Opinion
Docket No. 67096.
Decided February 1, 1983.
Frank J. Kelley, Attorney General, Louis J. Caruso, Solicitor General, George N. Parris, Prosecuting Attorney, and Don L. Milbourn, Chief Appellate Attorney, for the people.
Walter J. Lawrence, in propria persona, for defendant on appeal.
Before: WAHLS, P.J., and J.H. GILLIS and V.J. BRENNAN, JJ.
In this case we issue an opinion on defendant appellant's application for leave to appeal. See GCR 1963, 806.7.
Defendant Walter J. Lawrence received a traffic ticket on November 16, 1981, in Macomb County. He pled guilty in the 40th District Court on April 21, 1982, and was ordered to pay a fine and costs of $30. Lawrence argued that the court could not compel payment from him in a medium other than gold or silver coin currently in circulation and minted by the United States government. As authority for this position Lawrence relied upon art I, § 10, clause 1 of the United States Constitution.
Lawrence's argument was rejected, and he appealed to Macomb County Circuit Court. That court affirmed the trial court by opinion of August 12, 1982, and order of August 31, 1982. Lawrence has filed this application for leave to appeal from that order.
Lawrence argues that this question is one of first impression in Michigan. It is true that we have not found any reported cases on the question in Michigan, but there is a great body of unanimous law on the question in the reported cases from the federal courts and from other jurisdictions. We agree with those cases. The Attorney General of the State of Michigan issued an opinion, No 5934, on July 15, 1981, on the question which summarizes those cases and concludes that art I, § 10 does not require the State of Michigan to pay its debts or receive the payment for debts exclusively in either gold or silver coin. We agree and adopt that opinion as our own as follows:
"You have requested our opinion whether US Const, art I, § 10, requires the State of Michigan to pay its debts or receive payment for debts exclusively in either gold or silver coin.
"US Const, art I, § 10, in pertinent part, provides:
"`No State shall * * * make any Thing but gold and silver Coin a Tender in Payments of Debts * * *.'"
"It has long been established that the federal government pursuant to the broad powers delegated to Congress by US Const, art I, § 8, possesses the exclusive power to declare what shall be legal tender for the payment of all debts. Legal tender cases: Knox v Lee and Parker v Davis, 79 U.S. 457; 20 L Ed 287 (1870); Julliard v Greenman, 110 U.S. 421; 4 S Ct 122; 28 L Ed 204 (1884); Norman v Baltimore Ohio R Co, 294 U.S. 240; 55 S Ct 407; 79 L Ed 885 (1935); Guarantee Trust Co v Henwood, 307 U.S. 247; 59 S Ct 847; 83 L Ed 372 (1939). The reason for vesting Congress with this power was stated succinctly by the United States Supreme Court in Knox v Lee, supra:
"`The Constitution was intended to frame a government as distinguished from a league or compact, a government supreme in some particulars over States and people. It was designed to provide the same currency, having a uniform legal value in all the States. It was for this reason the power to coin money and regulate its value was conferred upon the Federal government, while the same power as well as the power to emit bills of credit was withdrawn from the States. The States can no longer declare what shall be money, or regulate its value. Whatever power there is over the currency is vested in Congress.' 79 U.S. 457, 545.
"Further explanation was later provided by the Court in Julliard v Greenman, supra, as follows:
"`By the Constitution of the United States, the several States are prohibited from coining money, emitting bills of credit, or making anything but gold and silver coin a tender in payment of debts. But no intention can be inferred from this to deny to Congress either of these powers. Most of the powers granted to Congress are described in the eighth section of the first article; the limitations intended to be set to its powers, so as to exclude certain things which might otherwise be taken to be included in the general grant, are defined in the ninth section; the tenth section is addressed to the States only.' 110 U.S. 421, 446."
"The Court went on to hold, inter alia:
"`The power of issuing bills of credit, and making them, at the discretion of the legislature, a tender in payment of private debts, had long been exercised in this country by the several Colonies and States; and during the Revolutionary War the States, upon the recommendation of the Congress of the Confederation, had made the bills issued by Congress a legal tender. See Craig v Missouri, 4 Pet 435, 453; Briscoe v Bank of Kentucky, 11 Pet 257, 313, 334-336; Legal Tender Cases, 12 Wall 557, 558, 622; Phillips on American Paper Currency, passim. The exercise of this power not being prohibited to Congress by the Constitution, it is included in the power expressly granted to borrow money on credit of the United States.
"`This position is fortified by the fact that Congress is vested with the exclusive exercise of the analogous power of coining money and regulating the value of domestic and foreign coin, and also with the paramount power of regulating foreign and interstate commerce. Under the power to borrow money on the credit of the United States, and to issue circulating notes for the money borrowed, its power to define the quality and force of those notes as currency is as broad as the like power over a metallic currency under the power to coin money and to regulate the value thereof. Under the two powers, taken together, Congress is authorized to establish a national currency, either in coin or in paper, and to make that currency lawful money for all purposes, as regards the national government or private individuals.' 110 U.S. 421, 447-448.
"In exercising its power to establish and regulate a national currency, Congress has, pursuant to 48 Stat 133 (1933); 31 U.S.C. § 463, expressly forbidden the making of obligations payable in gold or any particular kind of coin or currency except that which it was declared legal tender at the time of payment:
"`(a) Every provision contained in or made with respect to any obligation which purports to give the obligee a right to require payment in gold or a particular kind of coin or currency, or in an amount in money of the United States measured thereby, is declared to be against public policy; and no such provision shall be contained in or made with respect to any obligation hereafter incurred. Every obligation, heretofore or hereafter incurred, whether or not any such provision is contained therein or made with respect thereto, shall be discharged upon payment, dollar for dollar, in any coin or currency which at the time of payment is legal tender for public and private debts. Any such provision contained in any law authorizing obligations to be issued by or under authority of the United States, is hereby repealed, but the repeal of any such provision shall not invalidate any other provision or authority contained in such law.
"`(b) As used in this section, the term "obligation" means an obligation (including every obligation of and to the United States, excepting currency) payable in money of the United States; and the term "coin or currency" means coin or currency of the United States, including Federal Reserve notes and circulating notes of Federal Reserve banks and national banking associations.'"
"The constitutionality of 31 U.S.C. § 463, supra, was upheld in Norman v Baltimore Ohio R Co, supra.
"Presently, legal tender for the payment of all debts, including taxes, is declared in 79 Stat 255 (1965); 31 U.S.C. § 392 to be:
"`All coins and currencies of the United States (including Federal Reserve notes and circulating notes of Federal Reserve banks and national banking associations), regardless of when coined or issued, shall be legal tender for all debts, public and private, public charges, taxes, duties, and dues.'
"In recent years the federal courts have, in numerous instances, reaffirmed Congress's constitutional power to declare what is legal tender for payment of all debts, both public and private. United States v Tissi, 601 F.2d 372, 374 (CA 8, 1979); United States v Rifen, 577 F.2d 1111, 1112 (CA 8, 1978); United States v Daly, 481 F.2d 28, 30 (CA 8, 1973), cert den 414 U.S. 1064; 94 S Ct 571; 38 L Ed 2d 469 (1973); United States v Whitesel, 543 F.2d 1176, 1180-1181 (CA 6, 1976); United States v Schmitz, 542 F.2d 782, 785 (CA 9, 1976), cert den 429 U.S. 1105; 97 S Ct 1134; 51 L Ed 2d 556 (1977).
"While the question has never been considered by Michigan appellate courts in reported cases, the exclusivity of Congress' power has been consistently recognized by the State courts which have had occasion to consider the matter: e.g., Chermack v Bjornson, 302 Minn. 213; 233 N.W.2d 659, 660-661 (1974), cert den 421 U.S. 915; 95 S Ct 1573; 43 L Ed 2d 780 (1975), where the Minnesota Supreme Court ruled that the state was not required to tender income tax refunds in gold and silver coin; Radue v Zanaty, 293 Ala. 585; 308 So.2d 242, 244 (1975), where the Alabama Supreme Court held that it was impermissible for a taxpayer to tender payment of income taxes by checks redeemable only in gold or silver coin; Leitch v State Dep't of Revenue, 16 Or. App. 627; 519 P.2d 1045, 1046 (1974), in which the Oregon Court of Appeals described as `frivolous' the taxpayer's contention that transportation taxes could only be collected by the state in gold and silver; Allen v Craig, 1 Kan. App. 2d 301; 564 P.2d 552; 556-557 (1977), in which the Kansas Court of Appeals rejected a taxpayer's attempt to pay $4,000 in personal and real property taxes with a check which called for payment in 800 silver dollars, allegedly worth five times as much as federal reserve notes; Trohimovich v Director of Dep't of Labor, 21 Wn. App. 243; 584 P.2d 467, 470 (1978), where the Washington Court of Appeals denied an attempt by the owners of a business to make payment of state industrial insurance premiums with checks reflecting the owners' conversion of the total dollars due in gold based on final daily price-fixings of gold on the London Market; and Middlebrook v Mississippi State Tax Comm, 387 So.2d 726, 728 (Miss, 1980), where the Mississippi Supreme Court held that federal reserve notes are taxable dollars for purposes of paying state income tax assessments." OAG, 1981-1982, No 5934, p 251 (July 15, 1981).
It is our opinion, therefore, that US Const, art I, § 10 does not require the State of Michigan to pay its debts or receive payment for debts exclusively in either gold or silver coin. It is further our opinion that the state may not require the payment of private debts exclusively in either gold or silver coin since Congress alone possesses and exercises this authority.
The order of August 31, 1982, is affirmed.