port the rebellion because issued contemporaneously with it, and the tender of notes in payment of taxes was held good.1

§ 51. Mississippi notes in aid of Confederacy held void.

But where notes were issued by the legislature of Mississippi in aid of the Confederacy, in 1861, and made receivable in payment of taxes, they were void and not receivable in payment of taxes, which the reorganized State government directed should be paid in the currency of the United States.2

§ 52. Change in remedy not impairment of contract.

A State having contracted for the receipt of its bank notes in payment of taxes does not impair the obligation of a contract by enlarging, limiting or altering the modes of procedure for enforcing it, provided the remedy be not withheld or embarrassed with restrictions which seriously impair the value of the right. Thus a taxpayer in Tennessee, who was limited to an action at law against the tax collector to recover the amount of taxes paid in money under protest, was held to have an ample remedy.3

§ 53. The Virginia Coupon Cases.

The question of the enforcement of a State contract and the receipt of State obligations in payment of taxes, particularly with reference to the adequate remedies provided for the enforcement of such contract, was thoroughly considered in every possible phase by the Supreme Court in a series of cases known as the Virginia Coupon Cases, involv

1 Chief Justice Waite and Justices Bradley and Harlan dissenting. 2 Taylor v. Thomas, 22 Wallace, 479.

3 Tennessee v. Sneed, 96 U. S. 69, see infra, change in remedy; South Carolina v. Gailard, 101 U. S. 433.

ing litigation, which, in different forms, was before the court during a period of twenty years.

The State of Virginia in 1871, in adjusting its debt with its creditors on account of the separation of West Virginia during the Civil War, provided for funding two-thirds of its outstanding debt and accrued interest in bonds and coupons, the remaining one-third to be represented by certificates with a view to settlement with West Virginia. To facilitate the acceptance of this adjustment, it was provided that the coupons should be receivable at and after maturity for all taxes, debts, dues and demands due the State, and that this should be expressed on their face. The validity of this contract was at first sustained by the Court of Appeals of Virginia, which held invalid an act repealing the provision for the receipt of coupons for taxes. Thereafter however an act was passed providing that from the coupons when received for taxes there should be deducted a State tax equal to fifty cents on the one hundred dollars of the market value of the bonds, this act applying in terms to all bonds of the State, whether held by her own citizens or by non-residents and citizens of other States and countries. The court held1 that the receivability of the coupons for taxes was clearly a contract obligation inuring to the benefit of all the holders of the bonds and coupons; that the coupons were distinct and independent contracts, and that the taxing act could not be applied to coupons separated from the bonds and held by different owners without impairing the contract with the bondholder and the bearers of the coupons, as contained in the funding act.

§ 54. Virginia Coupon Cases under Act of 1882.

In 1882, the State enacted a law providing that when a mandamus was sued out against the collector of taxes to

1 Hartman v. Greenhow, 102 U. S. 672.

compel the receipt of coupons in payment, the taxpayer should be required to pay the taxes in money and file his coupons for the trial of the issue as to their genuineness. If the issue was found in their favor, the money paid was to be refunded out of the State treasury in preference to all other claims. The court, reaffirming its opinion as to the contract right to pay taxes in coupons, held that the remedy provided by this act was adequate and efficacious, and substantially equivalent to that which existed at the date when the coupons were issued. It said, however, that the question whether the tax collector was not bound in law to receive the coupons when tendered, and whether, if he refused them and proceeded with the collection of the tax, he could not be made personally responsible in damages was not before them.

§ 55. The Supreme Court on the Eleventh Amendment of the U. S. Constitution.

This question did come later before the court in a series of cases, reported as the Virginia Coupon Cases.2 The court reaffirmed its previous opinion, and held that the taxpayer was not compelled to seek the remedy provided by the act of 1882. He could tender his coupons, and such tender would be equivalent to payment so far as concerned the legality of all subsequent steps by the collector to enforce payment by distraint of his property. The coupons, made receivable for taxes, were not bills of credit within the prohibition of the Constitution, nor was the right of the taxpayer to sue the collecting officer for the recovery of property seized for taxes after he had made a lawful tender a suit against the State within the meaning of the Eleventh Amendment of the Constitution of

1 Antoni v. Greenhow, 107 U. S. 769.

2 114 U. S. 269.

the United States. On this point (four judges dissenting) the court said that there was a distinction between the government of a State and the State itself; that, in contemplation of law, the State had not passed the acts violative of the Constitution of the United States, as they were void, and therefore the officer had no official sanction for his conduct and was guilty of a personal violation of the plaintiff's rights. It also sustained the remedy by injunction against the collection of the tax, in cases where there was no adequate remedy at law, but held that a coupon holder, who had not alleged that he was a taxpayer, was not entitled to any relief. No direct action moreover for the denial of rights secured by the contract would lie on the 16th clause of section 629 of the Revised Statutes of the United States, but the remedy must be a judicial determination between individuals as to the validity of the law, under cover of which the attempt to collect the tax had been made, and the consequent wrongful disturbance of property rights occasioned.

One having tendered coupons in payment of a license required for the practice of a profession could go on practicing his profession, and any law of the State subjecting him to criminal proceedings therefor was invalid. He was not obliged to sue out a mandamus to compel the acceptance of the coupons.1

§ 56. The later Virginia Coupon Cases.

Another series of coupon cases came up for decision in 1889,2 and the court held void sundry acts of the Virginia legislature opposing impediments and obstructions to the use of the coupons, on the ground that these materially im

1 Royall v. Virginia, 116 U. S. 572, and Sands v. Edmunds, 116 U. S. 585. See also Willis v. Miller, 29 Fed. Rep. 238.

2 135 U. S. 662.

paired the obligation of the contract. Thus the provision which imposed upon the taxpayer the duty of presenting the bond, from which the coupons were cut, at the time of tendering them in payment, was an unreasonable condition. Another provision also was held invalid which prohibited expert testimony to establish the genuineness of the coupons. A special license fee of one thousand dollars required for the right to offer tax receivable coupons was adjudged a material interference with their negotiability. The court conceded that the rules affecting the remedy were subject at all times to modification and control by the legislature, even as to existing causes of action, but declared that no legislature had the power to establish rules which, under the pretense of regulating evidence, went so far, as to altogether preclude the party" from exhibiting his rights." It was held also that the coupons were lawfully tendered in payment of costs of suits, as well as in payment of taxes, and that the time-limit of one year for tendering coupons was, under the circumstances, unreasonable.

On the other hand, the requirement that the taxes for licenses to sell liquors and school taxes should be paid in lawful money, and not in coupons, did not impair the obligation of the contract. As to the liquor license this decision was put on the ground that there was involved the principle of regulation as well as taxation; and the act of 1871, as applied to the fund for maintaining schools, was contrary to the Virginia constitution of 1869.

The court remarks, concluding the opinions in this series of cases, at page 721: "It is certainly to be wished that some arrangement may be adopted which will be satisfactory to all parties concerned and relieve the courts as well as the Commonwealth of Virginia, whose name and history recall so many interesting associations, from all further exhibitions of a controversy that has become a vexation and a regret."