of payment gold be worth more or less. In Bronson vs. Rodes, 7 Wall., 229, Chief-Justice Chase said: "It is the appropriate function of the courts to enforce contracts according to the lawful understanding of the parties. .. . The intent of the parties is clear. .. . A contract to pay a certain number of dollars in gold or silver is therefore in legal import nothing else than an agreement to deliver a certain weight of standard gold, to be ascertained by a count of coins, each of which is certified to contain a definite proportion of that weight. It is not distinguishable, as we think, from a contract to deliver an equal amount of bullion of equal fineness." The same doctrine has been established by the cases of Butler vs. Horwitz, 7 Wall., 259, and Tribelock vs. Wilson, 12 Wall., 687, the latter case being decided in 1871, Justices Miller and Bradley dissenting. The later case of Gregory vs. Morris, 6 Otto, 619, decided in 1877, without dissent among the justices, affirmed the case first cited. And while it is within the bounds of possibility that this doctrine may be upset in some period of great excitement, it is as solidly established as any doctrine can well be, having been affirmed by a large number of the Supreme Courts of the States as well as by the Supreme Court of the United States, which in such matters has supreme authority.[1]
The currency problem has therefore been taken out of politics in a very large class of cases, and it can readily be done in nearly all. If bankers agree to pay their depositors in coin of a specified kind, say in gold coin of the present standard weight and fineness, regardless of legislation, they can readily make obligations due themselves likewise payable. Bankers, indeed, being subject to demand payments by their depositors, are really under a pledge to pay them in an undepreciated currency, since in the event of a debasement of the coinage the public would at once rush for the more valuable currency; and, as few bankers could stand such runs if made simultaneously on different banks, they are almost unanimously opposed to any change in the currency. The assertion may be ventured that the same causes that have led to the insertion of the above-cited provision in railroad mortgages will lead to similar contracts in other instances, particularly in the case of long-time, low-rate real-estate mortgages to insurance companies. While such changes can not come quickly, the pressure of interest and the universal desire for certainty will lead gradually to the adoption of expedients of the kind mentioned. If this kind of obligations should become common and of recognized validity, it is obvious that the political pressure, now so great, would be entirely neutralized, because few would have anything to gain
- ↑ For a collection of authorities, see 2 Daniel on Negotiable Instruments, sec. 1247.
