Definition and Etymology of Assignats
Assignats were a special form of paper money issued during the French Revolution from 1789 to 1796. Originally conceived as debt securities (assignats) backed by national properties, they evolved into full-fledged legal tender and played a central role in French monetary history. The term “assignat” derives from the Latin assignare (“to assign”, “to instruct”).
Assignats initially functioned as mortgage instructions on confiscated church property (so-called biens nationaux), but quickly became the main currency of France during the Revolution. Their legal treatment and value underwent repeated changes, shaped by various laws and decrees.
Legal Nature and Classification of Assignats
Assignats as securities
Legally, assignats were initially not banknotes in the classical sense, but rather government-guaranteed, interest-bearing bonds backed by specific state assets—mainly real estate. Each note represented a claim to the equivalent value of national assets, and in its original form, was documented and transferable.
Over time, interest payments were suspended and assignats increasingly served as a means of payment. This development—transforming them from a financing instrument to legal tender—was the result of various regulations and laws enacted by the National Assembly and, later, the Directory.
Legal Foundations
The first law introducing assignats dates to December 19, 1789. It provided for the issuance of 400 million livres in assignats for the sale of confiscated church properties. Subsequent legal provisions increased the emission volume and altered the function of assignats so that, from April 1790 onwards, they were recognized as legal tender for both private and public transactions.
By virtue of the law of April 17/18, 1790, they became effectively a circulating currency. Numerous further decrees, especially in 1791, 1792, and subsequent years, gradually dissolved their original backing by tangible assets, turning assignats into fiat money.
Forced Currency and Acceptance Requirement
A key aspect of the legal nature of assignats was the government-mandated forced currency (cours forcé). By decree of September 22, 1793, general compulsory circulation was introduced: there was a legal obligation to accept assignats for both government entities and private parties. Refusal to accept assignats could incur legal sanctions up to imprisonment.
This forced currency was further tightened as part of the so-called price and wage control laws (September 18, 1793 – “Loi du Maximum”), which played a central role in the hyperinflation of the years 1793 to 1796.
Legal Status after the End of Assignats
After confidence in assignats was severely undermined due to massive over-issuance, depreciation, and waves of forgery, the Directory decided on February 18, 1796, to withdraw them from circulation permanently through the law on the abolition of assignats (loi sur la suppression des assignats). The return and cancellation of the remaining assignats was legally regulated. With the introduction of the metal-backed “mandats territoriaux” in March 1796, and their subsequent failure, the era of the assignats ended for good; after this point, no legal claims could be made based on assignats.
Issuance, Circulation, and Legal Requirements
Issuing Authorities and State Liability
The issuance of assignats was carried out exclusively by state organs—initially by the treasury, later centralized through special assignat commissions. The state’s liability for the face value of assignats was explicitly established by law.
The state offered holders (initially) coverage secured by real estate, transferred from national assets. However, interest payments were legally discontinued as early as 1791, fundamentally altering the legal character of assignats.
Legal Consequences of Acceptance, Issuance, and Forgery
Acceptance and Circulation
Legislation relating to assignats imposed penal obligations in the context of circulation. Transactions, debts, and public payments were permitted and required to be made in assignats. Resistance to acceptance—due to distrust of their value or legality—could be prosecuted under revolutionary law.
Forgery and Legal Consequences
The forgery of assignats was a serious capital offense in revolutionary France. The law of July 16, 1793, prescribed the death penalty for the production or distribution of counterfeit assignats. Measures to prevent forgery included the introduction of finely crafted security marks and regular changes to the note design.
Legal Relationships to Expectant Rights and Third-Party Claims
Since assignats were initially issued as a form of bond, they could circulate like securities—being assigned, pledged, or inherited. Later, as legal tender, they were treated similarly to today’s banknotes in legal transactions. Claims against issuing authorities or third parties, in connection with the value development or withdrawal of assignats, were repeatedly restricted or excluded by supplementary regulations.
Impacts, Case Law, and Legal Consequences in Retrospect
Civil Law Consequences
The rapid devaluation of assignats caused significant problems in legal transactions (e.g. in long-term contracts and debt relationships), since obligations in assignats often no longer matched their originally intended value. After they were withdrawn from circulation in 1796, numerous legal disputes arose. Subsequent French jurisprudence generally ruled that claims in assignats were to be fulfilled only at the official rate, not at their real value.
International Law Implications
The assignats also caused a temporary crisis under international law, as foreign creditors were no longer able to realize their claims. The French state explicitly rejected international liability for the devaluation of assignats, leading to diplomatic tensions.
Conclusion: Legal Assessment of Assignats
Assignats are a historical precedent for state-issued paper money outside a precious metal standard. Legally, they evolved from covered securities to compulsory legal tender. Their introduction, regulation, and withdrawal from circulation were governed by numerous specific laws with far-reaching civil, criminal, and public law consequences. The legal experience with assignats was groundbreaking for subsequent monetary and financial legislation in France and beyond.
References and Further Reading
- Ernst, E.: Assignaten – Das Papiergeld der französischen Revolution, 3rd ed., Munich 2007.
- Sargent, T. J., Velde, F. R.: The Big Problem of Small Change. Princeton University Press, 2002.
- Law, J.: Money and the Law of the French Revolution. Paris 1974.
- <a href="https://fr.wikisource.org/wiki/Loirelativeauxassignats,1790″>Wikisource: Loi relative aux Assignats, 1790
- Digital Library French Revolution: Assignat Legislation Texts
Note: The term “Assignats” today is of historical significance only and has no practical relevance in the current legal system.
Frequently Asked Questions
What legal framework regulated the issuance of assignats?
The issuance of assignats was based on a series of legislative measures enacted during the French Revolution. The key foundation was the law of December 19, 1789, which enabled the creation of these securities, originally backed by the nationalization of church assets. As time went on, numerous decrees regulated the amounts issued, the modalities for redemption, and the specific structuring of the securities. Legally, assignats were recognized as state-guaranteed means of payment, with a statutory acceptance requirement—initially for state bodies and subsequently for private individuals—being key to their use. Legislative action against rejection of assignats as payment and criminal provisions against forgery also played a crucial role in the legal framework.
What legal consequences arose from the mandatory acceptance of assignats?
The acceptance requirement, also known as forced currency, was introduced by law and stipulated that both private individuals and public authorities were obliged to accept assignats at face value as means of payment. Anyone who refused to accept them risked severe penalties, including fines and, especially after the stiffening introduced by the law of April 27, 1793, even imprisonment or temporary exclusion from economic life. These legal measures were intended to secure the circulation and acceptance of assignats and maintain economic functionality despite inflation and the loss of trust.
What legal implications arose from the devaluation of assignats?
As inflation progressed, assignats underwent massive devaluation. Legally, this led to various adjustments, such as the introduction of price controls, forced currency, and statutory fixings of exchange rates between assignats and metallic money. Nevertheless, there was legal uncertainty, since ongoing contracts and debts were often denominated in assignats, whose real purchasing power fell rapidly. Legislators attempted to reorder legal relationships through conversion programs or the issuance of successor papers (e.g. mandates), but in practice, many private individuals and companies lost out or had to bear significant losses.
What legal provisions existed to protect against the forgery of assignats?
Forgery of assignats quickly became a serious problem, prompting the National Assembly to enact relevant penal laws. Forgery and imitation of assignats were strictly punished, initially by severe fines and imprisonment, and from the law of August 27, 1793, by the death penalty. Protecting payment transactions and ensuring trust in assignats as legal tender was a central concern of the legislature, which therefore drastically intensified the prosecution of forgers.
How were legal disputes concerning assignats resolved?
Disputes about the acceptance, value, or validity of assignats were essentially decided by the ordinary courts. The courts were guided by applicable laws on acceptance obligation, face-value guarantee, and any price fixing regulations. Often, the question arose as to whether a contract could be fulfilled in assignats or if metallic money could be demanded instead. Claims arising from refusal or discrimination against assignats were stringently assessed, especially after the forced currency was established by law. However, as the value of assignats plummeted, lawsuits and legal uncertainties grew ever more common.
What significance did assignats have for existing debt and contractual relationships?
The circulation of assignats brought considerable uncertainty to debt and contractual relationships. Initially, it was legally permissible—and even mandatory—to settle debts and payments in assignats or to accept them as payment. With advancing inflation, creditors suffered massive losses as they could collect claims only in heavily devalued assignats. Legislators sought to intervene with various measures, such as conversion deadlines or new forms of issuances. Nevertheless, these developments led to major legal uncertainties and, not infrequently, the loss of entire fortunes. Many contracts had to be renegotiated or settled by legislation post facto.
Were there special tax regulations relating to assignats?
Tax law was also affected by assignats. Taxes could be paid with assignats, as stipulated by law. This was to ensure that the state maintained a functioning revenue system and the liquidity of the assignats was upheld. Collection was at face value, regardless of actual purchasing power, which in turn exacerbated the erosion of state assets and further financing problems. Tax evasion and uncollectible taxes were punished more severely in law to support the monetary system.
