Argument for Plaintiff in Error.

der quality and their character of currency were due solely to the war. To the war was due not only the exercise of the power to give this quality and character, but the power itself.

The Resumption Act directed the forced loans authorized by the acts of 1862 and 1863, and continued by the Revised Statutes of 1874, to be redeemed and paid on demand on and after January 1st, 1879.

The Resumption Act also fixed the limit of time beyond which the currency which evidenced the loans should, not be irredeemable. After January 1st, 1879, it was redeemable in coin, and this quality of redeemability thenceforth inhered in every United States note described in the Resumption Act. It was not taken away by the act of May 31st, 1878, and could not be taken away, because the promise to pay the sum expressed in the treasury notes had been made by the Resumption Act a promise to pay in coin. Nothing short of a repeal of the Resumption Act, and a repudiation of the obligation which it created, could change the character of the promise. After the Resumption Act was approved, every note outstanding was as much a promise to pay in coin, on demand, on and after January 1st, 1879, the sum specified, as if those words had been printed on its face.

It has never been possible to divorce the question of the constitutional power to coin the public credit into money, and make it an instrument of discharging debts, from the history of legal tender paper money and its consequences. Nor is it possible now.

Facts have nowhere shown themselves to be more stubborn than in this discussion. The strange anomaly is presented, that while the mischiefs of the existing legal tender currency are established beyond contradiction by the voice of history, the teachings of experience, the recorded testimony of its authors, and the repeated decisions of the court, we now find it domesticated among us as an integral part of our national economy, under legislation which, unless arrested by this court, will warrant its perpetual continuance as a part of the ordinary administration of the government.

It is matter of undisputed fact that, as to the legal tender

VOL. CX-28

Argument for Plaintiff in Error.

quality, no public exigency required or justified the passage of the act of May 21st, 1878.

It is equally plain that, as to the legal tender quality, in the absence of a public exigency, no aid is derived to the act of May 31st, 1878, from any of the powers granted by the Constitution to Congress.

It cannot be claimed, as to the legal tender quality, that the prohibition to retire the United States notes when redeemed, and the direction to issue them after redemption, irrespective of any need of the government, was a legitimate exercise of the power "to borrow money." The use of the legal tender element was wholly unnecessary as a means of borrowing, and, in fact, the whole public debt was provided for by the funding measures, and the Resumption Act had explicitly directed that portion of it which was represented by the legal tender notes to be redeemed in coin. The legal tender quality was, therefore, not required as an incident or aid of the borrowing power. The credit of the government was a sufficient guaranty for the debt.

Nor can the issue of currency attempted by the act be brought within the power "to coin money and regulate the value thereof." Whatever may have been claimed under this provision as to the original issue, it can have no application here. The promise of the outstanding unredeemed legal tender notes on May 31st, 1878, as enlarged by the Resumption Act, had become a promise to pay on demand, in coin, the sum specified by the notes respectively, and this obligation was not interfered with by the act in question.

The act of May 31st, 1878, is, of course, unsupported by any of the powers given to Congress to "declare war," or to "raise and support armies" and "a navy," nor can public emergency of any kind be pleaded as an excuse for its enactment. The plea of the Secretary of the Treasury that the continuance of the legal tender would be a safeguard against future emergencies, was an admission that no present emergency existed which required its continuance or creation.

The claim for the exercise of the power attempted by the act of May 31st, 1878, on the ground that it was intended to

Opinion of the Court.

supply a currency for the people, simply revives the question whether making the "legal tender" and "lawful money" qualities an attribute of such a currency is within the scope of the powers of Congress. If we are right in claiming that these qualities are wholly independent of the proper elements of United States notes, when issued under ordinary conditions, then the power to issue such notes does not imply or carry with it the power to connect these qualities with the notes, save in the exigency which creates the power.

The government of the United States has no power of inherent sovereignty, but only such sovereign powers as were delegated to it by a written Constitution, which carefully and expressly declared that all powers not delegated by that instrument were reserved to the States and people. So that it would follow that the power to create a legal paper currency, if it exist at all, must exist by force of a delegation, and not by force of inherent sovereignty. On this principle it was that the Supreme Court held the old war legal tenders to be valid, as a measure incidental to the delegated war powers. The absence, therefore, of an express prohibition against Congress making anything but gold and silver a legal tender, as was made in respect of the States, furnishes no evidence that such a power was intended to be left with Congress. For the States without the prohibition would have had the inherent sovereign power that belonged to perfect political autonomies. This idea is illustrated by the analogous provision that no State shall pass any law impairing the obligation of a contract, and by the historic fact that it has always been held and admitted that Congress has no power to pass any law impairing the obligation of a contract otherwise than in the exertion of some power expressly conferred, the effect of which would be to accomplish that result; as the power to pass uniform bankruptcy laws, one of the incidents of which would be to impair the obligation of a contract.

Mr. Benjamin F. Butler, Mr. Thomas H. Talbot, and Mr. James McKeen for defendant in error.

MR. JUSTICE GRAY delivered the opinion of the court.

Opinion of the Court.

The amount which the plaintiff seeks to recover, and which, if the tender pleaded is insufficient in law, he is entitled to recover, is $5,100. There can, therefore, be no doubt of the jurisdiction of this court to revise the judgment of the Circuit Court. Act of February 16th, 1875, ch. 77, § 3; 18 Stat. 315.

The notes of the United States, tendered in payment of the defendant's debt to the plaintiff, were originally issued under the acts of Congress of February 25th, 1862, ch. 33, July 11th, 1862, ch. 142, and March 3d, 1863, ch. 73, passed during the war of the rebellion, and enacting that these notes should "be lawful money and a legal tender in payment of all debts, public and private, within the United States," except for duties on imports and interest on the public debt. 12 Stat. 345, 532,

709.

The provisions of the earlier acts of Congress, so far as it is necessary, for the understanding of the recent statutes, to quote them, are re-enacted in the following provisions of the Revised Statutes:

"SECT. 3579. When any United States notes are returned to the Treasury, they may be reissued, from time to time, as the exigencies of the public interest may require.

"SECT. 3580. When any United States notes returned to the Treasury are so mutilated or otherwise injured as to be unfit for use, the Secretary of the Treasury is authorized to replace the same with others of the same character and amounts.

"SECT. 3581. Mutilated United States notes, when replaced according to law, and all other notes which by law are required to be taken up and not reissued, when taken up shall be destroyed in such manner and under such regulations as the Secretary of the Treasury may prescribe.

"SECT. 3582. The authority given to the Secretary of the Treasury to make any reduction of the currency, by retiring and cancelling United States notes, is suspended."

"SECT. 3588. United States notes shall be lawful money and a legal tender in payment of all debts, public and private, within the United States, except for duties on imports and interest on the public debt."

The act of January 14th, 1875, ch. 15, " to provide for the re

Opinion of the Court.

sumption of specie payments," enacted that on and after January 1st, 1879, "the Secretary of the Treasury shall redeem in coin the United States legal tender notes then outstanding, on their presentation for redemption at the office of the Assistant Treasurer of the United States in the City of New York, in sums of not less than fifty dollars," and authorized him to use for that purpose any surplus revenues in the Treasury and the proceeds of the sales of certain bonds of the United States. 18 Stat. 296.

The act of May 31st, 1878, ch. 146, under which the notes in question were reissued, is entitled "An act to forbid the further retirement of United States legal tender notes," and enacts as follows:

"From and after the passage of this act it shall not be lawful for the Secretary of the Treasury or other officer under him to cancel or retire any more of the United States legal tender notes. And when any of said notes may be redeemed or be received into the Treasury under any law from any source whatever and shall belong to the United States, they shall not be retired, cancelled or destroyed, but they shall be reissued and paid out again and kept in circulation: Provided, 'That nothing herein shall prohibit the cancellation and destruction of mutilated notes and the issue of other notes of like denomination in their stead, as now provided by law. All acts and parts of acts in conflict herewith are hereby repealed." 20 Stat. 87.

The manifest intention of this act is that the notes which it directs, after having been redeemed, to be reissued and kept in circulation, shall retain their original quality of being a legal tender.

The single question, therefore, to be considered, and upon the answer to which the judgment to be rendered between these parties depends, is whether notes of the United States, issued in time of war, under acts of Congress declaring them to be a legal tender in payment of private debts, and afterwards in time of peace redeemed and paid in gold coin at the Treas ury, and then reissued under the act of 1878, can, under the