Union National Bank v. Chapman

Adams, P. J.:

Certain questions which arose in this case upon the former appeal were then disposed of to the apparent satisfaction of both parties, and, therefore, for the present at least they may be regarded as removed from the realm of controversy. One of the questions thus settled is that under the statutes of the State of Alabama a married woman, while permitted, with the assent or concurrence of her husband to enter into a written contract with him or any other person, ■cannot become a surety for her husband, either directly or indirectly. (Code of Ala. §§ 2346-2349.) Another is that the fact that the note in suit was executed by a tirm of which the appellant’s husband was a member did not take the case out of the operation of the Alabama statute. Still another is that the note in question is obnoxious to the usury law of ,the State, of Illinois, in consequence •of which the plaintiff must relinquish the interest thereon - if entitled to recover at all. (R. S. of Ill. chap. 74, § 6.)

But with these questions laid at rest and eliminated from our consideration upon this review, it still remains to be determined whether •or not the plaintiff can sustain its recovery against Mrs. Chapman,, and this, of course, depends upon whether the contract represented by the note signed by her as surety is to be governed by the law •of the State of Alabama or by that of Illinois, in which latter State ■concededly there is no inhibition against a married woman obligating herself as a surety for her husband.

It may be asserted as a rule of general application that the capacity of parties to contract is to be determined by the law of the place of contract, unless there is something to show that it was the intention of the parties at the time of its execution that the law of the place where the contract was to be performed should prevail. (2 Kent’s Com. *458; Grand v. Livingston, 4 App. Div. 589 affd., 158 N. Y. 688 ; Scudder v. Union Nat. Bank, 91 U. S. 406.)

Within the principle thus stated it would seem that a note made in the State of Alabama and delivered to the payee in that State •carries with it the presumption that it had its inception there, and that a subsequent transferee took it subject to the laws of that State. *60This much was held by this court upon the former appeal, but it. was also held that the presumption thus- created might be repelled, and inferéntially, 'at least, that if it could be shown that, the note-had no inception until it reached another State, its validity must be-determined by the laws of that State. Correlated to this latter proposition it may be said that a note has no inception or validity until it. has been perfected by both execution and delivery; and where, as-in this case, it is payable to the order of one of its makers and delivered to him for the express purpose of raising money thereon,, it has no inception until it is indorsed by the payee and transferred by him to some' third party. (Voigt v. Brown, 42 Hun, 394;. DuBois v. Mason, 127 Mass. 37; Pickering v. Cording, 92 Ind. 306.)

It is conceded that the note in suit was made solely for the purpose of raising money thereon for the use of the firm of Chapman, Reynolds'& Co., and that the payee thereof was a member of that firm. Furthermore, it was.found by the trial court that a few days after the note was made it was taken to Chicago by the payee, arid that he, after indorsing the same, transferred it to the plaintiff “ forth e purpose of securing loans already made to his firm and also for the purpose of procuring additional loans.” This woukl seem to' indicate that the note was not completed, that is, that it had no valid inception, until it reached Chicago, and if so the locus contractus was Illinois and not Alabama. (Cook v. Litchfield, 9 N. Y. 280 ; Lee v. Selleck, 33 id. 615 ; Hibernia Nat. Bank v. Lacombe, 84 id. 367, 378.)

. But even if it be conceded that the note was perfected in the State of Alabama, the conclusion would nevertheless be Well nigh irresistible that it was so perfected with the expectation and intention that the rights and obligations of the parties thereto should be determined by the law of Illinois, inasmuch as the contract entered into by both makers and indorser was to be performed in that State. That such was the intention of the makers of the note is expressly found by the learned trial court, which finding is not questioned or disputed by the appellant, as her counsel frankly states in his brief. It is true that it does not affirmatively appear that Mrs. Chapman was of the same mind when.she attached her signature to the note. Probably she. had no well-defined .thought or intention in regard *61to the matter, as she was signing as a mere matter of accommodation to her husband’s firm ; but she knew for what purpose the note was to be used and she must have known from the note itself that it was payable in Chicago. In these circumstances we think it it would be unreasonable to assume that she* contracted with reference to the law of Alabama instead of the law of .Illinois. It follows, therefore, that whether the note had its inception in Illinois or was executed in Alabama with the intention that it was a ■contract to be performed in the first-named State, the appellant cannot escape her liability therefor; and this conclusion, as we believe, is in harmony with the settled law of this and other States. (Lee v. Selleck, 33 N. Y. 615 ; Dickinson v. Edwards, 77 id. 573 ; Turnow v. Hochstadter, 7 Hun, 80; Milliken v. Pratt, 125 Mass. 374; Bell v. Packard, 69 Maine, 105; Johnston v. Gawtry, 83 Mo. 339; Andrews v. Pond, 13 Pet. 65; First Nat. Bank of Chicago v. Mitchell, 92 Fed. Rep. 565.)

We have examined the exceptions taken during the progress of the trial but are unable to discover that they present any prejudicial error. The judgment appealed from should consequently be •affirmed.

All concurred, except' McLennan, J., dissenting.

Judgment affirmed, with costs.