Gold Hill daily news. [volume] (Gold Hill, N.T. [Nev.]) 1863-1882, 1870-02-17
FURTHER ooNc1AHtNa THB Ii
GAL TRMDR1 ACT pEoIeIoM.

We gave yesterday In the NEWS a
brief synopsis of the recent decision
of the Supreme Court of the United
States, in the legal tender case, and
continue the subject, as 1t affects the
whole monetary affairs of the country
prior to and since Congress passed the
Legal Tender Act, in February, 1852.
The suit ON which the decision is
founded came up from Kentucky, on
the payment Of a note made before the
passage of the act. When the maker
went to pay it, he offered greenbacks,
which the bank refused to take. He
declined to pay in coin, and was there
upon sued by the bank. The Supreme
Court of Kentucky sustained the ac-
ton, and declared the act In question
unconstitutional. This brought the
case into the United States Supreme
Court, where it has twice been argued,
and is now finally decided, and again
in favor of the bank. Chief Justice
Chase read the decision for himself and
Justices Nelson, Clifford and Field,
adding that it was also concurred In by
Justice Grier before his resignation.
The Court holds that the act is consti-
tutional in so far as 1t relates to con-
tracts made after February %, 1852, at
which date it was signed by the Presi-
dent, but that Congress could not con-
stitutionally make it applicable to con-
tracts entered into prior to that date.
The Court, in other words, sustained
the act, but declares that it is not re-
troactive. Justice Miller, for himself
and Justices Davis and Swayne, dis
sented from the opinion of the Chief
Justice, and held that the act is consti-
tutional in its exact terms, and that
greenbacks are, as therein specified,
illegal tender in payment of all debts"
whether ON contracts made before or
after 1t became a law. All sorts Of
questions are at once raised as to the
scope of Judge Chase's decision.
Thousands Of notes and contracts
made prior to February, 1862, have of
course been settled ingreenbacks, and
inquiry Is made whether these settle
ments can now be re-opened, and
whether debtors can be compelled to
settle on q coin basis. Lawyers hold
that if g%reenbacks accepted with
out protest or reservation, there can
be no such thing as q re-opening Of the
cases. All unsettled contracts entered
into before 1862 can now, on the prin-
ciple laid down in this decision, be
enforced In coin. This necessarily
brings all outstanding corporate and
city bonds, as we'll rs individual
obligations, issued before the operation
Of the Act, within the Judgment of the
Court as pronounced, and that without
attempt at legal evasion, the decision
being beyond appeal. Some doubt,
however, is entertained as to the
course which may be adopted by the
States, against which there Is no legal
recourse, in the event Of their %continu-
ing to pay in currency. In many
cases, the debts of the States con-
tracted before 1862 are large enough to
present a temptation to disregard the
decision, if any State could be sup
posed capable Of an unqualified con
tempt of the lawful claims of its
creditors, and, in the case of some
weak States with heavy debts, and
already embarrassed In their finances,
there Is room for doubt whether the
decision may not appear to suggest
the necessity of, at least, some sort
of compromise with their creditors.
The debts of the different States are
estimated at $500, O00, 900. The in
terest on this sum, which, since 1862,
has been paid almost exclusively in
currency, now becomes payable, both
interest and principal, In coin. With
gold at Its present price, this Is equiva-
lent to an addition Of about 20 per
cent. to the debts of the States, as
hitherto estimated. 1t Is true that the
great bulk of Individual debts con-
tracted previous to 1862 have been,
llquidated, or compromised in some
way, and therefore this decision Of the
Supreme Court affects a comparatively
small amount Of them. There may
appear to be some doubt AS to whether
the States will accept the burthens inn
posed by this decision ; for, as there is
no legal recourse against a State gov
eminent, 1t will be, as a matter Of
power, optional with them whether
they act In conformity with the de-
cision or not. Disregard Of this final
instruction. of the law would, Of
course, be unqualified reputation ;
and it seems improbable that any State
placing any value upon its credit
would be SO %imprudent as to set the
law Of tho land at defiance. The OK
pectation of a steady approach toward
the specie basis, reducing the differ
ence between the value of gold and Of
paper, has Q tendency to neutralize the
inducements to such a discrcdltable
course. fs-