Hyperlawhypertext legal database Wilson v. Morgan 27 N.Y. Super. Ct. 58

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Wilson v. Morgan

27 N.Y. Super. Ct. 58 4 Rob. 58 Court N.Y. Super. Ct. Decision date 1866-03-12 English

Delivered by Monell, J.

Contents

Majority

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John Wilson et al. plaintiffs and respondents, vs. Edwin D. Morgan et al. defendants and appellants.

Headnote

1. A debt created by contract which can be paid with money, can be satisfied by whatever medium of payment is a legal tender at the time it is due and payable, and need not, and cannot, be satisfied in any other way.
2. A contract for the payment of a sum “ in gold or silver dollars,” is satisfied by payment in notes issued by the United States, under the act of congress of February 25,1862, authorizing such issue, and declaring that such notes shall be “lawful money, and a legal tender in payment of all debts, public andpri-' vate, within the United States.”
3. Thus, although a charter-party, made in Calcutta, subsequent to the passage of sueh act, provided, that'the freight should be paid, on unloading and right delivery of the cargo, if discharged in the United States, “ in silver or gold dollars,” or by approved bills on London, it was held, that on discharging the cargo here, the freight could be paid in legal tender notes.
4. The claim for the freight, in such a case, is a debt of the assignor, within the meaning of the act of Congress.
4. A contract to pay money in gold or silver coin cannot be specifically enforced ■ ' nor can any damages be recovered, upon its breach, except interest. The popular difference in value between paper and gold money is not recoverable.
(Before Monell, Garvin and Jones, JJ.)
Heard February 14,1866;
decided March 12, 1866.
This was an action on a charter party to recover the amount of freight stipulated therein to he paid by the defendants, and earned by the plaintiffs.
The plaintiffs, owners of the British ship Atalanta, by their agents, George Henderson & Go., in Calcutta, chartered the ship to Gillanders, Arhuthnot & Co., of Calcutta. The charter party was made in Calcutta, and is dated January 20, 1863. It contains the following clause : “ The freight to be paid on unloading and right delivery of the cargo, as follows, viz. if discharged in United States of America, in silver or gold dollars, or by approved bills on London, if at a port in the United Kingdom, as customary.”
The defendants were the consignees of the cargo. Upon the arrival of the vessel at the port of New York, in June, 1863, the defendants tendered payment of the freight money, amounting to $32,630, in United States legal tender notes. The
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tender was refused, and payment demanded in silver or gold dollars, as specified in the charter party, which was refused.
The action was tried by a referee, who found the tender of the U. S. legal tender notes, and that at the time of such tender, the market value thereof was thirty-three and one-eighth per cent less than that of gold or silver dollars.
By an arrangement between the parties, the plaintiffs credited the defendants with the market value of the amount tendered, leaing a balance of §7684.57 due.
The referee found the market value of such balance was, in the currency of the United States, §10,230.08. Upon these facts, the referee decided that the plaintiffs were entitled to recover said sum of §10,230.08, with interest, and rendered judgment accordingly.
The defendants appealed.
E. Terry, for the appellants, (defendants.)
I. Evidence was improperly admitted, on the trial, of the rate of exchange on London. The rate of exchange was immaterial, as the bill was such as was to be approved by the plaintiffs. The rate in gold Was immaterial. It might, with equal propriety, have been asked what was the rate in any commodity.
II. Evidence was improperly admitted, in that case, of what was called the market value of gold and silver dollars on the day named.
III. The motion to dismiss the complaint was improperly denied on the trial.
IY. The evidence offered of the custom of settling charters of vessels from Brazil to the port of New York, where the freight is payable in pounds, shillings and pence, sterling, was improperly rejected on the trial.
Y. The report of the referee was against evidence.
1. It was proved, beyond dispute, that it was now and always had been customary to pay freight on-charters of vessels coming to the United States from Calcutta, in United States currency.
2. He erroneously decided that, at the time of the tender,
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the market value of United.' States treasury notes was $33|- per cent less than that of gold or silver dollars, and that the said bill of exchange was worth $24,945.43 gold or silver dollars, according to its market value, at the city of New York, on the 10th July, 1863.
4. He adopted an erroneous method of determining what the bill of exchange was worth on that day. The question was, not what was a pound sterling worth, but what was the bill of exchange worth. It was worth what it would bring in the market, and that was what it cost on that day.
5. The referee erred in finding the market value of the balance of $7684.57 gold or silver dollars to be" $10,230.08 in legal tender notes. '
VI. Upon the whole case, the defendants were entitled to a report and judgment in their favor.
(1.) The complaint-is inconsistent, and the plaintiffs cannot have what' they ask for, unless they admit that the legal tender dollar is equal in value to the gold or silver dollar. It claims that the plaintiffs were entitled, under the charter, to be paid $36,630 silver or gold dollars, or by bills of exchange on London of the equivalent of 32,630 silver or gold dollars,” yet prays for judgment for something else, to wit, “ in the currency of the United States.” The 32,630 dollars in United States legal tender notes were equal in value, in point of law, to the same number of gold or silver dollars, claimed by the plaintiffs.
(2.) The government of the United States have always had and exercised the right of regulating and depreciating the currency, and determining what shall be legal tender, and determining the value of their currency.
See the following legal tender acts :
. 1792, April 2, establishing a mint, and makes (§ 16) all gold and silver coins issued therefrom a lawful tender in all payments whatsoever.
1793, February 9, ch. 5, makes certain foreign gold and silver coins current as money, and a legal tender for all debts at a specified rate. _
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1799, March 2, (ch. 22, § 61,) determines the rates of foreign coins.
1806, April 10, (ch. 22,) regulates the currency of foreign coins.
1823, March 3, (ch. 53,) makes gold coins of Great Britain, &c. receivable for public lands.
1834, June 25, (ch. 71,) regulates value of foreign coins.
1843, March 3, (ch. 69 and 92,) alters the values of foreign coin, and makes them a general legal tender.
1792, (ch.' 5,) a pure coin of 247 grains is • reduced to standard.
1834, June 28, (ch. 96,) standard of gold coin at mint altered.
1837, January 18, (ch. 4,) standard of gold and silver coin altered; certain silver and gold coins to be legal tender for their nominal values on similar terms.
1853, February 21, (ch. 79,) weight of half dollars reduced and made legal tender.
(a.) The act to authorize the issue of United States notes. &c. passed February 25,1862, (statutes at large, p. 345,) provides that such notes “ shall also be lawful money and a legal tender in payment of all debts, public and private, within the United States and the exercise of such right is within the legitimate powers of the general government of the United States. (The Metropolitan Bank v. Van Dyck, 27 N. Y. Rep. 400 . The People ex rel. Bank of Com. v. Com. of Taxes, 25 How. Pr. 14 , 16. Hague v. Powers, 39 Barb. 427 .)
(b.) Such exercise of right is not new with the United States . government. All governments have always exercised such right. (See 3 Bac. Law Max. 231. Emp. of Austria v. Day, 30 Law Jour. N. S. 690. Gilbert v. Brett, 1 J. Davies’ R. 48. Story’s Confl. Laws, § 280.)
(c.) Such a contract as the one in question is against public policy, of immoral tendency, injurious to the interests of mankind, and tends to make enemies and traitors to the government. It, therefore, ought not to be sustained. (Gilbert v. Sykes, 16 East, 150. Suse v. Pomp, 8 C. B. N. S. 538. Gibbs v. Fremont, 9 Exch. 25. Am. Law Reg. vol. 5, p. 95,
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Dec. 1865. Buckegger v. Schultz, in Supreme Court of Mich. Peyton v. Sweeney, Circuit Court, D. C.)
(d.)' By law, all debts can be paid in legal tender notes, whether expressly agreed to be paid in silver or gold dollars or not. In the eye of the law, a dollar of such legal tender notes, is equal in value to a gold dollar, and it has been so decided by the highest judicial tribunal of every state in the Union, where the question has arisen. (The Met. Bank v. Van Dyck, 27 N. Y. Rep. 400 . Regnolds v. The Bank of the State of Indiana, Am. Law Reg. vol. 1 N. S. p. 669. Wood v. Bullens, 6 Allen’s Rep. 516. Warnibold v. Schlicting, 16 Iowa Rep. 243 . Troutman v. Gowing, id. 415. Same cases cited in Am. Law Reg., Feb. 1865, p. 233, note. Henderson, Deft, in Error, v. McPike, Plff. in Error, Missouri Supreme Court, MSS. Shoenberger v. Watts, Am. Law Reg. vol. 1 N. S. p. 553. George v. The City of Concord, N. Hampshire Sup. Court, March, 1865, MSS. Reese v. Stearns, California Superior Court, January, 1866, MSS.)
A. F. Smith, for the respondents, (plaintiffs.)
I. The legal tender act of February 25, 1862, (if constitutional, which is denied,) does not touch this case.
1. It should be strictly construed. “ It is doubtful in policy and dangerous as a precedent.” (Per Judge Grier, Phil. and Reading R. R. v. Moison, MSS.) The words, “ shall be lawful money,” do not make the notes a legal tender. State bank notes, or those of the old United States Bank, are “ lawful money,” but they never were a legal tender. (Ib.)
2. The notes are a legal tender only for. “ debts unless a debt strictly exists, the legal tender act is not applicable, and the notes are no more than bank notes. So held by Judge Grier in the case before cited, and in several like cases in Philadelphia. (See Paterson v. Blight, MSS.) They decided that a mere ground rent was not a debt. The rents in question were, by the covenants contained in deeds by which they were created, made extinguishable, on the payment to. the grantor, his heirs and assigns, of a specified number of dollars,
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lawful silver money of the United States, “ the present legal standard, fineness and weight.” An attempt was made to extinguish the rents by the payment of legal tender notes, which failed, as the court held that no debt existed within the meaning of the act of Congress.
3. No debt existed in this case. “ The legal acceptation of debt is, a sum of money due by certain and express agreement.” (3 Blackstone, 154.) “ Debt is a sum of money due by certain and express agreement. In a less technical sense it is any claim for money, and in a still more enlarged sense, it is any kind of a just demand.” (3 Bac. Ab. title “Debt.”) In the bankrupt act of 1841, the distinction is preserved between debts due or to become due and all uncertain or contingent demands ; the former are called debts, and the latter claims. (5 St at. at Large, 445, § 5.) No action could be brought by the plaintiffs until the whole cargo was delivered. The cargo was not delivered until after the agreement of July 10,1863. The delivery of the cargo was a condition precedent to the right of action. No debt existed till the condition was performed. And as no debt existed, the legal tender act, which is confined to the case of'debts, is not applicable.
II. The plaintiffs had a lien upon the cargo, and a right to its possession, until they should receive the silver or gold dollars. They had carried the cargo to New York, and had possession of it, with a lien upon it to secure the performance by the defendants of the condition upon the performance of which they were entitled to its delivery. They were not in a position to enforce the performance of the condition by suit, because they had not delivered the cargo ; the defendants could not claim a delivery until they had performed the condition. The simple question is, can the defendants excuse themselves from the performance of the condition which they have assumed, by performing any other act, whether equal in value to, or greater or less in value than, that which they have agreed to do ? Could they claim the cargo until they tendered the master the silver or gold dollars P There was no debt, they owed nothing until, delivery; they were bound to perform
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a condition. As soon as they performed it, they were entitled to the cargo, and not until then. Estates in land, upon condition which cannot he defeated except by strict performance, are analogous, and so also are contracts in relation to personal property, where conditions precedent or concurrent must always be performed. (Morris v. Sliter, 1 Denio, 59 . Williams v. Healey, 3 id. 363. Dunham v. Pettee, 4 Selden, 508.)
1. This position is impregnable, unless it was unlawful for the parties making this charter party to agree, the one to give,- and the other to receive, silver or gold dollars.
(a.) But it was not a case of an existing debt and a promise to pay in silver or gold. In such a case (conceding the constitutionality of the legal tender act,) such a promise might be met and such a debt paid — by legal tender notes.
(6.) Both parties were foreigners, and owed no duty to the laws of this country.
(c.) It is a universal usage everywhere to make freights payable in gold or silver where paper is depreciated, and the usage is just as reasonable and indeed as necessary to carrying on commerce as that which makes the drawer and endorser of a foreign bill of exchange liable to pay the bill in the equivalent of specie—a'usage that existed before any statute on the subject.
(d.) The statutes of the United States in many enactments recognise, sanction or authorize contracts for the purchase of gold and silver, and of course contemplate their enforcement in the courts. (12 Slat, at Large, 719, § 4.) Act of March 3, 1863, provides for stamps upon contracts for the purchase and sale of gold and silver coin. Act of March 17,1862, {Id. 370,) authorizes the secretary of the treasury to buy coin. Act of. March 17, 1864, (Id. 404,) authorizes the secretary of the treasury.to dispose of any gold in the treasury not necessary for the payment of interest on the public debt. By the legal tender act itself, passed February 12, 1862, {Id. 346, § 5 ; 345, § 1;) duties are made payable in coin, and also interest on the public debt.
(c.) Authorities uphold contracts which recognize a differ
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ence in value between gold and currency. (Newman v. Keffer, Circuit Court of the United States, Judges Baldwin and Hopkinson, 30th November, 1836, 9 Casey, Penn. 442, n. Paup v. Drew, 10 How. 218 ,223. Mervine v. Sailor, District Court of Philadelphia, reported May 2, 1864, in Legal and Ins. Rep. Schoenberger v. Watts, 1 Am. Law Reg. N. S. 553, per Judges Hare and Sharswood.)
III. If, then, the plaintiffs had the right to retain the cargo until the condition was performed, and there should be delivered to them 32,630 gold or silver dollars, they were entitled to recover such sum as would be equivalent thereto after crediting the value of the bill of exchange, being 7,684 57-100 gold or silver dollars, worth $10,230.08, which the plaintiffs were entitled to • recover, with interest from July 10, 1863, the date of the agreement, and which was the amount o.f the recovery.
IV. There is another view upon which the plaintiffs were entitled to recover the same sum. Although congress made greenbacks a legal tender for debts, they did not repeal the law that makes gold and silver also a legal tender. (5 Stat. at Large, 138, §§ 10, 11.) The defendants gave the master, and he received a bill for £5039, 9s. 8d., “ without prejudice to the rights of either party.” They were, therefore, entitled to a credit of the value of this bill. The plaintiffs had a right to claim that its value was what it would sell for in gold, and a jury would not be inflexibly bound to find its value to be in greenbacks. The question of value was, then, one of fact, and no absolute right existed to compute the value in greenbacks. Considering the stipulation of the charter, to pay silver or gold dollars, is it doubtful that a jury would always find the value of the bill to be its gold value ? The referee so found.
V. There is still another view of the case, which is, perhaps, even more clear for the plaintiffs than the last proposition.
The bill was given and received “ without prejudice to the rights of either party.” It was given and received at its legal value. That legal value in this state is fixed by several decis
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ions at the par of the pound sterling. In other words, the value of the bill must be found.by multiplying the face of the bill by 444, or at most by 487. (See Scofield v. Day., 20 John. 102 . Martin v. Franklin, 4 id. 124 . Adams v. Cordis, 8 Pick. 260 . Schermerhorn v. Talman, 4 Kern. 135,136. Act of August 4, 1790,1 Stat. at Large, 167. Act of July 27, 1842, 5 Stat. at Large, 496.) This would produce nearly the same, but a little more favorable result.
VI. A right to pay in a bill on London would not have varied the result. • The value of such bill, as found by the referee, or as fixed by law, must be deducted, and the plaintiffs recover the residue..

By the Court,

The act of congress, passed February 25, 1862, provides that the notes, by that act authorized to be issued, shall be “ lawful money and a legal tender in payment of all debts public and private within the United States, except,” &c. (12 U. S. Stat. at Large, p. 711.)

The validity of the act is not open for discussion in this state. (Metropolitan Bank v. Van Dyck, 27 N. Y. Rep. 400 . Meyer v. Roosevelt, Id.) In those cases the tender of treasury notes, made lawful money by the act of congress, was held to satisfy a debt which had been contracted before the passage of the act,-to be paid in the then “ lawful money of the United States.”

The general theory of those decisions, and of all the decisions of other courts upholding the power of congress to create other lawful money than gold or silver coin, is that by the omission in the constitution of the United States, to declare, what shall or shall not be a legal tender, and the prohibition to the states to make any thing besides gold and silver a legal tender, the power, by necessary implication, is conferred ■ on the general government. Hence, at different periods, congress has designated what should be a legal tender. In 1792 they established a mint for coining gold and silver, which by the same act was made lawful money for the payment of all debts. In 1793, they made certain foreign coin a legal tender ; and

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from time to time have regulated the value of foreign and domestic coin. These acts have never been questioned, yet the power.to pass them is not expressly given to congress by any provision in the federal constitution. Hence they can be sustained only upon an implication of power. Congress is not confined to the exercise of powers expressly granted. The Supreme Court of the United States, in McCulloch v. The State of Maryland, ( 4 Wheat. 416 ,) and Gibbons v. Ogden, (9 id. 188,) wholly rejects any. such limitation, and the Court of Appeals in the cases cited (supra) follow these decisions.

The charter of the vessel in this case was made in January, 1863, nearly a year after the passage of the legal tender act, and the parties are presumed to have.made their contract with reference to the existing law. (Dewitt v. Brisbane, 16 N. Y. Rep. 508 .) For purposes of construction and ascertaining the intention of parties, the place of performance is the place of the contract. It is therefore to be assumed that the parties were cognizant of the law of the United States, making paper money a legal tender in payment of all debts, and were also cognizant of the interpretation of that law by our courts.

It was substantially conceded on the argument, by the respondent's counsel, that if a debt existed in this case, it could be satisfied by an offer of legal tender notes. That, it appears to me, was conceding too much, as it is entirely clear that a debt did exist. A charter-party is but a contract for the entire or some principal part of a ship for the conveyance of goods on a determined voyage, or for employment in other trade, and contains covenants by each party. In the charter before us, it was mutually agreed that the freight should be paid on unloading and delivering of the cargo. The lien which the owners had for their charter freight, was a mere security, and it might have been waived; but such waiver would not" have discharged the contract to pay freight. The right to collect freight by action has frequently been adjudged. In Clarkson v. Edes, (4 Cowen, 470,) it was held that the owner might insist on his lien, or by action compel payment.

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And in Barker v. Havens, ( 17 John. 234 ,) an action to recover freight from the consignor was sustained after the goods had been delivered to the consignee without payment. And where freight is payable on delivery of the goods, the consignee, by accepting the delivery, renders himself personally liable for the freight. (Coek v. Taylor, 13 East, 399.)

The obligation to pay freight is a debt, after the freight is earned, whether the obligation arises from an express or an implied agreement. Any agreement by which one party promises to pay money to another party, creates a debt. So also any agreement which expressly or impliedly imposes an obligation to pay money, is a debt.

The freight due from the defendants’ consignors, and for which an action could have been maintained, was a debt which they could have satisfied by payment. The defendants, as consignees of the goods, were the mere factors of the consignors. (Story on Agency, § 33.) Payment by them would have discharge^ the debt of their principal.

The argument of the respondent’s counsel proceeded upon the ground that no debt existed, as between the owner's and consignees. He seemed to lose sight of the consignors’ agreement to pay freight, (which agreement created a debt,) and also of the duty, as well as right, of the consignees to satisfy such debt of their principal by payment. And the question is not changed by the position of the parties on the record ; especially under the stipulation in the case.

But the main question is, can a contract to pay in silver or gold dollars be satisfied by payment in any other kind of money ?

Congress, by the legal tender act, has made a paper dollar the equivalent of a gold or silver dollar. Having the power to establish and regulate the value of coin, it has depreciated the value of gold and silver coin for every purpose cognizable by courts, to the level of paper money; and has declared that one of its notes representing the value of 100 cents shall be equal to a gold or silver dollar, representing the-value of the same number of cents. The power is not confined to paper money. Any other substance

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might be made the medium of exchange and declared lawful money. The uncoined and unstamped bits of silver of the- ancients, which were weighed out and not counted, and the wampum of the Indians, was money. Money is the mere representative, or supposed representative, of definite value. The precious metals, among all civilized nations, are the usual accepted representatives. Gold and silver are standards of value, which regulate, in a greater or less degree, all other values. Any other standard of value would do the same thing. A ton of coal, or a barrel of flour, if made by law the standard of value, would regulate and adjust all other values, gold as well as merchandise. Gold and silver coin at their established value for all legal purposes do not change ; they are never depreciated or appreciated. It is erroneous to say the market for gold fluctuates, except when it is trafficked in, as a commodity. As coin, or a medium of currency, its value, as fixed by law, does not change with the mutations of trade and commerce. All other things rise or fall, in the fluctuations of business, by comparison merely.

Congress having created paper money, and rendered it, nominally, for all legal purposes, equal to gold, there no longer remains, in legal .contemplation, any difference between them. The practical or actual depreciation of the former below the value of gold, is not produced by any law, but is occasioned by the laws of trade ; of supply and demand, and other causes for which the law is not accountable.

Used in commerce with foreign countries, gold and silver are the only accepted mediums of exchange, and their value is attributable to their universal appreciation and currency among all nations. In domestic commerce, however, they lose some of their importance, by the substitution of other standards of value, which are made their equivalent.

As an article for traffic, gold, either in coin or bullion, is regulated by the same rules that govern other commodities. Contracts for its purchase, or sale, are valid, and are regarded like contracts for the purchase, or sale, of merchandize. There is a wide difference, however, between gold or silver, as mer

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chandise, and as money.' A contract to buy or sell gold, cannot be specifically enforced ; an action for damages being entirely adequate ; the ’rule of damages being, in such a case, probably, the market value of the gold. As circulating mediums, gold and silver are not subject to any of the rules, or principles, which regulate contracts. It is used only to purchase property, to discharge obligations and pay debts.

A paper dollar having been ’made equal to a gold dollar, it ( must be accepted as such in satisfaction of any contract for the payment of money ; and no form or force of words can be used by contracting parties, to give to a gold dollar a legal value as money, above a paper dollar. A dollar is one hundred cents, no, more, no less, whether it is silver, gold or paper. And when congress declares that a paper dollar shall be current and pass for and represent and be of the value of one hundred 1 cents for all purposes of traffic and paying debts, it becomes the equivalent of one hundred cents in any'other substance or form.

It has been strongly urged that congress, in declaring paper money a legal tender in payment of debts, has recognized and preserved a distinction between it and coin; and the exception, • in the statute, of duties on imports and interest on the public debt, is mainly relied on to establish such distinction. It is true, that congress has also, from time to time, authorized the issuing of bonds and notes, the interest and principal of which is expressly payable in coin. (12 U. S. Statutes at large, 345, § 5. 709, § 1. 13 id. 13.) Such bonds and notes, however, were to become a part of the public debt of the country, and were accordingly brought within the great leading policy of the government of paying in specie, which had existed, at intervals, for more than three quarters of a century, having been originally enacted in 1789, re-enacted in 1840, and again in 1846. The exceptions, therefore, in the statute, of duties ' on imports, and interest on the public debt, as well as all subsequent legislation creating or prescribing the manner of payment of the public debt, are but re-enactments of .the acts referred to, and especially of the act commonly denominated

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the subtreasury act, passed by congress in 1840, (5 U. S. Stat. at large, 385,) and the act of August 5,1846, (9 Id. 59.) Those acts provide, that all sums accruing, or becoming payable to the United States for duties, taxes, sales of public lands, or other debts, should be paid in gold and silver only, and that all payments by the United States should also be made in gold and silver coin only.

It was not intended by the legal tender act of 1862, nor by any of the subsequent acts, to change the policy of the general government of paying in specie, and the exception, therefore, became necessary merely to preserve the provisions of former statutes. Since the passage of the act of August, 1846, payments to and by the general government have been made in coin only, or in notes issued under the authority of the United States, and directed to be received by law. In thus following the long established practice of the government pf paying in coin only, congress has indicated nothing that could be construed into a design to create any legal difference between gold or silver and paper money, as a legal tender in payment of private debts. Indeed, the exception gives force and explains the meaning of the previous parts of the sentence.

From the views which I have here expressed, it follows, necessarily, it seems to me, that a contract which creates a debt, which debt can be paid with money, can be satisfied • by any money which is a legal tender at the time the debt is to be paid, and can be satisfied in no other way. Indeed, I do not see how a contract can be framed, by which a party to it could be compelled to pay money in silver or gold, when some other substance is made by law sufficient to satisfy the debt. Let us test it by an example. Suppose the plaintiffs had sued to recover the freight, would the judgment have been for so many dollars in silver and gold ? Such a judgment could not be rendered. The recovery would be for so many dollars, and the judgment could be satisfied by the payment of the number of dollars, in any money which was a legal tender at the time.

The defendants’ consignors, had agreed to pay a certain sum of money ; and they had agreed- that it should be paid in silver

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or gold dollars. Could the owners have required a specific performance of the contract ? Certainly not. It was to pay money, not gold and silver dollars, and the sum of money only was recoverable. This rule is recognized and well settled when applied to contracts payable in chattels. (Pinney v. Gleason, 5 Wend. 393 . Rockwell v. Rockwell, 4 Hill, 164 .)

I know it is said, that the practical or marketable difference in value of- paper money and coin, must be presumed to have been within the contemplation of parties engaging to pay in coin ; and that therefore such difference should be recoverable as damages ; and such seems to have been the view taken by the referee in this case. It is also supposed that upon a contract to pay a sum of money in gold, a recovery may be had for the value of gold, as ascertained by comparison wdth paper money. But the difficulty with the suggestion is, that it does not recognize or admit the distinction which exists between gold as a commodity of traffic and gold used as money. A contract to deliver one thousand dollars of gold, is a very different contract from one to pay such sum in gold. The former can be specifically enforced, and the other can be satisfied by gold or its equivalent.

Money being the common measure of all things, has not like other tilings, any particular function. It takes the -place of all other things, but is represented only by standards created by law. But gold in bars is no more “money” than are pigs of iron, lead or copper. Like them it may be bought and sold by weight. But until it is “ coined ” and the value of the coin is ascertained and declared by law, it is no more a medium of exchange or currency than any other metal would be.

I am unacquainted with any rule of damages for the nonpayment of money, other than the legal rate of interest upon it. At common law, not even interest was recoverable, either as • an incident to the debt or otherwise; but statutes and adjudications have relaxed the common law, and it is now allowed as damages. (Sedg. on Damages, 234.) “ Interest,” says Domat. Liv. 111, title V, § 1, “ is the name applied to the compensation which the law gives to the creditor who is

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entitled to recover a sum of money from his debtor in default.” The loss experienced by those who are' not paid at maturity is as diversified as the use, they might make of the money, and as unforseen as the wants from which the injury might arise. But no such loss is recoverable ; the damages are limited to the infliction of interest merely. The recovery of the current rate of exchange besides interest, upon a debt contracted in Great Britain, was refused in Martin v. Franklin, ( 4 John. 124 ,) and in Scofield v. Day, (20 id. 102,) and I do not think a case can be found, which sustains any measure of damage for the non-performance of a contract to pay money, other than interest upon the sum in default. To adopt any other measure, would destroy the efficacy of the legal tender act, and limit its effect by admitting factitious values to regulate the damages. "

The plaintiff’s view cannot, therefore, in my judgment, be sustained upon any principle applicable to the recovery of the difference in value between paper and gold money as damages ; nor upon any principle applicable to the specific performance of contracts ; and no other principle has been suggested upon which it can be sustained.

The contract in this case was to pay a sum of money, which became a debt. The offer of money which had been made a legal tender in payment of all debts, was sufficient to discharge the obligation; and the agreement to pay in silver or gold dollars had no greater effect than if it had been to pay in the “ lawful money of the country.”

But the question is not new, nor without authority. The cases in the Court of Appeals, before referred to, substantially determine the question. The moment the validity of the act is assumed, the consequences flowing from it are apparent. Judge Davies says, (page 459 :) “It is the lawful money of the United States, made such by its authority, that, can only be effectually used in payment of debts, without reference to the intrinsic value of the thing tendered or paid.” We were referred, on the argument, to decisions made in some of the states of the Union containing views apparently opposed to

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those I have here expressed. As we have been furnished with only newspaper reports of those cases, we cannot be certain of the precise questions raised and decided.

The case of Mervine v. Sailor, in the District Court of Pennsylvania, held that a quit rent payable in “ lawful silver money,” could not be extinguished by the payment of a sum in gross, in legal tender notes. But the decision was solely upon the ground, that the quit rent was not a debt, and, therefore, not within the provisions of the legal tender act.

The right to satisfy a debt with legal tender money is fully recognized. The rent in that case was payable in “ silver weighing seventeen pennyweights and six grains,” and the learned Justice Hare says, that neither could the payment of such rent be specifically enforced, nor could the difference in value between the silver and legal tender money be recovered as damages.

Two nisi prius cases in the Supreme Court of this district were also referred to, Chapin v. Pretzfelder, Prouty v. Potter, and one case at special term, Luling v. Atlantic Mut. Ins. Co., ( 30 How. Pr. 69 .) The first two cases do not seem to have been much considered, and the report of them is too meager to enable us. to see what was intended to be decided ; and the last case was a proceeding in equity to require the payment ■ of dividends in gold.

There is nothing, therefore, in any of these cases, beyond a mere dictum, in two of them, which is hostile to the views we have here taken.

On the other hand we were referred to numerous decisions in the state courts, extracted from newspapers, sustaining our position.

The only one which has got into the books is Warnibold v. Schlicting, ( 16 Iowa, 243 ,) in which the Supreme Court of that state held, that a promissory note, payable in “ United States gold,” was satisfied by a tender of legal tender notes. The opinion of the Chief Justice is able, and his reasoning to my mind conclusive.

My conclusion is, that the charter party requiring the

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freight to be paid in silver or gold dollars, could be satisfied by payment in legal tender notes ; and that a tender of the freight in such notes discharged the debt.

The referee should, therefore, have held the tender sufficient, and it was error to award judgment for the plaintiff.

The judgment must be set aside, and a new trial ordered, with costs of the appellants to abide the evént. The order of reference must also be vacated if either party desires it.

Cases cited