of coin, if there was no extensive demand for the precious metals. Such was the case during the partial suspension of 1857, which being the result of a partial monetary spasm, lasted only three or four months, and therefore invalidates the position that there could be continued suspension of specie payments by the banks of this State."

It is well known that there is at this present time an extensive demand for the precious metals, unparalleled in the history of this government.

Either the banks of this State, or those holding their bills issued as money, must be subjected to loss at the present time. in the use of such bills as money.

Specie alone represents-as it has ever done the standard by which the value of all securities is measured. By this standard, the bills of the banks of this State are not equal to specie by nearly one-half at the present time. In issuing such bills, the banks undertook to give back their equivalent, in fact and not in name. In fact, the bills were only to represent a dollar, and to be used as such. The bills are of no intrinsic value, nor were they intended to be. They were to be redeemed in specie, on demand. In doing this now, the banks are subjected to no loss in fact; because they are doing no more than they have undertaken to do, and for which they have received an equivalent in special privileges granted them. Therefore, when I say that the banks are subjected to no loss by redeeming their bills, I only mean to say that, by being thus compelled to comply with the terms of their organization, they would not be permitted to make some fifty per cent. upon the non-redemption of their own bills; or, in other words, by redeeming them in legal tender notes, which are not of greater value than the bills of the banks upon record.

For the last two years or more, the banks have been realizing large amounts of profits by a neglect and refusal to redeem their bills in specie; whilst those who were possessed of their bills, and were compelled to use specie, and to procure it by purchase in the market with these bills, have been subjected to a corresponding loss. It was because of these facts, that these suits were first instituted, and not from any desire to impair the value of legal tender notes.

Clients of mine being necessarily compelled to use specie, must either procure it for the bills of these banks which they held, or they must purchase it in the market at a premium ranging from thirty to seventy per cent. They were compelled to do one or the other. Specie must be had; neither the bills of the banks or legal tender notes would answer the purpose; the Government would not receive the paper money of either its own make or that of the banks in payment of duties. For the purposes of travel in a great commercial Republic like ours, immense amounts of specie must be had; coin alone is available throughout the civilized world.

In regard to the constitutional power of Congress to make anything but gold and silver a legal tender in payment of ordinary debts, there is a great doubt. Never before has such a right been clained, or, at least, never exercised. Eminent jurists held it to be a monstrous and unwarranted assumption of power; while those who admit such right, do so principally upon the ground of right. The Courts in the first judicial district of this State have decided these legal tender notes invalid. Their decision amounts to this: in this seventh district a contrary conclusion was arrived at; while the Court before whom this immediate case was brought, gave no written opinionmerely rendering a decision in order that the question might be at once brought before this Court. The question therefore is a new one, and upon which there is no binding decision. What has been said and done before the Courts thus far, shows that great doubt and perplexity exists on all sides, in regard to the power of Congress to make legal tender notes a legal tender for ordinary debts. The redemption of its notes by a bank must certainly be held not an ordinary debt; and the Courts. should not give to legal tender notes greater latitude and effect than Congress intended, nor than is absolutely necessary, should it come to the conclusion that they are valid for any purpose. But it must be apparent that Congress never intended to make them, and did not make them equal to specie for the very act creating them shows that. And I ask the Court to consider well, before it says that the banks of this State-which are dependent upon and governed by the laws thereof shall be permitted to redeem their bills in paper-a kind of money

which, until within a recent period, was entirely unknown to. the law, and which could not have, in any manner, been contemplated in the contract creating banks.

If the necessities of this Government are such that the exercise of so doubtful a prerogative shall be deemed necessary to maintain it, let it be done with care and moderation, and not go beyond the point where such necessity ends. There can be no necessity for breaking down the laws of this State, in order to sustain those of the general government. Should the Court hold that Congress has a right to make paper money of such a character as to allow our banks to redeem their bills with it, it does virtually break down and invalidate the laws and constitution of this State. And more than that, it says to the people of this State: "that which you have taken as money by virtue of the laws of this State, as being equal to gold and silver, and which is now of not more than half the value of gold and silver, you shall not enforce the payment of, against those from whom you received it; but you shall take our paper money, although it has no greater value than that which you have of your own banks in redemption of it."

But, both the Constitution and laws of the State and the General Government, may be sustained and promoted by a fair, impartial, and determined course on the part of the Judi. ciary, unbiased by any of the trifles which surround us; determined to sustain the Constitutions of both, and thereby maintain the rights and interests of both.

I must here quote again from the report of the Superintendent for 1862. He says:

"At this peculiar juncture in public affairs, parties and individuals feel a willingness to strengthen the hands of the National Administration; measures that would arouse the most determined resistance in times of peace, are now acquiesced in-if not applauded. But there must be a limit to encroachments upon constitutional rights; if we would preserve the constituent elements of our present form of government. Instead of departing more widely from Constitutional principles, it becomes us rather to lay to heart and practice the beneficent counsel of the patriot JACKSON; who says: "Nor is our Government to be maintained-or our Union preserved-by invasions of the rights and powers of the several States. In thus attempting to make our General Government strong, we make

it weak; its true strength consists in leaving individuals and States as much as possible to themselves; in making itself felt-not in its power-but, in its beneficence; not in its control-but, in its protection; not in bending the States more closely to the centre-but, in leaving each to move in its proper orbit."

I submit the following propositions, which I have drawn up with some care, and which, I think, embody the principal point at issue in the case immediately under discussion :

1st. The banks of a State are subject to and bound by the laws of the State creating them.

2d. The General Government has no power to interfere with, or to control the banks of a State when created, or to change their rights or obligations under the State law and Constitution.

3d. That the Constitution of the State of New York, having declared that all banks should redeem their notes-circulated as money-in specie, and should file security for such purpose; neither the Legislature nor the Courts can change this requirement, but are bound to enforce it.

4th. That legal tender notes are not specie—within the plain meaning and intent of the Constitution and laws of this State; nor equivalent thereto; and that an offer by a bank to redeem its notes with legal tender notes, is not a compliance with the terms upon which it is permitted to exercise banking privileges within this State.

5th. That the redemption of their notes by banks of this State, is not the payment of a debt within the meaning and intent of Congress authorizing the issuing of legal tender notes, and making them a legal tender for all debts, public and pri

vate.

6th. That legal tender notes are not regarded by Congress as equal to specie, and are not so in fact.

7th. That the General Government has no right to demand, nor interest in demanding, that the banks of this State be permitted to redeem their notes in legal tender notes, nor in anything of less value than specie.

And let me say, that upon the last proposition I think the Court must agree with me. I am unable to see how the General Government is to be affected, or its rights or securities changed, by a decision of this Court holding the banks of this State to a strict compliance with the obligations which they have entered into with the People under and by virtue of the laws and Constitution of this State, and which obligations they have undertaken and given security to perform, and, have realized the benefit of on their part. In this connection allow me to say, that I am fully aware of the terrible calamity which now rests upon this Government, and how needful it is that every arm of the Government should be strengthened rather than weakened in its defence and protection from the impending danger that surrounds it. I hold that no man, community, or State has a right to do that, which shall even seem to embarrass the Government in its hour of need.

But the controversy here is not between the State and the General Government, however much the banks, and those who represent them, may desire to have it thus appear. Neither my clients nor myself are liable to the imputation of attempting to impair the securities of the General Government. We take the securities for what they are, and for what Congress intended they should be. What Congress might have done, is not the question the question is-what has it done?

Have not the people of this State as just a right to demand that the bills of the banks of this State be redeemed in gold and silver, as have the banks to insist that they be allowed to redeem in legal tender notes? Whichever is successful, will not impair the value of legal tender notes-nor take from the treasury one dollar.

If the General Government can create legal tender notes and make them available for all its purposes, it can make no difference to it whether the people or the banks of this State are in possession of the gold and silver coin, which we claim should be