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U.S. Supreme Court

Holyoke Water Power Co. v. American Writing Paper Co., 300 U.S. 324 (1937)

Holyoke Water Power Co. v. American Writing Paper Co.

No. 180

Argued December 11, 1936

Decided March 1, 1937

300 U.S. 324


Leases of water power rights to be enjoyed in perpetuity provided that the grantee should pay as rent "a quantity of gold which shall be equal in amount to" a stated number of

"dollars of the gold coin of the United States of the standard of weight and fineness of the year 1894, or the equivalent of this commodity in United States currency."

In 1894 and continuously thereafter till January 31, 1934, the statutory gold content of the dollar was twenty-five and eight-tenths grains of gold, nine-tenths fine. Since January 31, 1934, by force of the Gold Reserve Act of that year and the order of the President thereunder, the gold content of the dollar has been fixed to consist of fifteen and five twenty-firsts

Page 300 U. S. 325

grains of gold, nine-tenths fine. The Joint Resolution of June 5, 1933, had declared that every obligation payable in money of the United States, whether theretofore or thereafter incurred, should be discharged upon payment, dollar for dollar, in any coin or currency which at the time of payment was legal tender for public or private debts, irrespective of any provision contained therein whereby the obligee was given a right to require payment in gold or in a particular kind of coin or currency, or in an amount in money of the United States measured thereby.


1. The lessee's obligation under the contract was for the payment of money, and not for the delivery of gold as upon sale of a commodity. P. 300 U. S. 335.

2. A contract for the payment of gold as the equivalent of money, and a fortiori a contract for the payment of money measurable in gold, is within the letter of the Joint Resolution of June 5, 1933, and equally within its spirit, Norman v. Baltimore & Ohio R. Co., 294 U. S. 240. P. 300 U. S. 337.

An obligation to make delivery upon a bona fide sale is not fairly to be classified as an obligation "payable in money" within the meaning of the Joint Resolution, or so it may be assumed for the purpose of this case. But the evil aimed at by the Resolution does include transactions whereby gold, coined or uncoined, is to be delivered in satisfaction of a debt expressed in terms of dollars, payment, not sale, being then the end to be achieved, and transactions whereby a debt is to be discharged not in bullion, but in dollars, if the number of the dollars is to be increased or diminished in proportion to the diminution or the increase of the gold basis of the currency.

83 F.2d 398 affirmed.

Certiorari, 299 U.S. 526, to review a judgment of the Circuit Court of Appeals affirming an order of the District Court made in a proceeding for reorganization of the Paper Company under § 77B of the Bankruptcy Act. The order fixed the amounts due from that company to a Water Power Company, the present petitioner, under several leases. 11 F.Supp. 518. See 9 id. 451.

Page 300 U. S. 333

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