Opinion of the court.

On the 3d of March, 1873, another act was passed, entitled "An Act to raise revenue," and by its terms the taxes therein levied were applied to defray the expenses of the State government, and to pay the appropriations for charitable and penal institutions. A similar act, with similar application of the funds to be raised, was passed in 1874.

The plaintiff is the holder of certain of the bonds issued to the above-named railroad company, on which no interest has been paid, and in this bill he asks that the treasurer may be restrained from the payment of any moneys out of the treasury of the State, until he has replaced the $122,091.13, borrowed by him from the special tax fund, applicable to the payment of the interest on the bonds issued to the said company.

The facts are all admitted by the pleadings, and the simple question presented for our determination is whether upon such facts the relief asked for can be granted.

The use of the special tax fund to pay the general expenses of the State government was in violation of the Constitution and therefore unlawful, but the wrong, if any exists, has been done. We are not called upon to prevent the act, but to relieve against its consequences. The first, upon a proper application made in time, we might have done. The question now is, whether, upon this application, the latter is within our power.

The treasurer is a public officer. His office belongs to the executive department of the State. His duty is to execute the laws, not to make them. He, within his official sphere, carries into effect the will of the legislature, and can only do what the law permits.

The courts will not by mandamus compel a public officer to do that which the law does not authorize. Neither will they restrain him from doing that which the law requires. An unconstitutional law is no law, and the court will, when properly called upon, restrain its execution, because it cannot authorize. action by any one. It is for this reason that the wrongful application of this money might have been prevented. The law directing it being unconstitutional, conferred no authority upon the treasurer to do what was required. It is quite another thing, however, to compel him in his official capacity to substitute

Opinion of the court.

other moneys now in the treasury for that which he has improperly used.

That in substance is what we are called upon to do in this case. True, the form of the prayer is that the treasurer be restrained from paying out money from the treasury, but the real object is to compel him to retain in the treasury an amount equal to that which he has misapplied. This requires a refusal by the treasurer to pay the orders drawn upon him by the proper authorities pursuant to law. He is but the custodian of the public money. He has no discretion as to its use. It is held to be paid out and appropriated as the law directs.

The immediate question for our determination, therefore, is not whether the State should provide the means and require the treasurer to replace this fund, but whether it has so done. When the order to use the $150,000 was made, the treasurer was authorized to replace it out of the first money which came into the treasury by way of dividends or taxes. When that of the $200,000 was ordered, he was authorized to replace it from dividends and taxes for general purposes. The Revenue Act of 1871, however, expressly prohibited him from using for that purpose any money collected under its authority. The acts of 1873 and 1874 do not contain any such express prohibition, but they each direct that the taxes levied shall be applied to defray the expenses of the State government and to pay appropriations for charitable and penal institutions. This is the statement of the special object to which the tax is to be applied, required to be made in every law levying taxes, and the Constitution expressly prohibits its application to any other. While, therefore, the law does not prohibit the reimbursement of the special tax fund out of the money raised under its authority, the Constitution does. The expenses on account of which the money was taken from the fund, have already been paid with the money of the State. It is true the money paid ought not to have been so used, but it was none the less on that account the money of the State. The bondholders might, perhaps, if the money still remained in the treasury, compel its application to the payment of the interest on their bonds, but until so applied it did not become their property, and remains that of the State.

Syllabus.

It is not claimed that there is now any money in the treasury, except that which has been collected from taxes levied under the revenue laws of 1873 and 1874, and it is clear to our minds that there is no existing law which requires or even authorizes the treasurer to reimburse the special fund from that. The State may be under obligation to provide for such reimbursement, but the State and the treasurer occupy different positions. The State is the debtor, and is bound by its pledge of faith to provide means and pay its debts. The treasurer is but an agent of the State, bound only to pay its debts when required to do so by a valid law. If such a law exists, and he refuses to act, a proper court will by mandamus compel him to perform his duty. If he threatens to divert money appropriated for the payment of a debt, on proper application he may be restrained. But to authorize interference in either case, it must clearly appear that he wrongfully refuses to execute a valid law, which has been enacted by the legislative department for his guidance. The court cannot make laws for him. It can only compel him to execute such as have been made.

As there is therefore no money in the treasury which the treasurer is authorized or required by any existing law to appropriate for the reimbursement of the special tax fund, we cannot restrain him from paying out the funds in his hands until the reimbursement has been made. The principal in this case cannot be reached through the agent now before the court.

The bill is dismissed with costs.

United States Circuit Court, Eastern District of Virginia.

RICHARDS et al. v. THE CHESAPEAKE AND OHIO
RAILROAD COMPANY.

Secured creditors cannot dictate who shall be appointed a receiver. He is the hand of the court, and the interest of crediters of every grade will be considered in making the appointment.

Statement of the case.

A bill will be dismissed as to a subsequent mortgagee to the mortgagee in suit, he having been made a party to the litigation, and it being found that that hindered or defeated the suit.

Where trustees under a mortgage, of whom it is alleged in the bill for a foreclosure that they had refused to proceed to realize on the security, apply to come in and have been admitted as complainants in the bill, they must control the proceeding.

IN equity.

The Chesapeake and Ohio Railroad Company, a consolidated company, the component parts of which were the Virginia Central Railroad Company, the Blue Ridge Railroad Company, and the Covington and Ohio Railroad Company, became insolvent. There are secured and unsecured creditors of the road. The secured debts are:

A mortgage, dated April 1st, 1850, of the Virginia Central Railroad Company of all its property, to the Board of Public Works of Virginia for $100,000, to secure the payment of certain bonds of the company which are due and unpaid. A mortgage, dated June 2d, 1854, to James Lyons, William H. McFarland, and Hugh W. Fry, of the same company, of all its property, to secure the payment of other bonds of the company, amounting to $1,500,000, which are also due and unpaid. A mortgage, dated February 6th, 1866, of the same company, of all its property, to John B. Young and Robert R. Howison, to secure the bonds of the company for $300,000, with interest at eight per cent. per annum, which remain unpaid. A mortgage, dated October 1st, 1868, of all the railroads which form the Chesapeake and Ohio Railroad Company, to William Butler Duncan, Philo C. Calhoun, William Orton, and Matthew F. Maury (now deceased), to secure certain liabilities, in amount unascertained, of the Virginia Central Railroad Company. A mortgage, dated January 15th, 1870, executed to William Butler Duncan and Philo C. Calhoun, the trustees complainant, by the Chesapeake and Ohio Railroad Company, for $15,000,000, to secure the bonds now in suit. And. a mortgage dated subsequently to January 15th, 1870, executed to Philo C. Calhoun and William K. Kitchen, of all the property mentioned in the last preceding mortgage, and embracing also that portion of the line of road extending

Opinion of the court.

from Richmond down to the peninsula of the York and James Rivers, and the branch railroad from Scary Creek in West Virginia, to the mouth of the Kanawha, and the bridge to be erected over the Ohio at Huntington.

BOND, J.-On the 4th day of October, 1875, the complainants filed their bill in this court, in behalf of themselves and all others in like interest, alleging that they were the holders of certain of the six per cent. coupon bonds issued by the defendant, to the extent of $15,000,000, for the completion of their road from Richmond to the Ohio River. That the payment of these bonds, and the interest thereon accruing, was secured by what was claimed to be the first mortgage on said road, which mortgage was duly executed by defendant on the 15th day of January, 1870, and conveyed to William Butler Duncan and Philo C. Calhoun, citizens of New York, as trustees, all the franchises and property of said company then constructed, or thereafter to be constructed or acquired by the defendant.

The bill alleged that the company had made default in the payment of the interest on these bonds since the 1st day of November, 1873, and that complainants had required the trustees, Duncan and Calhoun, to foreclose the mortgage above referred to for the benefit of the bondholders named therein, with the proper offer of indemnity to them for expenses, and that they had failed and refused to institute proceedings therefor.

The bill concluded with an allegation of the total insolvency of the defendant, and with the ordinary prayer for an injunction and receiver, restraining the trustees and defendant corporation from disposing of the mortgaged premises without the order of this court, and for a sale and distribution of the proceeds among the bondholders, according to their respective priorities.

This bill, properly verified, being exhibited, the court ordered the motion for an injunction and receiver to be set for hearing on the 22d day of October following, provided a copy thereof, and of that order, was served on the defendant on or before the 7th day of October, 1875, and in the meantime, until the hearing of the motion, restrained the defendants from disposing of the mortgaged property, except in the ordinary way of the business