It is the first delivery of the executed instrument which determines the law by which its validity is to be tried. If the original delivery is made where the execution took place and where the instrument is payable, any subsequent use of it the author expressed his dissent from the doctrine laid down in Jewell v. Wright, 30 N. Y. 259. Subsequent decisions in New York have more clearly explained the ruling there made and settled the law more nearly in harmony with the text than it was understood to be before the later cases were decided. In Wayne County Savings Bank v. Low, 81 N. Y. 566, 570, Rapallo, J., says: "In Dickinson v. Edwards, 77 N. Y. 573, the decision in Jewell v. Wright was adhered to, and it was held that where a promissory note was made in this state by a resident thereof, bearing date and by its terms payable in this state, with no rate of interest specified, and was delivered to the payees without consideration, to be used by them for their accommodation, without restriction, and was first negotiated by them in another state at a rate lawful there but greater than that allowed by law in this state, it was usurious and void, there being no evidence in the case of any intention on the part of the maker that the note should be discounted or used out of this state. That case, as well as Jewell v. Wright, was distinguished from Tilden v. Blair, 21 Wall. 241, expressly upon the ground that in Tilden v. Blair, although the acceptance was made payable in New York by the acceptors who were residents of New York, yet, after having accepted in New York, they returned the acceptance to the drawer in Illinois for the purpose and with the intention that it should be negotiated by him in that state. And this court says in its opinion in Dickinson v. Edwards that that was the controlling fact in Tilden v. Blair, and that the ruling consideration was the intention of the acceptors that the draft should be used in Illinois, while in Jewell v. Wright and in the case then before the court there was nothing to show an intention on the part of the maker of the note to give authority to deal with it otherwise than as the law of this state would allow. The case of Bank of Georgia v. Lewin, 45 Barb. 340, and other cases are distinguished from Jewell v. Wright on the same ground, and it may safely be said that the case of Dickinson v. Edwards rests upon the ground that there was no evidence of knowledge or intention on the part of the maker of the note that it was to be used out of this state, and that, in the absence of such proof, it must be governed by the law of the place of payment. "In the present case the fact which was wanting in Jewell v. Wright and Dickinson v. Edwards clearly appears, and the case is brought within the principle of Tilden v. Blair, and the cases which have followed it. The note now in suit was dated and made payable in New York, but it was made for the express purpose of being used in renewal of another note for the same amount then held by the plaintiffs, a bank in Pennsylvania. The note in suit was actually written in Pennsylvania in the form in use in that state, by the cashier of the plaintiff, at the defendant's request, and forwarded by the cashier to the defendant for signature, and was signed by the defendant in New York, and then mailed by him to the plaintiff in Pennsylvania, together then contemplated by the parties cannot affect its validity.' If preliminary negotiations for a loan are made in one state, and it is agreed that the security shall be executed and recorded in the state of the borrower's residence, the contract is complete and the papers are delivered to the lender when they are put in possession of the proper officer to be recorded, though they are subsequently mailed to the creditor.2 [648] How is a contract to be considered which is usurious where it was made, and also by the law of the place where, by its terms, it is to be performed by payment? If the inter[649] est allowed by the law of the place of performance is higher than that permitted by law where the contract was made, the parties may, as has been before stated, stipulate with a check for the discount at the rate of eight per cent. per annum, which was lawful in Pennsylvania. The note and interest were consequently received by the plaintiff in Pennsylvania, and all this was done in performance of a previous agreement which had been entered into in Pennsylvania between the plaintiff and the defendant. All that was done by the plaintiff in New York was simply in execution of that agreement, and as is said in Dickinson v. Edwards in citing Tilden v. Blair, the designation of the place of payment of the note was an incidental circumstance for the convenience of the maker and not an essential part of the contract or with the intent to affix a legal consequence to the instrument. It cannot be contended that a party who goes into another state and there makes an agreement with a citizen of that state for a loan or forbearance of money, lawful by the laws of that state, can render his obligation void by making it payable in another state according to whose laws the contract would be usurious. Neither can it be claimed that because the obligation, instead of being signed in the state where the contract was made, is signed in another state and sent by mail to the place of the contract, it must be governed by the usury laws of the place where it was signed." See Sheldon v. Haxtun, 91 N. Y. 124; Western Transportation & C. Co. v. Kilderhouse, 87 id. 430; Merchants' Nat. Bank v. Southwick, 67 How. Pr. 324; Bowen v. Bradley, 9 Abb. (N. S.) 395. In Hanrick v. Andrews, 9 Port. 9, a loan was made in New York, and the interest was paid there on it, and the bill there drawn payable in Alabama, without interest- and it was held to be governed by the law of New York, and usurious. The interest contract was made and performed in that state at the time of the loan. The court held that an instrument, as to its form, and the formalities attending its execution, the mode of construing it, the meaning to be attached to the expressions by which the parties have contracted, and the nature and validity of the contract, is subject to the law of the place where it is made; and that the law of the place where is to be executed must regulate its performance. 1 Merchants' Nat. Bank v. Southwick, 67 How. Pr. 324. 2 Kellogg v. Miller, 2 McCrary, 395. for the higher interest without incurring the penalties [650] of usury. But if the contract is made payable in another state for the mere purpose of evading the usury law of [651] the place where it was made the form of the transaction will not sustain it. The contract will be disposed of by the [652] law of the state in which it is made. The court will decide according to the real object of the parties. An action [653] was brought on a bill of exchange drawn in New York, payable in Alabama, for an antecedent debt, which included a sum in addition greater than the interest in either state for the time of forbearance. The court say, the defendants allege that the contract was not made with reference to the law of either state, and was not intended to conform to either; that a rate of interest forbidden by the law of New York, where the contract was made, was reserved on a debt actually due; and that it was concealed under the name of exchange in order to evade the law. If this defense be true, and shall be so found by the jury, the question is not which law shall govern in executing the contract, but which is to decide the fate of a security taken upon a usurious contract which [654] neither will execute. Unquestionably it must be the law of the place where the agreement was made and the instrument taken to secure its performance. It was remarked that a contract of this kind cannot stand on the same principles with a bona fide agreement made in one place to be executed in another. In the last mentioned case the agreement was permitted by the lex loci contractus; and will even be enforced there if the parties be found within that jurisdiction. But the same rule cannot be applied to contracts forbidden by its laws and designed to evade them. In such cases the legal consequences of such an agreement must be decided by the law of the place where the contract was made. What would be the fate of a contract made with express reference to the law of the place of payment, though stipulating interest above the rate allowed there, as well as where it was made, is not decided by that case. The contract, if intended to evade the usury law of New York, and usurious, if governed by that law, is void. But if made with reference to the law of Ala 1 Story's Conf. L., § 293a. VOL. I-49 2 Andrews v. Pond, 13 Pet. 65. bama, and usurious by it, it is not wholly void. A contract of the latter kind is in part enforced by that law. May parties in New York, where the limit of interest is seven per cent., make a contract in a transaction which legitimately extends into Alabama for the payment of money there at a rate exceeding both the rate of New York and that of Alabama, and have the benefit of the law of the latter state to determine their rights, if the defense of usury be made? In an Indiana case a resident of that state borrowed money there of a domestic corporation upon a draft drawn there on New York, specifying six per cent. interest for the time it had to run; it was discounted at the rate of twelve per cent., and the question was, by what law the fate of the contract was to be determined. It was held to be an Indiana contract because the transaction was a loan made there, and because the bill specified the Indiana rate of interest.1 A resident of Massachusetts applied to a citizen of New York for a loan, and the latter agreed to lend him a sum at [655] eight per cent. on security of real estate situate in Massachusetts; the lender wrote the borrower to send him the note and mortgage, which were accordingly sent, and the lender caused the loan to be paid over to the borrower in Massachusetts. Hence, the contract sued on had its legal inception in New York; and the consideration therefor, the loan, passed to the maker of the note in Massachusetts; the contract was held to be governed by the law of that state, though the agreed rate of interest was usurious by the law of both states. It was deemed a Massachusetts contract because the important facts of the transaction took place in that state. An important case in New York seems to answer the question just stated. A New York corporation negotiated a loan of two bank corporations of Philadelphia; the bargain was made in New York, and the contract for repayment, in the form of certificates of deposit, was made there, stating the deposit of the money loaned with the borrowing corporation in New York; these certificates were payable on time, at Philadelphia, with interest at six per cent., the legal rate in Pennsylvania. The loan was to be in depreciated paper, but was 1 Mix v. Madison Ins. Co., 11 Ind. 2 Pine v. Smith, 11 Gray, 38. 117. 3 Curtis v. Leavitt, 15 N. Y. 9-296 paid in an equivalent of cash funds; and the difference between the amount received and that stated in the certificates of deposit, it was claimed, rendered it usurious by the laws of both states. Without deciding absolutely whether the contract was usurious, a majority of the court concurred in the conclusion that if it was usurious by the laws of both states it should be governed by the law of Pennsylvania, where the loan was to be repaid. 1 In an Illinois case a suit in chancery was commenced for the purpose of settling the rights of different creditors in the proceeds of a mortgage given for their common benefit. The demand of one creditor, a bank, was upon acceptances of bills of exchange drawn and accepted in Indiana, and payable in New York. These bills were based upon actual transactions, namely, the shipment of hogs and cattle. Where the transactions took place does not very distinctly appear; but from some indications in the report it is inferred that they occurred in Indiana. Two of the bills were purchased by the bank with a reservation of seven and a half per cent. in- [656] terest, which was greater than the amount allowed by law in either Indiana or New York; and the question was discussed, by the law of which state the fate of the security should be determined. It was held that the law of Indiana was to govern because the contract was made there.2 1 Adams v. Robertson, 37 Ill. 45. 2 On a rehearing of this case the court adopted an opinion prepared by one of the judges who sat at the first hearing but not at the second. In this the writer said: "Great conflict of opinion has prevailed in respect to the laws affecting the validity of contracts made in one country but to be performed in another. The laws of a country where a contract is made are obligatory upon the parties; and, upon principle, no contract declared void by these laws ought to be enforced in any other country. As an exception to the rule, it has been held that no nation is bound to take notice of or to protect the revenue laws of another country; but this exception has no foundation in principle, although it is so firmly established that courts cannot now overturn it. No man ought to be heard in a court of justice to enforce a contract founded in or arising out of moral or political turpitude, or in fraud of the just rights of the country in which the contract was made. Story's Conf. L., p. 435. The laws of every country allow parties to enter into obligations with reference to the laws of the country where such obligations are to be performed; and although such obligations may not be in accordance with the laws of the country where they are made, as regards obligations to be performed in that country, they may be strictly in |