Gay v. Rainey

Mr. Justice Breese delivered the opinion of the Court: This was assumpsit, in the St. Clair circuit court, by Jefferson Rainey, plaintiff, and against Edward J. Gay, defendant. T^here were two special counts in the declaration, and the common counts. The first count charges the defendant as guarantor of the note in question,, and in the second count he is charged as indorser only. The note was executed by Flanagan & Co. and Frances A. Flanagan, on November 15, 1871, payable two years after date to Edward J. Gay or order, with interest from date at ten per cent, interest payable semi-annually. There were various pleas to the several counts, and demurrers thereto, with replications and demurrers to them. As the first count on the guaranty was abandoned, it is not necessary to notice any pleadings applicable to that count, nor to discuss the questions arising upon the demurrer to the additional count, as that avers a guaranty also, and was withdrawn from consideration by the abandonment of that claim. The issues made up by the parties were, the general issue—failure of consideration— the solvency of Frances A. Flanagan, one of the makers of the note—neglect and failure of plaintiff to prosecute his suit with effect against the makers of the note—that defendant indorsed the note in the State of Louisiana, and by the laws of that State an indorser is entitled to notice of non-payment by the makers. The issues being so made up, they were submitted to the court for trial without a jury, and the court found for the plaintiff, and, refusing a motion for a new trial, rendered judgment for the plaintiff, and the defendant appeals. The claim against appellant as a guarantor of this note being abandoned, relieves us from the necessity of discussing any of the questions made in the pleadings, on this point. The only points remaining in the case are, the solvency of one of the makers of the note, and a failure by plaintiff to avail by suit of the ability of one of the makers to pay. We have examined the testimony on this issue, and are satisfied plaintiff used commendable and all necessary diligence to collect the money of the makers by suit, by judgment, by execution, and by sale of her property. The amount so received has been allowed by the circuit court in making up its judgment for the plaintiff. The second count contains the averment that the makers of the note, when it became due, were insolvent, and unable to pay the same or any part thereof, and that the institution of a suit against them would have been unavailing. These averments were put in issue by the plea of the general issue, and by the fourth plea of appellant, which denied the insolvency charged, and by his ninth plea he brings up the negligence of the plaintiff in not making the whole of his judgment out of the sale of Mrs. Flanagan’s property by prompt execution of his judgment, to the loss and injury of appellant. The replication to this plea fully meets all its charges and averments, and was sustained by the proof. By the exercise of proper diligence' appellee was enabled to make and did make a portion of the money due by this promissory note, and as appellant has received the benefit of it, the recovery against him being lessened by that amount, he has no cause to complain. It does not seem to us that appellee could have obtained any advantage over the other judgment creditors of Flanagan had he sought to do so, and, as argued by appellant, he might have done, and thereby secured the payment of the whole debt. These judgments, one in favor of Hondulite and one in favor of West, were rendered at the same term of court at which appellee obtained his judgment, and were therefore liens on this same real estate, and the holders of them were entitled, under the statute, to share pro rata in the proceeds arising from a sale by the sheriff, no matter on which judgment and execution the sale was actually made, all the executions being at the time in the sheriff’s hands. The liens were concurrent, the judgments having been rendered at the same term and executions having duly issued. Chap. 77, § 13, Rev. Stat. 1874, p. 622. The first execution having been returned “no property found,” appellee was diligent in ordering an alias fi. fa. to issue on December 31, 1874 and the other judgment holders, Hondulite and West, delayed until January following. We can perceive no delay or negligence of appellee working injuriously to appellant. The point remaining to be considered is, that the indorsement of this note having been made in the State of Louisiana, the liability of the indorser must be governed by the law of that State, which requires notice to the indorser of non-payment by the makers of the note, before an indorser can be charged. We have no doubt of the correctness of this general principle, that the law of the place where a contract is made must govern when its enforcement is sought. What is the contract here ? Was any contract made in Louisiana, by this writing of indorsement simply? Clearly not. The note was payable to Edward J. Gay or order. What does he say in regard to it? He testifies the note in question was written and signed at Belleville, Illinois, by the makers thereof, and sent to him by mail; after some delay he indorsed it on November 9, 1871, and returned it with a letter, by mail, to E. T. Flanagan, his object in indorsing being to accommodate Flanagan. Flanagan & Co., the makers, negotiated and delivered it to appellee in Belleville, in this State, before due, and he had no knowledge the note had ever been elsewhere than in the hands of appellant and makers. These facts show this to be an Illinois contract, for, by the writing of indorsement, while it remained in the indorser’s possession it had no vitality. He could have erased the indorsement at any moment. The note was made in this State, and .was returned to this State and negotiated in this State on the faith of the indorsement. This indorsement formed no contract; to make it a contract the note indorsed must be returned, and when delivered and negotiated, the same became a binding contract. The rule is, the place where a contract is made depends not upon the place where it is actually written, signed or dated, but upon the place where it is delivered as consummating the bargain. 1 Daniell on Negotiable Instruments, 660, referring to Freese v. Brownell, 35 New Jersey, 286; Campbell v. Nichols, 33 id. 81. This note was made in this State, and indorsed by appellant in Louisiana for the accommodation of the makers, and delivered to them so indorsed, in Belleville, in this State. The indorsement is governed by the laws of the State where delivered and negotiated. The party to whom appellant lent his signature was the agent for putting the instrument into circulation, and his own contract with those to whom it is negotiated must be judged on the principles of agency which refer the contract to the place where the circulation commences. Id. 661, referring to Cook v. Moffet, 5 Howard (U. S. Sup. C.) 295; Hyde v. Goodman, 3 Comst. 266; Davis v. Coleman, 7 Iredell, 424. This, undoubtedly, is the general rule, and there is nothing in this case to take it out of that rule. We perceive no error in this record calling for a reversal of the judgment, and we must affirm the same. Judgment affirmed.