VOL. XVIII. No. 40.] LONDON, WEDNESDAY, DECEMBER 26, 1810. [Price 15.

Legal Tenders have been the cause of the overthrow of every financial system into which they "have been introduced."— -ESSAY on American Paper money.

their own notes; that is to say, they would be ready to give her fresh promises to pay in lieu of the promises to pay which they had given her before; but, she could not compel them to give her one shilling's worth of gold or silver, except there might be due to her, in the way of interest, any fractional part of a pound."

Thus far, then, the Bank Company's notes are a legal tender. And, in the affairs between man and man, if such notes be once accepted and received in payment of any debt whatever, they are, after such acceptance and receipt, to be considered as a legal payment in that case. If, for instance, I owe my neighbour a hundred pounds, and tender him Bank of England notes in payment, and he receive them in payment to the amount of the sum due to him, he is paid, I am acquitted of my debt; he cannot afterwards sue me for the debt, upon the ground, that I have not paid him money, as he might do in the case of other promissory notes, if there were no particular agreement to bar him.

prevailed; and, I have heard 'it said, or seen it stated in print, that this compulsion cannot be effected; because, it has been said, if you were to bring your ac tion of debt against Paperkite and Co. they would pay the amount into Court in Bank of England notes; and that, upon proof of their having done this being produced, the Court would stop the proceedings, or at least, throw all the costs there. after incurred, upon you.

This would, indeed, make the Bank of England notes a legal tender in fact, though not in law; or, in other words, it would make an Act of Parliament a mere delusion, a shuffle, a cheat, a base premedi tated fraud. But, this is all a mistake; it is not founded in fact; the Courts would attempt to do no such thing; for, if one could, in any case, suppose the inclination to exist in the mind of a Judge, he would not do it, nor think of it, in the face of what has already been done,

The question has been decided, and that, too, with all possible solemnity, as will But, here the legal tender of Bank of appear from the case which I am now England notes stops. They are not yet, in about to lay before you, and the perusal any other case, put upon a footing with of which will remove all doubts whatever money. As to all the transactions be- upon the subject. There appears to have tween man and man, except in the above been no doubt about the letter of the law, circumstances, which can occur only in the mind of either of my correspond. where the Bank of England itself is a party, ents; but they both doubt of its interpretano person is obliged to take Bank of Eng-tion in the Courts; and the last mentioned land Notes in payment of any debt, or legal demand. And, this is a thing well worthy of the attention of all those, who have it in contemplation to enter into contracts which are to have a future operation; for, if the value of gold and silver, compared with that of Bank notes, should continue to increase, those who now make contracts for payments to be made some years hence, should bear it constantly in mind, that the party to whom they will have to make such payment, will, at all times, have it in his power to insist upon gold coin in payment.

If this be the law, without any other exceptions than those above named, it follows, of course, that I can have not the least hesitation in telling my Devonshire correspondent, that I am quite sure, that any holder of a Country Bank note has it, at all times, in his power to compel the payment of it in gold or silver coin from the "King's mint and of full weight and due fineness. I know, that a different notion has

gentleman says, that, though upon the face of the Act, there is nothing to warrant the supposition, that a holder of a Country Bank note could not compel the payment of it in gold and silver, yet he thinks, that such holder would, by the judicial construc tion of the Act, be defeated in any attempt to compel such payment; and, he seems to think, that this is pretty clearly demonstrated in the fact (as he supposes it to be), that no one has ever yet attempted to compel Country Bankers to pay their notes in gold and silver.

He will, doubtless, be surprised to find, that the attempt has not only been made, but that it fully succeeded. In the year 1801, four years after the Bank Stoppage, or Restriction, Act was passed, a Mr. GRIGBY, in the county of Suffolk, went to the Bank Shop of Messrs. OAKES and Co, of St. Edmunds Bury, and, in presenting them one of their own Five Guinea notes for payment, demanded money. The Bankers tendered him a five pound Bank of

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a

" to bring an action if payment in money,

"was refused.

"The question for the opinion of the "Court was, Whether under the circum"stances before stated, the Plaintiff was "entitled to recover?

Serjeant SHEPHERD, for the Defendants, "argued, that though unquestionably pre"vious to the passing of the 37 Geo. 3, c. "45, commonly called the Bank Act, a "bank note would not have been a legal "tender, yet that, since the passing of the "above act such notes must be considered as cash, for that the necessary conse quence of the above act being to absorb a vast proportion of the actual cash of "the country, the Legislature must have "intended to give a new character to "bank notes by way of substitute; that "they had specifically declared them to "be a good tender so as to prevent an ar"rest, and yet if the same spirit which ac◄ "tuated the present Plaintiff in the com"mencement of this action was to con"tinue to influence his conduct, and that "of others also, a Defendant, though ex

England note, and five shillings, which he refused to receive, saying, that the five pound Bank of England note was not money, and that he would not take it. The Bankers told him, that, if he wanted specie for his accommodation, they would let him have it. He declined to receive it in that way; he said that he stood in no need of it as an accommodation; that he demanded it as a right; and that, unless they paid him in the coin of the kingdom, he would bring an action of debt against them. Upon this ground they refused him payment in coin, whereupon he brought his action and obtained a verdict in his favour at the Assizes; but the question of law was, upon the motion of the Defendant's counsel, reserved for decision by the Judges; and the following is the Report of the Case, as argued before, and determined by the four Judges, of the COURT OF COMMON PLEAS, on the 19th of Nov. 1801. "GRIGBY against OAKES and Another. -This was an action on a promissory note; the Defendants as to all but five "guineas pleaded non assumpserunt, and "as to the remaining five guineas they pleaded a tender. The cause came on "to be tried at the Summer Assizes for Suffolk, before Mr. Baron Hotham, "when a verdict was found for the Plaintiff, with one shilling damages, subject to the opinion of the Court "upon the following case. The Defendants are Bankers at Bury St. Edmunds, and issued the note in question" "for five guineas, payable on demand to "the bearer. On the 31st of January last, the Plaintiff carried several notes "to the shop of the Defendant, and de"manded payment. He first presented "other notes, to the amount of 50 gui "neas, for which he received payment, "partly in Bank of England notes and "partly in cash, the cash being ten pounds," which declared payments in bank notes "and being the proportion of money they "usually pay.. He then presented the "note in question, for which the Defend"ants tendered in payment a 51. Bank of" "England note and five shillings in silver. "This the Plaintiff refused on the ground "that the tender was partly in a Bank of "England note, objecting to such note, "LORD ALVANLEY, (Chief Justice).—The "and insisted on being paid wholly in "question for the Court to decide is a money. The Defendants refused to "mere question of law, arising, as it has "pay wholly in money. The Plaintiff" been contended, out of the provisions of "did not at the time say he wanted "the 37 Geo. 3. c,45. In fact we are "money for his own particular accom-called upon to say whether it follows as " modation, but stated that he came on a necessary consequence from that act, "purpose to have cash for the note, or "that a tender in bank notes is equivalent

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empted from arrest, might ultimately be "taken in execution, though ready to pay "in bank notes, since he might possibly "be unable to satisfy the judgment ob"tained against him altogether in money; "because even if a sale of his goods took "place, the Sheriff might not be able to "avoid receiving a large proportion of "bank notes from the purchasers; that,

indeed, in some respects, bank notes "were privileged by the 37 Geo. 3, c. 45, beyond cash, inasmuch as a tender of "them in satisfaction of a debt operated "to discharge a party from arrest, which

was not the case with a tender of money, "which must be pleaded in bar; and "that no contrary inference could be "drawn from the 8th section of the act,

"to be equivalent to payments in cash, if "made and accepted as such, because "that must have been the case before the passing of the act, and therefore that "clause must be deemed nugatory.

Serjeant SELLON, on the other side, was "stopped by the Court.

"tions of parliament, and to speak loudly "the resolution not to alter the character "of bank notes, but in those cases which "are specially provided for. Without

"Judge HEATH. I am of the same opi"nion. The question for us to decide is, "whether a tender in Bank notes is a good legal tender? Now the 37 Geo. "3. c. 45. appears to me to negative that question; for the several provisions of "the act making them a good legal ten"der in certain excepted cases, excludes "the idea of their being so generally in "cases not provided for by the act. It "has been argued, however, that the ope"ration of the act will in many cases be

"to a tender in money? It may be very "true that individuals may be occasionally subjected to great inconveniences "from the operation of that act; but are "we therefore to say that the Legislature" however referring to any of those spe"has enacted that which the provisions of "cific clauses, and arguing from them as "the act do not warrant? If we were at "to the intent of the Legislature, I should liberty to refer to our own private know- "be clearly of opinion, that the present ledge of the language that was held in "Plaintiff is entitled to our judgment in "Parliament while this act was pending, "his favour. "no doubt could be entertained upon the "subject. We know that it was very "much canvassed at that time, Whether or not the Legislature ought to go the "length of declaring bank notes a good "legal tender? I, therefore, it had been" "intended by the Legislature so to make "them, that intention would have been expressed in such clear terms that no "question could have arisen upon the subject. Indeed, it is expressly pro"vided, in the 2nd section of the act, that "if the Governor and Company of the "Bank of England shall be sued on any "of their notes, or for any sum of money, "payment of which in their notes the "party suing refuses to accept, they may apply to the Court in which such proceedings are instituted, to stay proceed-" ings during such time as they are restricted from paying in cash. But with "respect to individuals it was not intended" "to prevent any creditor, who should be so disposed, from captiously demanding a payment in money, though such a "creditor is deprived of the benefit of ar"resting his debtor. Thank God, few "such creditors as the present Plaintiff "have been found since the passing of the "act! But yet, whatever inconveniences" "may arise, and to whatever length they may go, Parliament and not this Court "must be applied to for a remedy. In

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very injurious, unless we determine it "to be a necessary inference from the "act that Bank notes were intended by "the Legislature to be put upon the same "footing as cash. But whatever incon"veniences may arise, the Courts of Law cannot apply a remedy. I think; "indeed, the Legislature acted wisely, having the recent example of France before their eyes, to avoid making bank "notes a legal tender; for in France we "know that legislative provisions of that "kind in favour of paper currency only "tended to depreciate the paper it was de

signed to protect, and were ultimately re"pealed, as injurious in their nature." "Judge RooKE. I am of the same opinion."

"Judge CHAMBRE. This case appears "to me almost too plain for argu"ment. It has been thought that the

convenience arising from the operation" Courts went a great way in holding

"of an act of Parliament, can be no "a tender in bank notes to be a good ten"ground of argument in a Court of law; der, if not objected to at the time. "and even if it were, still I should enter- Certainly that was an innovation; "tain no doubt, that it was the intention" though perhaps a beneficial one. But "of the Legislature to make bank notes a "the act upon which the present question legal payment only in certain cases by" arises affords nothing but arguments "them expressed, and that in all other" against the inference attempted to be "cases they should remain upon the "same footing upon which they stood be. "fore the act, except as to the exemption "from arrest, which they afford to the party tendering them in payment. The "Sth section of the act, which has been "treated as nugatory in the argument, "however it may enact nothing new, still

appears to me pregnant with the inten

"drawn by it. Surely the observation "that in some respects the Legislature "have put bank notes on a more favoura "ble footing than cash, leads to a con"clusion directly contrary to that which "it was intended to support. If the Le

gislature have not gone far enough it is "for them, not for us, to remedy the de"fect. Indeed, by making bank notes a