Neely v. McFadden

2 S.C. 169, 1870 S.C. LEXIS 18
CourtSupreme Court of South Carolina
DecidedNovember 26, 1870
StatusPublished
Cited by5 cases

This text of 2 S.C. 169 (Neely v. McFadden) is published on Counsel Stack Legal Research, covering Supreme Court of South Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Neely v. McFadden, 2 S.C. 169, 1870 S.C. LEXIS 18 (S.C. 1870).

Opinion

The opinion of the Court was delivered by

IVili.ARD, A. J.

The plaintiff sues on a promissory note, dated December, 22d, 1863, payable in twelvemonths after date. On the trial the defendant introduced no testimony ; but insisted that under the operation of the “ Act to determine the value of contracts made in Confederate States notes or their equivalent,” passed March 26tli, 1869, the debt was reduced to the- sum which, according to the scale of values set forth in that Act, was the equivalent in the currency of the United States of the face of the note at its date. The Court sustained this view. The plaintiff, thereupon, offered testimony to prove the real consideration of the contract, and that it was [172]*172not with reference to Confederate States notes. The Court excluded such testimony as varying a written contract, and under such instructions the jury found a verdict for the plaintiff. It is evident that this verdict must be set aside, unless the proposition is established that all contracts made between the dates to which that Act relates are exclusively controlled thereby, without regard to extrinsic evidence of the real intent of the parties, or the facts of the case, in the following respects: first, that all such contracts are to be held as made in contemplation of Confederate currency; and, second, that the value of Confederate currency is to be determined according to the rule laid down in that Act.

The Act relates to contracts created or contracted in Confederate States notes, or with reference to such notes as a “ basis of value,” made during the years 1861, 1862, 1863, 1864 and 1865. It declares that the obligation of such contracts shall be determined by the value of said Confederate States notes in the lawful money of the United States at the time such debts or obligations were created or contracted. Section 2 commences as follows: “Pursuant to the preceding Section, the value of one dollar of lawful money of the United States in said Confederate States notes is declared as follows, namely ;” then follows a tabular statement of the relative values of such currency during the different months or parts of the year extending through the period of years before mentioned. This table places the nominal amount of $13.50 of Confederate States notes, on the 1st of December, 1863, at the value of one dollar lawful money of the United States. To ascertain the value of that amount of Confederate notes, on the 22d of December, 1863, the rate of increase during the month of December, as ascertained by comparing the values set down for December 1, 1863, with those for January 1, 1864, must be taken into account, and the value from December 1 actually increased accordingly.

The following questions are to be considered: 1st. Where no mention is made on the face of a contract, of Confederate States notes, but the contract calls for “ dollars,” or “ lawful money,” alone, can the fact that the parties dealt with reference to Confederate currency be made out by extrinsic proofs? 2d. When that fact appears, can resort be had to the Act in question as the means of ascertaining the value of such Confederate currency? 3d. Is the Act final and conclusive between the parties, as it regards the class of contracts to which it applies? or may the parties introduce [173]*173evidence contradictory of the declarations of the Act as to the true state of relative values ?

I. Can the parties resort to proof outside of that afforded by the instrument itself, to convert an obligation to pay “ dollars,” or “ lawful money,” into one to pay according to the value of the notes of the Confederate States? These notes were not lawful money under the Constitution and laws of the United States, and', therefore, could not, as a question of legal conclusion alone, satisfy the expression, “lawful money.” It is necessary, therefore, to show, as matter of fact, that' where the parties said lawful money, they did not mean that which the law adjudged to be lawful money, but certain promises to pay, having current commercial value, but not answering the description of “ lawful money.” This question must be looked at both on grounds of substantial justice and of technical law. The object of technical - rules is to afford lights by means of which justice may be attained. What is justice, in a legal sense, is determined by the conscience of the community as revealed in the spirit of the law's, and not by the conviction of any single individual mind, however gifted.

In December, 1863, the parties to this controversy resided in the State of South Carolina. The Constitution and laws of the United States, although obligatory upon them, were practically inoperative for the time being. The State of which they were citizens was, in common with certain other States, engaged in making war upon the Government and people of the United States. Though a war in form, it was in effect a rebellion against the sovereignty of the United States. The confederated States assumed, among other things, to exercise national power, to make war, to maintain military forces, to levy taxes and contributions, and to establish standards of values. The gold and silver coin of the United States had ceased to be the actual representative of values in the dealings of these communities, not only in the Confederate States, but throughout the territorial limits of the United States. This was not alone due to its insufficient supply for commercial purposes, but to the additional fact that in that portion of the country main- ■ taining the authority of the United States the paper issues of the Government, made a legal tender, .had replaced gold and silver in current transactions, and, as a consequence, the prices of all commodities had adjusted themselves to the nominal value of such issues ; and, as such issues had a relative value as compared- with gold and silver, less than its nominal value, commercial dealing [174]*174no longer rested upon the standards of coin values. The language of commerce was unchanged in form, the terms that were employed to express the measures of values, as a general thing, still continued in use, but the import and force of those terms had been changed through the legislation that sought to give commercial value to the bills of the Government. In the Confederate States a still more complicated state of facts existed. Here, also, gold and silver coin had ceased to control the values of commodities as dealt in by the communities. The war having destroyed commercial intercourse between the sections of the country, the currency put in circulation by the Government of the United States did not, and could not, enter into the local circulation here to a sufficient extent to influence values. The Confederate States put in circulation obligations which, from the necessity of- the case, became the basis of values, determining the prices of commodities dealt in by the people. Here, also, the language of commerce remained unchanged; but the terms intended to express monetary values were, according to the common understanding, assumed to relate to the notes of the Confederacy then in circulation. In December, 1863, if we may assume the correctness of the table to which reference has been made, Confederate currency stood to the United States currency in the ratio of about fourteen to one.

Such was the general state of affairs. Of much we can take judicial notice; of the rest, it has become part of the history of the country, and, as such, forms, at least, a fair basis for testing the principles involved in the present question.

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Cite This Page — Counsel Stack

Bluebook (online)
2 S.C. 169, 1870 S.C. LEXIS 18, Counsel Stack Legal Research, https://law.counselstack.com/opinion/neely-v-mcfadden-sc-1870.