It may be argued, that Ninety One per cent, received in London upon the state Bonds by the addition of the exchange between that place and New York, will realize to the state in New York the par value of the bonds. This circumstance has not escaped the notice of your committee, and they answer:

1. That the addition of the exchange, as proposed, will not bring the sale upon to par: Nine per cent, the present rate of exchange, upon Ninety One dollars, is only Eight dollars, nineteen cents: and this, added to Ninety One dollars, amounts only to $99.19 in New York, for $100, payable in London—leaving the sale more than ⁴/5 of one per cent below par.

2. But the apparent gain by exchange is fallacious. It must be always remembered, that the money is to be repaid in London: that, . . . New York, it will be against us, when we remit them from New York to London: and that, whatever is made by exchange on receiving the loan, will be lost on its repayment. This answer will also apply to any similar gain in exchange, between New York & Illinois.

Again—it may be urged, that the rate of exchange may not continue as it now is; for it is the opinion of some that, by the year 1870, exchange will be in favor of the United State & against London. To this no other reply is necessary, than to say—that the question whether a sale under the present contract be at par or not, is a question of fact, dependant upon circumstances, actually existing, known & ascertained: that the same will be either at par, above, or below, according to these circumstances: and that the question cannot be affected by a contingency which may or may not happen hereafter. Such a contingency will have an influence on the future loss or profit of the transaction: but it has no bearing upon the question now under consideration, which be must decided,

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solely with reference to the present, known and certain, condition of things.

Lastly, some may suggest, that Mess^rs Wright & Co may probably sell the bonds at a higher rate than Ninety One per cent, perhaps even at the nominal and true par in London. This cannot alter the question. The law forbids a sale to be made for less than par: the contract authorises Mess^rs Wright & Co to sell at 9 percent below par, or at any better price to be had: the contract is therefore in violation of the law. And whether Mess^rs Wright & Co sell at 91, or 100, or 109—the authority, given him by the contract, to sell at 91, exceeds that conferred by the law upon the agents themselves.

Your committee omit to notice the unusual powers conferred upon Mess^rs Wright & Co, and the extensive discretion allowed them, by this contract. They conclude, with the expression of their opinion, made up from a deliberate review of all the features of the case, that the contract in question does authorize a sale to be made of the state Bonds “at less than their par value”: and that therein it exceeds the powers granted to the agents, who entered into said contract on the part of this state, and violates the law under which they acted.

Therefore be it resolved by the House of Representative the Senate concurring herein that the said contract is unauthorised by law and void and that we will not ratify the same

Resolved further that his excellency the Governor be requested to revoke the appointments of the Honorable Richard Martin Young and John Reynolds as agents to negotiate loans for canal purposes and that he forthwith notify Messrs Wright & C of the refusal of the state to agree

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to said contract and that he forbear altogether to sell any of the State bonds deposited with him by said agents in pursuance of said contracts