Appellant
State of Texas
Appellees
George W. White, John Chiles, et al.
Appellant's Claim
That securities sold to the appellees by a Confederate military board were the property of the state of Texas and should be returned.
Chief Lawyers for Appellant
R. T. Merrick, George W. Pascal
Chief Lawyers for Appellees
P. Phillips, J. M. Carlisle, S. S. Cox, J. W. Moore
Justices for the Court
Salmon Portland Chase (writing for the Court), Nathan Clifford, David Davis,Stephen Johnson Field, Samuel Nelson
Justices Dissenting
Robert Cooper Grier, Samuel Freeman Miller, Noah Haynes Swayne (James M. Wayne had died in office and had not been replaced)
Place
Washington, D.C.
Date of Decision
12 April 1869
Decision
In favor of the state of Texas.
Significance
By declaring that the Confederate states had never legally been severed fromthe United States, the Court provided a legal basis for Reconstruction to proceed.
The Missing Bonds
In the years immediately following the Civil War, debate was furious over what rights the states of the former Confederacy would retain or be forced to forfeit before they were reintegrated into the Union. The U.S. Supreme Court settled a fundamental part of this issue based on the result of a lawsuit overthe unlikely matter of a bond transfer.
On 1 January 1851, the U.S. government paid the state of Texas $5,000,000 infederal bonds to settle boundary claims. Most of the bonds, which were redeemable in 15 years, were sold by the Texas state government to investors. However, some of the securities were channeled into the state treasury as a schoolfund. These bonds were still in the treasury when Texas seceded from the Union on 4 March 1861 and joined the Confederacy.
After the members of the sitting state government of Texas either resigned orwere ejected from office, the new Confederate Texas legislature passed a bill requiring any securities in the treasury to be sold to pay for munitions. Amilitary board entrusted with this duty sold and delivered 135 bonds to theinvestment firm of White & Chiles on 15 March 1865. Seventy-six more bonds were transferred to English bankers in return for a delivery of cotton cards and medical supplies to be handled by White & Chiles.
At the outbreak of the Civil War, the U.S. Treasury had been warned that theTexas military board might sell the securities. The bonds were easily identifiable, since each bore a number and was to be endorsed by the governor of Texas. Ultimately, the U.S. Treasury did not have to decide whether or not to honor most of the bonds sold by the rebel military board. In October of 1865, four months after the Civil War ended, an agent of the state of Texas, G. W. Paschal, told the New York Herald that the bond transfer was a conspiracy between the Confederate Texas government and White & Chiles. Judge Paschal, who had remained faithful to the Union, warned the public that he considered the transaction to be illegal and would ask the U.S. Treasury to refrain from making any payments on the bonds. Paschal announced through the pressthat the bonds were still the property of the state of Texas.
By that time, a re-formed non-Confederate Texas government had passed a law authorizing the state's governor to recover the sold securities. The new Texasgovernment filed suit for recovery of the bonds, claiming that they had beenseized by persons hostile to the United States, who had acted in concert with White & Chiles with the aim of overthrowing the federal government. Thesuit also noted that the bonds were overdue at the time of transfer and hadnever been endorsed by any governor of Texas. The suit asked for an injunction preventing White & Chiles and the other purchasers from receiving any payment from the U.S. government so that the bonds might be returned to Texas.
The Texas claim presented a problem that was both legal and political, because secession had left the state's relation to the Union without a clear definition. In the Reconstruction Acts passed by the U.S. Congress in March of 1867, Texas was no longer considered to be a state. Responding to the lawsuit, George White and John Chiles--who had already sold the bonds--argued that Texashad forfeited its statehood and was in no legal position to sue anyone. Theybelieved that the bonds were negotiable on their face value. So did the purchasers named in the suit, who claimed under oath that they had no idea Texashad a claim against the bonds when they were purchased.
Political Fact or Legal Fiction
The case was brought before the U.S. Supreme Court on 5 February 1869 and wassufficiently complicated to take three days to argue. Nevertheless, the Court returned its decision relatively quickly on 12 April. By a 5-3 vote, the Court returned jurisdiction over the bonds to the state of Texas.
The decision hinged on the nature of American statehood. Chief Justice Chasenoted that a state was comprised of a combination of people, territory, and government. Of these, the people or "political community" were the primary component, not a government. By the logic of the Court's majority, Texas had "entered into an indissoluble relation" upon assuming statehood in 1845. "The act which consummated her admission into the Union was something more than a compact; it was the incorporation of a new member into the political body," wrote Justice Chase. "And it was final. The union between Texas and the other States was as complete, as perpetual, and as indissoluble as the union betweenthe original States."
The Court considered the state's secession from the Union to be inconsistentwith the constitutional concept of "a perpetual Union," which had been agreedto by Texans upon assuming their statehood. All acts of the Confederate Texas legislature--including the disputed bond sale--were "utterly without operation in law." Despite the Civil War, the Court found that Texans had never ceased being American citizens. To decide otherwise, Chase wrote, would be to conclude that the war had not been fought to save the Union, but had been instead a war of conquest, waged against "foreigners."
The majority's conclusion that Texas had continued to be a state, in spite ofthe war, brought a pointed dissent from Justices Grier, Swayne, and Freeman.Justice Grier's written opinion noted that the Supreme Court had jurisdiction only in cases involving actual states and rejected the idea that Texas hadremained a part of the Union. During its eight years as a "rebel state," Grier noted, Texas was not represented in the U.S. Congress, had not participatedin the national presidential election, and was presently under the militaryrule of the federal government. "Politically, Texas is not a State in this Union," wrote Grier, insisting that the case should be decided on the basis of"political fact," not upon "a legal fiction."
The Court's decision that the Constitution created "an indestructible Union,composed of indestructible States" was not received well by Northern Radicalpoliticians intent on punishing the defeated Confederate states. The decisionwas equally unwelcome among Southern Democrats, who hoped that the defeatedstates would be reintegrated into the Union with their prewar governmental powers intact. While the Court's decision affirmed the compact between states and the federal government, it also acknowledged the right of the U.S. Congress to control how Reconstruction would proceed. In this sense, the decision strengthened the hand of Republican Reconstructionists, who presided over the healing of a troubled but indivisible nation which, in theory at least, had never been torn asunder.
Related Cases
State of Texas
Appellees
George W. White, John Chiles, et al.
Appellant's Claim
That securities sold to the appellees by a Confederate military board were the property of the state of Texas and should be returned.
Chief Lawyers for Appellant
R. T. Merrick, George W. Pascal
Chief Lawyers for Appellees
P. Phillips, J. M. Carlisle, S. S. Cox, J. W. Moore
Justices for the Court
Salmon Portland Chase (writing for the Court), Nathan Clifford, David Davis,Stephen Johnson Field, Samuel Nelson
Justices Dissenting
Robert Cooper Grier, Samuel Freeman Miller, Noah Haynes Swayne (James M. Wayne had died in office and had not been replaced)
Place
Washington, D.C.
Date of Decision
12 April 1869
Decision
In favor of the state of Texas.
Significance
By declaring that the Confederate states had never legally been severed fromthe United States, the Court provided a legal basis for Reconstruction to proceed.
The Missing Bonds
In the years immediately following the Civil War, debate was furious over what rights the states of the former Confederacy would retain or be forced to forfeit before they were reintegrated into the Union. The U.S. Supreme Court settled a fundamental part of this issue based on the result of a lawsuit overthe unlikely matter of a bond transfer.
On 1 January 1851, the U.S. government paid the state of Texas $5,000,000 infederal bonds to settle boundary claims. Most of the bonds, which were redeemable in 15 years, were sold by the Texas state government to investors. However, some of the securities were channeled into the state treasury as a schoolfund. These bonds were still in the treasury when Texas seceded from the Union on 4 March 1861 and joined the Confederacy.
After the members of the sitting state government of Texas either resigned orwere ejected from office, the new Confederate Texas legislature passed a bill requiring any securities in the treasury to be sold to pay for munitions. Amilitary board entrusted with this duty sold and delivered 135 bonds to theinvestment firm of White & Chiles on 15 March 1865. Seventy-six more bonds were transferred to English bankers in return for a delivery of cotton cards and medical supplies to be handled by White & Chiles.
At the outbreak of the Civil War, the U.S. Treasury had been warned that theTexas military board might sell the securities. The bonds were easily identifiable, since each bore a number and was to be endorsed by the governor of Texas. Ultimately, the U.S. Treasury did not have to decide whether or not to honor most of the bonds sold by the rebel military board. In October of 1865, four months after the Civil War ended, an agent of the state of Texas, G. W. Paschal, told the New York Herald that the bond transfer was a conspiracy between the Confederate Texas government and White & Chiles. Judge Paschal, who had remained faithful to the Union, warned the public that he considered the transaction to be illegal and would ask the U.S. Treasury to refrain from making any payments on the bonds. Paschal announced through the pressthat the bonds were still the property of the state of Texas.
By that time, a re-formed non-Confederate Texas government had passed a law authorizing the state's governor to recover the sold securities. The new Texasgovernment filed suit for recovery of the bonds, claiming that they had beenseized by persons hostile to the United States, who had acted in concert with White & Chiles with the aim of overthrowing the federal government. Thesuit also noted that the bonds were overdue at the time of transfer and hadnever been endorsed by any governor of Texas. The suit asked for an injunction preventing White & Chiles and the other purchasers from receiving any payment from the U.S. government so that the bonds might be returned to Texas.
The Texas claim presented a problem that was both legal and political, because secession had left the state's relation to the Union without a clear definition. In the Reconstruction Acts passed by the U.S. Congress in March of 1867, Texas was no longer considered to be a state. Responding to the lawsuit, George White and John Chiles--who had already sold the bonds--argued that Texashad forfeited its statehood and was in no legal position to sue anyone. Theybelieved that the bonds were negotiable on their face value. So did the purchasers named in the suit, who claimed under oath that they had no idea Texashad a claim against the bonds when they were purchased.
Political Fact or Legal Fiction
The case was brought before the U.S. Supreme Court on 5 February 1869 and wassufficiently complicated to take three days to argue. Nevertheless, the Court returned its decision relatively quickly on 12 April. By a 5-3 vote, the Court returned jurisdiction over the bonds to the state of Texas.
The decision hinged on the nature of American statehood. Chief Justice Chasenoted that a state was comprised of a combination of people, territory, and government. Of these, the people or "political community" were the primary component, not a government. By the logic of the Court's majority, Texas had "entered into an indissoluble relation" upon assuming statehood in 1845. "The act which consummated her admission into the Union was something more than a compact; it was the incorporation of a new member into the political body," wrote Justice Chase. "And it was final. The union between Texas and the other States was as complete, as perpetual, and as indissoluble as the union betweenthe original States."
The Court considered the state's secession from the Union to be inconsistentwith the constitutional concept of "a perpetual Union," which had been agreedto by Texans upon assuming their statehood. All acts of the Confederate Texas legislature--including the disputed bond sale--were "utterly without operation in law." Despite the Civil War, the Court found that Texans had never ceased being American citizens. To decide otherwise, Chase wrote, would be to conclude that the war had not been fought to save the Union, but had been instead a war of conquest, waged against "foreigners."
The majority's conclusion that Texas had continued to be a state, in spite ofthe war, brought a pointed dissent from Justices Grier, Swayne, and Freeman.Justice Grier's written opinion noted that the Supreme Court had jurisdiction only in cases involving actual states and rejected the idea that Texas hadremained a part of the Union. During its eight years as a "rebel state," Grier noted, Texas was not represented in the U.S. Congress, had not participatedin the national presidential election, and was presently under the militaryrule of the federal government. "Politically, Texas is not a State in this Union," wrote Grier, insisting that the case should be decided on the basis of"political fact," not upon "a legal fiction."
The Court's decision that the Constitution created "an indestructible Union,composed of indestructible States" was not received well by Northern Radicalpoliticians intent on punishing the defeated Confederate states. The decisionwas equally unwelcome among Southern Democrats, who hoped that the defeatedstates would be reintegrated into the Union with their prewar governmental powers intact. While the Court's decision affirmed the compact between states and the federal government, it also acknowledged the right of the U.S. Congress to control how Reconstruction would proceed. In this sense, the decision strengthened the hand of Republican Reconstructionists, who presided over the healing of a troubled but indivisible nation which, in theory at least, had never been torn asunder.
Related Cases
- Luther v. Borden, 48 U.S. 1 (1849).
- National League of Cities v. Usery, 426 U.S. 833 (1976).
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