Bank of Georgia v. Lewin

By the Court, Ingraham, P. J. It was held by the general term of this district, in Balme v. Wombough, (38 Barb. 352,) that a note drawn in Minnesota, for money loaned there, and made payable in the state of New York, was not usurious, unless the laws of Minnesota made it so. The fact of its being made payable in New. York did not affect its validity; although it would have been void if the contract had been made in New York. The present case differs from that only in the fact that the instrument is a hill of exchange drawn on a person residing here. The contract was made in Georgia, the money paid there, and the drawer, as well as the bank, were at the time of the contract, both subject to the laws of Georgia. The mere fact that the funds upon which the draft was drawn were in the hands of a third person, in New York, was no part of the contract, so as to affect its validity. The drawer owed the plaintiff some money, and gave the draft, in Savannah. The whole transaction took place there, and was [343] performed there, so far as the drawer had any thing to do with it. In Gibb v. Tremont, (20 Law and Eg. Rep. 555,) it was held that on such a hill of exchange, if not paid, the law of the place where made, and not of the place where payable, was to govern as to the rule of damages, and the drawer was liable for interest according to the laws of the country where the bill was drawn. [New York General Term, November 6, 1865. The contract between the parties was an agreement by the drawer to transfer to the plaintiff funds which he had in New York. The payment was made in Georgia, and the contract made there. If the bill of exchange was not paid, the plaintiff’s remedy against the drawer was according to the law of the place where the contract was made, and he could have recovered interest according to the law of that place. It can hardly be said, under such circumstances, that the acceptor' here, who holds the funds of the drawer, can refuse payment because the contract was void, when the law says it is valid. In Chapman v. Robertson, (6 Paige, 634,) Walworth, Ch. held that where a loan of money was made in one country and was payable in another, the parties might agree on interest according to the laws of the place where the loan was made. And in Pratt v. Adams, (7 Paige, 632,) it was also held, that if the contract was not illegal where made and where the money was loaned, the same was not void, although the bills on which the loan was made were made payable in New York, and would have been void for usury if subject to the laws of this state. The contract between the parties was made under the laws of another state, and we must consider the parties as contracting according to the laws of that place. The judgment should be affirmed. Ingraham, Leonard and Geo, G. Barnard, Justices.]