The debts from the United States to the soldiers of Virginia, not having been put into either of these forms, the assignments of them were void in law.
A creditor may give an order on his debtor in favor of another, but if the debtor does not accept it, he must be sued in the creditor's name; which shows that the order does not transfer the property of the debts. The creditor may appoint another to be his attorney to receive and recover his debt, and he may covenant that when received the attorney may apply it to his own use. But he must sue as attorney to the original proprietor, and not in his own right.
This proves that a power of attorney, with such a covenant, does not transfer the property of the debt. A further proof in both cases is, that the original creditor may at any time before payment or acceptance revoke either his order or his power of attorney.
In that event the person in whose favor they were given has recourse to a court of equity. When there, the judge examines whether he has done equity. If he finds his transaction has been a fair one, he gives him aid. If he finds it has been otherwise, not permitting his court to be made a handmaid to fraud, he leaves him without remedy in equity as he was in law. The assignments in the present case, therefore, if unfairly obtained, as seems to be admitted, are void in equity as they are in law. And they derive their nullity from the laws under which they were made, not from the new resolutions of Congress. These are not retrospective. They only direct their treasurer not to give validity to an assignment which had it not before, by payments to the assignee until he in whom the legal property still is, shall order it in such a form as to show he is apprized of the sum he is to part with, and its readiness to be paid into his or any other hands, and that he chooses, notwithstanding, to acquiesce under the fraud which has been practised on him. In that case he has only to execute before two justices a power of attorney to the same person, expressing the specific sum of his demand, and it is to be complied with. Actual payment, in this case, is an important act. If made to the assignee, it would put the burthen of proof and process on the original owner. If made to that owner, it puts it on the assignee, who must then come forward and show that his transaction has been that of an honest man.
Government seems to be doing in this what every individual, I think, would feel himself bound to do in the case of his own debt. For, being free in the law, to pay to the one or the other, he would certainly give the advantage to the party who has suffered wrong rather than to him who has committed it.
It is not honorable to take a mere legal advantage, when it happens to be contrary to justice.
But it is honorable to embrace a salutary principle of law when a relinquishment of it is solicited only to support a fraud.
I think the resolutions, therefore, merit approbation. I have before professed my incompetence to say what are the laws of North Carolina on this subject. They, like Virginia, adopted the English laws in the gross. These laws forbid in general the buying and selling of debts, and their policy in this is so wise that I presume they had not changed it till the contrary be shown.
VII.—Plan for establishing uniformity in the Coinage, Weights, and Measures of the United States. Communicated to the House of Representatives, July 13, 1790.
New York, July 4, 1790.