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Opinion of the Court, per DENIO, Ch. J.
The evidence would have authorized the jury to find that there was a breach of duty by the defendant, and the nonsuit was therefore erroneous.
The judgment should be reversed, and a new trial should be ordered, with costs to abide the event.
All the judges concurred in the foregoing opinion, except Brown and CAMPBELL, JJ., who dissented.
Judgment reversed, and new trial ordered.
THE EAGLE BANK OF ROCHESTER V. PATRICK RIGNEY and
Usury cannot be predicated of the advantage obtained by the lender by means
of the difference of exchange between the place of the loan and the place of the payment, where both places are within the State.
John C. Cochran, for the appellant.
G. F. Danforth, for the respondents.
DENIO, Ch. J. This was an action on a promissory note for $600 at two months, made by the defendant Rigney and indorsed by the other defendant for his accommodation, and discounted by the plaintiffs' bank, they deducting the discount for the time it had to run at the rate of seven per cent. The defendants proved, by the oath of the defendant Rigney, that the president of the plaintiffs' bank required as a condition of the loan that the note should be made payable at Albany, where the maker had not and did not expect to have any funds, instead of Rochester, where he resided, and where the bank was situated, the president saying that the motive for that requirement was to give the bank the difference of exchange, and that the note need not be sent to Albany, but might be paid here a day or two in advance of its maturity. The exchange was then, and generally was, half of one per cent in favor of Albany. The defendants offered to show that the defendant Rigney had previously obtained discounts at the plaintiffs' bank, where the same condition of making
Opinion of the Court, per Dexio, Ch. J.
the notes payable at Albany was exacted; that in all these cases the notes were paid at Rochester without being sent to Albany, and the difference of exchange was exacted and paid by Rigney. The judge excluded the evidence, and the defendants' counsel excepted, and a verdict was directed in favor of the plaintiffs.
The point on the merits was determined against the defendants in the case of Oliver Lee & Co's. Bank v. Walbridge (19 N. Y., 134). It was there held that usury could not be predicated of an advantage obtained by the lender by means of the difference of exchange between the place of the loan. and the place of payment, where both were within this State. It was shown that damages for exchange was only legally applicable to foreign bills, and that the borrower upon domestic paper could only be compelled to pay the amount, without the addition of exchange in lawful money of the United States, which the law considered of the same value in every part of the State. That case is entirely decisive of the present.
The evidence offered and excluded was incompetent. If the plaintiffs exacted usury in the other transactions offered to be proved, it would not legally tend to show that the contract in the present case was usurious. The defendants here paid no usurious premium, and the contract which they made did not secure the payment of any.
The judgment must be affirmed.
2 Baro 1528, dotton eng CASES
DETERMINED IN THE
su W1 Barb, 519 COURT OF APPEALS COURT
STATE OF NEW YORK,
At the December Term, A. D. 1865.
URIAH M. LEE and THOMAS MURPHY, Respondents. v.
GEORGE SELLECK, Appellant.
33 615 128 406
In determining the lex loci contractus, the engagements of the maker and
indorser of a note are to be treated as independent contracts. The liability of the maker, on a note executed in New York and payable in Illi
nois, is controlled by the law of Illinois, the State in which his engagement is
to be performed. The duty of the indorser arises only on default by the maker, and by an unre
stricted indorsement in New York to the holders, he undertakes to pay them
in the Stale in which they reside. An indorsement, written in Illinois for the accommodation of a maker in Wis.
consin, but intended to be delivered at New York for the purchase of goods, takes effect as a contract on delivery there, and the liability of the indorser is
to be determined by the law of New York, and not by the statutes of Illinois. Under the Illinois statutes, the holders of a promissory note are not bound to
pursue their remedy against the maker in the courts of another State, as a condition precedent to recovery against the indorser.
Tue appeal is from an order of the Supreme Court at the General Term in the second district, reversing the judgment at Special Term, in favor of the defendant, and granting a new trial. The case, as decided in that court, is reported in 32 Barbour, 522.
The appellant was sued in this State as indorser of a promissory note for $3,378.75, made in August, 1857, and pay
Statement of caso.
able eight months after date, at George Selleck's bank, Morris, Illinois, with current exchange on New York.
The facts material to the issue, as found by the judge, are substantially these:
The note at maturity was duly presented and protested, and due notice was given to the indorser.
At the date of the note, and ever since that time, the maker, Benjamin Selleck, was solvent, and resided at Beloit, in the State of Wisconsin. He made the note in the city of New York, and forwarded it thence for indorsement to George Selleck, who resided at Morris, Illinois. The appellant wrote his indorsement there, and transmitted the note by mail to the maker at Beloit, who mailed it to the plaintiffs at New York. They received it in that city with the appellant's indorsement thereon.
The note was given for goods sold and delivered by the plaintiffs to Benjamin Selleck, on an agreement that he would give his note with this indorsement, and the plaintiffs received it about ten days after the delivery of the goods.
By the statute of Illinois then in force, the effect of such an indorsement, if all the parties had been residents of that State, and the contract had been concluded there, would be to bring the case within the following provision, the indorser being regarded as the plaintiffs' assignor :
Every assignor or assignors, or his, her, or their heirs, executors, or administrators of every such note, bond, bill or other instrument in writing, shall be liable to the action of the assignee or assignees thereof, or his, her, or their executors or administrators, if such assignee or assignees shall have used due diligence, by the institution and prosecution of a suit against the maker or makers of such assigned note, bond, bill or other instrument of writing, or against his, her, or their heirs, executors, or administrators for the recovery of the money or property due thereon, or damage in lieu thereof; provided, that if the institution of such suit would have been unavailing, or that the maker or makers had absconded or left the State, when such assigned note, bond, bill or other instrument in writing became due, such assignee or assignecs,
Opinion of the Court, per PORTER, J.
or his, or her executors or administrators, may recover against the assignor or assignors, or against his, or their heirs, executors or administrators, as if due diligence by suit had been used.”
The following were the judge's conclusions of law applica ble to these facts:
1. That the law of the State of Illinois governs the contract of indorsement of said note, and the liability of the indorser.
2. That the fact that the note was sent by the indorser by mail, to the maker in Wisconsin, and by him forwarded by mail to the plaintiffs in New York, does not make the contract of indorsement a New York or Wisconsin contract, governed by the law of either of those States, but the indorsement is governed by the laws of IHinois.
3. That the residence of the maker, Benjamin Selleck, in Wisconsin, at the time of the making and indorsement of said note, does not relieve the plaintiffs from the necessity of prosecuting the maker at law, before resorting to the indorser.
4. That the plaintiffs have not used due diligence by the institution and prosecution of a suit against Benjamin Selleck, the maker, it not appearing that the institution of such suit would have been unavailing.
5. That the plaintiffs, on the evidence, are not entitled to recover against the defendant, George Selleck, and that the said George Selleck is entitled to judgment against the plaintiffs for his costs.
To each of these conclusions the plaintiffs duly excepted.
A new trial having been granted at the General Term, the appellant stipulates that if the order be affirmed, judgment absolute shall be rendered against him.
E. L. Fancher, for the appellant.
Levi S. Chatfield, for the respondent.
PORTER, J. If the contract of the indorser was made in the city of New York, and in contemplation of its performance there, the plaintiffs were entitled to judgment. The
TIFFANY.- VOL. VI. 78