Court Opinion

ID: 9421337
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:57:53.236991+00
Date Added: 2024-06-11T17:22:29.725925
License: Public Domain

*35Mr. Justice Black and Mr. Justice Douglas,
dissenting.
We believe that the “federal law merchant," which Clearfield Trust Co. v. United States, 318 U. S. 363, 367, held applicable to transactions in the commercial paper of the United States, should be applicable to all transactions in that paper. Indeed the Court said in National Metropolitan Bank v. United States, 323 U. S. 454, 456, that “legal questions involved in controversies over such commercial papers are to be resolved by the application of federal rather than local law.” Not until today has a distinction been drawn between suits by the United States on that paper and suits by other parties to it. But the Court does not stop there. Because this is “essentially a private transaction,” it is to be governed by local law. Yet the nature of the rights and obligations created by commercial paper of the United States Government is said to be controlled by federal law. Thus, federal law is to govern some portion of a dispute between private parties, while that portion of the dispute which is “essentially of local concern” is to be governed by local law. The uncertainties which inhere in such a dichotomy are obvious. Cf. Southern Pacific Co. v. Jensen, 244 U. S. 205; Davis v. Department of Labor, 317 U. S. 249.
The virtue of a uniform law governing bonds, notes, and other paper issued by the United States is that it provides a certain and definite guide to the rights of all parties rather than subjecting them to the vagaries of the laws of many States. The business of the United States will go on without that uniformity. But the policy surrounding our choice of law is concerned with the convenience, certainty, and definiteness in having one set of rules governing the rights of all parties to government paper, as contrasted to multiple rules. If the rule of the Clearfield Trust case is to be abandoned as to some parties, it should be abandoned as to all and we should start afresh on this problem.