I concur in the result reached by Justice SHARPE. The place of contracting *Page 666 controls the question of the capacity of the parties to contract. Palmer National Bank v. Van Doren, 260 Mich. 310; American Law Institute Restatement of the Conflict of Laws, § 333. The notes were dated and payable at Chicago and secured by Chicago real estate. The loan was made in Chicago 25 days after the notes had been signed and not until an actual cloud on the title to the realty had been removed. These circumstances leave no doubt that the notes in question constituted Illinois contracts. See Palmer v. Hill, 140 Mich. 468; State of Ohio, exrel. Fulton, v. Artie Purse, 273 Mich. 507. The facts are entirely different from those in Re Estate of Lucas,272 Mich. 1, in which the loan was solicited by residents of Michigan, the moneys were first received in Michigan by the borrowers and subsequently the note was dated and signed in Michigan and was payable in Michigan. The place of contracting is where the note is first delivered for value. In 2 Beale on Conflict of Laws (1st Ed.), p. 1047, it is said:
"Delivery, however, is not the only requisite to the creation of a contract on a negotiable instrument. Value must be given, and until, therefore, there has been a delivery for value, the instrument cannot be said to have had any inception. * * *
"It follows that the place of contracting of a contract on a negotiable instrument, be it the obligation of the maker, the drawer, or the indorser, is the place where, after the signature of the party in question, the instrument is first delivered for value."
It is true that the physical act of signing the note in the instant case took place in Michigan and the notes were mailed to plaintiff in Chicago, but there was no absolute delivery until the plaintiff had satisfied itself of the status of the title to the mortgaged *Page 667 property and until an actual cloud had been removed. Until that time the transaction was conditional and the notes of no binding force and effect.
The rule is stated in 2 Beale on Conflict of Laws (1st Ed.), p. 1045, as follows:
"The phrase 'place of contracting' and its equivalents, the place of making or the place where the contract is made, properly mean the place in which the final act was done which made the promise or promises binding."
A somewhat similar case arose in Palmer v. Hill, supra, where it was held, as stated in the syllabus to the opinion:
"Where a note and mortgage executed in California in favor of a Michigan bank, on Michigan real estate, is sent to the mortgagee in Michigan, where it is accepted and the consideration paid, the contract is a Michigan contract."
We do not believe that the case of Burr v. Beckler, 264 Ill. 230 (106 N.E. 206, L.R.A. 1916 A, 1049, Ann. Cas. 1915 D, 1132), should in any way be controlling on this court in determining the lex loci contractus. The problem in the instant case is termed by the authorities as one of "qualifications." The prevailing view in answer to the problem is that the law of the forum should control on the question of lex locicontractus. An excellent treatment of the entire subject may be found in an article entitled, "The Theory of Qualifications and the Conflict of Laws," by Professor Lorenzen in 20 Columbia Law Review, p. 247.
Were we not to be controlled by our own law and obliged each time to ascertain what a foreign State would have held under similar circumstances, our decisions would be in hopeless confusion and it *Page 668 would be necessary each time to examine the decisions of other States in determining the lex loci contractus. The question, however, is foreclosed in this State as we held in the case ofState of Ohio, ex rel. Fulton, v. Artie Purse, supra, that the law of the place of contracting is to be determined in accordance with the law of the forum.
The judgment should be reversed, with costs to plaintiff.
BUSHNELL, J., concurred with BUTZEL, J.
POTTER, J., did not sit.