Briscoe v. The Commonwealth's Bank of Kentucky
[Note: this opinion was published in U.S. Reports with the following disclaimer:
In cases where constitutional questions are involved, unless four judges of the court concur in opinion, thus making the decision that of a majority of the whole court, it is not the practice of the court to deliver any judgment, except in cases of absolute necessity.
Four judges not having concurred in opinion as to the constitutional questions argued in these cases, the court directed that the cases shall be re-argued at the next term.]
IN error to the Court of Appeals of the state of Kentucky.
The legislature of the state of Kentucky, on the 29th November 1820, incorporated a 'Bank of the Commonwealth,' the whole capital stock of which, amounting to two millions of dollars, belonged exclusively to the state, and consisted of certain funds, moneys, stocks, &c. enumerated in the act. The bills and notes of this bank were made receivable in all payments for taxes and other demands of the state: the interest arising from loans and discounts, after the payment of expenses, became part of the annual revenue, and the revenue of the state was made part of the capital of the bank. The management of the institution was entrusted to a president and twelve directors, chosen annually, by joint ballot of both houses of the general assembly. See the act, 2 Littell and Swigert's Digest of the Stat. Laws of Kentucky, sec. 1, 3, 5, 17, 24, 25, pp. 155, 156, 159, 162, 163.
On the 25th of December 1820, the legislature passed another act, making it lawful, when any execution should issue, for the plaintiff to indorse thereon, that notes of the Bank of Kentucky or its branches, or notes of the Bank of the Commonwealth or its branches, would be received in payment; whereupon such execution should be collected and replevied agreeably to the laws then in force, allowing three months replevin only. But if any execution issued without such indorsement, such execution was allowed to be stayed two years, on giving bond with approved security, &c., 2 Littell and Swigert's Digest, 459, 500, sec. 1 and 2.
This was an action brought in March 1831, in the circuit court of Mercer circuit, Kentucky, by the bank so incorporated, against George H. Briscoe and others, to recover the sum of two thousand and forty-eight dollars and thirty-seven cents, the amount of a promissory note given by them to the bank.
The defendants in the court below, the plaintiffs in error, pleaded, in substance, that the note sued on was given in renewal of another note, and that of a preceding one; and that the only consideration given for the original note, by the said bank, was bills of credit issued by the state of Kentucky, through and by means of the said bank, contrary to the constitution of the United States.
To the pleas of the defendants the plaintiffs demurred, and the circuit court sustained the demurrers, and gave judgment against the defendants for the amount of the note, with interest and costs. The defendants appealed, and the court of appeals, at May term 1832, affirmed the judgment of the circuit court.
The court of appeals being the highest court of law of the state of Kentucky, in which a decision on the case could be had, and there being drawn in question rights attempted to be derived under a law of a state, impugned on the ground of its repugnance to the constitution of the United States, the case has been removed from the court of appeals of Kentucky to the supreme court of the United States, by writ of error, pursuant to the provisions of the twenty-fifth section of the judiciary act of 1789.
For the plaintiffs in error, three points were insisted on.
1. That the record shows a proper case for the jurisdiction of this court, within the provisions of the twenty-fifth section of the judiciary act of 1789.
2. That the act of the legislature of Kentucky establishing the Bank of the Commonwealth, is unconstitutional and void; being repugnant to the provision of the constitution of the United States, which declares that no state shall emit bills of credit.
3. That the Bank of the Commonwealth has no right to recover on the promissory note which is the foundation of this suit, because the consideration was illegal.
The case was argued by Mr White and Mr Wilde, for the plaintiffs in error; and by Mr Hardin and Mr Bibb, for the defendant.
Mr Chief Justice MARSHALL delivered the opinion of the Court in this, and on the following case.
Note. — Mr. Justice Johnson and Mr. Justice Duvall were absent when these cases were argued.