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to theo. foster, esq. 2 - Alexander Hamilton, The Works of Alexander Hamilton, (Federal Edition), vol. 10 
The Works of Alexander Hamilton, ed. Henry Cabot Lodge (Federal Edition) (New York: G.P. Putnam’s Sons, 1904). In 12 vols. Vol. 10.
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to theo. foster, esq.2
1 Sept., 1791.
I have had the pleasure of receiving your two letters of the 23rd July & 4th of August. You concluded rightly that it could require no apology for entering into the detail with which you have favored me. On a subject so interesting to your State, your desire to communicate information was indulged with peculiar propriety, & on any subject I shall always esteem myself obliged by your sentiments. Thoroughly impressed with the hardship of a decision against the certificates which had been surrendered to the State by their Proprietors, I did not come to it without a serious struggle between my Judgment & my Wishes; but after mature deliberation I saw no way of allowing those Certificates to be received on the proposed loan which would not involve inextricable embarrassment. All the States have called in large portions of their respective Debts.
There is good reason to believe, that on a close investigation Rhode Island might not be found to be the only State in which they had been so called in for a very inadequate consideration. And tho’it might be urged to distinguish the case, that Rhode Island alone compelled the surrender, on pain of forfeiture, it might be answered that in sound equity, there is no very material distinction between obliging Persons to surrender their property for less than its value, under the penalty of confiscation and laying them under a necessity of doing the same thing, from the total and deliberate neglect of a better provision. Be this as it may, I saw no safe rule, that would be admitted to be such by even the candid part of those, whose interest it might be to dispute it, by which I could pronounce that Certificates surrendered and cancelled by the Mutual Acts of the Creditor and Debtor should be permitted to receive and acquire validity in respect to one State and not in respect to another. And without such rule, all the extinguished portions of the Debts of all the States might, if they should think proper to make it so, acquire a capacity of being subscribed towards the assumption. Where this would lead it is not necessary to say. The two Carolinas have actually passed laws for subscribing the portions of their respective Debts which have been extinguished by them—the only answer I can give is that a Bond surrendered as discharged constitutes no Debt and that in every such case, there is no Debt to be assumed.
I cannot allow an after act of a State to create a Debt within the meaning of the funding Act, which it cannot be admitted to have contemplated as then in existence. It may be asked, How then shall the Certificates which remained in the hands of Individuals, but which were forfeited by the law of the State, be admitted upon the Loan, any more than those which were surrendered? This is a question not wholly free from difficulty; but if I had found no distinction satisfactory to my own mind, I should have been obliged to reject the whole. Such a distinction, however, was in my opinion to be found. Upon principle, it is a general rule, that the dissolution of a contract by one party without the concurrence of the other, is void.
The Creditors who did not concur may claim the benefit of that rule and it is to be supposed that it was the intention of Congress, they should have it. It may be said to be a legal presumption that Congress, at the time of passing the funding Act, was acquainted with the laws of Rhode Island respecting the Certificates. And in point of fact the generality of them were so at least in substance. They must, therefore, have been apprised, that if the forfeiture annexed in those laws to the not bringing in the certificates for payment was to prevail, there was no debt of the State of Rhode Island to be assumed. By assuming a Sum of 200,000 Dollars, a sum by the way nearly corresponding with the amount of the outstanding Certificates, the clear inference is that they meant to consider those Certificates as in force, and the forfeiture as far as regarded the assumption, as inoperative. But it is not a reasonable presumption, that they could have intended to comprise the surrendered Certificates, which could not even be repossessed by the individual proprietors without a subsequent act of the State.
I have made some suggestions in this letter, which I should perhaps have omitted if I had considered it as strictly official, and therefore request that it may be received as a private and in some sort a confidential communication.
I cannot lose the opportunity of expressing to you that I feel myself truly and very much indebted to the Senators of Rhode Island for the very flattering manner in which they have made mention of the Secretary of the Treasury in their late communication to the State.
The measure of their approbation certainly exceeds that of his services or pretentions.
With respectful consideration and real regard, I have the honor to be
Dear Sir Your obedient Servant.
This letter of Hamilton’s to Theo. Foster is now (1904) for the first time printed. The publishers are indebted to the courtesy of Mr. G. H. Crawford and to the Hamilton Club, of Brooklyn, for permission to use the letter in this set. Theo. Foster was United States Senator from Rhode Island in 1790.