1. Where a plaintiff in error set up in the court below that he
was entitled to have a note held by him and made by the defendant
in error paid in gold or silver coin under the Constitution upon a
proper construction of various clauses of that instrument, and the
decision of the court below was against the right thus set up, this
Court has appellate jurisdiction under the 25th section of the
Judiciary Act of 1789 or the 2d section of the Amendatory Judiciary
Act of 1867, to review the decision. The case of
Roosevelt
v. Meyer, 1 Wall. 512, overruled.
2. Where it note is for dollars, payable by its terms
in
specie, the terms
"in specie" are merely descriptive
of the kind of dollars in which the note is payable, there being
more than one kind of dollars current recognized by law, and mean
that the designated number of dollars shall be paid in so many gold
or silver dollars of the coinage of the United States.
3. The Act of February 25, 1862, in declaring that the notes of
the United States shall be lawful money and a legal tender for all
debts, only applies to debts which are payable in money generally,
and not to obligations payable in commodities or obligations of any
other kind.
4. When a contract for money is by its terms made payable in
specie or in coin, judgment may be entered thereon for coined
dollars.
Bronson v.
Rhodes, 7 Wall. 229, affirmed.
In June, 1861, Wilson gave to Trebilcock his promissory note for
nine hundred dollars, due one year after date with ten percent
interest,
payable in specie and, at the same time, to
secure its payment, he and his wife executed and delivered to
Trebilcock a mortgage, duly recorded, upon certain real property in
Iowa.
In February, 1863, Wilson offered to pay the amount due on the
note, principal and interest, and for that purpose tendered to
Trebilcock such amount in United States notes, declared by the Act
of Congress of February 25, 1862, [
Footnote 1] to be a legal tender for all debts, public and
private, with certain exceptions, but Trebilcock refused to receive
them, asserting that the note was payable in gold or silver coin of
the United States.
Page 79 U. S. 688
In July, 1865, Wilson and wife presented to one of the district
courts of Iowa their petition, reciting the contract to pay "in
specie" and setting forth that they had tendered to Trebilcock the
full amount of money, principal and interest, due, "said money so
offered and tendered being United States legal tender Treasury
notes, commonly called greenbacks;" setting forth further that
Trebilcock had refused to accept the same, "because," among other
reasons,
"the said money was not in kind what the contract demanded or
called for; . . . the said defendant claiming that the same was
payable only in gold or silver coin,"
and praying finally that Trebilcock might be required by decree
to release and discharge the mortgage upon the proper book of
record, as required by law upon the payment of a mortgage debt. The
complainants averred that they had kept the money tendered, ready
to pay the defendant, and that they brought the same into court for
that purpose.
The defendant demurred to the petition, and for causes, among
others of demurrer, set down the following:
"1st. The petition shows upon its face that by the contract the
note could only be discharged by payment of the amount due thereon
in gold."
"2d. The petition asks the aid of this Court for the reason that
the petitioners tendered the amount of the note described in the
petition in United States Treasury notes. Such tender is not good.
There is no law of this state or of the United States making
anything but gold and silver a legal tender in discharge of the
contract set out in the petition. This contract was entered into on
the 25th day of June, 1861. The law of Congress making United
States Treasury notes a legal tender in payment of debts does not
apply to this contract, because it was not enacted until long after
this contract was entered into, to-wit, on the 25th day of
February, 1862. To apply this law to this contract would be to make
it a retrospective law, a law impairing the obligation of
contracts, in violation of the Constitution of the United
States."
The court overruled the demurrer, and in September, 1866, gave
its decree, that the mortgage be cancelled, and
Page 79 U. S. 689
that the defendant enter satisfaction of it upon the record,
thus holding that the tender in notes was legal and sufficient.
On appeal to the Supreme Court of Iowa, this decree was, in
October, 1857, affirmed, and the defendant brought the case here on
a writ of error, under the 25th section of the Judiciary Act of
1789.
That section was reenacted, with some changes in its
phraseology, by the 2d section of the act of 1867, amending the
Judiciary Act of 1789. As the old section was the ground of
argument at the bar and the new one is adverted to in the opinion
of the court, both are here presented.
"
Judiciary Act of 1789 [Footnote 2]"
"SEC. 25.
And be it further enacted that a final
judgment or decree in any suit, in the highest court [of law or
equity] of a state in which a decision in the suit could be
had,"
"Where is drawn in question the validity of a treaty or statute
of, or an authority exercised under, the United States, and the
decision is AGAINST their validity,"
"Or where is drawn in question the validity of a statute of or
an authority exercised under any state, on the ground of their
being repugnant to the Constitution, treaties, or laws of the
United States, and the decision is in favor of such their
validity;"
"
Or where is drawn in question the construction of any
clause of the Constitution, or of a treaty, or statute of, or
commission held under the United States, and the decision is
AGAINST the title, right, privilege [or exemption], specially set
up or claimed by either party, under such [clause of the said]
Constitution, treaty, statute [or], commission, may be reexamined
and reversed or affirmed in the Supreme Court of the United States
upon a writ of error, . . . in the same manner and under the same
regulations, and the writ shall have the same effect as if the
judgment or decree complained of had been rendered or passed in a
[circuit] court, and the proceeding upon the reversal shall also be
the same, except that the Supreme Court [instead of remanding the
cause for a final decision, as before provided], may at their
discretion [if the cause shall have been once remanded before],
proceed to a final decision of the same, and award execution [but
no other error shall be assigned or regarded as a ground of
reversal in any such case as aforesaid than such as appears on the
face of the record, and immediately respects the before-mentioned
questions of validity or construction of the said Constitution,
treaties, statutes, commissions, or authorities in dispute]."
"
Amendatory Judiciary Act of 1867 [Footnote 3]"
"SEC. 2.
And be it further enacted that a final
judgment or decree in any suit in the highest court of a state in
which a decision in the suit could be had,"
"Where is drawn in question the validity of a treaty or statute
of, or an authority exercised under, the United States, and the
decision is AGAINST their validity,"
"Or where is drawn in question the validity of a statute of or
an authority exercised under any state, on the ground of their
being repugnant to the Constitution, treaties, or laws of the
United States, and the decision is in favor of such their
validity;"
"
Or where any title, right, privilege, or immunity is
claimed under the Constitution, or any treaty or statute of, or
commission held, or authority exercised under the United
States, and the decision is AGAINST the title, right, privilege [or
immunity], specially set up or claimed by either party under such
constitution, treaty, statute, commission [or authority], may be
reexamined and reversed or affirmed in the Supreme Court of the
United States upon a writ of error . . . in the same manner and
under the same regulations, and the writ shall have the same effect
as if the judgment or decree complained of had been rendered or
passed in a court [of the United States], and the proceeding upon
the reversal shall also be the same, except that the Supreme Court
may, at their discretion, proceed to a final decision of the same,
and award execution [or remand the same to an inferior court]."
Mr. G. B. Corkhill, for the defendant in error, asked to have
the case dismissed for want of jurisdiction, relying on
Roosevelt
Page 79 U. S. 691
v. Meyer, [
Footnote
4] as in point. There Meyer, a mortgagor, tendered in United
States notes, authorized by the Act of February 25, 1862 (the sort
of notes tendered here), then at a discount of 4 percent for gold,
to Roosevelt, his mortgagee, the amount due on a mortgage, one
created in 1854, like this one, before the passage of the legal
tender acts. Roosevelt refused the tender, demanding coin. The
highest court of New York decided that the notes were a good
tender, and though it appeared by the order of that court for
judgment that on the hearing of the case Roosevelt relied on the
provision of the Constitution that "the Congress shall have power
to coin money and regulate the value thereof," and of the 5th, 9th,
and 10th amendments, which ordain that "no person shall be deprived
of property without due process of law," that "the enumeration in
the Constitution of certain rights shall not be construed to deny
or disparage others retained by the people," and that "the powers
not delegated to the United States by the Constitution, nor
prohibited by it to the states, are reserved to the states
respectively or to the people" -- against all which, as he
contended the decision of the New York court sustaining the tender
had been -- this Court dismissed the case for want of jurisdiction.
It said that "as the validity of the act of February 25, 1862, was
drawn in question, and the decision was in favor of it, this Court
could not take cognizance of the case."
But if jurisdiction exists, the unsettled condition of the law
of legal tender justifies asking a review of the whole subject,
cases of coin contract (if this one falls within that class) as
well as others.
MR. JUSTICE FIELD delivered the opinion of the Court.
The principal question presented in this case for our
consideration
Page 79 U. S. 692
is whether a promissory note of an individual, payable by its
terms
in specie, can be satisfied, against the will of the
holder, by the tender of notes of the United States declared by the
Act of Congress of February 25, 1862, to be a legal tender in
payment of debts.
There is, however, a preliminary question of jurisdiction raised
which must be first disposed of. The state court, in holding the
tender legal and sufficient, sustained the validity and
constitutionality of the act of Congress declaring the notes a
legal tender. Its decision was therefore in favor of, and not
against, the right claimed by the plaintiffs under the act of
Congress, and hence it is contended that the appellate jurisdiction
of this Court does not arise under the 25th section of the
Judiciary Act of 1789. Some support is given to this view by the
decision of this Court in
Roosevelt v. Meyer, [
Footnote 5] where it was held that as
the validity of the legal tender act was drawn in question in that
case and the decision of the state court was in favor of it and of
the right set up by the defendant, this Court had no jurisdiction
to review the judgment, and a dismissal of the case was accordingly
ordered. The Court in that case confined its attention to the first
clause of the 25th section of the Judiciary Act, and in its
decision appears to have overlooked the third clause. That section
provides for the review of the final judgments and decrees of the
highest court of a state in which decisions could be had in three
classes of cases:
First. Where is drawn in question the validity of a treaty or
statute of, or an authority exercised under the United States and
the decision is against their validity;
Second. Where is drawn in question the validity of a statute of
or an authority exercised under any state on the ground of their
being repugnant to the Constitution, treaties, or laws of the
United States and the decision is in favor of their validity,
and,
Third. Where is drawn in question the construction of any clause
of the Constitution or of a treaty or statute of
Page 79 U. S. 693
or commission held under the United States and the decision is
against the title, right, privilege, or exemption specially set up
or claimed by either party under such clause of the Constitution,
treaty, statute, or commission.
Under this last clause, the appellate jurisdiction of this Court
in the case of
Roosevelt v. Meyer might have been
sustained. The plaintiff in error in that case claimed the right to
have the bond of the defendant paid in gold or silver coin under
the Constitution upon a proper construction of that clause which
authorizes Congress to coin money and regulate the value thereof
and of foreign coin, and of those articles of the amendments which
protect a person from deprivation of his property without due
process of law, and declare that the enumeration of certain rights
in the Constitution shall not be construed as a denial or
disparagement of others retained by the people, and reserve to the
states or the people the powers not delegated to the United States
or prohibited to the states.
The decision of the court below being against the right of the
plaintiff in error claimed under the clauses of the Constitution
the construction of which was thus drawn in question, he was
entitled to have the decision brought before this Court for
reexamination.
In the present case, as the defendant claimed a similar right
upon a construction of the same and other clauses of the
Constitution, and a like adverse decision of the court below was
made, he is equally entitled to ask for a reexamination of the
decision.
But the defendant also claimed a right to demand coin in payment
of the note of the plaintiff by the acts of Congress regulating the
gold and silver coins of the United States, and making them a legal
tender in payment of all sums according to their nominal or
declared values, contending that the act of 1862, making notes of
the United States a legal tender for debts, did not apply to the
contract in suit. He thus claimed in fact, although he did not
state his position in this form, that upon a proper construction of
the several acts together, he was entitled to payment in coin.
This
Page 79 U. S. 694
right having been denied by an adverse decision, he was clearly
in a condition to invoke the appellate jurisdiction of this Court
for a review of the decision.
Nor is the appellate jurisdiction of this Court in this case
affected by the change in the language of the third clause of the
25th section of the Judiciary Act of 1789, by the 2d section of the
Amendatory Judiciary Act of February 5, 1867. By this clause in the
latter act, the judgment or decree of the highest court of a state
can be reviewed
"where any title, right, privilege, or immunity is claimed under
the Constitution or any treaty or statute of or commission held or
authority exercised under the United States and the decision is
against the title, right, privilege, or immunity specially set up
or claimed by either party under such Constitution, treaty,
statute, commission, or authority."
The section came incidentally before the Court at the last term
in
Stewart v. Kahn, [
Footnote 6] but it was not deemed necessary to determine
whether it had superseded the 25th section of the Judiciary Act of
1789. As there observed, it is to a great extent a transcript of
that section, and several of the alterations of phraseology are not
material. The principal addition is found in the second clause, and
the principal omission is at the close of the section. But in this
case, as in that, there is no occasion to express any opinion as to
the effect of the new section upon the original. Under the new
section, as under the old, if that be superseded, the plaintiff in
error can seek a review of the decision made against the right
claimed by him.
We proceed, then, to consider the merits of the case. The note
of the plaintiff is made payable, as already stated,
in
specie. The use of these terms,
in specie, does not
assimilate the note to an instrument in which the amount stated is
payable in chattels -- as for example to a contract to pay a
specified sum in lumber or in fruit or grain. Such contracts are
generally made because it is more convenient for
Page 79 U. S. 695
the maker to furnish the articles designated than to pay the
money. He has his option of doing either at the maturity of the
contract, but if he is then unable to furnish the articles or
neglects to do so, the number of dollars specified is the measure
of recovery. But here the terms
in specie are merely
descriptive of the kind of dollars in which the note is payable,
there being different kinds in circulation, recognized by law. They
mean that the designated number of dollars in the note shall be
paid in so many gold or silver dollars of the coinage of the United
States. They have acquired this meaning by general usage among
traders, merchants, and bankers, and are the opposite of the terms,
in currency, which are used when it is desired to make a
note payable in paper money. These latter terms, in currency, mean
that the designated number of dollars is payable in an equal number
of notes which are current in the community as dollars. [
Footnote 7]
This being the meaning of the terms
in specie, the case
is brought directly within the decision of
Bronson v.
Rhodes, [
Footnote 8] where
it was held that express contracts, payable in gold or silver
dollars, could only be satisfied by the payment of coined dollars,
and could not be discharged by notes of the United States declared
to be a legal tender in payment of debts.
The several coinage acts of Congress make the gold and silver
coins of the United States a legal tender in all payments,
according to their nominal or declared values. The provisions of
the Acts of January 18, 1837, and of March 3, 1849, in this
respect, were in force when the Act of February 25, 1862, was
passed, and still remain in force. As the act of 1862 declares that
the notes of the United States shall also be lawful money and a
legal tender in payment of debts, an this act has been sustained by
the recent decision of this Court as valid and constitutional, we
have,
according to that decision, two kinds of money,
essentially different in their nature, but equally lawful. It
follows, from
Page 79 U. S. 696
that decision that contracts payable in either or for the
possession of either must be equally lawful, and, if lawful, must
be equally capable of enforcement. The act of 1862 itself
distinguishes between the two kinds of dollars in providing for the
payment in coin of duties on imports and the interest on the bonds
and notes of the government. It is obvious that the requirement of
coin for duties could not be complied with by the importer, nor
could his necessities for the purchase of goods in a foreign market
be answered, if his contracts for coin could not be specifically
enforced, but could be satisfied by an offer to pay its nominal
equivalent in note dollars.
The contemporaneous and subsequent legislation of Congress has
distinguished between the two kinds of dollars. The Act of March
17, 1862, [
Footnote 9] passed
within one month after the passage of the first legal tender act,
authorized the Secretary of the Treasury to purchase coin with
bonds or United States notes, at such rates and upon such terms as
he might deem most advantageous to the public interest, thus
recognizing that the notes and the coin were not exchangeable in
the market according to their legal or nominal values.
The Act of March 3, 1863, [
Footnote 10] amending the internal revenue act, required
contracts for the purchase or sale of gold or silver coin to be in
writing, or printed, and signed by the parties, their agents or
attorneys, and stamped; thus impliedly recognizing the validity of
previous contracts of that character without this formality. The
same act also contained various provisions respecting contracts for
the loan of currency secured by a pledge or deposit of gold or
silver coin, where the contracts were not to be performed within
three days.
Legislation of a later date has required all persons making
returns of income, to declare "whether the several rates and
amounts therein contained are stated according to their values in
legal tender currency, or according to their values
Page 79 U. S. 697
in coined money," and if stated "in coined money," it is made
the duty of the assessor to reduce the rates and amounts "to their
equivalent in legal tender currency, according to the value of such
coined money in said currency for the time covered by said
returns." [
Footnote 11]
The practice of the government has corresponded with the
legislation we have mentioned. It has uniformly recognized in its
fiscal affairs the distinction in value between paper currency and
coin. Some of its loans are made payable specifically in coin,
whilst others are payable generally in lawful money. It goes
frequently into the money market, and at one time buys coin with
currency, and at another time sells coin for currency. In its
transactions it every day issues its checks, bills, and
obligations, some of which are payable in gold, while others are
payable simply in dollars. And it keeps its accounts of coin and
currency distinct and separate.
If we look to the act of 1862 in the light of the
contemporaneous and subsequent legislation of Congress and of the
practice of the government, we shall find little difficulty in
holding that it was not intended to interfere in any respect with
existing or subsequent contracts payable by their express terms in
specie, and that when it declares that the notes of the United
States shall be lawful money, and a legal tender for all debts, it
means for all debts which are payable in money generally, and not
obligations payable in commodities, or obligations of any other
kind.
In the case of
Cheang-Kee v. United States, [
Footnote 12] a judgment for unpaid
duties, payable in gold and silver coin of the United States,
rendered by the Circuit Court for the District of California, was
affirmed by this Court.
It is evident that a judgment in any other form would often fail
to secure to the United States payment in coin, which the law
requires, or its equivalent. If the judgment were rendered for the
payment of dollars generally, it might, according to the recent
decision of this Court, be paid in
Page 79 U. S. 698
note dollars, and if they were depreciated, the government would
not recover what it was entitled to receive. If, on the other hand,
the value of the coin was estimated in currency and judgment for
the amount entered, the government, in case of any delay in the
payment of the judgment, by appeal or otherwise, would run the risk
of losing a portion of what it was entitled to receive by the
intermediate fluctuations in the value of the currency. From
considerations of this kind, this Court felt justified in
sustaining the judgment of the Circuit Court for California
requiring its amount to be paid specifically in coin, as being the
only mode by which the law could be fully enforced. [
Footnote 13] The same reasoning justified
similar judgments upon contracts that stipulated specifically for
the payment of coin. The twentieth section of the act 1792,
[
Footnote 14] establishing a
mint and regulating the coins of the United States, in providing
that the money of account of the United States shall be expressed
in dollars, dimes, cents, and mills, and that all proceedings in
the courts of the United States shall be kept in conformity with
this regulation, impliedly, if not directly, sanctions the entry of
judgments in this form. The section has reference to the coins
prescribed by the act, and when, by the creation of a paper
currency, another kind of money,
Page 79 U. S. 699
expressed by similar designations, was sanctioned by law and
made a tender in payment of debts, it was necessary, as stated in
Bronson v. Rhodes, to avoid ambiguity and prevent a
failure of justice, to allow judgments to be entered for the
payment of coined dollars, when that kind of money was specifically
designated in the contracts upon which suits were brought.
It follows from the views expressed that the judgment of the
Supreme Court of Iowa must be reversed and that court directed to
remand the cause to the proper inferior court of the state for
further proceedings in conformity with this opinion,
And it is so ordered.
[
Footnote 1]
12 Stat. at Large 345.
[
Footnote 2]
1 Stat. at Large 86.
[
Footnote 3]
14
id. 386.
[
Footnote 4]
68 U. S. 1 Wall.
512.
[
Footnote 5]
68 U. S. 1 Wall.
512.
[
Footnote 6]
78 U. S. 11
Wall. 502.
[
Footnote 7]
Taup v. Drew,
10 How. 218.
[
Footnote 8]
74 U. S. 7 Wall.
229.
[
Footnote 9]
12 Stat. at Large 370.
[
Footnote 10]
Ib., 719, § 4.
[
Footnote 11]
14 Stat. at Large 147.
[
Footnote 12]
70 U. S. 3 Wall.
320.
[
Footnote 13]
The twelfth section of the Act of Congress of March 3, 1865,
entitled, "An act amendatory of certain acts imposing duties upon
foreign importations," enacts:
"That in all proceedings brought by the United States in any
court for due recovery, as well of duties upon imports alone as of
penalties for the nonpayment thereof, the judgment shall recite
that the same is rendered for duties, and such judgment, interest,
and costs shall be payable in coin by law receivable for duties,
and the execution issued on such judgment shall set forth that the
recovery is for duties, and shall require the marshal to satisfy
the same in the coin by law receivable for duties; and in case of
levy upon and sale of the property of the judgment debtor, the
marshal shall refuse payment from any purchaser at such sale in any
other money than that specified in the execution."
It appears from the examination of the record in
Cheang-Kee
v. United States that the judgment of the circuit court in
that case, affirmed by the Supreme Court, was rendered before this
act was passed, namely on the 8th of August, 1864.
[
Footnote 14]
1 Stat. at Large 250, § 20.
MR. JUSTICE BRADLEY, dissenting:
I dissent from the opinion of the Court in this case for reasons
stated in my opinion delivered in the cases of
Knox v. Lee
and
Parker v. Davis. * In all cases
where the contract is to pay a certain sum of money of the United
States, in whatever phraseology that money may be described (except
cases specially exempted by law), I hold that the legal tender acts
make the Treasury notes a legal tender. Only in those cases in
which gold and silver are stipulated for as bullion can they be
demanded in specie, like any other chattel. Contracts for specie
made since the legal tender acts went into operation, when gold
became a commodity subject to market prices, may be regarded as
contracts for bullion. But all contracts for money made before the
acts were passed must, in my judgment, be regarded as on the same
platform. No difficulty can arise in this view of the case in
sustaining all proper transactions for the purchase and sale of
gold coin.
*
Supra, p.
79 U. S.
554.
MR. JUSTICE MILLER, dissenting:
In the case of
Bronson v. Rhodes, I expressed my
dissent on the ground that a contract for gold dollars, in terms,
was in no respect different, in legal effect, from a contract
for
Page 79 U. S. 700
dollars without the qualifying words, specie or gold, and that
the legal tender statutes had, therefore, the same effect in both
cases.
I adhere to that opinion, and dissent from the one just
delivered by the Court.
