Court Opinion

ID: 6678957
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:18:51.33448+00
Date Added: 2024-06-11T16:00:47.195949
License: Public Domain

Mr. Justice Jones.
While concurring in the result, 1 am unable to concur in so much of the opinion of Mr. Justice Gary as holds the instrument in question non-negotiable, because of the provision relating to attorney’s fees. The stipulation is as follows: “And if this note is collected by suit, or placed in the hands of an attorney for collection, we promise to pay ten per cent, attorney’s fees for collection in *313addition to principal and interest.” While not expressly so stated, the whole agreement shows that the parties intended the ten per cent, attorney’s fees for collection to attach in a certain contingency after maturity. Now a note ceases to be negotiable at maturity. Therefore, a stipulation for attorney’s fees for collection after maturity does not import into the promise any element of uncertainty, affecting its negotiability.' Its negotiability had ended before the additional liability attached. Mr. Daniels, in his work on Negotiable Instruments (vol. 1, § 62, 4 ed.), says: “It seems paradoxical to hold that instruments, evidently.framed as bills and notes, are not negotiable during their currency, because when they cease to be current they contain a stipulation to defray the expense of collection. So far from tending to check the circulation of paper, such a provision adds to its value, and thus renders it more available for commercial purposes.” The Supreme Court of Georgia, speaking through Simmons, C. J., clearly expresses the true view thus: “The stipulation as to costs and attorney’s fees is not a part of the main engagement, but relates to the remedy in case of failure to comply with the contract, and is intended to compensate for the expense resulting from its breach. It does not become effective unless there is a failure to pay at the time specified, and it cannot then affect its negotiability, for negotiability in the full commercial sense closes at maturity.” This view is sustained0 by many authorities, which need not here be cited. I do not think this case is ruled by the case of Bank v. Strother, 28 S. C., 505, cited. In that case the stipulation was, “and also all counsel fees and expenses in collecting this note, if it is sued or placed in the hands of counsel for collection.” Chief Justice Mclver, speaking for the Court in that case, said: “If the paper, in addition to an obligation to pay a specified sum of money, contains also an obligation to pay another undefined sum of money even upon a contingency, that, it seems to us, will deprive it of the character of a note, under the statute of Anne.” Moreover, the instrument *314under consideration in Bank v. Strother expressly declared that the payees “have full power of declaring this note due, and take possession of said engine and saw mill at any time they may deem this note insecure, even before maturity of the same.” Here clearly was an uncertainty in the time of payment, and coupling this with the stipulation as to counsel fees and expenses in collecting, it was clear that Strother under the terms of the instrument was, in a certain contingency that might happen before the time fixed for payment, liable for an uncertain amount of counsel fees and expenses, since the instrument was liable to be declared due and placed in the hands of counsel for collection before its stated maturity. 'Besides this, Bank v. Strother was ruled by Read v. McNulty, 12 Rich., 445, because'of the stipulation,-“with current rate of exchange,” which imports uncertainty in the amount due at maturity, because the rate of exchange is variable. If Bank v. Strother is to be deemed authority for the view that uncertainty in an instrument subsequent to its maturity renders it unnegotiable, I am unwilling to go beyond the express limitation in that case, viz: that a promise to pay an additional undefined sum after maturity renders the instrument unnegotiable. In the case at bar the amount of attorney’s fees is not undefined, but is fixed aud certain. The better view, both in reason and the growing weight of authority, is that such a stipulation as the one under consideration, in no wise affecting the certainty of the obligation in all its parts at the time fixedfor payment, does not destroy the negotiability of the instrument intended or declared to be negotiable by the parties. The great importance of removing unreasonable restrictions on the negotiability of paper intended for commercial use should incline all courts, especially when not controlled by binding authority, to adopt a rule in harmony with the progress of commercial law.