We’ve discussed SCOTUS’ Hepburn, Knox and Juilliard cases from 1870-1884 (https://restorefreedomkh.com/qw64), but which case got it right? In a way, they each got it a bit right, and a bit wrong. The Constitution does allow Congress to make legal tender, with the express powers provided to “regulate commerce” and “coin Money.” However, the reasoning in the majority opinions of Knox and Juilliard, as explained in Justice Chase’s dissent, allowed the “powers [of] the government [to] become practically absolute and unlimited.” Yet, Justice Chase was a bit wrong when he wrote the majority opinion in Hepburn, too.  He reasoned that Congress had no authority whatsoever to set our paper currency as legal tender. That is simply not correct. But he was correct with respect to contracts already in place when the Legal Tender Act was passed. Article 1, Section 10 of the Constitution does not allow any “Law impairing the Obligation of Contracts.” So, requiring the new US paper currency to be accepted for payment on contracts specifying otherwise that were in place before the Legal Tender Act was signed into law is unconstitutional as an impairment of a contractual obligation, with no other constitutional justification for doing so.

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