U.S. Supreme Court
Baldy v. Hunter, 171 U.S. 388 (1898)
Baldy v. Hunter
Argued April 29, 1898
Decided May 81, 1898
171 U.S. 388
Transactions between persons actually residing within the territory dominated by the government of the Confederate states were not invalid for the reason only that they occurred under the sanction of the laws of that government or of any local government recognizing its authority. chanroblesvirtualawlibrary
Within such territory, the preservation of order, the maintenance of police regulations, the prosecution of crimes, the protection of property, the enforcement of contracts, the celebration of marriages, the settlement of estates, the transfer and descent of property, and similar or kindred subjects were, during the war, under the control of the local governments constituting the so called Confederate states.
What occurred or was done in respect of such matters under the authority of the laws of these local de facto governments should not be disregarded or held invalid merely because those governments were organized in hostility to the Union established by the National Constitution; this because the existence of war between the United States and the Confederate states did not relieve those who were within the insurrectionary lines from the necessity of civil obedience, nor destroy the bonds of society, nor do away with civil government or the regular administration of the laws, and because transactions in the ordinary course of civil society as organized within the enemy's territory, although they may have indirectly or remotely promoted the ends of the de facto or unlawful government organized to effect a dissolution of the Union, were without blame "except when proved to have been entered into with actual intent to further invasion or insurrection."
Judicial and legislative acts in the respective states composing the so called Confederate states should be respected by the courts if they were not
"hostile in their purpose or mode of enforcement to the authority of the National government, and did not impair the rights of citizens under the Constitution."
Applying these principles to the present case, the Court is of opinion that the mere investment by Hunter, as guardian, of the Confederate funds or currency of his ward in bonds of the Confederate states should be deemed a transaction in the ordinary course of civil society, and not necessarily one conceived and completed with an actual intent thereby to aid in the destruction of the government of the Union.
The case is stated in the opinion.