Legal Tender

Aiton's Encyclopedia (1910)

an offer of money or other commodity recognized by law in payment of a debt. In the United States money is the only legal tender. Checks, drafts, jewelry, merchandise of any description, even land, may be refused by the person to whom payment is due. The exact change must be offered. The presentation of a twenty dollar gold coin in payment for a twenty-five cent dinner is not legal tender. The courts would hold that the customer had not offered to settle his bill. A debtor is not permitted to annoy his creditor by putting him to the inconvenience of accepting a large amount of small coin. Gold coins are legal tender in any amount, the rule as to exact change being observed. Silver dollars are legal tender for all debts, public and private, unless expressly excluded by contract. The small silver coins are legal tender in sums not exceeding $10, the five cent, three cent, and one cent pieces are legal tender to the amount of twenty-five cents. Foreign money cannot be forced in payment of debts. United States notes, that is to say, paper money , are legal tender for all private debts, but the government may refuse to accept them in payment of duties. During the Civil War our government insisted on duties being paid in gold. The government also contracts to pay the interest on its public debt in gold. Notes issued by national banks are, with certain exceptions, legal tender. The question of legal tender is an important one in business. If, for instance, one's home were about to be sold under mortgage, and the holder of the mortgage desired to get possession of it, he is legally free to refuse a payment, even in excess of the amount due, unless the offer of the exact amount due be made in the form of money. See Money