In re Jonathan J. Milner. In this case, I do not enter into an inquiry whether this provision of the bankrupt act embodying state exemption laws is unconstitutional as not giving a "uniform law on the subject of bankruptcies throughout the United States," as required by the eighth section of the first article of the Federal Constitution. This may become a grave question for the court. But as it has not been urged in the present case, I give no opinion concerning it. In the case at bar, it appears that under the provision of the bankrupt act adopting the state law, the assignee has set apart to the bankrupt property of the value of $300. So far as this matter is concerned, therefore, I decide that he has committed no error. Upon the whole, the only error committed by the assignee, is his refusal to turn over to the bankrupt his $175 worth of household and kitchen furniture. As to this point only, his decision is reversed; and he is ordered forthwith to deliver to the bankrupt that furniture. U. S. DISTRICT COURT, N. D. GEORGIA. A debt incurred by the loan of Confederate treasury notes is not provable in bankruptcy. In re JONATHAN J. MILNER. ERSKINE, J. In 1863, John Neal loaned twenty-five hundred dollars, in "Confederate treasury notes," to Milner, the bankrupt, for which amount he made his promissory note to Neal. Subsequently, Neal, in making a disposition of his property among his children and grandchildren, gave this note to his son-in-law, Samuel Bailey, in trust for minor children of Susan Beall, a daughter of said John. Bailey, as trustee, sought to prove this claim against the estate of the bankrupt. Counsel for the latter objected: First, because the consideration for the contract was Confed In re Jonathan J. Milner. erate treasury notes; secondly, because these notes were borrowed for the purpose of hiring a substitute to serve in the Confederate army, with the knowledge of Neal, and that the notes were so appropriated, and the substitute hired therewith did go into the said army. Evidence being heard on these points, the register rejected the claim, and the proceedings were certified to the court. The conclusion at which the register arrived was approved. Ante, p. 19, quarto. The party whose claim was thus rejected, petitioned the judge for a rehearing, on the ground that the testimony adduced in proof of the second objection in particularwas wholly insufficient to warrant the decision of the register, or affirmance by the court. A new hearing was granted before the register. The testimony, on both sides, is long and contradictory, with the exception that all agree that the loan was made in Confederate treasury notes. But the register adhered to the course of reasoning previously entertained by him, and gave the same judgment as before. Mr. Bailey being still dissatisfied with the ruling, the matter was again certified for review. From the views which I entertain of the legal principles involved in this proceeding, it is not essential to an approval or disapproval of the conclusion at which the register arrived, that these Confederate treasury notes, or any portion of them, were used to procure a substitute to serve in the Confederate army, or that they were employed for any other purpose. The register holds, as he held at first, that the contract was illegal and void; and this result I approve and affirm. But I do not concur with him in one of the principal reasons advanced for his decision; and which reason is more prominently argued in his first written opinion than in his last, namely, that these notes were bills of credit within the sense of that term, as understood in the Constitution. He said: "Art. 1, section 10, clause 1, of the Constitution declares, among other things, that' no state shall enter into any confederation' or 'emit bills of credit.' It follows, then, that In re Jonathan J. Milner. the confederation, styled the Southern Confederacy, was entered into by the several states of which it was composed, in direct violation of an express provision of the supreme law of the land. As no state can, constitutionally, emit bills of credit,' it follows, as a matter of course, that no confederation of states can do so, without bidding defiance to the Constitution. The issuance of Confederate treasury notes was not only an illegal act within itself, but was doubly illegal, having been done by an illegal confederation." "No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit," etc. Const. U. S. art. 1, sec. 10, p. 1. No disquisition on the origin of bills of credit, or history of their rise and progress, or of their fall, under the inhibition just cited, would aid in the determination of this case. Therefore, I will but remark, that the great minds who framed the Constitution were, from recent experience, aware of the blighting effect on the domestic and foreign commerce of the states, and on the welfare of the whole country, which flowed from the almost indiscriminate issuing of these bills by the colonies and afterwards by the states, as a circulating medium, or as money among the people, to suffer its perpetuation, or to longer tolerate it to the states - and time has proven the wisdom of their statesmanship. So far as I have been able to ascertain, all paper answering to bills of credit put forth during the war of independence, were promises to pay. But, be this so or not, the supreme court of the United States, in Craig et al. v. The State of Mississippi, 4 Peters, 410, held, that a paper currency emitted by a state, and receivable in discharge of all debts and taxes due the state, and of all salaries and fees of office, &c., and pledging the faith and funds of the state for the redemption of these paper issues, was within the Constitution prohibition. The same court, in Briscoe v. The Bank of the Common wealth of Kentucky, 11 Peters, 258, gave the following comprehensive definition of a bill of credit: "The definition, In re Jonathan J. Milner. then, which does include all classes of bills of credit emitted by the colonies, or states, is a paper issued by the sovereign power, containing a pledge of its faith, and designed to circulate as money." Taking this definition as imparted by the highest judicial tribunal in the land, it will conduce to a correct conclusion of the endeavor to ascertain whether these treasury notes, or bills, issued by the so-called Confederate States, fall within it. Although it is declared that no state shall emit bills of credit; yet if two or more of the states ally themselves or confederate together, and on their faith and credit issue these bills, I apprehend, the inhibition would apply with a force equally as direct and controlling against the allied or confederated states as against a single one. Here is a copy of one of these treasury notes. "Fundable in eight per cent. stock or bonds of the Confederate States. Six months after the ratification of a treaty of peace between the Confederate States and the United States, the Confederate States of America will pay five dollars to bearer. Richmond, September 2, 1861. "Receivable in payment of all dues, except export duties." Then follow the names of a register and treasurer. One decision, and only one, on this subject has been brought to my notice; that is the case of Bank of Tennessee v. Union Bank of Louisiana, lately tried before Judge Durell, and a jury, in the circuit court of the United States, for the Eastern District of Louisiana, and published in the American Law Review for January, 1868. The judge is there reported to have said, in his charge to the jury, "that Confederate treasury notes issued by said government, and circulated as money, were bills of credit within the meaning of the Constitution; and therefore an unlawful issue." The views which present themselves to my mind do not terminate in accord with the opinion expressed by that learned and able judge. During the years 1860 and 1861, South Carolina, Georgia, Louisiana, Virginia, and other states, by similar modes, called In re Jonathan J. Milner. on the people to send delegates to meet in convention. Accordingly these conventions assembled, and each passed an ordinance of secession, as it is generally termed, by which ceremony these conventions severally adventured to withdraw the states from the Federal Union, and to release the people from their subjection to the laws of the land, and their allegiance to the nation. The Constitutional State governments were overthrown, and superseded by spurious and revolutionary governments. The setting up of a pretended central or general government, styled "The Confederate States of America," followed; and, soon thereafter, open rebellion and war of portentous magnitude burst upon the nation. Vide The Prize Cases, 2 Black, 635, and Shortridge v. Mason, United States circuit court, District of North Carolina, opinion of the court delivered by Chief Justice Chase. 2 Am. Law Review, 95, and 5 Internal Revenue Record, p. 206. In the seceded states so called, the sovereign authority being for the time displaced, consequently there ceased to be, within any of them, a government under the Constitution of the United States. Then can it be said that the usurping power could pledge the faith of the state by a public law, or otherwise, for the payment of the treasury notes issued by the so-called Confederate States of America? Or could this pretended general government bind any of those states for the redemption of these notes? But these Confederate treasury notes or bills do not pretend to have been emitted by a state, or a combination of states of the Union; nor can it be inferred from indicia found upon them, nor can their recondite * his- 108 tory show, that they emanated from the sovereign power, and on the faith of any of the states. And thus it will be seen that they did not possess the characteristic attributes of bills of credit, in accordance with the definition of the supreme court of the United States; they did not issue by virtue of the sovereignty of the state, nor did they rest for their currency on the faith of the state pledged by |