The Scranton tribune. [volume] (Scranton, Pa.) 1891-1910, 1896-10-07

The Albany Law Journal for oct. 3
contains paper by James j. Fl. Ham
ilton, of this city, touching legal tender
acts and the gold clause in contracts
which is of interest to laymen as we'll
as to lawyers, especially in view OF the
fact that political party is battling
this year to make SO cents worth of
silver bullion plus a government stamp
full legal tender for one dollars worth
of debt and to prevent the stipulation
in money contract that it shall he
paid in a particular kind of coin, rs for
instance gold. The points considered
by Mr.. Hamilton are: What would be
the effect of free silver triumph upon
contracts? Could creditor be COM
PEELED to receive payment of his claim
in deprecated silver whether he would
or not? Could he stipulate in his con-
tract for payment in gold irrespective
of a federal statute making silver full
legal tender?
In passing it may be observed that
gold coin today is not legal tender at
its face. but only at its market value.
If gold coin be abraded, it will pay
only it's weights worth of debt. On the
other hand, our greenbacks, having no
market value, are legal tender at their
face; and our subsidiary silver. being
worth less as bullion than as coin. is
by law made legal tender within linn
tied amount ($5). The object of such
a statutory bolster to inferior money
is apparent from the fact that without
it creditors would not take ii in pay
ment of debts when by contract they
could demand bullion value.
The principal decision quoted by Mr..
Hamilton as bearing upon the forego-
ing points occurred in connection with
the act of congress of Feb. %. 1862, de-
claring that United States notes (com-
monty called greenbacks) shall be law
full money. and a legal tender in pay
ment of all debts. public and private,
within the United States, except for
duties on imports and interest on the
public debt" In interpreting this act
the Supreme court held that it had no
application to contracts payable by
their express terms in gold or silver
coins or specie. no matter whether such
contracts We're entered into before its
passage or after: and that q tender
of greenbacks is not sufficient to dis
charge such contract. 1t was also held
that in all contracts entered into be-
fore the passage of the act there was
the implied condition of payment in
gold or its equivalent and that. there
fore. the legal tender act had no effect
upon contracts executed before its pas
sage. The right to expressly contract
for payment in specie or its equivalent
is thus fully affirmed by the highest
court. Other decisions of similar tenor
are cited by Mr.. Hamilton to the num-
ber of twenty-five or thirty.
In conclusion, then, as Mr.. Hamilton
points out:
Under the decisions Of the court of last re-
sort, in spite Of the repeal of any provso
contained in the statutes, legal tender laws
cannot prevent cOntractural stipulations
for payment in gold. or in any other des-
ignated form Of legal tender, nor the en-
forcement of such stipulation; and it is
more than doubtful whether it lies within
the power of congress to forbid or pre-
vent such stipulations. To hold that it
can, will require another reversal of the
uniform and unbroken line of decisions
of the most illustriOus court on earth.
But should this come about. what then?
Even In such case there Is a remedy.
Legal tender laws cannot increase the
al
u man to sell his property for depre-
ciated currency, or to give something for
nothing. or to take in exchange for his
wheat, his coal. his ores or mis- merchan-
and is not willing to accept. They may,
however, put a sprag in the spOkes of
commerce, stop business transactions.
and abolish credit. by compelling every
equivalent when the goods are sold. 1t
is beyond the power of legislatures to
make contracts for men, or to substitute
different contracts for those which they
have made. If | buy horses. no Legislative
act can compel me to take cows instead:
and If contract for LOCO bushels of wheat
| cannot be required by statute to be sat
isned with receiving 1000 bushels of oats.
Gold ard silver are commodities, and are
bought and sold as other commodities.
Unless the government should assume u
monopoly of dealing in these metals (ani
it will hardly be claimed that it has the
ConStltHtioHdl power 10 40 tHlS1, no one
can be prevented from contracting for the
purchase of gold; and when he has con-
tracted for its purchase, he is entitled
to damages for a breach OF a contract
Just as he Is In the case of the breach of
Il contract for the purchase of any other
commodity. His contract in this case
would not call for current coin. and, there
fore, could not be satisfied by n tender of
silver or greenbacks. ana would not come
within the purview Of the legal tender de-
cisions. In such case. however. both the
logic of tho situation and the law of the
case would prevent the entering Of n judg-
ment payable In gold: but the judgment
entered would he a general money julg-
ment for the damages the contracting
party has suffered by the breach of the
contract: and the measure of these dam
ages would be the value of the gold ct
the time Of the breach, calculated In lsga!
tender.
IN other words. even free coinage
would not put the creditor at the
debtors mercy; the most it could do
would be to upset present forms of bus
mess and cause a wholesale readjust-
ment. There would still be no way out
for the man who wanted to escape
from an honest performance of his con-
tract obligations.
IN his speech at st. Louis last Sat-
urday night Mr. Bryan said he was
born after the war" A correspond
ent living In Hyde Park raises the
point that II Mr.. Bryan spoke the truth.