Bank of Louisiana v. Williams

Simball, J. : The Bank of Louisiana, a corporation created by the state of Louisiana and domiciled there, sued David P. Williams and Elizabeth M., his wife, to recover the amount due on a promissory note, dated Concordia Parish, La., April 8, 1857, for $30,000, payable one year after date; the note was secured by mortgage on property situated in said Con-cordia Parish, La., executed by Williams and wife. Mrs. Williams pleaded her coverture, and that she was, at the date of the contract, resident in Adams county, Miss., and has since resided there. The plaintiff relied upon the fact, that the charter of the bank authorized a married woman, jointly with her husband, to make this sort of contract. It will thus be perceived that this is one of those embarrassing questions, arising out of the conflict of laws so perplexing to the courts. The general rule is, that lex loci contractus governs as to validity and construction; unless, — 624 — indeed, some other state or country is appointed by the parties as the place of performance, and the contract is made with special reference to its law. It is laid down by Story on Confl. of Laws, § 232, to be a universal principle, common to the civilized world, essential to a contract, that it shall be upon a sufficient consideration, and lawful in its terms and purposes. Theoretically, the rule of the civil law of continental Europe is, that the legal capacity of a person to do, or not to do, certain acts, is to be referred to the law of the domicile. Thus, the Code Napoleon enacts: “The laws concerning the status and capacity of persons govern Frenchmen, even when residing in a foreign country. ’ ’ Practically, no nation or state ever gave effect to such a rule; the modifications and exceptions became so numerous that they have taken the place of the rule itself and almost superseded it. It is not true, generally, that the “status” and “capacity” of persons in foreign countries is determinable by the law of their domicile. An English nobleman would not be permitted, in an American court, to put in an answer in chancery on honor, because he had that privilege in his own country. Nor would a person, who had incurred the penalties of premuniré, or who had suffered judgment of outlawry, be denied a remedy in our courts for a debt or a personal wrong, because the British courts were closed against him. In both cases, so soon as the limits of the country of the domicile are passed, the privilege in the one instance and the disability in the other, cease to have effect and will not be respected. It is the prerogative of the sovereignty of every cóuntry to define the conditions of its members, not merely its resident inhabitants, but others temporarily there as to capacity and incapacity. But capacity or incapacity, as to acts done in a foreign country, where the person may be temporarily, will be recognized as valid or notin the forum of his domi625 die, as they may infringe ox not its interests, laws and policies. Relations which are natural, and therefore universal, as husband and wife, parent and child, and tender infancy, will be considered as subsisting everywhere, and are under the protection of the laws of every country where the parties sustaining them may go. Natural incapacity is incident to tender infancy. The child of six, eight or ten years has not attained to the state of free moral agency, and is not accountable for his actions. It is to be supposed, therefore, that the courts of all countries would consider his acts, wherever done, as imposing no responsibility. But the age at which majority is attained, and responsibility for acts done begins, is not uniform in all countries. Each for itself prescribes the time, each determines for itself when the will and judgment are sufficiently matured for the duties and responsibilities of independent conduct. Thompson v. Ketcham, 8 Johns. 192, illustrates the proposition. The note was ma'de in Jamaica, the defense was infancy according to the law of New York. It was determined that the transaction was subject to the law of the place of the contract and that infancy was a defense or not according to the law of Jamaica. Contracts maybe “located” in a country or state other than that in which they are made, as when performance is appointed there, and the parties may be supposed to have had in view that law. Dutton v. Murphy, 30 Miss. 65; Le Breton v. Miles, 8 Paige, 265. Married women in this state hold their property by a tenure, which is defined either by the statute or the instrument under which it is conveyed to them. The original of the laws creating their separate estates is, doubtless, the doctrine which sprung up in the equity courts recognizing their usufructuary interest, while the legal title was held for their use by a trustee. The principle was imported by the equity courts from the civil law, as were many others. As usee or cestui que trust, they were regarded as owners, capa — 626 — ble of almost an unrestrained power of disposition. They could not be called to account for the manner in which they disposed of the income, and they could create charges and debts which equity would respect and effectuate out of the trust property. The entire theory had its origin in the equity courts, and was encouraged and amplified, so as to free married women from marital restraints and disabilities quoad the trust estate. In their transactions touching the property, they were treated as owners, they acted as femes sole; but it was only in the courts of chancery that they had that character. The law courts, whenever their contracts or obligations were brought before them, rejected them as void pacts importing 'no force or validity. The circumstance that she had a separate estate, and made the engagement with reference to payment from that source, did not emancipate them from the disability of coverture. Our statutes, therefore, undertook to deal with this subject so as to simplify her relations to her property, her power over it, and, by operation of law, to convert the equitable estate sub modo into a legal estate ; so that, in so far as it was wise and prudent for her to create liabilities, they should be legal debts recognizable in a court of law and collectible out of her property. Instead of looking to the rules and principles which were devised in equity as defining her relations and powers over her property, we refer to the statutes as prescribing the conditions upon which she may charge it, orto the instrument under which she holds it. They are limitations of her estate; they are the conditions on which it rests. If a foreign creditor comes into this state and seeks compulsory paymént of a debt made by a wife abroad, he must submit himself to the law of the forum for his remedy; he must consult the rules and regulations which govern courts here as to the form of the suit, and, according to the character of his “right,” our system of jurisprudence determines whether he must sue at law or in chancery. If an estate be in the wife by deed or will, with power expressly conferred to borrow money, or incur debt,* for all — 627 — purposes which shall be binding upon it, lie may address himself to the chancellor, as a creditor, haying a right to be paid out of that fund. If he goes into a court of law, he is met at the threshold with a notice that the wife holds her separate property, under certain restrictions and limitations ; that, if the boundaries of her power have not been passed, the court is. prepared to give him redress. But he must satisfy the court that his debt was such a charge upon her estate, or its income, as she had the power to makeotherwise it would be a violation of the tenure, the conditions of her title, to allow Mm to subject it. But the creditor may say, “ I. cannot bring this debt within the terms defined by your law. Nevertheless it was such a contract as a married woman could make by the law of Louisiana. ' Comity requires your courts to treat the contract precisely as Louisiana would, and I demand a judgment against the wife.” “ No,” says the court, “ you cannot get here any fruit of a judgment; there is nothing subject to its payment, and our law affords no remedy against a married woman in any of its courts, law or equity, except through a property which she has, and which must be pointed out by the creditor. We know of no such thing as a personal obligation, aside from and independent of a property which may discharge it.” If she holds property under a deed or will, with unlimited power to charge and dispose of it, a court of equity will effectuate her contracts, by treating them as a charge or quasi lien on her estate, but not as creating any personal obligation on her, for the moment her separate estate has been exhausted (there being no personal separate obligation), all remedy in favor of creditors is exhausted. But it is said that this contract, being made in Louisiana, if good there is good everywhere. Let us look closely to the transaction and analyze its parts and its entirety. The charter of the bank directed two millions of its capital to bé employed in loans to the agricultural interest, on notes and mortgages, renewable for a term of years; the property hy628 pothecated to be worth twice the amount of the loan; and, inasmuch as many landed estates belonged to married women, by the thirty-second section of the charter they were authorized to ‘ ‘ bind themselves jointly and in solido with their husbands, in all hypothecatory contracts and obligations made with the bank, and in such case the property and rights of such wife, either dotal or of any other description, shall be affected by such contracts and obligations, provided the wife be of age at the making of the contract.” It is manifest that the scheme of the bank was to encourage the agricultural interests of Louisiana, and the loans of the $2,000,000 were to be made upon real estate situated there. The loans to agriculturists are expressly required to be made upon mortgage —“hypothecary contracts” is the language. The wife is emancipated, so far, and so far only, as to capacitate her to join with her husband in the “hypothecary obligation.” She subjects all her rights and property, “ dotal,” or of any other description. Her qiaraphernalia, wardrobe, jewels and ornaments, according to her degree in life, are pledged, as well as her property at the marriage, or subsequently coming to her. This obligation, which is exceptional, not allowed by the general law in its scope and effect, submits all her property and rights to the discharge of this obligation. This brief review conclusively shows that the contract is local, purely and entirely, founded upon a local policy, and can only be made by a class of married women, the wives of agriculturists, whose estates are situate in Louisiana. It certainly was' not contemplated by the charter of the bank that these loans should be made on mortgages of plantations outside of that state. It was intended that the most ample security should be given for the debts, and that the performance of the contract should be made within the state. Nor was it suqiposed that the obligation of the wife extended further than to cover her dotal and paraphernal rights and property in that state. It is as much as if the law-maker had said, married women can mortgage their landed estates, — 629 — and bind dotal and other property situate in that state, for this sort of contracts.. ^Tlie transaction stands upon ground local to Louisiana, and a policy there which is exceptional from the general rule and general law. Assuming, as a doctrine of the law, that the contract of a married woman, valid at the place where made, shall be so regarded everywhere, does that embrace an obligation incurred by her, growing out of special circumstances, and not included in the general law and policy of the place, but resting altogether on special reasons, and looking to local property for its payment %/If, by the law of Louisiana, a married woman was competent to incur debts generally, and coverture imposed no disability, it would be a different question from that we are dealing with. If a married woman resident here, while temporarily in that state, should incur a debt and courts should be appealed to to enforce it, comity might enjoin the duty of a remedy, if our system could provide one. But we would be under no duty to give a “personal judgment ” if such a proceeding had no place in our jurisprudence. The utmost that we could do would be to lay hold of her property here and apply it, provided in so doing we did no violence to the essential conditions and tenure by which she held it. If she contracts a debt in Louisiana, or at home, she charges it upon her estate here, unless the terms upon which the estate rests and is held forbid it. / It matters not whether the suit be at law or in eqnity, whether the property be unconditionally hers at the marriage, or come to her by descent or devise afterward, or in any other mode, creditors, upon whatever consideration the debt arose, have no remedy under our system of jurisprudence, against her “ personally.” The proceeding is in rem against her estate. If the suit be at law under the statute, while the judgment may be for so much money, it is a necessary part of it, that it be levied of her separate estate. The condition precedent to a right of recovery either at law or in equity is, that there be a separate estate out of which satisfaction may be — 630 — Rad.. Our jurisprudence does not realize the possibility of a “personal judgment against a married woman.” And Ras remedial macRineiy for creditors, only against tRose wRo Rave property, and only tRen to tRe extent of its value or its income, as tRe case may be. But for tRe express autRority conferred by our statutes, it is evident tRat a married woman could not be sued- at law upon Rer contracts. To tRe extent enumerated in articles 24 and 25, courts of law are empowered to enforce Rer contracts (but tRat as we Rave said is specifically against tRe property). TRe difference between tRe separate estate, as recognized in courts of equity, and tRe title to property, and rigRts connected with it, as declared and defined in the statutes is, that the former is an equitable, and the latter is a legal estate; the former is created by a conventional instrument, or by devise, and may contain restrictions or not on the power of disposition, or the title may be simply placed in a trustee for Rer use, without prescribing the extent of Rer power over the estate, or restricting Rer right of charging it. In the leading case in this country, of Jacques v. Methodist Church, Johns. Ch., it was accepted by Chancellor Kent, as the true doctrine, that she was, as to Rer separate estate, a “feme sole,” and may charge or dispose of it very much at her pleasure, unless restrained by the instrument creating it. In the later case of Gardner v. Gardner, 22 Wend. 526, it was Reid to be the better opinion, that debts contracted expressly for Rer own account ought to be considered as an appropriation, or appointment for the creditor of so much of Rer separate estate as may be needed to pay the debt. TRe earlier English cases proceeded upon the ground, that the main object of the trust was, that the property might be deemed as Reid for the payment of her debts. Norton v. Turville, 2 P. Wms. 145. In Peacock v. Monk, 2 Ves. Sr., Lord Hardwicke said : “If the wife gave a bond for borrowed money, this would give a foundation to demand the money out of Rer estate. TRe doctrine was extended so as to include all obligations given by the wife, — 631 — whether as surety for the husbaud, or a stranger, on the predicate that, by creating the obligation, she must have meant to appoint its payment out of her separate estate, as that was the only mode in which she could give it eifect. 2 Story’s Eq. Jur., §§ 1399 to 1402. There seems tobe a tendency in some of the later cases to repudiate the reasoning founded upon the idea of an appointment; its fallacy was exposed in a late case by Lord Cottingham. If a married woman makes several notes, of different dates, and to different persons, on the theory of an appointment, they ought to be paid in the order of their date, whereas the equity courts have never recognized any such preference. Perhaps the sounder view is, that the chancery courts will treat all debts contracted by herself or for her account, and with her consent, whether written or verbal, as enforceable out of her separate estate. Murray v. Barlee, 3 Myl. & K. 239; 2 Craig & Phil. 48; 22 Wend. 526; 18 B. Monr. 649; 14 ib. 247. In 18 ib., supra, the court declined to enforce the contract of the wife as surety for the husband, because it was. “ stride juris,” the surety does not participate in the consideration, it arises upon signing the obligation, and in no wise connects itself with whatis antecedent. 2 D. & E. 370; 2 Brown’s Ch. 382, 383; 2 Ves. Jr. 542; 3 Wil. 359; 2 Caines’ Cas. in Error, 1. In Daniel v. Robinson, 18 B. Monr. 649, the property was conveyed to the wife “for her sole and separate use.” The statute was, that the separate estate could not be incumbered or sold, only by order of a court of equity, and that for exchange and re-investment. It was held that her debts were not chargeable on the estate, her disposition only extended to the income. The statutes are enabling in so far as they retain to the wife the possession and control of her property, and the use and benefit of its income. To that extent they relieve from the disability of coverture. As to the income and profits, she is under no restriction. She may lease her lands but cannot sell or mortgage them, except by joint deed of her — 632 — husband and herself (perhaps, as to movable effects and choses in action, she may sell or assign them, at pleasure). These statutes are restrictive of the equity doctrine that a wife may charge and dispose of her separate property as a feme sole. If the property was hers absolutely, at the date of the marriage, the statute withdraws it from the control of the husband, and she holds it, subject to the restrictions of the law, if she acquires it afterward. The law impresses itself as conditions of her tenure, unless the instrument creating the estate otherwise provides. We understand the doctrine in this state to be, that a married woman (unless the instrument creating her estate otherwise provides) holds separate property, whether owned at her marriage or acquired since, as if the 23d, 24th, 25th, 26th and 27th articles of the Code, pp. 335, 336, were embodied in an instrument conferring the property upon her; these define the nature and extent of her estate, her ability to sell and dispose of it, and her power to charge or bind it for debts. This separate property “ consists of real and personal estate, money, rights and credits.” “Of every species and description of property.” Art. 23, supra. It is this separate estate, whether in the form of lands, personal effects or credits, that she may dispose of and alien, or charge with debt, provided each be done according to the terms of the law. If she make a mortgage to secure a “debt contracted for necessaries for herself and children, or for their education,” the mortgage is of no effect unless the husband join in it; while the debt being such as she may contract, may be recoverable out of her property. There is no room for the application of the equitable doctrine, that, by virtue of general contracts and engagements to pay money, she charges, or is deemed as intending to charge, her estate, for the statutes which is as if conditions of her tenure or limitations upon her power over the estate, defines in how far she can act as a feme sole, and declares that to that extent she shall charge her property, and by necessary implication, negatives every other mode or any greater extent. If an instrument empowers a married — 633 — woman to dispose of property by a deed, attested by two witnesses, * * * a deed attested by one will not suffice. Montgomery v. Agricultural Bank, 10 Smedes & Marsh. 576. Not because the law requires two witnesses, but because the power was prescribed to be executed in a particular way. So, if the statute declares that she may charge her estate with a certain class of debts, contracted for certain enumerated purposes, it is to the exclusion of all others. The married woman’s law of 1839 gave no power to the wife to impose a debt on her separate estate, which consisted only of lands and slaves. In Davis v. Foy, 7 Smedes 6 Marsh. 67, speaking of the statute, the court say “that its effect is rather to take away all power of subjecting her property to her creditors, except in the particular mode specified in the statute. In Frost v. Doyle, ib. 76, the court declare the purpose of this legislation to be to limit the rule in equity that the wife is a feme sole as respects her separate estate, and that its object would be defeated by holding that she could charge the separate estate by note or bond. The cases of Berry v. Bland, ib. 83, and Davis v. Gisk, 9 ib. 151, commenting on the power which a wife has over property settled upon her by deed or will, in accordance with Morgan v. Elam, 4 Yerg. 375, and Doty v. Mitchell, 9 Smedes & Marsh., on the same point, seem to hold the rule to be, that she has no power except what the' instrument imparts, and that she is a feme sole only so far as she stipulates for exemption from common-law disability. This places her upon narrower ground than the English and the American courts generally assign her. The cases of Garrett v. Dabney, 27 Miss. 343, and Block v. Cross, 36 ib. 558, dissent from the doctrine of the cases in 7 and 9 Smedes & Marsh., supra, and place the rule here in accord with the reason and authority of equity courts generally, viz.: “that if the instrument is silent as to her power over the property, neither restricting nor prescribing the mode of charging or disposition, the power is absolute, — 634 — and she deals with it as a feme sole.' Such is, doubtless, the true doctrine. ' Equity treats her as owner, unembarrassed by coverture. Curil v. Compton, 14 Smedes & Marsh. 58; Dalton v. Murphey, 30 Miss. 65; Russ v. Wingate, ib. 445; Stamp v. Green, 34 ib. 546; Steadman v. Holman, ib, 551; Scott & Gray v. Pope & Eton, 36 ib. 117; Carter v. Whitworth, 43 ib. 61; Dunbar v. Meyer, Deutch & Co., ib. 679; Bacon v. Bevan, 44 ib. 203; Foxworth v. Magee, ib. 430; Anderson v. Gregg, ib. 170, give utterance to the same reading of the statute. Article 910 of the Louisiana Civil Code conforms to the current of modern jurisprudence: “The law is obligatory on all the inhabitants of a state, foreigners while residing there, and upon property within its limits.” In the Bank of Louisiana v. Farrar, 1 La. Ann. 49, the note and mortgage were dated in Mississippi, but the paper was made payable in Louisiana, and the mortgaged property was situated there, so that it was, in legal effect, a Louisiana contract, and as such dealt with by the court. Article 2412 is to the effect that the wife cannot bind herself conjointly with the husband for debts contracted, before or after marriage, by him. As we understand by the general law of Louisiana a wife, with the consent and concurrence of her husband, can only bind herself where the consideration inures to herself or her estate. Porter v. Silliman, 44 Miss. 282, and cases there cited. It may be observed that article 2412, supra, was enacted into law subsequent to the date of the charter of the bank. It was held, however, in Farrar’s case, supra, that it did not repeal the thirty-second section of the charter. It thus appears that the special law under which this contract was made is in derogation of the general law, and ought, therefore, to be construed strictly, and not carried beyond its reason and policy. We have reached the Conclusion that this contract (on the case made in the record) is not obligatory on Mrs. Williams. Hot, however, without difficulty and hesitation. — 635 — We realize the importance of the principle and its practical eifect- in the community. This protracted discussion can only be excused, as it evinces an earnest desire to discover and announce the truth. The judgment is affirmed.