 
Are the Mint's Mistakes and Errors Your Property or the Governments?
by David L. Ganz
Column 7 - August 30, 1999
|
|
Collecting mint mistakes and errors is popular, as the 1955 double die, 1943 copper cent, and 1995 double die cent indicate. It can also be lucrative, as the $32,200 winning bid at the 1999 ANA auction conducted by Heritage proved in the case of the 1943 copper cent. The question of law and coins is to what degree errors in the issuing process can influence the ability for a collector to acquire, and a dealer to sell such material.
So the Mint flubbed its job, hubbing the 1995 Lincoln cent twice, making an error and then compounding it by failing to spot the flaw before it was released into circulation. It's the most significant new issue in years.
But hardly the first time, since the 1955 double die cent is virtually an identical mistake - one worth a lot more, too. In the case of the 1943 copper cent, the wrong planchet - copper instead of steel plated with zinc - was utilized.
There are other examples. In producing a proof set, the engraving staff of the Mint overlooks something tiny -- a mintmark -- and creates a low mintage rarity. It goes out in the mail but is discovered, and a furious recall takes place. This would be the 1968 s-less set, or that of 1970 or 1971 (just to cite three recent examples). Can any one of them -- or all of them -- be legally held?
How about the 1913 Liberty head nickel? Here's a coin with a pseudo past, and interesting present, and (in light of recent action taken by the government) a questionable future.
Galvanos for the anticipated 1970 Eisenhower dollars (not actually authorized until December 30, 1970 and not struck until 1971) leaves the Mint and then are offered for sale to interested collectors. Can you acquire them?
Ira Reed, a dealer in the Philadelphia area of the 1940's, causes some cents and buffalo nickels to have reeded edges, possibly at the Philadelphia Mint itself. The coins are resold to collectors. Do you want to keep them?
Hundred of thousands of 1933 double eagles are produced at the United States Mint, and several of them enter the stream of commerce while the rest are recalled to the melting cauldrons and an historical footnote. Is it worth it to buy one today?
Each of these events creates an interesting legal issue to the holder of one or more of these special numismatic items all of which (with the exception of the galvano) have legal tender properties, but each of which also have other exceptions.
Whether or not they were government property, the issue becomes whether they remain the property of the United States Mint or the government after they have left the Mint and entered the circulation pool, however that may be defined.
Through the years, the Mint has given conflicting answers to the question, as have United States attorneys in various districts, when the cases involving them have been prosecuted.
Where the government has the least difficulty, it seems, is when they actually release an item directly -- even with an error. When they attempt a recall, however, they can stop it even if it has been placed in the mail.
(The way this is accomplished is to request the post office to stop the mail and return it to the sender, in this case the U.S. Mint).
Once the coin is out, however, the Mint will generally support the right of collectors to own it, provided the coin made it out of the Mint legally -- and without connivance.
Back in 1970, for example, Roy Cahoon, then assistant director of the Mint, told me a remarkable story of a collector who returned a 1970 proof set that lacked an "S" mintmark, requesting a "perfect" proof set.
Cahoon gently returned the set with a letter, advising the lucky recipient that the private market might afford him a lot of perfect sets, if he was willing to part with his mint error.
But for a coin like the 1933 $20, whose history is somewhat uncertain, and whose records are imprecise at best, the government's history is more checkered. It has litigated to seek return of the coin -- successfully, several times -- against James A. Stack and J.F. Bell.
(The argument that the coin couldn't legally be held because private gold ownership was illegal wouldn't wash today. More interesting is whether or not there is any proof today that the coin was not mixed in with other monies, as mint products routinely are).
The travails and trials in recent times of one mid-west dealer over precisely such a coin shows that no matter what the government claims, or says, it still must meet its burden of proof - and years after the fact, that can be very hard to do.
The 1955 double die cent paved the way for the 1995 cent. In the stamp field, there had already been the 1918 and 1924 airmail upside down printing issues that left errors in the hands of philatelists.
No one seriously in 1995 sought to argue that the double die cent was the property of the government because it was an error that was mistakenly released.
As to the galvano, if it was disposed of by the Mint as either a gift or as decorative art, there seems little doubt that it can be made available to third persons. Only if it was purloined from the Mint does it rise to the level of illegality.
And, for the Ira Reed pieces, it probably is too long ago to definitively determine whether or not they are (or were) made at the Mint, added on later, or simply constitute a fantasy issue that sells to error collectors because of their interesting design features.
That 1913 Liberty nickel has a story all its own. Back in 1967, Aubrey Bebee bought one at the ANA convention auction for a then world's record of $46,750 (my how times have changed). Sometime later, I posed the question to Hugo Ranta, then assistant general counsel of the Treasury, as to whether the coin could be legally held - and he proclaimed that it was subject to seizure as an unlawfully issued coin.
Bebee was justifiably outraged at the thought, but the issue of a stellar rarity just never did come up until the 1933 double eagle was seized by the government as part of contemporary litigation.
Placed in perspective, that 1995 double die cent -- or some other error or unusual coin-- belongs in your collection and there's no reason not to put it there. With some other coins, however, it's necessary to examine the circumstances of their creation, availability, and price before deciding how to proceed.
|
|
Search NumisMedia
Keyword search all of our past and present numismatic articles
|
|
|
|
|
|
NumisMedia
Monthly
Archive
Our monthly article detailing specific areas of numismatics for dealers, collectors, and investors of U.S. Rare Coins
|
|
|
|
|
David L. Ganz
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/quotes_special.gif)
