The Private Bond Case as a Postponement of the Real Issue

Abstract

The discussion which immediately follows a significant Supreme Court ruling often emphasizes its political and economic effects; and if any respectable chain of reasoning can be found serve the purpose, a decision expedient from an economic angle becomes correct from a legal point of view. Moreover, it is widely recognized that in the field of Constitutional Law the Court may escape the past without restricting the future by somewhat forced construction and a selection from among competing analogies. The existence of this process and the desire of the critic approve a practically desirable result combine minimize the importance of a single decision as a source of Constitutional Law. Yet in the long run the true significance of the case may prove be that it furnishes points of reference on which the Court, if it chooses, may later rely. Viewed in this latter sense, as a precedent for the future rather than a result socially desirable for the present, the case of Norman v. Baltimore & Ohio R. R.' is found contain many important implications which have passed unnoticed. In particular, if, as seems altogether likely, the process of extending federal powers continues, the necessary and proper clause and the Fifth Amendment as a substantive check thereon will inevitably become the focal points of a portentous struggle. An attempt will be made in the following pages subject the Norman case careful analysis with a special view these implications. The plaintiff's bond in this case provided that payment of principal and interest would be made in coin of the standard of weight and fineness existing when the bond was issued. A joint resolution of Congress declared invalid all contract provisions, past or future, which purported to give the obligee a right require payment in or a particular kind of coin or currency, or in an amount in money of the United States measured thereby. . . 2 The first section of Mr. Chief Justice Hughes' opinion deals with the interpretation of the clause in the bond. With the issues involved in this matter we are not here concerned. Suffice it say that, while discarding the theory that the contracts were for as a commodity, or bullion, the Chief Justice also denied by implication the contrary contention that they were for coin and nothing else. They were, he concluded, gold value contracts,