AR15.Com Archives
 State Issue Currency
1fromtx  [Team Member]
2/4/2012 3:28:22 PM EDT
I got this article following another link in Survival Gear.
Don't know if this is a dupe or not, but posting it anyway.

State Issue Currency

For whatever reason, this kinda shocked me. Not a whole lot shocks me now days.
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_DR  [Team Member]
2/4/2012 3:33:34 PM EDT
we've printed it before, we can print it again if need be.

tc556guy  [Team Member]
2/5/2012 10:43:07 AM EDT
We have local currency alternatives.

The topic of alternate currencies has been covered here in the past. if it interests you you might dig the old threads out of the archives
ilbob  [Member]
2/5/2012 6:49:17 PM EDT
CA issued script a few years ago when it could not pay its bills. They looked like a check but were really revenue anticipation warrants (or something like that).

IL just does not pay its bills on time to deal with its budget crisis.
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thecreeper23  [Team Member]
2/6/2012 8:20:49 AM EDT
Trivia Time. First case ever argued to the U.S. Supreme Court involved state-issued paper currency and a state law requiring people to take the money for payment:

West v. Barnes, (1791)* (August 2-3, 1791)

The case of West v. Barnes would have been a comedy of errors, if not for the bad fortune that befell William West at every turn. *West was the first case argued before the US Supreme Court; however, the documentation was lost, so the case does not appear in US Reports, the official publication of US Supreme Court opinions (at 2 US 401, the place currently occupied by Oswald v. State of New York, (1791))

In 1763, William West, a farmer, politician and innkeeper from Scituate, Rhode Island, purchased a large quantity of molasses on credit from Daniel Jenckes & Son, merchants from Providence, Rhode Island. In order to secure the note, West gave them the mortgage on his 500-acre farm.

West apparently intended to resell the molasses at a profit, but for unknown reasons, was forced to sell at a loss. He made regular payments on the mortgage for 20 years, but was unable to settle the debt.

In 1785, West requested and received permission from the Rhode Island legislature to raise money by selling some of his property through a lottery. Before the sale could take place, however, the state attempted to solve its own economic problems by issuing its first paper currency. As a result, many buyers at West's sale chose to pay in paper, rather than the gold and silver he anticipated.

West raised enough money to retire his debt to Jenckes & Son, but when he attempted to pay, the merchant refused the newly minted currency. The Rhode Island legislature had anticipated resistance to trade in paper currency and instituted a law in May 1786, the Emitting Act, that allowed debtors to discharge their obligations through the state court. According to law, the debtor paid the money to the court and the judged cited the creditor to appear before him within ten days to receive payment. If the creditor failed to appear, the judge was authorized to issue a certificate discharging the debt. Under the Rhode Island Emitting Act, this process was intended to "...forever operate as a discharge and a bona fide payment of the said debt..." The state would then confiscate any unclaimed amount for its Treasury.

West paid the full amount of the debt on September 16, 1789, but Jenckes failed to appear in the specified time and forfeited his claim.

It was later discovered that Jenckes had given West's farm deed to his son, Crawford, in 1788. Crawford died in September 1789, after the citation was issued, but before it expired.* Interest in the property passed to Crawford's brothers and sisters. No one communicated this information to West, who could have intervened with the court if notified earlier, until John Jenckes died in 1791. From 1789 until 1791, West reasonably believed the debt was settled.

Immediately following Jenckes' death, Crawford's heirs took legal action against West over the mortgage. David Barnes, a Massachusetts lawyer and husband of Crawford's sister Joanna, filed suit in federal court under diversity jurisdiction (Diversity-of-citizenship jurisdiction allows residents of different states to take civil action against each other in federal court, if the amount in dispute exceeds a certain threshold. In 1789, the amount had to meet or exceed $500.00.). Barnes alleged West owed the estate an amount approximate to $13,000 in 2009 USD.

West, who had no legal training, defended himself in circuit court, and asserted he had paid the debt to the state court in 1789. Barnes demurred (acknowledged the facts may be true, but claimed they did not enable the defendant to prevail in the suit). The arguments were submitted to the circuit court, which seated Chief Justice John Jay, Justice William Cushing, and District judge Henry Marchant. The judges found in favor Barnes for reasons not documented, and ordered West to pay the plaintiff's claim plus court costs.

Dissatisfied, West immediately decided to appeal to the Supreme Court on a "writ of error," alleging the judges were mistaken in their legal decision. Although the procedure for submitting a writ was unclear, West attempted to comply with the requirements of the Court within the ten-day filing deadline. Unfortunately, West became confused and requested the circuit court issue a writ in error against itself, which he then mailed along with the court records and other documents to John Tucker, Clerk of Courts for the US Supreme Court, in Philadelphia. He sent a second copy to Pennsylvania Attorney General William Bradford, Jr., who had agreed to represent West's interests.

The disposition of the original paperwork is unknown. Whether Tucker received the documentation late or misplaced it, the ten days had elapsed before West's case was entered into the docket (for this reason, another case appears to have been heard ahead of West's, although none was).

The Court convened to hear West v. Barnes on August 2, 1791. Instead of focusing on the facts material to the debt, however, the Court was forced to deal with the problem of the procedural error of the writ being issued by the district court instead of the US Supreme Court, and the excessive time elapsed before the case was received.

The Court's opinion is anti-climactic. By unanimous decision, the five justices (John Rutledge never fulfilled his obligation to the Court) ruled that the writ in error was invalid because it had been issued by the wrong court. Although they acknowledged Congress had failed to clarify the instructions and had allowed insufficient time for filing, given the distance from Providence to Philadelphia, they determined that the solution had to be rendered by the Legislative, not Judicial, branch. The court ruled that all writs had to be issued by the Clerk of the Supreme Court, and dismissed the case without considering the question of the disputed claim.


The legal dispute between Barnes and West continued after their failed attempt at resolution. To make matters worse for West, the State of Rhode Island had suspended the Emitting Act under which he paid his debt just three days after he tendered cash to the court. That left Barnes' claim against West intact, and forced West to attempt to recover his money from the state in a separate action.

In 1792, Barnes attempted to have West and his family removed from the farm, but the local Marshal refused to take action. Barnes returned to court and initiated eviction proceedings against the family.

In June 1793, the court entered a default judgment against West and awarded the property to Barnes. In 1794, a jury awarded Barnes $90.00 in damages and $59.90 in court costs for West's failed appeal to the Supreme Court.

The sad end of the tale is that West lived the rest of his days in poverty, but Barnes moved to Providence where he became a United States Attorney, then a Federal District Court Judge. There was no redeeming justice in the dispute between West and Barnes.

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