Certain moneys of the United States are "lawful money." This term is used to denote the legal-tender quality of money, and dates from 1862.6 Legal tender is a quality given a circulating medium by act of Congress. A form of currency may have such attributes as to make it generally acceptable by custom and yet not possess the full legal-tender quality. Congress by law decrees that a circulating medium must, under specified conditions, be accepted by creditors from debtors in liquidation of debts which do not specify the form of money in which they are to be paid.
Gold coin is legal tender at its face value in payment of all debts, public and private, provided that the coin is not below the standard weight and limit of tolerance prescribed by law. When below such standard weight and limit of tolerance, gold coin is legal tender in proportion to its weight. Any gold coin, if reduced in weight by natural abrasion not more than 1/2 per cent below the standard weight, after a circulation of twenty years as shown by its date of coinage, and at a ratable proportion for any period less than twenty years, is received at its nominal value by the United States Treasury, but any below this limit of tolerance are to be recoined. Any holder of coin below the limit is not likely to present it for recoinage if it is possible to circulate it, for he will lose its deficiency.
6 Gold and silver certificates have not been legal tender as between persons, but when held by national banks they could, until 1917. be counted as part of their lawful reserve money. Gold certificates were made legal tender in 1920.
Silver dollars are legal tender at their face value in payment of all debts, public and private, without regard to the amount, except where otherwise expressly stipulated in the contract. Gold coins and silver dollars, being standard, are not redeemable.
Subsidiary silver coins are legal tender for amounts not exceeding $10 in any one payment. They may be presented in multiples of $20 to the Treasurer of the United States or the federal reserve banks for redemption into lawful money.
Minor coins of nickel and bronze are legal tender to the extent of 25 cents in one payment, and they are redeemable in multiples of $20, like subsidiary silver.