Murray v. Harrison

Sutherland, J. I shall treat the demurrers to the complaint, which are general, as presenting and intending to present for decision, the single question, whether the plaintiff must deem herself and her bond and mortgage satisfied by the $4,151.66, (which she has received in legal tender notes, or whether she is entitled to receive in addition thereto, the — 490 — $2000 in legal tender notes, deposited in the United States Trust Company, under the order of the court in the partition suit, hy arrangement between the parties, as and for the difference between $4151.66 (the amount due on the bond and mortgage-for principal and interest) and the market value of a certain quantity or number of pieces of gold or silver coin, of the standard mentioned in the condition of the bond, amounting by tale, or denominationally, to the same sum. In my opinion, it inevitably follows from the decision of the Court of Appeals in Meyer v. Roosevelt, (27 N. Y. Rep. 400.) holding the legal tender act to be constitutional and valid, not only as to contracts made after the passage of the act, but also as to contracts made before, that this court must consider the - plaintiff's bond and mortgage fully paid and satisfied by the $4151.66, which she has received in legal tender notes, and that there must be judgment for the defendants on the demurrers. The condition of the bond (dated May 26th, 1846) is, to - pay $4000, in three years from date, “'in gold or silver coin, . of the standard by which the coins of the United States were regulated by the laws existing on the 26th day of May, 1846, with -interest at the rate of seven per cent per annum, payable on the 26 th day of May and November in each and-every year, in coin as aforesaid.” Grold and silver are used not only for coinage, but extensively for various other useful purposes; hence, gold and silver bullion, as a commodity, or as merchandize, has an intrinsic value, not only for coinage, but for such other purposes ; and hence, gold or silver coin has an instrinsic value as a commodity, or as merchandize, and may be treated as such by parties in making contracts, and in construing and enforcing contracts, I do not see why the courts should not treat gold. or silver coin as the parties have treated it by their contract. The coinage, or stamping of portions or pieces of these metals alloyed with various metals, by government prerogative, fixes the value of such pieces as money, or coined money; — 491 — but the regulated standard of a gold or silver coin of a given weight, that is the proportion by weight of its fine metal and alloy, determines its relative value- as a commodity. Before the legal tender act, money meant coined money, in all legal proceedings to enforce the payment or collection of money debts. It was the office of money, or coined money, not only , to measure the money value of all commodities, even its own value, viewed or treated as a commodity, but also to pay, or satisfy money debts. Indeed, if one may be excused for uttering such a mere verbal truism, value in the abstract, or as measured by money, could not be expressed without money. Hence, it is evident that before the legal tender act, it followed from the office or capacity of coined money, the coinage system of the United States, its adopted unit of value, and the power of congress to coin money, and to regulate the value of coins, that a promise to pay one hundred dollars was in legal effect a promise to pay at the option of the promissor, one hundred dollars, in any coin which might be a legal tender for one hundred dollars, at the time of payment; and hence, .that a note for one hundred dollars, and a note for one hundred dollars payable in one hundred silver dollars, or in one hundred gold dollars, or in five double eagles, or ten eagles, or twenty half eagles, with or without the additional words, lawful or current money, of the United States, was the same in legal effect, for, in either case, the note could have been paid in silver dollars, or in either of the gold coins. My excuse for these extremely elementary remarks, must be the peculiar character of the contract in this case. The contract is to pay four thousand dollars (the principal mentioned in the condition of the bond) and the interest, in gold or silver coin, of the standard by which the coins of the United . States were regulated by the laws, on the 26th day of May, 1846, the date of the bond. As the standard of a gold or silver coin of a given weight, determines its relative value, as bullion, or a commodity, the contract maybe said to be, to pay $4000, and interest, in gold or — 492 — silver coin of the value of like coin of a certain standard specified in the contract. It is plain then, that by the contract, the parties to it treated the gold or silver coin to be paid or tendered, as a commodity, or as specific articles of a commodity, for the coin is to be valued, of course valued in money, in dollars and cents. By the contract, coin tendered in payment is to be valued, and if not of the-value, or standard, called for by the contract, then the difference in values is also to be paid or tendered. The values, and the difference between them, must of course be expressed in money, in dollars and cents. blow the thing, the coins, which by the contract is to be valued in money, can not by the contract be treated as money. Money and the thing which it is to measure, and express the value of, can not both be viewed or treated as money, even though that thing be gold or silver coin. It is evident then, that the parties to the contract, by -it • treated the coin in which the bond is payable, as a commodity, which by the contract was to be of a cettain value, or of a value the means of ascertaining which are fixed by the Contract. The court must treat the coin in which the bond is payable, as the parties to the contract by the contract have treated it; and what is the result ? Of course the result is, that the court must view the contract as a contract to pay a certain sum of money, a money debt, in a certain commodity, or in specific articles of a certain commodity, at a certain price or valuation fixed or provided for by the contract. And what is the legal result P It must be deemed settled that a contract for the payment of a certain sum of money, a note for instance, in specific articles, at a certain pripe or valuation, gives to the paying party the option or privilege of paying the money in such specific articles, at the price or valuation, but does not give to the party entitled to receive payment, the right to enforce payment in such articles, at the price named, or any other price or valuation ; that the paying party may pay in — 493 — the specific articles, or commodity, at the price or valuation, but that the receiving party must receive his debt in money, if legally tendered. (Pinney v. Gleason, 5 Wend. 394. Smith v. Smith, 2 John. 235. Brooks v. Hubbard, 3 Conn. R. 58, 60. Fletcher v. Derrickson, 3 Bosw. 181.) Of course it follows if the legal tender act had not been passed, but congress, after the date of the bond, had materially debased, or lowered the standard of gold and silver coin, that the plaintiff would have been obliged to receive payment of her debt, in such debased gold or silver coin, by tale or count; that her debt could have been paid in any gold or silver coin, at its then regulated standard or value, as coin or money, which was or might be a legal tender for such a sum or amount of money. It is plain that this result would have followed from the very terms of the contract, and without reference to the considerations that it was the evident intention of Bronson, to whom the bond was executed, as executor, by the contract, to protect the estate under his charge, against the power of congress to regulate the value of coins, of course to debase them, and that no court could aid a party in thus undertaking by contract, to thwart or evade a conceded power of congress. The very terms of the contract compel the court to hold that the plaintiff’s claim is not for the coin to be valued, or for its .value, but that her claim is, for her money debt, expressed in dollars, and the interest on it, by the contract to be paid in gold and silver coin, &o. I am not aware that the standard or weight of gold or silver coins (except the weight of half dollars, and smaller silver coins, by the act of 1853, and which, by the act, are made a legal tender for sums not exceeding five dollars,) has been lowered or lessened, or altered since the date of the bond. I can not see, therefore, how there could have been occasion for saying what has been said, as to its construction, legal effect, &c. if the legal tender act had never been passed ; but the legal tender act was passed, and has been held constitu — 494 — tional by a court which controls, and has a right to control, the decisions of this court. The act does not declare legal tender notes to be coins. The most sanguine alchemist that ever lived, probably never dreamed of converting paper into either gold or silver. A ten dollar legal tender note does not purport on its face to be ten dollars, but does purport on its face to be a promise to pay ten dollars. On its face it purports to be a promise to pay money, not to be money. But the act does declare that these notes “ shall be lawful money, and a legal tender in payment of all debts, public and private, within the United States, except duties on imports, and interest on government bonds, which shall be paid in coin.” How, any thing which is a legal tender for a money debt, which a party is by law obliged to receive in payment of his money debt, must be money, or considered to be money, for it performs an office, or has a capacity, which nothing but money can perform, or have. It necessarily follows, then, from the terms and legal effect » of the terms of the plaintiff’s bond, or contract, and from the legal tender act, and the controlling decisions affirming its constitutionality, that I must hold, as the complaint shows, that the plaintiff had received $4151.66, the amount due on the bond for principal and interest, in legal tender notes; that the bond has been paid; and that she must consider herself and her bond both satisfied, by such payment; for such is the controlling law of the case. Of course any one must see that when gold and silver coin is the subject of a contract of purchase and sale and delivery or of pledge, or of special deposit, or of an unlawful conversion, it is perfectly consistent with the foregoing views and conclusion arrived at, for the court to treat it as a commodity, and apply the same rule of damages for its non-delivery, or unlawful conversion, as would be applied for the non-delivery or unlawful conversion of any other article or commodity. And to prevent misapprehension of what has been said, — 495 — and in view of several of the cases growing out of the legal tender act, cited on the argument, and which I have not time more particularly to refer to, I will go farther and say, if A. B. in the present condition of things, agrees to sell and deliver one hundred bushels of wheat to 0. D. or to perform certain services for 0. D. for one hundred dollars in gold or silver coin, that I do not see why the court can not and ought not to treat the agreement as an agreement in the one case to exchange one commodity for another commodity, and in the other case, as an agreement to exchange or render certain services for a certain commodity. An agreement to pay so many dollars in coin, or in coin at a certain valuation by tale or weight, is one thing; but an agreement to pay so many dollars, or to render certain services or deliver a certain commodity, for coin, by tale or weight, is another thing. The result of the legal tender act is, that gold and silver coins have practically ceased to be currency, and have become, except as to the government, practicálly exclusively a commodity, and are bought and sold and speculated in, and commonly viewed and treated as such. Why should a court ignore this state of things, unless compelled to do so by the terms of the contract or by force of' the legal tender act ? Why should not A. B. and 0. D. be presumed to have made the supposed agreement, in view of the fact that gold and silver coin has, as between individuals, become exclusively a commodity—in view of the fact that a gold eagle is worth ■ fourteen or fifteen dollars in legal tender notes? Why should not the court consider A. B. and 0. D. as having by their supposed agreement, treated the coin to be paid for the commodity or services as a commodity, and the words one hundred dollars, as used by them for the purpose of designating the quantity or number of pieces of coin, at their stamped or coined value as money, to be delivered or paid ? And if A. B. and 0. D. have so treated it by their supposed agreement, why should not the court so treat it, and consider G. D.’s — 496 — agreement as substantially an agreement to deliver a certain quantity or number of pieces of coin, as a commodity, for a certain other commodity, or for certain services ? [New York Special Term, February 4, 1867. In examining the plaintiff’s case of a money debt, and her rights under her money bond, in view of the legal tender act, I have not intended to say any thing not consistent with the conclusion that if in the supposed case, A. B. delivered the wheat or performed the services according to agreement on his part, and G. D. did not pay or deliver the coin according to agreement on his part, he would be legally liable to pay the value of the coin in dollars ; that is, practically, in legal tender notes,- for practically legal tender notes are money, and represent dollars. The agreement on 0. D.’s part in the supposed case is not to pay so many dollars, nor to pay so many dollars in coin, or in coin at a certain valuation, but is an agreement to pay so many dollars in coin for the wheat, or for the services. Mo debt or duty is due from him until A. B. delivers the wheat or performs the services, and when A. B. does this, the terms of the supposed agreement would not compel the court to , hold that a money debt of one hundred dollars was due from 0. D.; and I do not see why the court could not hold, considering the circumstances under which the supposed agreement was made, and with reference to which the parties must be presumed to have contracted, that G. D.’s duty was, on performance by A. B., either .to deliver the coin, or to pay its value in legal tender notes. There must be judgment for the defendants on the demurrers, with costs. Sutherland, Justice.]