Legal tender

Legal tender: A term applied to the status of various kinds of coinage. When paying debts in peace time, gold and Bank of England notes are legal tender for every purpose and cannot be refused by creditors, except that no one can be compelled to give change. Silver in peace times is not a legal tender for sums over £2, nor is bronze for sums over 1s (one shilling). On the proclamation of war the Government issued paper money which was made legal tender by Act of Parliament, and at the same time Postal Orders were made legal tender.