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charged by the company for water. This board met the prices fixed for the time being by the honest judgand fixed a tariff of rates to go into effect on the 1st of ment of such a commission as was specially provided June, 1878. In July, of the same year, Friedlander, for in the act, must be deemed reasonable, both by the one of the commissioners appointed by the supervisors company and the public, is not denied. The dispute died. By his death a vacanoy was created in the is as to the power of the State, under the prohibitions board which has never been filled.

of the Constitution of the Uuited States, to substituto In 1779 the people of California adopted a new Con- for this commission another, selected without the costitution, which went into effect on the 1st of January, operation of the company, or some other tribunal of a 1880. Article 14, sections 1 and 2 of this Constitution different character, like the municipal authorities of are as follows:

the locality. The Spring Valley Company claims that “ARTICLE 14.

it has, under its charter, a right to the maintenance of “Water and Water Rights.

the commission which was created by the requisite ap“Section 1. The uses of all water now appropriated, pointments in 1878, and the object of this suit is to or that may hereafter be appropriated, for sale, rental,

compel the board of supervisors to perpetuate that or distribution, is hereby declared to be a public use,

commission by filling the vacancy that exists in its and subject to the regulation and control of the State,

membership. So that the whole controversy here is in the manuer to be prescribed by law: Provided,

as to the right of water companies that availed themthat the rates or compensation to be collected by any

selves of the privileges of the act of 1858 to secure a person, company, or corporation in this State for the virtual monopoly of trade in water at a particular use of water supplied to any city and county, or city place, to demand the appointment of the commission or town, or the inhabitants thereof shall be fixed, an- provided for in that act, notwithstanding the Constinually, by the board of supervisors, or city and county

tution of 1879, and the legislation under it. or city or town council, or other governing body of

The Spring Valley Company is an artificial being such city and county, or city or town, by ordinance or

created by or under the authority of the Legislature otherwise, in the manner that other ordinances or

of California. The people of the State, when they first legislative acts or resolutions are passed by such body,

established their government, provided in express and shall continue in force for one year and no longer.

terms that corporations, other than for municipal Such ordinances or resolutious shall be passed in the purposes, should not be formed except under general month of February of each year,and take effect on the

laws, subject at all times to alteration or repeal. The first day of July thereafter. Any board or body fail

reservation of power to alter or repeal the charters of ing to pass the necessary ordinances or resolutions fix- cor tions was not new, for almost immediately ing water rates, where necessary, within such time, after the judgment of this court in the Dartmouth Colshall be subject to peremptory process to compel lege case (Dartmouth College v. Woodward, 4 Wheat. action at the suit of any party interested, and shall be

518), the States, many of them, in granting charters liable to such further processes and penalties as the

acted on the suggestion of Mr. Justice Story in his Legislature may prescribe. Any person, company, or concurring opinion (p. 712) and inserted provisions by corporation collecting water rates in any city and

which such authority was expressly retained. Even county, or city or town in this State, otherwise than before this decision it was intimated by the Supreme as so established, shall forfeit the franchises and water

Judicial Court of Massachusetts in Wales v. Stetson, 2 works of such person, company, or corporation to the

Mass. 143, that such a reservation would save to the city and county, or city or town where the same are

State its power of control. In California the Consticollected for the public use.

tution put this reservation into every charter, and " Section 2. The right to collect rates or compensa

consequently this company was from the moment of tion for the use of water supplied to any county, city

its creation subject to the legislative power of alteraand county, or town, or the inhabitants thereof, is a tion, and if deemed expedient, of absolute extinguishfranchise, and cannot be exercised except by authority

ment as a corporate body. of and in the manner prescribed by law.”

Water for domestic uses was difficult to be got in Under this provision of tbe Constitution and the

some parts of the State. Large amounts of money legislation based thereon, the board of supervisors

were needed to secure a sufficient supply for the inclaim the right and power to fix the rates to be charged habitants in many localities, and as a means of comby the company for water, and refuse to appoint a

bining capital for such purposes the act of 1858 was member to fill the vacancy in the board of commis- | passed. Other statutes had been enacted before to sioners occasioned by the death of the former incum

effect the same object, but it is said they were not bent. This suit was begun in the Supreme Court of

such as a company with capital enough to supply San the State for a writ of mandamus requiring the board

Francisco was willing to accept. The act of 1858 was of supervisors to take action in the matter and fill the thought sufficiently favorable, and the Spring Valley vacancy. The court on final hearing refused the writ | Company, after organizing under it, expended a large and dismissed the petition. This writ of error was

amount of money to provide the means of supplying brought by the company to review that judgment.

the territory on which San Francisco is built, aud The general question involved in this case is whether make it possible to support a great population there. water companies in California, formed under the act

All this was done in the face of the limitations of the of 1858 before the adoption of the Constitution of 1879,

Constitution on the power of the Legislature to create have a right, which the State is probibited by the

a private corporation and put it beyond the reach of Constitution of the United States from impairing or

legislative control, not only as to its continued existtaking away, to charge their customers such prices for

ence, but as to its privileges and franchises. One of water as may from time to time be fixed by a commis

the obligations the company assumed was to sell sion made up of two persons selected by the company,

water at reasonable prices, and the law provided for a two by the public authorities of the locality, and if

special commission to determine what should be need be, a fifth selected by the other four, or by the

deemed reasonable both by the consumers and the sheriff of the county. The Spring Valley Company

company, but there is nowhere to be found any evi. claims no rights of this character that may not also be

dence of even a willingness to contract away the power claimed by every other company formed under the of the Legislature to prescribe another mode of sec. same act.

tling the same question if it should be considered deThat the companies must sell at reasonable prices all

sirable. In the Sinking Fund cases, 99 U. S. 721, it the water they are able to furuish consumers, and that

was said that whatever rules for the government of the affairs of a corporation might have been put into were one of construction only, this argument might the charter when granted could afterward be estab- have force, but the dispute now is as to legislatire lished by the Legislature under its reserved power of power, not legislative action. The Constitution of amendment. Long before the Constitution of 1879 California adopted in 1849 prohibited one Legislature was adopted in California, statutes had been passed in bargaining away the power of succeeding Legislatures many of the States requiring water companies, gas to control the administration of the affairs of a private companies, and other companies of like character to corporation formed under the laws of the State Of supply their customers at prices to be fixed by the this legislative disability the Spring Valley Company municipal authorities of the locality; and as an inde- had notice when it accepted the privileges of the act pendent proposition, we see no reason why such a regu- of 1858, and it must be presumed to bave built its lation is not within the scope of legislative power, works and expended its moneys in the hope that unless prohibited by constitutional limitations or valid neither a succeeding Legislature, nor the people in contract obligations. Whether expedient or not is a their collective capacity when framing a Constitution, question for the Legislature, 'not the courts.

would ever deem it expedient to return to the old It is said however that appointing municipal officers mode of fixing rates, rather than on any want of to fix prices between the seller and the buyers is in power to do so, if found desirable. The question here effect appointing the buyers themselves, since the bay is not between the buyer and the seller as to prices, ers elect the officers, and that this is a violation of the but between the State and one of its corporations as principle that no man shall be a judge in his own case. to what corporate privileges have been granted. The But the officers here selected are the governing board power to amend corporate charters is no doubt one of the municipality, and they are to act in their offi. that bad men may abuse, but when the amendments cial capacity as such a board wben performing the are within the scope of the power, the courts cannot duty which has been imposed upon them. Their gen- interfere with the discretion of the Legislatares that eral.duty is, within the limit of their powers, to ad- have been invested with authority to make them. minister the local government, and in so doing to pro- The organization of the Spring Valley Company was vide that all shall so conduct themselves, and so use not a business arrangement between the State and the their own property, as not unnecessarily to injure company as contracting parties, but the creation of & others. They are elected by the people for that pur- new corporation to do business within the State and pose, and whatever is within the just scope of the pur- to be governed as natural persons or other corporapose may properly be intrusted to them at the dis- tions were or might be. Neither are the chartered cretion of the Legislature. That it is within the rights acquired by the company under the law to be power of the government to regulate the prices at looked upon as contracts with the city and county of which water shall be sold by one who enjoys a virtual San Francisco. The corporation was created by the monopoly of the sale, we do not doubt. That question State. All its powers came from the State and none is settled by what was decided on full consideration in from the city or county. As a corporation it can conMunn v. Ilinois, 94 U. S. 113. As was said in that tract with the city and county in any way allowed by case, such regulations do not deprive a person of his law, but its powers and obligatious, except those which property without due process of law. What may be grow out of contracts lawfully made, depend alone on done if the municipal authorities do not exercise an the statute under which it was organized, and such honest judgment, or if they fix upon a price which is alterations and amendments thereof as may, from manifestly unreasonable, need not now be considered, time to time, be made by proper authority. The profor that proposition is not presented by this record. vision for fixing rates cannot be separated from the reThe objection here is not to any improper prices fixed mainder of the statute by calling it a contract. It was by the officers, but to their power to fix prices at all. a condition attached to the franchises conferred on By the Constitution and the legislation under it, the any corporation formed under the statute and indismunicipal authorities have been created a special tri-solubly connected with the reserved power of alterabunal to determine what, as between the public and tion and repeal. the company, shall be deemed a reasonable price dur- It follows that the court below was right in refusing a certain limited period. Like every other tribu- ing to award the writ of mandamus which was prayed, nal established by the Legislature for such a purpose, and its judgment to that effect is affirmed. their duties are judicial in their nature, and they are Field, J., dissented. bound in morals and in law to exercise an honest judgment as to all matters submitted for their official determination. It is not to be presumed that they

POWER OF CONGRESS TO AUTHORIZE will act otherwise than according to this rule. And

LEGAL TENDER NOTES. here again it is to be kept in mind that the question before us is not as to the penalties to be inflicted on

SUPREME COURT OF THE UNITED STATES, the company for a failure to sell at the prices fixed,

MARCH 3, 1884. but as to the power to fix the price; not whether the company shall forfeit its property and franchises to

JUILLIARD V. GREENMAN. the city and county if it fails to meet the requirements Congress has the constitutional power to make the treasury of the Constitution, but whether the prices it shall notes of the United States a legal tender in payment of charge may be established in the way provided for in private debts, in time of peace as well as in time of war. that instrument. It will be time enough to consider Under the act of May 31, 1878, chapter 146, which enacts that the consequences of the omissions of the company

notes of the United States, issued during the war of the when a case involving such questions shall be pre

rebellion under acts of Congress declaring them to be a

legal tender in payment of private debts, and since the sented.

close of that war redeemed and paid in gold coin at the But it is argued that as the laws in force before 1858,

treasury, shall be reissued and kept in circulation, notes for the formation of water companies, which provided

so reissued are a legal tender, for fixing the rates by the municipal authorities, were not accepted by tho Spring Valley Company, and that

N error to the Circuit Court of the United States of 1858, without such a provision, was, it is to be in

for the Southern District of New York. The ferred that the State contracted with this company

opinion states the case. not to subject it to the judgment of such authorities GRAY, J. Juilliard, a citizen of New York, brought in a matter so vital to its interests. If the question an action against Greemman, a citizen of Connecticut,

IN

in the Circuit Court of the United States for the treasury is authorized to replace the same with others Southern District of New York, alleging that the of the same character and amounts. plaintiff sold and delivered to the defendant, at his “ Section 3581. Mutilated United States notes, special instance and request, one hundred bales of when replaced according to law, and all other notes cotton, of the value and for the agreed price of which by law are required to be taken up and not $5, 122.90; and that, the defendant agreed to pay that reissued, when taken up shall be destroyed in such sum in cash on theldelivery of the cotton, and had not manner and under such regulations as the secretary of paid the same or any part thereof, except that he had the treasury may prescribe. paid the sum of $22.90 on account, and was now justly “Section 3582. The authority given to the secretary indebted to the plaintiff therefor in the sum of $5,100; of the treasury to make any reduction of the currency, and demanding judgment for this sum with interest by retiring and cancelling United States notes, is busand costs.'

pended. The defendant in his answer admitted the citizen “Section 3588. United States notes shall be lawful ship of the parties, the purchase and delivery of the money and a legal tender in payment of all debts, cotton, and the agreement to pay therefor, as alleged; public and private, within the United States, except and averred that after the delivery of the cotton he for duties on imports and interest on the public debt." offered and tendered to the plaintiff, in full payment, The act of January 14, 1875, chapter 15, “to provide $22.50 in gold coin of the United States, forty cents in for the resumption of specie payments,' enacted that silver coin of the United States, and two United States on and after January 1, 1879, “the secretary of the notes one of the denomination of $5,000, and the other of treasury shall redeem in coin the United States legal the denomination of $100, of the description known as tender notes then outstanding, on their presentation United States legal tender notes, purporting by recital for redemption at the office of the assistant treasurer thereon to be legal tender, at their respective face of the United States in the city of New York, in sums values, for all debts, public and private, except duties of not less than fifty dollars;" and authorized him to on imports and interest on the public debt, and which use for that purpose any surplus revenues in the treasafter having been presented for payment, and re- ury and the proceeds of the sales of certain bonds of deemed and paid in gold coin, since January 1, 1879, at the United States. 18 Stat. 296. the United States sub-treasury in New York, had been The act of May 31, 1878, chapter 146, under which the reissued and kept in circulation under and in pursu- notes in question were reissued, is entitled "An act to ance of the act of Congress of May 31, 1878, chapter forbid the further retirement of United States legal 146; that at the time of offering and tendering these tender notes," and enacts as follows. notes and coin to the plaintiff, the sum of $5,122.90 “From and after the passage of this act it shall not was the entire amount due and owing in payment for be lawful for the secretary of the treasury or other the cotton, but the plaintiff declined to receive the officer under bim to cancel or retire any more of the notes in payment of $5,100 thereof; and that the de- United States legal tender notes. And when any of fendant had ever since remained, and still was, ready said notes may be redeemed or be received into the and willing to pay to the plaintiff the sum of $5,100 in treasury under any law from any source whatever and these notes, and brought these notes into court, ready shall belong to the United States, they shall not be reto be paid to the plaintiff, if he would accept them. tired, cancelled or destroyed, but they shall be reissued

The plaintiff demurred to the answer, upon the and paid out again and kept in circulation : Provided, grounds that the defense, consisting of new matter, that nothing herein shall prohibit the cancellation and was insufficient in law upon its face, and that the facts destruction of mutilated notes and the issue of other stated in the answer did not constitute any defense to notes of like denomination in their stead, as now prothe cause of action alleged.

vided by law. All acts and parts of acts in conflict The Circuit Court overruled the demurrer and gave herewith are hereby repealed." 20 Stat. 87. judgment for the defendant, and the plaintiff sued out The manifest intention of this act is that the notes this writ of error.

which it directs, after having been redeemed, to be reThe amount which the plaintiff seeks to recover, and issued and kept in circulation, shall retain their origiwhich, if the tender pleaded is insufficient in law he nal quality of being a legal tender. is entitled to recover, is $5,100. There can therefore The single question, therefore, to be considered, and be no doubt of the jurisdiction of this court to revise upon the answer to which the judgment to be renthe judgment of the Circuit Court. Act of February dered between these parties depends, is whether notes 16, 1875, ch. 77, $ 3; 18 Stat. 315.

of the United States, issued in time of war, under acts The notes of the United States, tendered in payment of Congress declaring them to be a legal tender in pay. of the defendant's debt to the plaintiff, were originally ment of private debts, and afterward in time of peace issued under the acts of Congress of February 25, 1862, redeemed and paid in gold coin at the treasury, and chapter 33, July 11, 1862, chapter 142, and March 3, then reissued under the act of 1878, can, under the 1863, chapter 73, passed during the war of the rebellion, Constitution of tbe United States, be a legal tender in and enacting that these notes should “be lawful payment of such debts. money and a legal tender in payment of all debts, pub- Upon full consideration of the case, the court is lic and private, within the United States,"' except for unanimously of opinion that it cannot be distinguished duties on imports, and interest on the public debt. in principal from the cases heretofore determined, re12 Stat. 345, 532, 709.

ported under the names of the Legal Tender Cases, 12 The provisions of the earlier acts of Congress, so far Wall. 457; Dooley v. Smith, 13 id. 604; Railroad Com. as it is necessary, for the understanding of the recent pany v. Johnson, 15 id. 195, and Maryland v. Railroad statutes, to quote them, are re-enacted in the following Co., 22 id. 105; and all the judges, except Mr. Justice provisions of the Revised Statutes :

Field, who adheres to the views expressed in his dis“Section 3579. When any United States notes are senting opinions in those cases, are of opinion that returned to the treasury, they may be reissued, from they were rightly decided. time to time, as the exigencies of the public interest The elaborate printed briefs submitted by counsel in may require.

this case, and the opinions delivered in the Legal Ten“Sectiou 3580. When any United States notes re- der Cases, and in the earlier case of Hepburn v. Gristurned to the treasury are so mutilated or otherwise wold, 8 Wall. 603, which those cases overruled, forcibly injured as to be unfit for use, the secretary of the present the arguments ou either side of the question of the power of Congress to make the notes of the other principal legislative powers concludes by declarUnited States a legal tender in payment of private ing that the Congress shall have power debts. Without undertaking to deal with all those “To make all laws which shall be necessary and arguments, the court has thought it fit that the proper for carrying into execution the foregoing grounds of its judgment in the case at bar should be powers, and all other powers vested by this Constitufully stated.

tion in the government of the United States, or in any No question of the scope and extent of the implied department or officer thereof." powers of Congress under the Constitution can be By the settled construction and the only reasonable satisfactorily discussed without repeating much of the interpretation of this clause, the words “necessary reasoning of Chief Justice Marshall in the great judg- and proper" are not limited to such measures as are ment in McCulloch v. Maryland, 4 Wheat. 316, by absolutely and indispensably necessary, without which which the power of Congress to incorporate a bank the powers granted must fail of execution; but they was demonstrated and affirmed, notwithstanding the include all appropriate means which are conducive Constitution does not enumerate, among the powers or adapted to the end to be accomplished, and which granted, that of establishing a bank or creating a cor- in the judgment of Congress will most advantageously poration.

effect it. The people of the United States by the Constitution That clause of the Constitution which declares that established a National government, with sovereign “the Congress shall have power to lay and collect powers, legislative, executive, and judicial. “The taxes, duties, im posts and excises, to pay the debts government of the Union,” said Chief Justice Mar

and provide for the common defense and general wel. shall, “though limited in its powers, is supreme within fare of the United States," either embodies a grant of its sphere of action;" "and its laws, when made in power to pay the debts of the United States, or prepursuance of the Constitution, form the supreme law supposes and assumes that power as inherent in the of the land." "Among the enumerated powers of United States as a sovereign government. But in government, we find the great powers to lay and col- whichever aspect it be considered, neither this nor lect taxes; to borrow money; to regulate commerce; any other clause of the Constitution makes any mento declare and conduct a war; and to raise and sup- tion of priority or preference of the United States as a port armies and navies. The sword and the purse, all creditor over other creditors of an individual debtor. the external relations, and no inconsiderable portion Yet this court, in the early case of United States v. of the industry of the Nation, are intrusted to its gov- Fisher, 2 Cranch, 358, held that under the power to pay ernment." 4 Wheat. 405, 406, 407.

the debts of the United States, Congress had the power A Constitution establishing a frame of government, to enact that debts due to the United States should declariug fundamental principles, and creating a na- have that priority of payment out of the estate of an tional sovereignty, and intended to endure for ages insolvent debtor, which the law of England gave to and to be adapted to the various crises of human af. debts due to the Crown. fairs, is not to be interpreted with the strictness of a

In delivering judgment in that case, Chief Justice private contract. The Constitution of the United

Marshall expounded the clause giving Congress power States, by apt words of designation or general descrip

to make all necessary and proper laws, as follows: "In tion, marks the outlines of the powers granted to the construing this clause, it would be incorrect, and National Legislature; but it does not undertake, with

would produce endless difficulties, if the opinion the precision and detail of a code of laws, to enume- should be maintained that no law was authorized rate the subdivisions of those powers, or to specify all

which was not indispensably necessary to give effect the means by which they may be carried into execu

to a specified power. Where various systems might be tion. Chief Justice Marshall, after dwelling upon this

adopted for that purpose, it might be said with review, as required by the very nature of the Constitu

spect to each, that it was not necessary, because the tion, by the language in which it is framed, by the

end might be obtained by other means. Congress limitations upon the general powers of Congress in

must possess the choice of means, and must be emtroduced in the ninth section of the first article, and

powered to use any means which are in fact conducire by the omission to use any restrictive term which

to the exercise of a power granted by the Constitumight prevent its receiving a fair and just interpreta

tion. The government is to pay the debt of the Union, tion, added these emphatic words: “In considering

and must be authorized to use the means which appear this question, then we must never forget that it is a

to itself the most eligible to effect that object." 2 Constitution we are expounding." 4 Wheat. 407. See

Cranch, 396. also page 415. The breadth and comprehensiveness of the words of

In McCulloch v. Maryland, he more fully developed the Constitution are nowhere more strikingly exbibi

the same view, concluding thus: “We admit, as all ted than in regard to the powers over the subjects of

must admit, that the powers of the government are revenue, finance, and currency, of which there is no limited, and that its limits are not to be transcended.

But we think the sound construction of the Constituother express grant than may be found in these few brief clauses :

tion must allow to the National Legislature that dis“ The Congress shall have power

cretion, with respect to the means by which the “To lay and collect taxes, duties, imposts, and ex

powers it confers are to be carried into execution, cises, to pay the debts and provide for the common de

which will enable that body to perform the high duties fense and general welfare of the United States; but all

assigned to it, in the manner most beneficial to the duties, imposts, and excises shall be uniform through

people. Let the end be legitimate, let it be within the out the United States;

scope of the Constitution, and all means which are ap"To borrow money on the credit of the United

propriate, which are plainly adapted to that end, States;

which are not prohibited, but consist with the letter To regulate commerce with foreign nations, and

and spirit of the Constitution, are constitutional." 4

Wheat. 421. among the several States, and with the Indian tribes;"

The rule of interpretation thus laid down has been " To coin money, regulate tbe value thereof, and of

constantly adhered to and acted on by this court, and foreign coin, and fix the standard of weights and meas

was accepted as expressing the true test by all the ures."

judges who took part in the former discussions of the The section which contains the grant of these and power of Cougress to make the treasury notes of the

United States a legal tender in payment of private of bis own action, by recording that “this vote in the debts.

affirmative by Virginia was occasioned by the acquiesThe other judgments delivered by Chief Justice cence of Mr. Madison, who became satisfied that strikMarshall contain nothing adverse to the power of Cou-ing out the words would not disable the government gress to issue legal tender notes.

from the use of public notes, so far as they could be By the Articles of Confederation of 1777, the United safe and proper; and would only cut off the pretext States in Congress assembled were authorized "to for a paper currency, and particularly for making the borrow money or emit bills on the credit of the United bills a tender, either for public or private debts." States;” but it was declared that “each State retains But he has not explained why he thought that strikits sovereignty, freedom and independence, and every ing out the words "and emit bills ” would leave the power, jurisdiction and right which is not by this con- power to emit bills, and deny the power to make them federation expressly delegated to the United States in a tender in payment of debts. And it cannot be Congress assembled.” Art. 2; art. 9, $ 5; 1 Stat. 4, 7. known how many of the other delegates, by whose Yet upon the question whether, under those articles, vote the motion was adopted, intended neither to proCongress, by virtue of the power to emit bills on the claim uor to deny the power to emit paper money, and credit of the United States, had the power to make were influenced by the argument of Mr. Gorham, who bills so emitted a legal tender, Chief Justice Marshall “ was for striking out, without inserting any prohibispoke very guardedly, saying: “Congress emitted tion," and who said: “If the words stand, they may bills of credit to a large amount, and did not, perhaps suggest and lead to the emission.” “The power, so could not, make them a legal tender. This power re- far as it will be necessary or safe, will be involved in sided in the States." Craig v. Missouri, 4 Pet. 410, that of borrowing." 5 Elliot's Debates, 434, 435 and 435. But in the Constitution, as he had before ob- note. And after the first clause of the tenth section served in McCulloch v. Maryland, “there is no phrase, of the first article had been reported in the form in which like the Articles of Confederation, excludes in- which it now stands, forbidding the States to make cidental or implied powers; and which requires that any thing but gold or silver coin a tender in payment every thing granted shall be expressly and minutely of debts, or to pass any law impairing the obligation described. Even the tenth amendment, which was of contracts, when Mr. Gerry, as reported by Mr. framed for the purpose of quieting the excessive jeal- Madison, "entered into observations inculcating the ousies which had been excited, omits the word ,'ex- importance of public faith, and the propriety of the pressly,' and declares only that the powers 'not dele- restraint put on the States from impairing the obligagated to the United States, nor prohibited to the tion of contracts; alleging that Congress ought to be States, are reserved to the States or to the people;' laid under the like prohibitions;" and made a motion thus leaving the question, whether the particular to that effect; he was not seconded. Id. 536. As an power which may become the subject of contest bas illustration of the danger of giving too much weight, been delegated to the one government or prohibited to upon such a question, to the debates and the votes in the other, to depend on a fair construction of the the convention, it may also be observed that proposiwhole instrument. The men who drew and adopted tions to authorize Congress to grant charters of incorthis amendment had experienced the embarrassments poration for National objects were strongly opposed, resulting from the insertion of this word in the Arti- especially as regarded banks, and defeated, Id. 440, cles of Confederation, and probably omitted it to avoid 543, 544. The power of Congress to emit bills of credit those embarrassments." 4 Wheat. 405, 406.

as well as to incorporate National banks, is now clearly The sentence sometimes quoted from his opinion in established by decisions to which we shall presently Sturges v. Crowninshield had exclusive relation to the refer. restrictions imposed by the Constitution on the powers The words “to borrow money," as used in the Conof the States, and especial reference to the effect of the stitution, to designate a power vested in the National clause prohibiting the States from passing laws im-government, for the safety and welfare of the whole pairing the obligation of contracts, as will clearly people, are not to receive that limited and restricted appear by quoting the whole paragraph: “Was this interpretation and meaning which they would have in general prohibition intended to prevent paper money? a penal statute, or in an authority conferred, by law We are not allowed to say so, because it is expressly or by contract, upon trustees or agents for private purprovided that no State shall 'emit bills of credit; 'poses. neither could these words be intended to restrain the The power “to borrow money on the credit of the States from enabling debtors to discharge their debts United States” is the power to raise money for the by the tender of property of no real value to the credi- public use on a pledge of the public credit, and may tor, because for that subject also particular provision be exercised to meet either present or anticipated exis made. Nothing but gold and silver coin can be penses and liabilities of the government. It includes made a tender in payment of debts." 4 Wheat. 122, the power to issue, in return for the money borrowed, 204.

the obligations of the United States in any appropriate Such reports as have come down to us of the debates form, of stock, bonds, bills, or notes; and in whatever in the Convention that framed the Constitution afford form they are issued, being instruments of the Nano proof of any general concurrence of opinion upon tional government, they are exempt from taxation by the subject before us. The adoption of the motion to the governments of the several States. Weston v. strike out the words “and emit bills" from the Charleston City Council, 2 Pet. 449; Banks v. Mayor, 7 clause "to borrow money and emit bills on the credit | Wall. 16; Bank v. Supervisors, id. 26. Congress has of the United {States" is quite inconclusive. The authority to issue these obligations in a form adapted philippio delivered before the Assembly of Maryland to circulation from hand to hand in the ordinary transby Mr. Martin, one of the delegates from that State, actions of commerce and business. In order to prowho voted against the motion, and who declined to mote and facilitate such circulation, to adapt them to sign the Constitution, can hardly be accepted as satis- use as currency, and to make them more current in factory evidence of the reasons or the motives of the the market, it may provide for their redemption in majority of the Convention. See 1 Elliot's Debates, coin or bonds, and may make them receivable in pay. 345, 370, 376. Some of the members of the Convention, ment of debts to the government. So much is settled indeed, as appears by Mr. Madison's minutes of the beyond doubt, and was asserted or distinctly admitdebates, expressed the strongest opposition to paper ted by the judges who dissented from the decision in money. And Mr. Madison has disclosed the grounds | the Legal Tender cases, as well as by those who con

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