Silver Free Coinage and the Legal Tender Decisions

• Author: Christopher G. Tisduman
• DOI: 10.1177/000271629700900203
• Published date: 01 September 1897
• Date: 01 September 1897
• Subject Matter: Articles

SILVER FREE COINAGE AND THE LEGAL
TENDER DECISIONS.
Now that the national political contest, involving more
particularly the proposition for the free and unlimited coin-
age of silver dollars at the ratio to gold of sixteen to one,
has been decisively settled against the proposition, and
in favor of maintaining the present gold standard of the
currency, it seems to be an opportune time to call the
attention of the thinking people of this country to the dif-
ficulties we would have encountered, in securing from the
Supreme Court of the United States a pronouncement of the
unconstitutionality of a silver free-coinage act of Congress,
which would have been passed and made law, if the Demo-
cratic party had been successful at the polls.
Throughout the heated political contest, the opposition
papers teemed with arguments to prove that the free coinage
of silver at the stated ratio meant repudiation pro tanto of
all existing obligations; and this argument, brought home
to the small investor, the savings bank depositor, the holder
of life insurance policies, and the wage-earner, unquestion-
ably secured the defeat of the silver party. And, although
during the canvass very little was said in speech or print of
the protection against such a dishonest act of government
which might be confidently expected as a last resort from
the courts, in declaring a silver free-coinage law unconsti-
tutional, this feeling was undoubtedly widespread, if not
often expressed. This expectation, in the light of our
history, was a most natural one. For the whole constitu-
tional law of this country, both national and state, is im-
pregnated with the policy of protection to vested interests.
Our revolutionary forefathers seemed to have been fearful of
an unfettered popular will, and their boast-and the states-

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men and jurists of the world have commended our govern-
ment on account of it-was that they had established such
a system of checks of one branch of the government upon
another, as that it was impossible for any radical change to
be effected in the form or policy of our government, which
was not supported by the overwhelming second thought
of the nation. As history has revealed it to us, the chief
and most valuable check, devised by the framers of the
national constitution, was the power of the courts to pro-
nounce an act of Congress or state legislature unconstitu-
tional, which contravened any provision of the written
constitution.
Before the constitution of the United States was adopted
and the present Union established, and while the Constitu-
tional Convention was sitting at Philadelphia, the Congress
of the Confederation was framing an ordinance for the gov-
ernment of the northwest territory; and, in setting forth the
fundamental principles of justice, which should pervade and
control the governmental acts of the territory, the ordinance
provided inter alia:
&dquo;And in the just preservation of rights and property it is under.
stood and declared that no law ought ever to be made, or have
force in the territory, that shall in any manner whatever interfere
with or affect private contracts or engagements bona fide and without
fraud previously made. &dquo;
This declaration was called forth by the very general
desire to repudiate the inheritance of public indebtedness
from the expenditures in the prosecution of the revolu-
tionary war. In order to more effectually stem this tide of
sentiment in favor of repudiation of public obligations, the
Constitutional Convention inserted in the constitution the
well-known provision that, ‘ ‘ no state shall pass any law
impairing the obligation of contracts. &dquo;
The convention
did not think it necessary to impose the same explicit re-
striction upon the powers of Congress, probably because the
national government was not expected at that time to play

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a very large or important role in the internal affairs of the
country. But in the fifth amendment to the constitution,
adopted subsequently, it was provided that
neo person shall be deprived of life, liberty or property without due
process of law.’’
It is therefore one of the fundamental propositions of
American constitutional law, that neither the national nor
the state legislatures have the power by enactment to take
one man’s property and give it to another, even upon pay-
ment of compensation, except in the enforcement of the
payment of debts. In the exercise of the right of eminenl
domain, a private owner’s land may be taken for devotion
to public use, upon payment of compensation. But it is not
possible for land so condemned to be devoted to the strictly
private use of another.
Property is defined as &dquo;any thing or object of value which
one may acquire and own,&dquo; and one of the commonest
divisions of property in the law books is into things
in possession and things in action. Things in action, or,
to employ the old Norman-French term, choses in action,
include every claim against another for money, or money’s
equivalent, which can be successfully enforced in a judicial
action.
It is manifest, therefore, that the constitutions,
both national and state, guarantee one in the secure pos-
session of things in action, as well as of things in possession.
When the National Bankrupt Law, which cut off the
claims of creditors of an insolvent debtor, was claimed to be
a violation of the right of property in things in action, it
was justified on the ground that the constitution of the
United States had expressly authorized the enactment of the
law, thereby making it an express exception to the ordinary
constitutional guaranty of protection to vested rights
It is probably not an exaggerated statement that three-
fourths of the private property of the world are things in
action, contracts, bonds, notes, open accounts, covenants,
* 6ee Ogden M. Saunders, 12 wheat. 26o.

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mortgages, etc., and the great majority of these things in
action are contracts, which call for the payment of money.
It is also probably true, that the overwhelming majority of
these current monetary obligations were created in this
country since 1873, when...