Landmark Supreme Court Case: Texas v. White (1869)
Texas v. White (1869) is the nineteenth landmark Supreme Court case, and sixth case in the Economics module, featured in the KTB Prep American Government and Civics Series designed to acquaint users with the origins, concepts, organizations, and policies of the United States government and political system. The goal is greater familiarization with the rights and obligations of citizenship at the local, state, national, and global levels and the history of our nation as a democracy. While there is overlap, these landmark cases are separated into cases addressing:
- Foreign Policy
- Science & Technology
- Public Safety
- Death Penalty
- Speech, Press, and Protest
- Criminal Justice
- Politics, Society, Freedom, and Equality
The Supreme Court
The Supreme Court is the highest court in the United States. Article III of the U.S. Constitution created the Supreme Court and authorized Congress to pass laws establishing a system of lower courts. The Constitution elaborated neither the exact powers and prerogatives of the Supreme Court nor the organization of the Judicial Branch as a whole. Thus, it has been left to Congress and to the Justices of the Court through their decisions to develop the Federal Judiciary and a body of Federal law.
The number of Justices on the Supreme Court changed six times before settling at the present total of nine in 1869. Since the formation of the Court in 1790, there have been only 17 Chief Justices* and 102 Associate Justices, with Justices serving for an average of 16 years. On average a new Justice joins the Court almost every two years.
The Supreme Court of the United States hears about 100 to 150 appeals of the more than 7,000 cases it is asked to review every year. That means the decisions made by the 12 Circuit Courts of Appeals across the country and the Federal Circuit Court are the last word in thousands of cases.
Court of Appeals
In the federal court system’s present form, 94 district level trial courts and 13 courts of appeals sit below the Supreme Court. The 94 federal judicial districts are organized into 12 regional circuits, each of which has a court of appeals. The appellate court’s task is to determine whether or not the law was applied correctly in the trial court. Appeals courts consist of three judges and do not use a jury.
The appellate courts do not retry cases or hear new evidence. They do not hear witnesses testify. There is no jury. Appellate courts review the procedures and the decisions in the trial court to make sure that the proceedings were fair and that the proper law was applied correctly.
A court of appeals hears challenges to district court decisions from courts located within its circuit, as well as appeals from decisions of federal administrative agencies. In addition, the Court of Appeals for the Federal Circuit has nationwide jurisdiction to hear appeals in specialized cases, such as those involving patent laws, and cases decided by the U.S. Court of International Trade and the U.S. Court of Federal Claims.
The nation’s 94 trial courts are called U.S. District Courts. At a trial in a U.S. District Court, witnesses give testimony and a judge or jury decides who is guilty or not guilty — or who is liable or not liable. District courts resolve disputes by determining the facts and applying legal principles to decide who is right.
Trial courts include the district judge who tries the case and a jury that decides the case. Magistrate judges assist district judges in preparing cases for trial. They may also conduct trials in misdemeanor cases.
There is at least one district court in each state, and the District of Columbia. Each district includes a U.S. bankruptcy court as a unit of the district court.
Federal courts have exclusive jurisdiction over bankruptcy cases involving personal, business, or farm bankruptcy. This means a bankruptcy case cannot be filed in state court. Bankruptcy Appellate Panels (BAPs) are 3-judge panels authorized to hear appeals of bankruptcy court decisions. These panels are a unit of the federal courts of appeals, and must be established by that circuit. Five circuits have established panels: First Circuit, Sixth Circuit, Eighth Circuit, Ninth Circuit, and Tenth Circuit.
Texas v. White (1869)
On February 1, 1861, the Texas secession convention drafted and approved an Ordinance of Secession. This ordinance was subsequently approved by both the state legislature and a statewide referendum. On January 11, 1862, the state legislature approved the creation of a Military Board to address issues involved in the transition in the shift in loyalty from the United States to the Confederate States.
Texas had received $10 million in United States bonds in settlement of border claims as part of the Compromise of 1850. While many of the bonds were sold, there were still some on hand in 1861. Needing money, the legislature authorized the sale of the remaining bonds.
Existing state law required the Texas governor to sign his endorsement on any bonds which were sold, but the state feared that the sale price would be depressed if the United States Treasury refused to honor bonds sold by a Confederate state. The legislature therefore repealed the requirement for the governor’s endorsement in order to hide the origin of the bonds.
Before the bonds were sold, a Texas Unionist notified the Treasury, which ran a legal notice in the New York Tribune, that it would not honor any bonds from Texas unless they were endorsed by the prewar governor (Sam Houston). Despite the warning, 136 bonds were purchased by a brokerage owned by George W. White and John Chiles. Although this sale probably occurred earlier, the written confirmation of the transaction was not executed until January 12, 1865. The bonds were in the meantime resold to several individuals, one or more of whom were able to successfully redeem the bonds through the United States government.
As the United States Treasury Department became aware of the situation regarding the bonds, it refused to redeem those bonds sold by White and Chiles. After the state realized that it was no longer in possession of the bonds, it determined that the bonds had been sold illicitly to finance the rebellion against the United States. Three post-Civil War Governors of Texas (temporary, elected, and appointed), in order to regain ownership of the bonds for the state, approved filing a lawsuit under Article III, Section 2 of the United States Constitution which granted original jurisdiction to the Supreme Court in all cases “in which a State shall be a party”.
Chiles, who was being sued along with White, argued that he could not be sued because Texas lacked evidence. He claimed the bond documents were destroyed by soldiers and that there was no way to get them back. White believed; therefore, that he should not have to reimburse Texas.
Q: Was Texas eligible to seek redress in the Supreme Court?
A: Yes. Texas did indeed have the right to bring suit.
Q: Could Texas constitutionally reclaim the bonds?
A: Yes. Acts of the insurgent Texas legislature–even if ratified by a majority of Texans–were “absolutely null.”
5-3 ruling Texas (and the rest of the Confederacy) never left the Union during the Civil War, because a state cannot unilaterally secede from the United States. Treasury bond sales by Texas during the war were invalid, and the bonds were therefore still owned by the post-war state.
The Articles of Confederation created a perpetual union between the colonies, and the Constitution, when it was implemented, only strengthened and perfected this perpetual relationship. When Texas joined the United States, it did not merely create a compact with the other states; rather, it incorporated itself into an already existing indissoluble political body.
For these reasons, Texas had never been outside the Union and any state actions taken to declare secession or implement the Ordinance of Secession were null and void. The rights of the state itself, as well as the rights of Texans as citizens of the United States, remained unimpaired.
The state’s suspension of the prewar government did require the United States to put down the rebellion and reestablish the proper relationship between Texas and the federal government. These obligations were created by the Constitution in its grant of the power to suppress insurrections and the responsibility to insure for every state a republican form of government.
Actions in furtherance of the war effort meant the state’s relationship with White and Chiles “was therefore treasonable and void”. Consequently, the current state of Texas still retained ownership of the bonds and were entitled to either the return of the bonds or the payment of a cash equivalent from those parties who had successfully redeemed the bonds.
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