The Waterbury Democrat., 1935-02-18


 applied to government bonds.
 The court likewise threw out a suit in which payment at the rate of $1,69 in devalued currency was sought on gold certificates turned in under the treasury's gold seiz ure orders.
 The court resorted to unprece- dented procedure by first announce ing it's decisions in the cases. and then proceeding one by one to the reading of opinions supporting the decisions.
 Court Had No Authority
 In the government bonds and gold certificates cases the court held the U. S. court ofS claims, in which the suits were filed. had no authority to entertain such suits.
 In the Liberty bond case, the court held that congress went too far in eliminating the gold pay ment clause from government bonds.
 But it said that any action to re- cover must be in law and that the court of claims had no Jurisdiction.
 Government Cannot Be Sued
 The supreme courts action in denying the court of claims 5uris. diction in these cases appeared 10 leave the holders of government bonds and gold certificates no re- course in recovering extra pay ments regardless of the fact the court believed congress went too far in applying the gold clause cancellation to federal bonds.
 The government cannot be sued anywhere except in the court of claims without it's permission. With the court of claims denied permission to entertain these suits, the bondholders apparently have no place to seek compensation. Remedial action in congress would seem to be their only alternative and this would be opposed by the administration forces.
 Treasury officials said h y viewed the courts action on the gold cases as a complete govern ment victory.
 No $1.69 Payment Allowed
 The decision of the court up holding outlawing of the gold clause in private bonds affected some $75,O00, 100000 of obliga- tions, chiefly those of railroads, public utilities and other leading col porations.
 Holders of bonds of some of these corporations had demanded payment at the rate of $1.69 TOT $1 face value. They claimed they were entitled to the extra amount because the New Deal had devalu- ed the dollar proportionately. The supreme court, however, denied their claims.
 Chief Justice Charles Evans Hughes, loudly reading the hrst opinion, sketched the new deals ac. tions in meeting the 1S3S banking crisis and readjusting the nations monetary system.
 eve are not concerned with the wisdom of steps taken" Hughes told the courtroom packed with administration officials. lawyers. Wall street representatives and so- cialits.
 I've arec oncerned only with power" Hughes said.
 Justic ce Benjamin Cordozo, hunched in his chair, peered in' tently into the faces of the dis tinguished visitors in the first few rows.
 Senate Majority Leader Joseph T. Robinson came in at 12:15 as Hughes was reading. He was ad- vised by an attorney that "the government has been upheld in all cases"
 That's fine" Robinson exclaim- ed, a broad smile on his face.
 Angus MacIean, assistant solici-. tor general, was present in the courtroom.
 Contracts, the court noted, can not circumvent the exercise of con. stitutional powers belonging to congress.
 Hughes opinion noted. that at time the gold clause bonds were issued there was nothing to make them illegal. It said there was a distinction between the gold cases and earlier cases which had been cited by the litigants.
 The court noted that it had pre- viously held that treasury notes could be made legal tender for past as we'll as future obligations.
 Fully cognizant of the great in- terest not only in the courts de- cisions but upon what considera- tions they were based. Hughes carefully explained historic prece- dents.
 He paused occasionally to em- phasize certain features of the ruling. As he spoke of the power of congress to coin money and reg ulate the value of money, he look. ed toward group of senators which included McAdoo. McKellar. Thomas, Duffy and Former Rep. James M. Beck. noted constitution. al authority.
 Hugo Carusi. assistant attorney general, left as soon as the de- >cisions were announced to tele-' phone his superior. Attorney Gen. eral Homes S. Cummings.
 At 12:30 p. m.. Hughes was still reading. Despite the fact that 1t was filled ot capacity, stric si- lence prevailed in he courtroom.
 ..-'le court found that gold and silver had peculiar qualities which made their possession subject to the power of the state to exercise its sovereign rights over the cur rency. This power the opinion broadly endorsed.