Leach v. Smith

25 Ark. 246
CourtSupreme Court of Arkansas
DecidedDecember 15, 1868
StatusPublished
Cited by7 cases

This text of 25 Ark. 246 (Leach v. Smith) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Leach v. Smith, 25 Ark. 246 (Ark. 1868).

Opinion

Story, Special C. J.

Smith and wife brought assumpsit against Leach, on two promissory notes executed by. Leach, each bearing date of August 1,1862, each for the sum of “two thousand and eighty-five dollars,” with interest at the rate of eight per cent., from due, payable to the order of Charles J. Lassiter — one on January 1,1864, and the other on January 1,1865, both of which were indorsed by Lassiter to Laura A. Smith.

The defendant in the court below interposed the following plea: “And the said defendant, by his attorney, comes and defends the wrong and injury, when, &e., and says actio non, as to the sum of $8,383^0-, part and parcel of the sum of said two promissory notes in plaintiffs’ declaration mentioned, because he says it was understood and agreed by and between the defendant and Charles J. Lassiter, the payee in said two promissory notes in plaintiffs’ declaration mentioned, at the time of making said notes, that said promissory notes were to be paid in Confederate money, or other bank bills then current; and the defendant avers, that at the date of said promissory notes, in said plaintiffs’ declaration mentioned, the value of said promissory notes in United States legal tender notes was the sum of $836^^-, which said sum of $8363^ is due to the plaintiff, and he may have judgment therefor, and that the said sum of $3,333-]^ is the excess over such value, and this the said defendant is ready to verify.” “To which the plaintiffs interposed their demurrer, which was by the court sustained, and the defendant refusing to plead further,” says the record, “ it is ordered that the said plaintiffs have judgment, and on motion, the instruments sued on are filed, whereby it appears that the plaintiffs’ damages are reduced to a certainty, and are by' the court assessed at $5,226^-. It is therefore considered,” &c.; judgment in the usual form.

The first error assigned is that the court below sustained the demurrer'to the defendant’s plea.

It was evidently attempted by this plea to set up, under the act of March 5,1867, laws of 1866-7, page 195, other and different contracts from those imported by the instruments on which suit was brought. Certainly it can not be held to be a plea of partial failure of consideration, as argued by the appellant, for the plea does not even state’ what was the consideration of the notes, but attempts to show that the notes were payable in one or' more kinds of depreciated currency. 2 Blackstone, 443. This, as has been well settled in the case of Roane v. Green & Wilson, 24 Ark., 210, under the common law rule of evidence, the defendant would not be permitted to show.

Conceding, for the present, the validity of the act of the Legislature, to which reference is above made, the plea is still defective. The act provides “that in all suits at law or in equity, ixpon any bond, bill, promissory note, or other contract for the payment of money, which was intended and understood or agreed by the contracting parties should be paid in Confederate money or other paper currency, the plaintiff or complainant in such suit shall recover in gold and silver or United States legal tender notes only th% value of such Confederate money, or otherpaper currency, as estimated in the community at the ¿¿me and place of making said contract, and interest thereon.”

And it is further provided “ that where any such bond, bill, promissory note, or other written contract does not express the kind of money to be paid, it shall be allowed the defendant to plead or answer such intention and understanding or agreement in bar of the excess over such value, and prove the same by parol testimony.”

There is no allegation in the plea of the value of Confederate money or bank bills then current, in which, as the plea alleges, the notes were to be paid. The allegation is, “ the value of said promissory notes,” &c. The value of the promissory notes, and the value of Confederate money or other bank bills, might be very different. The value of the promissory notes, in business parlance, was whatever they would bring in the market, and would depend greatly upon the responsibility of the maker. The statute provides for the recovery of the value of “Confederate money or other paper currency;” the plea for the recovery of the value of the promissory notes, the respective values of which, as we have seen, might be very different.

But we think our duty requires us to go further, and decide whether the Legislature has not exceeded its powers, and passed an act prohibited by the Constitution of the United States or of this State. It is conceded to be the correct doctrine that every enactment of the State Legislature is presumed to be constitutional and valid; that, before it can be pronounced otherwise, that clause of the Constitution must be clearly designated with which the act of the Legislature conflicts, since the Legislature, representing the people, have, as a rule, power to pass any and all acts, except those which are prohibited by either the State or Federal Constitution; and, under our system of government, it is only from the Constitution that the judicial department derives its authority to nullify the acts of a coordinate department. State v. Ashley, 1 Ark., 513. Eason v. State, 11 Ark., 481.

When we call to mind the changes effected by this law, and its importance to the people of this State, and doubting not that the purest motives of public policy influenced the legislative action, we are admonished to approach a subject of so much moment in that calm aqd even frame of mind which can only be produced by laying aside all extraneous considerations, and to decide it as a pure question of constitutional law.

For the purpose of considering the question, we will grant that the parties in this case contracted with a distinct understanding that the payment was to be made in Confederate money. This contract must be enforced according to its terms, or the obligation of the contract is changed and impaired. The terms of the contract, then, would be, that the defendant, in one and two years after date, respectively, would pay the sum of $2,085 in Confederate money, with interest from maturity, at the rate of eight per cent. Here the parties contract for a fluctuating currency, and will any one contend that at the time the note became clue the maker of the note was not entitled to pay it in Confederate money, though during the time the currency may have depreciated fifty per cent.? In other words, where parties contract to pay in a fluctuating medium, do they not contract in view of and are not each bound without regard to the fluctuations ? This is certainly so, whether the payment is to be made in a legal tender currency or not. Wallace v. Henry, 5 Ark., 105. Story on Notes, sec. 390-394. Story on Con. of Laws, sec. 311-314.

"We have assumed that no question is raised as to the legality or illegality of Confederate money; for, if a contract is made in consideration of or payable in a currency the issuance of which is prohibited by law, the entire contract is void. 5 Ark., 684; 4 Peters, 410; 8 Peters, 40; 5 Bing., (N. C.,) 675; 4 Coldwell, 275, 300; 3 Coldwell, 20, 157, 295, 419 and 468.

But, passing on: At the time the contract was to be executed, the maker was entitled to satisfy it by a specific performance. 5 Ark., 105. But the act takes away this right, and provides that it shall be discharged in a different manner.

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Bluebook (online)
25 Ark. 246, Counsel Stack Legal Research, https://law.counselstack.com/opinion/leach-v-smith-ark-1868.