Legal tender subtleties leave collectors and dealers scratching their heads

The $20 for $20 coins are popular, but difficult to spend.

Nobody can argue about the success of the Royal Canadian Mint’s (RCM) face value program when it comes to selling coins, the problem seems to be when owners want their money back. When the first $20 for $20 coin came out in 2011, members of the public jumped at the chance to acquire a silver coin for face value. The issue sold out in just 29 days, despite limitations on how many could be sold to a single address. The coins, which contain slightly more than one-quarter troy ounce of silver, have an approximate bullion value of $7 at press time. That success led to a program that continues, and has now been expanded to $50 for $50 and even $100 for $100 coins, all proving popular sellers. In recent years, mintages have been lowered from the 2011 high of 250,000 to 200,000 in the most recent issue, but the coins always sell out in the year of issue. Continue reading →

NCLT conundrum has a solution

I’m going to be honest, sometimes I shudder when I hear the words legal tender. The reason is because there seems to be a massive disconnect between what legal tender is, and what it actually means. It is subject of an article in this issue. To most members of the public it means that they can spend it anytime they want, or convert a legal tender coin into paper money. To the Royal Canadian Mint (RCM), it means that the coin has legal tender status under Canadian law, but it is not expected to circulate. To banks and businesses, it is at best a weird coin which has no place in the circulating coin distribution program. It is complicated by the fact that non-circulating legal tender (NCLT) coins are sold by the Mint, so people expect the Mint to stand behind them, in fact to redeem them for a cheque if submitted. That’s not what legal tender means in Canada. Continue reading →

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