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of Massachusetts, vol. 1. p. 402, that productive of all the consequences of bills of credit were emitted for the first paper money. We cannot then assent time in that colony in 1690. An army to the proposition, that the history of returning, unexpectedly from an expe our country furnishes any just argument dition against Canada, which had proved in favor of that restricted construction as disastrous as the plan was magnifi- of the Constitution, for which the councent, found the government totally un- sel for the defendant in error contends. prepared to meet their claims. Bills of The certificates for which this note credit were resorted to, for relief from was given, being in truth. bills of credit this embarrassment. They do not ap- in the sense of the Constitution, we are pear to have been made a tender; but brought to the inquiry : they were not on that account the less Is the note valid of which they form bills of credit, nor were they absolutely the consideration ? harmless. The emission, however, not It has been long settled, that a promise being considerable, and the bills being made in consideration of an act which is soon redeemed, the experiment would forbidden by law is void. It will not be have been productive of not much mis- questioned, that an act forbidden by the chief, had it not been followed by repeat- Constitution of the United States, which ed emissions to a much larger amount. is the supreme law, is against law. The subsequent history of Massachu. Now the Constitution forbids a State to setts abounds with proofs of the evils 'emit bills of credit.' The loan of these with which paper money is fraught, certificates is the very act which is forwhether it be or be not a legal tender. bidden. It is not the making of them
Paper money was also issued in other while they lie in the loan offices ; but colonies, both in the north and south; the issuing of them, the putting them and whether made a tender or not, was into circulation, which is the act of productive of evils in proportion to the emission; the act that is forbidden by quantity emitted. In the war which the Constitution. The consideration of commenced in America in 1755, Virginia this note is the emission of bills of credit issued paper money at several succes- by the State. The very act which consive sessions, under the appellation of stitutes the consideration, is the act of treasury notes. This was made a tender. emitting bills of credit, in the mode preEmissions were afterwards made in 1769, scribed by the law of Missouri; which în 1771, and in 1773. These were not act is prohibited by the Constitution of made a tender; but they circulated to the United States. gether; were equally bills of credit : Cases which we cannot distinguish and were productive of the same effects. from this in principle, have been decided In 1775 à considerable emission was in Slate courts of great respectability; made for the purposes of the war. The and in this court. In the case of the bills were declared to be current, but Springfield Bank vs. Merrick et al. 14 were not made a tender. In 1776, an Mass. Rep. 322, a note was made payaadditional emission was made, and the ble in certain bills, the loaning or negobills were declared to be a tender. The tiating of which was prohibited by statbills of 1775 and 1776 circulated togeth- ute, inflicting a penalty for its violation. er; were equally bills of credit; and The note was held to be void. Had this were productive of the same consequen- note been made in consideration of these
bills, instead of being made payable in Congress emitted bills of credit to a them, it would not have been less relarge amount; and did not, perhaps pugnant to the statute ; and would concould not, make them a legal tender. sequently have been equally void. This power resided in the States. In În Hunt rs. Knickerbocker, 5 Johns. May 1777, the legislature of Virginia Rep. 327, it was decided that an agree. passed an act for the first time making ment for the sale of tickets in a lottery, ihe bills of credit, issued under the au not authorized by the legislature of the thority of Congress, a tender so far as to State, although instituted under the auextinguish interest. It was not until thority of the government of another March, 1781, that Virginia passed an act State is contrary to the spirit and policy making all the bills of credit which had of the law, and void. The consideration been emitted by Congress, and all which on which the agreement was founded had been emitted by the State, a legal being illegal, the agreement was void. tender in payment of debts. Yet they. The books, both of Massachusetts and were in every sense of the word bills of New York, abound with cases to the same credit, previous to that time; and were effect. They turn upon the question
whether the particular case is within the indicated; or if it shall be indispensable principle, not on the prineiple itself. It to the preservation of the Union, and has never been doubted, that a note giv, consequently of the independence and en on a consideration which is prohibited liberty of these States; these are conby law, is vuid. Had the issuing or cir- siderations which address themselves culation of certificates of this or of any to those departments which may with other description been prohibited by a perfect propriety be influenced by them. statute of Missouri, could a suit have This department can listen only to the been sustained in the courts of that mandates of law; and can tread only State, on a note given in consideration that path which is marked out by duty. of the prohibited certificates ? If it The judgment of the Supreme Court could not, are the prohibitions of the of the State of Missouri for the first Constitution to be held less sacred than judicial district is reversed; and the those of a State law ?
cause remanded, with directions to enter It had been determined, independently judgment for the defendants. of the acts of Congress on that subject, that sailing under the license of an ene: Mr Justice Johnson. my is illegal. Patton vs. Nicholson, This is a case of a new impression, 3 Wheat. 204, was a suit brought in one and intrinsic difficulty; and brings up of the courts of this district on a note questions of the most vital importance given by Nicholson to Patton, both citi- to the interests of this Union. zens of the United States, for a British The declaration in the ordinary form ; license. The United States were then and the part of the record of the State at war with Great Britain; but the li- court, which raises the questions before cense was procured without any inter- us, is expressed in these words : at a course with the enemy. The judgment court, &c, came the parties, &c, and of the Circuit court was in favor of the neither party requiring a jury, the cause defendant; and the plaintiff sued out a is submitted to the court; therefore, all writ of error. The counsel for the de- and singular, the matters and things, fendant in error was stopped, the court and evidences, being seen and heard by declaring that the use of a license from the court, it is found by them that the enemy being unlawful, one citizen the said defendants did assume uport had no right to purchase from or sell to themselves in the manner and form another such a license, to be used on the plaintiffs by their counsel allege; and board an American vessel. The consid- the court also find that the consideration eration for which the note was given for which the writing declared upon, and being unlawful, it followed of course the assumpsit was made, was for the loan that the note was void.
of loan office certificates, loaned by the A majority of the court feels constrain. State at her loan office at Chariton; ed to say that the consideration on which which certificates were issued and the the note in this case was given, is against loan made in the manner pointed out by the highest law of the land, and that the an act of the legislature of Missouri ; note itself is utterly void. In rendering approved, &c. And the court do further judgment for the plaintiff, the court for find that the plaintiff hath sustained the State of Missouri decided in favor of damages by reason of the non-performthe validity of a law which is repugnant ance of the assumptions and undertakto the Constitution of the United States. ings aforesaid, of them the said defend
In the argument, we have been re- ants, to the sum, &c; and therefore it is minded by one side of the dignity of a considered that the plaintiff recover,' &c. sovereign State ; of the humiliation of In order to understand the case, it may her submitting herself to this tribunal: be proper to premise, that the territory, of the dangers which may result from now occupied by the State of Missouri inflicting a wound on that dignity : by having been subject to the Spanish govthe other, of the still superior dignity of ernment, was at the time of its cession the people of the United States; who governed by the civil law as modified have spoken their will, in terms which by the Spanish government; that it so we cannot misunderstand.
continued, subject to certain modificaTo these admonitions, we can only tions introduced by act of Congress, un. answer; that if the exercise of that ju- til it became a State ; when the people risdiction which has been imposed upon incorporated into their institutions as us by the Constitution and laws of the much of the civil law as they thought United States, shall be calculated to proper : and hence, their courts of jusbring on those dangers which have been tice now partake of a mixed character
perhaps combining all the advantages of because it does not appear from anything the civil and common law forms. By on the record, that this ground of deone of the provisions of this law the trial fence was specially set up in the courts by jury is forced upon no one; is yet of the State. But this we consider no open to all; and when not demanded, longer an open question; it has repeatthe court acts the double part of jury edly been decided by this court, that if and judge.
a special verdict or the instruction of a It is obvious, therefore, that the mat- court involve such facts as that the ter certified from the record of the State judgment must necessarily, affirm the court before recited, is in nature of a validity of the State law, or invalidity of special verdict, and the judgment of the a right set up under the laws or Consticourt is upon that verdict: and in this tution of the United States; the case is light it shall be examined.
sufficiently brought within the provisions The purport of the finding is that the of the twentyfifth section. vote declared upon was given ' for a The judgment of the court in this loan of loan office certificates, loaned by case affirms the validity of the contract the State under certain State acts, the on which the suit is instituted. And caption of which is given.'
this could not have been affirmed, unSome doubts were thrown out in the less on the assuraption that the aci in argument, whether we could take no- which it had its origin was constitutional. tice of the State laws thus found, with In the argument of counsel the obout being set out at length: but in this jections to this contract were presented there can be no question; whatever in the form of objections to the considerlaws that court would take notice of, ation. But this was unnecessary to his we must of necessity receive and con- argument; since even a valuable consider, as if fully set out.
sideration will not make good a contract By the acts of the State designated by in itself illegal. These notes originate the court in their finding, the officers of directly under the law of Missouri; the treasury department of the State they are taken in pursuance of its prowere authorized to create certificates of visions; have their origin in it; and rest small denominations, from ten dollars for their validity upon it: and if that down to fifty cents, bearing interest at law be void, must fall with it. Whether, two per centum per annum, and to loan therefore, the bills for which they were these certificates to individuals; taking given be void or valid, if the law be void, in lieu thereof promissory notes, payable the notes would be so. not exceeding one year from the date, There are some difficulties on the subwith not more than six per cent interest, ject of consideration, for which I would and redeemable by instalments not ex reserve myself until they become unaceeding ten per cent every six months, voidable. But it is not one of those difgiving mortgages of landed property for ficulties that, as a guide for the State, security
the power of the States over the laws of These certificates were in this form : contracts will legalize a contract made, This certificate shall be receivable at under whatever law, or for whatever the treasury, or any of the loan offices of consideration. That argument makes the State of Missouri, in the discharge of the act to justify itself; and is a direct taxes or debts due the State, for the sum recurrence to that exercise of sovereign of $ with interest for the same, power which it was the leading princi. at the rate of two per centum per annum ple of the Constitution that each should from this date, the-
renounce, so far as it was incompatible 182 ;' which form is set out in, and pre- with the provisions of the Constitution; scribed by the act designated in the the objects of which were the security of finding of the court.
individual right, and the perpetuation of This writ of error is sued out under the Union. the twenty fifth section of the judiciary The instrument is a dead letter unless act; upon the supposition that the its effect be to invalidate every act done State act is in violation of that provision by the States in violation of the Constiin the Constitution which prohibits the tution of the United States,
And as States from emitting bills of credit; and the universal modus operandi by free that the note declared on is void, as hav- States must be through their Legislaing been taken for an illegal considera- tures, it follows, that the laws under tion, or without consideration.
which any act is done, importing & As a preliminary question, it has been violation of the Constitution must be argued, that the case is not within the a dead letter. The language of the provisions of the twentyfifth section ; Constitution is,' no State shall emit bills
of credit;' and this, if it means anything, defendant in error, that it was essential must mean that no State shall pass a to the description of bills of credit in the law which has for its object an emission sense of the Constitution, that they of bills of credit.
should be made a lawful tender. But It follows, that when the officers of a his own quotations negative that idea, State undertake to act upon such a law, and the Constitution does the same, in they act without authority; and that the the general prohibition in the States to contracts entered into direct or inciden- make anything but gold or silver a legal tal to such their illegal proceedings, are tender. If, however, it were otherwise, mere nullities.
it would hardly avail him here, since This leads us to the main question: these certificates were, as to their offiWas this an emission of bills of credit in cers' salaries, declared a legal tender. the sense of the Constitution ? And The great end and object of this rehere the difficulty which presents itself striction on the power of the States, will is to determine whether it was a loan or
furnish the best definition of the terms an emission of paper money; or, per- under consideration. The whole was haps, whether it was not an emission of intended to exclude everything from paper money under the disguise of a use, as a circulating medium, except loan. There cannot be a doubt that this gold and silver; and to give to the Unilatter view of the subject must always ted States the exclusive control over the be examined; for that which it is not coining and valuing of the metallic mepermitted to do directly, cannot be legal. dium. That the real dollar may repreized by any change of names or forms. sent property, and not the shadow of it. Acts done in fraudem legis,' are acts Now, if a State were to pass a law in violation of law.
declaring that this representative of moThe great difficulty, as it is here, must ney shall be issued by its officers, this ever be to determine, in each case,
would be a palpable and tangible case ; whether it be a loan, or'an emission of and we could not hesitate to declare such bills of credit. That the States have an
a law, and every contract entered into unlimited power to effect the one, and
on the issue of such paper, purporting are divested of power to do the other, are
a promise to return the sum borrowed,
to be propositions equally unquestionable; but
mere nullity. But suppose a where to draw the discriminating line is State enacts a law authorizing her offithe great difficulty. I fear it is an insu. lars, and to give in lieu thereof certifi
cers to borrow a hundred thousand dolperable difficulty
cates of one hundred dollars each, exThe terms, bills of credit,' are in pressing an acknowledgment of the debt; themselves vague and general, and, at it is presumed there could be no objecthe present day, almost dismissed from tion to this. Then suppose that the nextour language. It is then only by re- year she authorizes these certificates to sorting to the nomenclature of the day be broken up into ten, five, and even one of the Constitution that we can hope to dollar bills." Where can be the objecget at the idea which the framers of the tion to this? And if, at the institution Constitution attached to it. The quota- of the loan, the individual had given for tion from Hutchinson's History of Mas- the script his note at twelve months, sachusetts, therefore, was a proper one instead of paying the cash; it would be for this purpose ; inasmuch as the sense but doing in another form what was here in which a word is used, by a distin- done in Missouri ; and what is often guished historian, and a man in public done, in principle, where the loan is not life in our own country, not long before required to be paid immediately in cash. the revolution, furnishes a satisfactory
Pursuing the scrutiny farther, with a criterion for a definition. It is there view to bringing it as close home to the used as synonymous with paper money; present case as possible : a State having and we will find it distinctly used in the exhausted its treasury proposes to antisame sense by the first Congress which cipate its taxes for one, two or three met under the present Constitution.
years; its citizens, or others, being willThe whole history and legislation of ing to aid it, give their notes payab e a the time prove that, by bills of credit, sixty days, and receive the script of the the framers of the Constitution meant State at a premium, for the advance of paper money, with reference to that their credit, which enables the State, by which had been used in the States from discounting these notes, to realize the the commencement of the century down cash. There could be no objection to this to the time when it ceased to pass, be- negotiation; and their script being by fore reduced to its innate worthlessness. contract to be receivable in taxes, nothIt was contended, in argument, for the ing would be more natural than to break
it up into small parcels in order to adapt his contracts. This approximates them it to the payment of taxes. And if in to bills on a fund; and a fund not to be this state it should be thrown into cir- withdrawn by a law of the State. culation, by passing into the hands of Upon the whole, I am of opinion that those who would want it to meet their the judgment of the State Court should taxes, I see nothing in this that could be affirmed. amount to a violation of the Constitution Thus far the transaction partakes of the Mr Justice Thompson. distinctive features of a loan; and yet it This case comes up by writ of error, cannot be denied that its adaptation to from the State Court of Missouri, on a the payment of taxes does give it one judgment recovered against the plaincharacteristic of a circulating medium. tiffs in error, in the highest court in that And another point of similitude, if not of State ; and the first question that has identity, is the provision for forcing the been made here, is, whether this court receipt of it upon those to whom the has jurisdiction of the case, under the State had incurred the obligation to pay twentyfifth section of the judiciary act money.
of 1789. The result is, that these certificates If the construction of this lwentyfifth are of a truly amphibious character; but section was now for the first time brought what then should be the course of this before this court, I should entertain very court? My conclusion is, that, as it is a serious doubts whether this case came doubtful case, for that reason
within it. The fair, and as I think, the bound to pronounce itinnocent. It does clear import of that section is, that some indeed approach as near to a violation of one of the cases therein stated, did, in the Constitution as it can well go, with- point of fact, arise, and was drawn into out violating its prohibition ; but it is in question; and did receive the judgment the exercise of an unquestionable right, and decision of the State Court. It is although in rather a questionable form; pot enough that such question might and I am bound to believe that it was have been made. A party may waive done in good faith until the contrary the right secured to him under this secshall more clearly appear.
tion. This would not in any manner affect Believing it then a candid exercise of the jurisdiction of the State Court: and the power of borrowing, I feel myself at might of course be waived. In the presliberty to go further, and briefly to sug- ent case, there is no doubt but the facts gest two points, on which these bills which appeared before the State Court vary from the distinctive features of the presented a case which might properly paper money of the revolution.
fall within this section. The defendants i. On the face of them they bear an might have insisted that the State law interest, and for that reason vary in val- was unconstitutional, and that the cerue every moment of their existence: tificates issued in pursuance of its prothis disqualifies them for the uses and visions were void. And if the court had purposes of a circulating medium; which sustained the act, it would have been the universal consent of mankind de- one of the cases within the twentyfifth clares should be of an uniform and un section. But the court was not bound changing value, otherwise it must be to call upon the party to raise the objecthe subject of exchange, and not the me- tion, for the purpose of putting the cause dium.
in a situation to be brought here by writ 2. All the paper medium of the revo. of error. It cannot be doubted but that lution consisted of promises to pay. there might have been an express waiver This is a promise to receive, and to re- of this right; and I should think an imceive in payment of debts and taxes due plied waiver would equally preclude a the State. This is not an immateri. review of the case by this court; and al distinction; for the objection to a that such waiver ought to be implied in mere paper medium is, that its value all cases where it does not appear that depends upon mere national faith. But in point of fact the question was made, this certainly has a better dependence; and received the judgment of the State the public debtor who purchases it may Court. But to entertain jurisdiction in tender it in payment; and upon a suit this case, is perhaps not going farther brought to recover against him, the Con- than this court has already gone, and I stitution contains another provision to do not mean to call in question these which he may have recourse. As far decisions; but have barely noticed the as the feeble powers of this court ex- question, for the purpose of stating the tend, he would be secured (if he could rule by which I think all cases under ever need security) from a violation of this section should be tested.