than six months. It is better for the state to apply the 
money on few claims, than on many, and thereby save an immense expense in 
keeping accounts, etc. Suppose the whole debt had been presented. The dividend 
would scarcely have been ten cents on a bond, and the auditor would have 
required an army of clerks to aid him in the matter.

If the above views are correct, then the auditor is the proper officer to whom 
to present the claims. It is his duty to apportion and pay to the legal 
holders of all claims, presentable by the law, that present their claims on 
the first day of January of any year, after a tax shall have been collected 
under the law. That in the present instance the claim preferred by the 
governor on behalf of the United States deposit fund, and the claims presented 
on behalf of interest bonds, must be excluded from the computation and 
apportionment to be made by the auditor; and a writ of mandamus must issue as 
prayed for.

D. L. Gregg, for the respondent:

It is contended on the part of the respondent:

1. That the auditor of public accounts is not entitled by law to make a 
distribution of the proceeds of the tax provided for by the fifteenth article 
of the constitution, or to issue his warrant for the payment of the same or 
any part thereof.

The duties of the auditor are defined by law: R. S., ch. 13, secs. 7, 8. He is 
not authorized to act beyond the settlement of ordinary accounts, unless 
specially directed so to do. His general powers do not extend to the payment 
of moneys belonging to special funds. That this is so regarded is shown by the 
fact that, whenever such funds have been created, special provision is made by 
law for their disbursement. The "interest fund" provided for by the act of 
March 1, 1845, is paid out by the governor: R. S., 600. So also of other 
special funds, as that for the support of the deaf and dumb asylum, the 
hospital for the insane, etc., etc. Had these funds been within the class 
of "accounts" which the auditor is required to take under his charge and 
disburse, such provisions for their payment would have been unnecessary and 
superfluous.

The fifteenth article of the constitution directs the assessment and 
collection of a two mill tax, and provides that the fund so created shall be 
apportioned and paid over, pro rata, on the principal of that portion of the 
state debt not included under the heads of canal and school indebtedness. The 
language of this article is copied into the revenue act of February 8, 1840 
(sec. 21), but no direction is given either in the constitution or law 
specifying the officer by whom such apportionment and payment shall bo made. 
The auditor, as has been already shown, does not possess the requisite power 
for this purpose. If it exists at all, it must be vested in the governor. He 
is bound by the constitution (art. iv, sec. 9) to "take care that the laws be 
faithfully executed," and where the law is silent, as to the officer who shall 
give effect to a specific power, which is required to be executed, the duty 
must fall into his hands.

Therefore, it must be concluded that the petitioner has mistaken his proper 
remedy. He should have made his application for payment to the governor, and 
not to the auditor of public accounts.

2. That the deposit fund is a debt due from the state of Illinois to the 
United States, and, consequently, entitled to share in the pro rata 
distribution of the proceeds of the two mill tax, provided for by the 
fifteenth article of the constitution. It is shown to be a debt, from a 
consideration of the terms on which it was received. On its receipt, 
certificates of deposit were issued to the general government, expressing the 
usual legal obligations, and pledging the faith of the state "for the safe 
keeping and repayment thereof:" U. S. Statutes at Large, vol. 5, p. 55.

The state of Illinois is bound to refund every dollar when congress shall 
require the same to be done: Act of June 23, 1836, and act of October 2, 1847; 
Stat. at Large, pp. 57, 501. The obligation of repayment is not less sacred, 
than in the case of bonds in the hands of individual creditors.

The act of February 12, 1849 (Laws, p. 70), recognizes this obligation, and 
provides for the application of "the annual dividend upon the surplus revenue 
due the general government." This the state has a right to do, as the amount 
is, for the present, under her sole and exclusive control.

If, then, it be established that the amount of surplus revenue deposited with 
the state, under the act of congress above cited, is a valid and subsisting 
debt, due to the United States, it follows conclusively that the proceeds of 
the constitutional tax must be applied upon it pro rata, as in the case of 
other indebtedness.

3. That the proceeds of the two mill tax can be applied only to the 
extinguishment of the principal of the public debt. Hence, interest of every 
kind is excluded, whether liquidated by the issue of interest bonds, or 
otherwise. It is none the less interest because funded. It still retains its 
distinctive character, and must be excluded from a proportional share in the 
proceeds of the tax. It follows, then, that the bonds of this character 
presented for payment, are entitled to no consideration which will place them 
on the footing of the original bonds. They represent merely a portion of the 
interest of the public debt, and stand on an inferior footing.

Treat, C. J. It is the duty of the auditor to apportion the proceeds of the 
two mill tax, assessed and collected under the provisions of the fifteenth 
article of the constitution, among the holders of state indebtedness presented 
for the purpose, and draw warrants on the treasury for the payment of their 
respective shares. He is required to audit the accounts of "all persons 
authorised to receive money out of the treasury, by virtue of any 
appropriation made, or to be made by law, particularly authorizing such 
account;" and "on ascertaining the amount due any person from the treasury, 
the auditor shall grant his warrant on the treasury for the sum due:" R. S., 
ch. 13, secs. 7, 8. This general direction clearly embraces the apportionment 
and distribution of the two mill tax. The fund receivable from this source is 
expressly devoted to a particular object—the payment of the principal of a 
certain portion of the state debt. It is specifically appropriated by the 
constitution, and by the law passed in pursuance thereof: Laws of 1849, p. 
126, sec. 21. But an appropriation by the legislature was unnecessary. The 
provision of the constitution is complete in itself, and can be executed 
without the aid of legislation. Money can only be drawn from the treasury on 
the warrant of the auditor, except where the law has prescribed a different 
mode, as in the case of the interest fund, which is required to be apportioned 
and paid by the executive: R. S., 600. In the absence of any law specially 
designating the officer, by whom the apportionment and distribution of the 
fund in question are to be made, the general provision of the statute clearly 
devolves the duty on the auditor.

The duties of the auditor in respect to this fund are plain and manifest. The 
fifteenth article of the constitution is clear and explicit in its terms. It 
is capable of but one construction. It levies a two mill tax for the specific 
purpose of extinguishing the principal of state indebtedness, except the canal 
and school debts; and directs that the proceeds shall annually be applied pro 
rata on the principal of such of the preferred indebtedness, as shall be 
presented for the purpose. The fund is not to be apportioned generally on the 
preferred indebtedness, but only on such part thereof as shall be exhibited to 
the auditor for payment. It is to be applied exclusively to the reduction and 
discharge of the principal of the indebtedness, and not on account of the 
interest. The auditor has, on the first day of January, in each year, to 
ascertain the amount of the two mill tax actually paid into the treasury, and 
likewise the amount of unpaid principal on such of the preferred indebtedness, 
as shall, on that day, be presented to him for payment; and then to declare a 
dividend on the principal of such indebtedness, so that each holder thereof 
may receive his proportionate share of the fund in the treasury. He must then 
issue a warrant on the treasurer, in favor of each holder, payable out of the 
special fund, and endorse the amount on the bond or other legal evidence of 
the indebtedness, as so much paid thereon on account of the principal.

As before remarked, the proceeds of the tax are to be applied exclusively in 
the satisfaction of the principal of the indebtedness. This is the express 
requirement of the constitution. No portion of the fund can be apportioned and 
paid on account of interest. Interest bonds are necessarily excluded. They 
cannot be considered as principal, within the true intent and meaning of the 
constitutional provision. It would not be contended, that interest coupons 
could be included in the apportionment of the fund. An interest bond is but an 
amalgamation of several coupons into one obligation. The indebtedness, though 
changed in form, still retains iits distinctive features. It is still a part 
of the interest of the public debt, as contradistinguished from the principal. 
The law, authorizing the funding of the interest, shows on its face, that it 
was not the design to convert the interest into principal. The interest bonds 
are not payable, and do not bear interest, until 1857. The chief object of the 
law was to avoid the confusion and inconvenience resulting from the largo 
quantity of coupons, identical in number and amount, and often detached from 
the obligations to which they belonged: Laws of 1847, p. 161. Besides, 
specific provision, however inadequate, had already been made for the payment 
of the interest: R. S., 600. It may possibly be, that interest bonds, after 
their maturity, should be regarded as part of the principal of the public 
debt, and entitled to share in the proceeds of the two-mill tax. But upon that 
question no opinion is now intimated. (a)

Nor can the surplus revenue deposited with this state, under the provisions of 
the act of congress of the twenty-third of June, 1836, be now considered as an 
indebtedness on the part of the state, that can be presented for payment out 
of this fund. It was expressly provided, by the act of congress of the second 
of October, 1837, that the surplus revenue previously  distributed, 
should "remain on deposit with the states, until otherwise directed by 
congress." That act continues in full force. There must, therefore, be some 
affirmative action by congress, before this deposit can be recalled. Until 
such legislation is had, the general government cannot present the 
certificates of deposit, and claim to participate in the distribution of the 
fund in question. The governor is not in any sense the holder of these 
certificates of deposit. If they could be presented for payment, it would be 
the right of the United States, and not of the state, to designate the agent 
to whom the dividend should be paid. The creditor has the option to present 
his debt for payment or not. The state cannot appoint an agent to represent 
its creditors, much less to divert any part of the fund from its intended 
destination. It is not even competent for the legislature to direct a portion 
of the fund to be reserved from the apportionment, for the benefit of 
creditors who may fail to present their demands on the day indicated by the 
constitution. So much of the act of the twelfth of February, 1840, as requires 
the amount of the surplus revenue deposited with the state, to be taken into 
consideration in the apportionment of the proceeds of the two-mill tax, and 
the dividend thereon to be paid to the governor, is a clear and palpable 
violation of the constitution. The legislature might, with equal propriety, 
have directed the whole of this tax to be annually added to the school fund, 
or distributed among the several counties in the state.

Let a peremptory mandamus issue pursuant to the prayer of the petition.

Mandamus awarded. 

------------------
(a) In The People v. Dubois, 19 Ill., 223 (decided December Term, 1837), the 
court held that these interest bonds, after maturity, were entitled to share 
in the proceeds of the two-mill tax.

Additional Comments:
Reports of Cases Determined in the Supreme Court of the State of Illinois from 
November Term, 1850, to June Term, 1851, both inclusive by E. Peck, Counsellor 
at Law. Volume XII. Reprinted from the Original Edition, with Annotations by 
William Gordon McMillan of the Chicago Bar. Callaghan & Company, Chicago, Ill. 
1881.

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