Court Opinion

ID: 3594802
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:42:33.380097+00
Date Added: 2024-06-11T07:44:26.165326
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 268 
[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 269 
It is a general rule of international law, that the rights of the parties to a contract, as distinguished from theirremedies, are to be determined by the law of the place where the contract is to be performed. If a contract be made in one state or country, and it appears upon its face that it is to be performed in another, it will be presumed that the contract was entered into with reference to the laws of the latter, and those laws will be resorted to in ascertaining the validity, obligation and effect of the contract. This general rule, however, has its exceptions; one of which is, that where a contract is declared void by the law of the state or country where it is made, it can not be enforced as a valid contract in any other, though by its terms it was to have been performed there. Thus, assuming that the contracts in question had been made in Ohio, and that by the laws of that state such contracts are declared void, the courts of this state would be bound also to declare them void, though by their terms they were to have been performed here, and though if made here they would have been valid contracts. This exception is required by that just comity and public convenience upon which all international law is founded. A contract which is illegal and void, either by the law of the place where it is made, or that of the place where it is to be performed, *Page 270 
is illegal and void every where. (See Andrews v. Herriott, 4Cowen, 510, note a, and cases there cited.)
The statute of Ohio, upon which the defense rests, declares, in substance, that every insurance effected in that state by a foreign company, except as therein provided, shall be, to all intents and purposes, null and void. It is not claimed that the insurance, for which the notes in question were given, was effected in the manner prescribed in the statute. It follows, upon the principles already stated, that if it was effected in Ohio, the whole transaction was void. It is necessary, therefore, in the first place, to determine where the contracts upon which this action is brought were made.
Hatch was the agent of the company. He was authorized "to make surveys and receive applications for insurance." This was the extent of his authority, and beyond this he did not assume to act. He received the defendant's applications for insurance, with the premium notes executed by the defendant, and transmitted them to the company, at its place of business in the state of New-York. When did the transactions become obligatory upon the parties as contracts? In other words, when were the notes delivered to the company, so as to invest it with the legal right of enforcing payment according to their terms; and when did the company become bound to the defendant, as an insurer? The answer to these questions involves the solution of the inquiry where the contracts were made.
The applications of the defendant for insurance could in no sense have been regarded as a contract until they had been accepted by the company. The agent did not assume to do any thing which would bind the company. His office was to receive, and submit to the company, the defendant's propositions. Until the company acted upon such propositions, it was within the defendant's power at any time to recall them. Before the company had agreed to insure, the defendant, notwithstanding the execution and delivery of the notes and applications to the agent of the company, might have withdrawn his applications and upon his doing so, his notes would have been inoperative. Until then, the transactions were wanting in that mutuality *Page 271 
which is essential to a valid contract. But when the company having received the applications, accompanied with the notes, consented to insure, and issued its policies, what was before revocable became irrevocable. What was before a mere proposition, then became invested with the attributes of a contract, and from that time each party became bound for its performance. If this be so, the contracts are to be regarded as having been made when the company received and accepted the defendant's applications and issued and transmitted to him their policies. Of course, they were contracts made in the state of New-York, and not in Ohio. The insurance was not effected in Ohio, nor were the policies "signed, issued, or delivered" there. The case therefore is not within the prohibitions of the statute. This being so, it is immaterial where the notes were payable. If the notes had been payable at the defendant's store in Ohio, this would have constituted no ground of defence. Suppose the defendant had himself applied to the company, at Norwich, for insurance, and had made his premium notes payable at his own store in Ohio, would it be pretended that there was any thing unlawful in such a transaction? The statute does not prohibit notes, though given for insurance to a foreign company, from being made payable in Ohio. It only prohibits foreign companies from effecting insurance or issuing or delivering policies in that state. If this has not been done in this case, (and we have seen that it has not,) there is nothing to impair the validity of the defendant's notes.
I think the learned referee, before whom this case was tried, decided correctly, and that the judgment of the supreme court should be affirmed.
Judgment affirmed. *Page 272