What does a legal tender mean?
The mode of payment that is considered to be a valid way of settling a financial obligation by the law is called a legal tender. It may be anything that removes a debt. Any kind of paper currency and coins may be classified as legal tenders. However, personal checks, credit and debit payments may not be considered to be legal tender. They may be considered to be non cash methods of payment. Given below are some of the important questions about legal tender laws: A person owes fines in a court. However, as per the Article 1, Section 10 of the Constitution, the court may only accept gold and silver coins when a debt is repaid. Does this make paper currency invalid as a legal tender? Will the person be immune from paying the fine?
Any kind of currency or paper money that is issued by the government of USA may be considered to be a valid legal tender. This kind of money may be certified by the US government. The government also has a right as per the constitution to create a tender that will suit the public best. Hence, the person may not be immune from repaying the debt. What action can a person take if banks refuse to cash a silver certificate that he/she bought in 1989?
The Secretary of Treasury, C Douglas Dillon stated that silver certificates may not be encashed against silver dollars from March 25, 1964. This decision was taken after the Act of June 4, 1963 that allowed the exchange of silver certificates for silver bullion till June 24, 1968. This decision was taken because the vault at the Treasure Department had about three million unclaimed silver dollars. All these coins were considered to have numismatic value and could be of interest to collectors. Hence, it would be impossible to distribute these coins among people who had silver certificates. Hence, since June 24, 1968, no organization may be required to exchange silver certificates for silver dollars. However, these certificates are still valued as legal tender. However, their numismatic value may be dependent on their age and condition. A person who has such a certificate and wants to sell it at a higher value may try selling it to a coin collector or through an auction house. Does a university have a legal right to accept only credit and debit cards and refuse cash at the food court?
Most of the times, institutions like universities, colleges and private institutions may decide on a mode of payment as long as it does not discriminate against someone. Such a thing is done for security purposes and may not be considered to be illegal. In some cases, the universities may also have a limit on the legal tenders that they accept. Are city authorities allowed to tell a merchant how to run his/her business and what kind of payment to accept?
If a city tries to restrict the mode of payment that can be accepted by vendors and merchants, it may be considered to be unconstitutional. The only right that the city authorities may have is to make sure that the businessmen maintain correct records and documents about all the purchases and sales. The only entity that has the authority and power to declare standards of currency is the federal government. A person had signed a contract for an event that was to take place after a year. He/she had signed a deposit check for the event. Can the person now change the mode of payment to credit card? Will this have any legal problems?
In order to prohibit a person from changing the mode of payment to credit cards, the contract should have a clause that states that credit card payment is not permitted. If this is the case, then the person may not be able to modify the mode of payment. If he/she does, it may be considered to be breach of contract. However, if there is no such clause in the contract, then any kind of legal tender may be accepted. However, the individual may have to inform the bank to put a stop to the payment of the check if it has already been deposited. Many people may involve barter of goods and currency every day. All these transactions are controlled by the legal tender laws. All currency and bullion related matters are handled by these laws. You may ask a lawyer if you have any further questions about the legal tender laws.
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