Falls v. U.S. Savings, Loan & Bldg. Co.

• Decision Date: 25 November 1892
• Citation: 13 So. 25,97 Ala. 417
• Court: Alabama Supreme Court
• Parties: FALLS ET AL. v. UNITED STATES SAVINGS, LOAN & BLDG. CO.

13 So. 25

97 Ala. 417

FALLS ET AL. v. UNITED STATES SAVINGS, LOAN & BLDG. CO.

Supreme Court of Alabama

November 25, 1892

Appeal from city court of Birmingham; William W. Wilkerson, Judge.

Action by the United States Savings, Loan & Building Company against H. J. Falls and others to foreclose a mortgage. There was a judgment for plaintiff, and defendants appeal. Reversed.

In the first paragraph of the bill the complaint described itself as "a body corporate under the laws of the state of Minnesota, doing business in the county of Jefferson, state of Alabama." The defendants demurred to the bill, on the grounds-First, that it is not shown therein that the complainant had a known place of business in the state of Alabama at the time said loan was made; second, that it was not shown that the complainant had a resident agent or agents in the state of Alabama at the time the loan was made; and third, that the bill shows that the rate of interest charged against the defendants by the complainant was usurious. The court overruled each of these grounds of demurrer. In their joint answer the defendants alleged that the loan, to secure which the mortgage was made, was executed by Mattie D. Falls for the purpose of enabling her husband to get the money he desired, and that she subscribed for the said stock and executed the mortgage and note with this end in view. Their answer also contained the following averments: "The respondents, further answering, say that the entire transaction set forth in said bill took place in the county of Jefferson, Birmingham, Ala. That the defendants to said bill resided here, and the property in said mortgage is located here, and said complainant by its agent negotiated and conducted and concluded said transaction here. And this respondent says that said complainant had no place of business in said state, or agent authorized as required by the laws of the state of Alabama, and the effort [was] to locate said transaction in Minnesota, [and was intended] to avoid the laws of the state of Alabama in reference to these requirements, as well as the laws against usury. *** And respondents say that, at the time of making said contract said complainant had not filed in the office of the secretary of state, at the capitol at Montgomery, any instrument in writing as required by law designating a known place of business in this state, and an authorized agent residing thereat. And respondents say that for this reason said contract of mortgage was and is contrary to the policy of the state of Alabama, and void, and that said debt and every agreement relative thereto is and was void as to every part save the principal sum by reason of the usurious character of said contract as aforesaid."

R. H Pearson and John Vary, for appellants.

J. M McMaster and F. H.

Ewing, for appellee.

STONE C.J.

In Code 1886, § 2790, is this language: "The proceedings of any legislative body, purporting on the face of the book to be printed by authority of the government, state, or territory, are evidence without further proof." A book published in St. Paul, Minn., in 1879, was offered in evidence to prove the statute law of that state. It was objected to. The title page of the book has these words: "The General Statutes of the State of Minnesota. *** Prepared by George B. Young." Immediately succeeding the foregoing statement is found the following: "Edited and published under the authority of chapter 67 of the Laws of 1878 and chapter 67 of the Laws of 1879." These statutes are printed in full on the second leaf of the book. Chapter 67 of the statutes of 1878 declares that "the said statutes shall be compiled and published by a commission consisting of George B. Young and such others as he may associate with him, under the supervision and direction of the governor.". Chapter 67 of the Statutes of 1879 provides that "the edition of the General Statutes and other public laws of this state in force at the close of the legislative session of eighteen hundred and seventy-eight, (1878) prepared by George B. Young, pursuant to chapter sixty-seven (67) of the General Laws of Eighteen Hundred and Seventy-Eight, (1878), shall be competent evidence of the several acts and resolutions therein contained, in all courts of this state, without further proof or authentication." It is difficult to conceive of language which would more clearly express the fact that the laws found in said book were printed by authority of the state than is here shown. Our statute does not require that the state shall be the publisher. That it is done with its authority is enough. Clanton v. Barnes, 50 Ala. 260; Bradley v. Bank, 60 Ala. 252. There is nothing in this exception. There is, if possible, less merit in the objection to the introduction in evidence of the Minnesota Compilation of Statutes, published in 1891, so far as those statutes can be considered in this case. See the certificates in the first of the volume, made by the secretary of state and state librarian, and see section 261 of the book itself.

The real transaction in this case was a loan of money by a Minnesota corporation-the United States Savings, Loan & Building Company-to Mrs. Falls; and the negotiation and agreed contract were conducted and consummated in Alabama. The corporation had a place of business in Birmingham, Ala., and had an agent there-at. It had complied with our constitutional and statutory provisions. Const. art. 14 § 4; ^[1] Sess. Acts 1886-87, p. 102. ^[2] This compliance gave it a constitutional and legal right to transact business in Alabama.

An objection was reserved to the action of the city court in receiving in evidence what purports to be a certified copy of the act and proceedings by which appellee was incorporated. The precise objection is that the authentication is not a compliance with legal requirements. We hold it to be unnecessary to decide this question. That the appellant executed the note and mortgage, the collection of which by foreclosure is the purpose of this suit, is fully shown, and nowhere denied. We hold that the mortgage shows on its face that the United States Savings, Loan & Building Company is a corporation. This is shown in very many of its recitals, and this dispensed with all proof of its incorporation. So whether the transcript was properly authenticated or not was immaterial. Mrs. Falls had admitted complainant's corporate character by the execution of the mortgage. 1 Mor.

Priv Corp. § 39; 2 Mor. Priv. Corp. §§ 592, 774. Each separate government or state has its own legislative system and policy; and in determining and enforcing rights which originate out of our jurisdiction, comity requires that we shall admeasure the redress by the yardstick of the place where the right accrued. In entering into contracts, if nothing appear to the contrary, the law of the place silently becomes a part of the contract, and determines the measure of right it secures. This right by comity, however, has limitations. No state will enforce contracts or redress grievances entered into or suffered in another state or foreign country, if the enforcement involve a breach of legal or moral right as maintained in the law of the forum. When a corporation of foreign creation not only attempts to enforce rights before our tribunals, but goes further, and actually performs corporate acts within our jurisdiction, they can claim and exercise no exceptional rights or privileges which may have been conferred by the law of their creation, if such enforcement involves a breach of our own public policy or statutory system. The legislature of one state cannot confer rights and authorize their exercise beyond its own boundaries, unless they be in harmony with the general policy of the state or country in which the exercise is attempted. "The power of a corporation to act in a foreign country depends both upon the law of the country where it was created, and on the law of the country where it assumes to act. It has only such powers as were given to it by the authority which created it. It cannot do any act by virtue of those powers in any country where the laws forbid it so to act. It follows that every country may impose conditions and restrictions upon foreign corporations which transact business within its limits." Story, Confl. Laws, (8th Ed.) § 106, note a. In 2 Mor. Priv. Corp. § 959, is this language: "It is a fundamental principle that the laws of a state can have no binding force, pro-prio vigore, outside of the territorial limits and jurisdiction of the state enacting them." And in section 964 the same author says: "It has been held that, although a corporation be expressly authorized by its charter to charge a certain rate of interest upon its loans, it will nevertheless not be permitted to charge the same rate in a foreign state, if that would be contrary to the usury laws there in force." And in section 965 this author says: "Foreign corporations have no right by the law of comity to do acts within a state which are prohibited by the laws of that state to its own citizens or corporations engaged in a similar business." It is not our intention to determine in this case whether a building and loan association, incorporated and doing business in Alabama, can contract for and recover a greater rate of interest than 8 per cent. per annum. See our statutory system, commencing with section 1553 of the Code of 1886. What we do decide is that the statutes of Minnesota have no binding force with us; and any provision found in them which authorizes a corporation of their creation to contract for and recover more than 8 per cent. for the loan or forbearance of money is obnoxious to our statute ^[3] enacted for the prevention of usury. We hold, further, that the contract which gave rise...