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On motion two hundred and forty copies of the report of the Committee on Incorporations were ordered printed for distribution.
As shown by the certificate of the Secretary of the Territory, dated May 21, 1845, the act repealing the charter of the Miners' Bank was presented to the Governor on the 15th of May, and after being retained by him for three days, “was returned to the committee from which it was received, without his signature.” Under these conditions, by the provisions of the Organic Law of the Territory, the act became a law.
(c) Provisions of Bill.
The Judge of the Third Judicial District was authorized to appoint two trustees. These trustees were to have full power to settle up the business of the bank, "to sell and convey the personal and real estate,” and also “to collect and pay the debts.” They were to have authority to sue for and recover any debt or property of the bank in the name of “The Trustees of said Bank;" after paying the debts and necessary expenses they were to divide the money and remaining property among the stockholders.
Provision was made that the trustees should receive in payment for debts due the bank, the bills of the same at their face value. All real estate was to be sold on a credit of four, eight and twelve months with equal payments. The purchasers were to give a mortgage on the property and also a bond with security, which was to be approved by the trustees. If there were any failures to comply with these requirements within two days after the sale, the property, after giving twenty days notice, was again to be sold; if any loss was sustained as a result of this second sale, the first purchaser should pay the deficiency and the costs.
Before entering upon the discharge of their duties, the trustees were to give a bond in such a sum and with such
1 Chapter 31, Laws of the 7th Legislative Assembly of the Territory of Iowa.
security as should be approved by the Judge of the Third Judicial District; and were to be held “jointly and severally responsible to the creditors and the stockholders of said bank to the extent of the property and the effects of the said bank as shall come into their hands."
Any suits pending in the courts of the Territory, of which the bank was a party, should not be discontinued or in any way effected” by the repeal of the charter, but were to be prosecuted to a final termination by the trustees.
The trustees, on receiving their appointment, were to take possession of the property and make a “complete schedule” of it and file a copy in the office of the clerk of the District Court of “Du Buque” County. The affairs of the bank were to be closed up within a reasonable time, not to exceed two years, unless by special consent of the Judge upon the showing of a good cause. They were to make a final report to the Judge, and to make such reports from time to time of the condition of their trust as he might require. The amount of their compensation was to be fixed by the Judge. The act was to take effect in twenty days after its passage.
3. Provision for Payment of Debt Due the Miners' Bank by the Territory of Iowa.
On May 21, 1845, Samuel Murdock of Clayton County introduced in the Council a resolution' requiring the Committee on Territorial Affairs to report at an early date how much the Territory is indebted to the Miners' Bank of Dubuque; when the debt was contracted and for what purposes, also as to what means the Territory has for paying the same.
The committee made their report in the form of (No. 55, C. F.) “A Bill to provide for the payment of the debt due to the Miners' Bank of DuBuque.” It was read and referred to the Committee of the Whole, and by them reported back
- Journal of Council, 7th Legislative Assembly of the Territory of Iowa, p. 65.
2 June 4, 1845.
without any amendments, and was finally passed by the Council on June 7th.
The bill as passed by the Council was received in the House and referred to Committee on Judiciary, and was reported back without any amendments on June 9th and sent to the Governor for his signature.
On June 1oth, 1845, this act' was signed, to provide payment for the long past due account of the Miners' Bank of DuBuque against the Territory of Iowa, which had been contracted under the provisions of the act of the 15th of January, 1841.
By this act the Territorial Treasurer was to give a three months' notice, published in at least two papers in the Territory, and in some one paper in St. Louis and Cincinnati, of a public sale of lots belonging to the Territory on the first Monday in May, 1846.
There were to be enough of these lots sold to the highest bid der, upon 6 and 12 months credit, to pay the debt due to the “ Miners' Bank of Du Buque.” The purchasers were to make a bond with sureties to secure these payments, and when they were made the Treasurer was to execute a deed for the lots. As soon as these bonds matured the Territorial Treasurer was to collect them and pay the debt.
This act was to take effect after its passage, which was upon June 10th, 1845.
It will be seen by the provisions of this act that notes given to the bank for money loaned could not be paid at the earliest date possible, before May 1847. Six years after they were given and over four years after the last one was due.
4. Protest Against Provision for Banks in Constitution.
Before the vote was taken on June 2, 1845, upon the “Bill to submit to the people the draft of a Constitution formed by the late convention,” nine members submitted a written pro
Chapter 18, Laws of the Legislative Assembly of the Territory of Iowa, 1845.
test to its passage. The objections as to boundaries were given and a number of others, including that it would prohibit the Legislature from adopting a system of internal improvements, the creation of corporations for manufacturing and other useful purposes, and that no bank could ever be constituted under it.
They admit that there are provisions for the establishment of State banks under certain conditions, but that the very provisions are a “mockery.” The members of the convention must have known that without an alteration of the Constitution "no sane man” would become a stockholder in a bank where he was liable not only to the amount of stock owned, but to an unlimited extent.
But the strongest argument, one that proved to be the true condition of Iowa under the same circumstances later, was that if the citizens of the Territory were deprived of the privileges of banking and the issuing of paper money the inevitable result would be a flood of paper money from the adjoining states of the worth of which but little could be known, and over which the Legislature of this Territory would have no control. It was apprehended that the “annual loss to our citizens” from such a currency would more than exceed the tax necessary to support a State government. “Every tyro in politics knows that the meaner the paper currency, the scarcer will be the precious metals." The adoption of this Constitution would cause an inflow of this depreciated paper money and the consequent disappearance of gold and silver. A little gold and silver would remain, but was sure to become an "article of merchandise," and could be bought of “those consistent advocates of a hard money currency, called brokers or shavers ” at the market price “which even now ranges from twelve to fifty per cent."
1 Journal of House, p. 167 et seq. The persons signing this protest were: Stephen S. Shelleday, Joseph M. Robertson, Richard Noble, James Anderson, Charles Stewart, N. Munger, Hugh D. Downey, Charles Clifton, and S. D. Woodworth.
5. Address by Directors of the Miners' Bank “To the People of Iowa.”
On June 16th, 1845, the directors of the Miners' Bank issued an address? “ To the People of Iowa.” This stated that a concise statement for the information of the public of the past history and present condition of the bank had been made necessary by the “strenuous efforts which some people have made, and are now making, to destroy this institution." It was an able, and in the historical part, a fair statement of the bank's position. The legal position taken by it was proven later to be wrong. It was widely circulated over the State and had a considerable influence upon the minds of the people; but this reaction in its favor came too late to be of any service to the bank.
After summarily disposing of the reasons (or rather, the motives) of the persons who had so long pursued the bank with unrelenting hostility, by the statement that these in no way concerned the conduct or the merits of the bank; it then proceeded to discuss the bank's political history. It stated that the charter was granted by a Democratic Legislature and of the nine commissioners, under whom it went into operation, and who, by the provisions of the act of incorporation, were its directors, “a majority were men whose democracy no man dares question."
It went into operation in 1837 at the inception of a great financial panic which resulted in nearly a complete prostration of the business of the country. Within a year many of the merchants and all the banks in the Mississippi Valley had suspended with one exception. It had suffered with the others; but had sustained itself until 1841, several years after every bank West of the Alleghanies, with the exception noted, had suspended. That in 1842 it resumed and paid out specie until a draft had been protested and was forced to suspend again. The statement is made that the first suspension
1 Executive Document, 1st Sess. 19th Cong., Vol. VIII, 1845-46. Doc. 226, p. 1228.