State Codes and Statutes
Statutes > Vermont > Title-24 > Chapter-119 > 4652
§ 4652. Waiver of defenses; rights of holder
On the sale and issuance of any municipal bonds or revenue bonds to the bank by any governmental unit, that governmental unit is deemed to agree that on the failure of that governmental unit to pay interest or principal on any of the municipal bonds or revenue bonds owned or held by the bank when payable, all defenses to nonpayment are waived; and further, with respect to municipal bonds, upon nonpayment and demand on that governmental unit for payment, if funds are not available in its treasury to make payment, the governing body of that governmental unit shall forthwith assess a tax on the grand list of the governmental unit, sufficient to make payment with 12 percent interest thereon, and cause the tax to be collected within 60 days; and further, with respect to revenue bonds, upon nonpayment and demand on that governmental unit for payment, such governmental unit shall make payment together with interest thereon of 12 percent, which shall be due and payable within 60 days; and further, notwithstanding any other law, including any law under which the municipal bonds or revenue bonds were issued by that governmental unit, the bank upon nonpayment is constituted a holder or owner of the municipal bonds or revenue bonds as being in default. Also notwithstanding any other law as to time or duration of default or percentage of holders or owners of bonds entitled to exercise rights of holders or owners of bonds in default, or to invoke any remedies or powers thereof or of any trustee in connection therewith or of any board, body, agency or commission of the state having jurisdiction in the matter or circumstance, the bank may thereupon avail itself of all other remedies, rights and provisions of law applicable in that circumstance, and the failure to exercise or exert any rights or remedies within any time or period provided by law may not be raised as a defense by the governmental unit. All of the bonds of the issue of municipal bonds or revenue bonds of a governmental unit on which there is nonpayment, are for all of the purposes of this section deemed to be due and payable and unpaid. The bank may carry out the provisions of this section and exercise all of the rights and remedies and provisions of law herein provided or referred to. (Added 1969, No. 216 (Adj. Sess.), § 3, eff. March 27, 1970; amended 1987, No. 15, § 18, eff. May 15, 1987.)
