Legal tender is a hot topic these days, with the discussion covering everything from bitcoin to “cashless” businesses. “Legal tender” is the money (including bills and coins) approved in a country for the payment of debts, the purchase of goods, and other exchanges for value.  In Hepburn v Griswold (1870), SCOTUS held that although Congress had the power to issue paper notes as currency, it did not have the power to make this paper currency a “legal tender.” The court noted the federal government has the power to “regulate commerce,” “to coin Money,” and “to borrow money,” but found there is “no express grant of legislative power” to create paper legal tender. Of note, in this case the court concluded that “an act of making mere promises to pay dollars a legal tender in payment of debts previously contracted, is not a means appropriate . . . to carry into effect any express power vested in Congress.” The next year, in Knox v Lee, SCOTUS held the Legal Tender Act was constitutional, as necessary in times of war. Then in Juilliard v Greenman (1884), SCOTUS expanded that, holding that Congress could make paper currency “a legal tender for the payment of private debts” even in times of peace. Congress now relies on 31 USC 5103, which states that all US coins & currency are legal tender for all debts, taxes and dues. So, which court got it right? Check out https://restorefreedomkh.com/njiu for the answer!

Post Views: 37