Orleans County monitor. [volume] (Barton, Vt.) 1872-1953, 1913-04-02
What is Money Loaned?

In your report of the Orleans county
listers meeting held at Barton, March
25th, you refer to the encouragement
ais Interpretation of the words mon
ey loaned" in the exemption clause of
the new tax law. You now ask me for
my understanding of that term. Pos
sibly little explanation of the way
the words money loaned" were used
during the last session of the legisla-
ture may be of interest at this time.
S54. the Babbitt bill. introduced in
October provided for the exemption of
money loaned on real estate at per
cent or less. S66. the Laird bill. which
did not limit the exemptions to money
loaned on real estate only, was intro
duced in October. Both passed the
senate. HAP, the Martel bill. also in
troduced in October, HISS by Mr.. Flynn.
H372, by Mr.. Plumley, of Ludlow, and
H374, as amended by the senate. all
providing for exemption from taxation
because of low interest rate used the
same words money loaned" as indi-
eating a debt. That term has been
fairly and fully before the public since
last October.
And now comes the opinion that mort
gage notes given by the purchaser d.
rectly to the seller as payment for
farm are not in the same exempt class
as notes given to procure cash to pay
for that same farm, outstanding
the fact that both bear 5 per cent in.
terest.
have yet to learn that there was
any discussion in either house indicat-
ing that any per cent interest bear
against. Had there been such an init
nation it is hardly conceivable that
the bill could have become law until
so amended as to make such an inter
probation impossible. The press had
been discussing the tax question for
months previous to the passage of this
bill and if there be a single editor who
pointed out the possibility of such a
construction he now has the right to
stand up and say 81 told you so. -
If any lawyer of the state thought it
there was most excellent opportunity
for him to have advertised his wis
dom by pointing it out.
The public accepted the common un-
derstanding in good faith and in many
cases have proceeded to adapt their
business to the changed conditions.
What is money? Is it simply pieces
of metal with Official inscriptions there
on, or uncoined bullion both of which
have a real intrinsic value? Is it paper
upon which the government has ex
pressed certain promises? Or is it also
representation of value elsewhere
existing. An evidence if you lease 'ot
the governments indebtedness to the
holder. National banks issue their
currency or notes backed by the gov
eminent in exchange for articles of
value. A debt exists evidenced by
VIII oh c1pnY,1xy
to pay. Are they cash or promises to
pay cash?
A man buys farm, creates a debt
evidenced by notes representing the
value of that farm. Those notes may
be negotiated for check That check
is not cash but is accepted in lieu there
of because of faith in the maker S
credit. Under this opinion can that
check which is merely an order to pay
be accepted as cash loaned? But YOU
say the check is exchangeable for cash
because it has credit behind it. So
have the notes. The very readiness
with which mortgage notes given for
the purchase price may be paid and
notes given to obtain cash to pay the
previous notes shows the f1imsy char
acter of the discrimination which this
opinion sets up between them.
| Personally ! am not fortunate
enough to own any per cent paper
and have nothing to gain or lose by the
decision, but don't like to see justice
perverted by a discrimination which
seeks to deprive the debtor of one of
the benefits contemplated by the law
when it deprived him of the offset.
1t was not the intent of the legisla-
ture nor was it so construed by the
press, the public or the bar. Time
will tell what the supreme court will
say about this. l am not lawyer
and confess that it is presumption fol
me to express an opinion. but, fully
believe that this technical interpreta
ton is an unwarranted perversion Of
justice for which an outraged people
will demand reckoning.
Very sincerely,
O. w. Locke.
Orleans, VT. March 20, 1918.