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In Burlock v. Taylor, 16 Pick. 335, an assignment of personal property by a debtor in New York, valid under the laws of that State, was sustained against a subsequent attachment by a citizen of New York of property in Massachusetts, although the assignment would have been invalid if made in Massachusetts...
The courts of a State will not sustain the claim of attaching creditors, not citizens of the State whose process is invoked, in preference to the claim of an assignee obtaining title under the laws of the State of the insolvent debtor.'
An assignment executed in another State, will not always be enforced to the manifest injury of citizens of the State in which its enforcement is sought,' and a receiver of an insolvent corporation in the State where it was created cannot claim the proceeds of a policy of insurance on its property in another State, where the loss was made payable, as against an assignee for its creditors who has been appointed in the latter State.
The title acquired by an assignee for the benefit of creditors, although good as to the property assigned, is (as to assets in other states, whose policy it is not to recognize as against the claims of creditors of the assignee domiciled therein, the validity of general assignments with preferences) liable to be defeated by attachments sued out of the courts of such other states by creditors domiciled therein, to recover their debts out of such assets. But when declared fraudulent or invalid at the place where the property is situated they will not be sustained even if valid in the State where made;' or where a different law exists.
Clearly the courts of a State cannot be required to give effect to an assignment or transfer of property within it, or of debts due to its citizens, which is found to be contrary to the policy and 1 Cunningham v. Butler, 2 New Eng. Rep. 338, 42 Mass. 47; Bentley v. Whit
temore, 19 N. J. Eq. 462; Sanderson v. Bradford, 10 N. H. 265. 'Daniels v. Willard, 16 Pick. 36; Whipple v. Thayer, 16 Pick. 25; Martin v.
Potter, 11 Gray, 37; Richardson v. Forepaugh, 7 Gray, 546; Bagby v. At
lantic, M. &0. R. Co. 86 Pa. 291. 3 Platt v. Continental Ins. Co. 62 Vt. 166. *Kimball v. Lee, 4 Cent. Rep. 332, 40 N. J. Eq. 403. 5 Zipcey v. Thompson, 1 Gray, 243; Boyd v. Rockport Mills, y Gray, 406;
Bryan v. Brisbin, 26 Mo. 423: Varnum v. Camp, 13 N. J. L. 329. 6 Edgerley v. Bush, 81 N. Y. 199; Green v. Van Buskirk, 74 U. S. 7 Wall.
139, 19 L. ed. 109. See Howard Nat. Bank v. King, 10 Abb. N. C. 346; Atherton v. Ives, 20 Fed. Rep. 896.
laws of the State. To uphold the opposite doctrine would be to encourage fraudulent contrivances to defeat the operation of local insolvent or collection laws.
In Faulkner v. Hyman, 2 New Eng. Rep. 181, 142 Mass. 53, it was held that a voluntary assignment in trust for creditors, made in New York, and valid there, is not valid in Massachusetts, against an attachment, if such an assignment is one which, if made between citizens of Massachusetts, would be inoperative for want of compliance with legal requisitions. If the suit had been brought by New York plaintiffs alone, it was conceded that they could not be heard to deny the validity of the assignment, because as citizens of New York they would be bound by its laws even in Massachusetts.' If brought by Massachusetts creditors alone, it is equally true, as the assignment is not valid by the law of Massachusetts, that the attachment would prevail. All the parties are necessarily compelled to join in the action, and the New York plaintiffs are under no disability to sue in 'Massachusetts. The principle of comity, it was held, did not require the Massachusetts court to enforce the New York law, different from its own, against the just rights of its own citizens and to their prejudice, because if it failed to do so, the residents of New York would incidentally obtain a benefit which they could not otherwise. A Massachusetts court is not required to deny its own citizens their lawful rights for the sake of denying to residents of New York that which could be accorded them only by reason of respect for the laws of New York, if they had brought suit alone. Considering that the other plaintiffs were residents of Massachusetts, the fact that some are residents of New York was not considered sufficient to place the Massachusetts court under a duty to enforce the New York law as to assignments.
But the rule that contracts made out of the State, which contravene the policy of the State, will be held void, does not make void an assignment for creditors merely because it does not have annexed to it the schedule required in such cases by the laws of the State, as such schedules are not parts of the contract. Zipcey v. Thompson, 1 Gray, 245; Foster v. Goulding, 9 Gray, 52, 53; State
Bank Receiver v. Plainfield Bank, 34 N. J. Eq. 450. May v. Wannemacher, 111 Mass. 202. *Birdseye v. Baker, 2 L. R. A. 99, 82 Ga. 142. See Drucker v. Wellhouse, 2
L. R. A. 328, 82 Ga. 129.
The Supreme Court of the United States has shown a strong disposition to follow the ruling of a state court, in which the parties resided, where the conveyance for the benefit of creditors was executed and in which the bulk of the property is situated, sustaining such conveyance, even in case of a conveyance of doubtful validity. Especially is this true where the instrument was executed with the general acquiescence of creditors, and its purpose is equality between them, and it was not challenged for years, and the trustee, on the faith of its validity, assumed large liabilities, and carried on business to an enormous extent, and the creditors accepted payment resulting therefrom. Indeed, where a debtor, having large and scattered properties, and being much embarrassed, transfers his property for the benefit of his creditors equally, equity requires that any creditor who is not satisfied with the provisions of such transfer shall act promptly in challenge thereof, or else be adjudged to have waived any right of challenge to the instrument.'
$ 12. Questions of Commercial Law, Rule in United States Supreme Court.-But the Supreme Court of the United States has declined to be bound by the decision of a state court where such decision “is not based on a statute of the State, nor on any rule of law affecting title to lands, nor any principle which has become a settled rule of property, but on those principles of pub. lic policy designed for the protection of the State or the public, of which it must judge for itself, as the state courts do when the question is fairly presented.” :
The courts of the United States are not controlled by the decisions of state courts on questions of general commercial law.'
On any question depending upon mercantile law, and not alone on local statute or usage, the courts of the United States are not bound by the decisions of the courts of a State.“
Decisions of state courts are not binding upon questions con"Jenck: v. The Quidnick Co. 135 U. 8. 457, 34 L. ed. 200. "Delmas v. Merchants Mut. Ins, Co. 81 U. S. 14 Wall. 661, 20 L. ed. 757. 3 Brooklyn City & N. R. Co, v. Nat. Bank of the Republic, 102 U. S. 14, 26 L.
ed. 61; Watson v. Tarpley, 59 U. S. 18 How. 517, 15 L. ed. 509; Mercer County v. Hackett, 68 U. S. 1 Wall. 83, 17 L. ed. 548; Pine Grove Tup. v. Tulcott, 86 U. S. 19 Wall. 666, 22 L. ed. 227; Oates v. First Nat.
Bank, 100 U. S. 239, 25 L. ed. 580. *Liverpool & G. W. Steam Co. v. Phenix Ins. Co. 129 U. S. 397, 32 L. ed. 788.
cerning contracts of insurance, those being questions of general commercial law.'
Upon the general principles and doctrines of common jurisprudence, it is the duty of this court to form an independent judgment.
What constitutes a contract of carriage is not a question of local law upon which the decision of a state court must control. It is a matter of general law, upon which this court will exercise its own judgment.
The decision of the state court holding a contract invalid on grounds of public policy is not binding on the Supreme Court of the United States.'
If the decision of the existence of an alleged contract requires a construction of the State Constitutions and laws, this court is not necessarily governed by previous decisions of the state courts, except where they have been so firmly established as to constitute a rule of property.
Subsequent fluctuations in the construction of a Statute, by the courts of the originating State or country, though they may be entitled to great respect, are not within the meaning of the rule.
This principle applies with equal force to all contracts which come within its jurisdiction.”.
In a recent case the Supreme Court of Pennsylvania has questioned this line of ruling.”
Plaintiff, being the proprietor of a circus, made a special contract with defendant for the transportation of a number of his own cars upon certain conditions and terms, elaborately set out in writing, among which was a stipulation that in consideration that the service was to be performed "for much less than the ordinary, usual and legal rates charged other parties for a like amount of transportation,” the plaintiff released the defendant from all liability for or on account of loss, damage or injury to any of the animals, property or things thus transported, “although such loss, damage or injury may be caused by the negligence of the (defendant), its agents or employés.” Damage having occurred by the negligence of defendant, plaintiff brought this suit, and the sole question was whether it could be maintained in the face of the stipulation above set forth.
Carpenter v. Providence Wash. Ins. Co. 41 U. S. 16 Pet. 495, 10 L. ed. 1044. 'Pana v. Boroler, 107 U. S. 529, 27 L. ed. 424. 3 Michigan Cent. R. Co. v. Myrick, 107 U. S. 102, 27 L. ed. 325. Delmas v. Merchants Mut. Ins. Co. 81 U. S. 14 Wall. 661, 20 L. ed. 757. Louisville & N. R. Co. v. Palmes, 109 U. S. 244, 27 L. ed. 922. “Cathcart v. Robinson, 30 U. S. 5 Pet. 264, 8 L. ed. 120; Endlich, Interpre
tation of Statutes, 519. "Carroll Co. v. U. 8. 18 Wall. 71, 21 L. ed. 771; Fairfield v. Gallatin Co. 100
U. S. 53, 25 L. ed. 546; Douglas8 v. Pike Co. 101 V. S. 685, 25 L. ed. 971. *Forepaugh v. Delaware, L. & W. R. Co. 5 L. R. A. 508, 128 Pa. 217.
The contract was made, was to be performed, and the alleged breach occurred in New York. No possible element was wanting, therefore, to make it a New York contract. It is admitted that in New York the stipulation is valid, and this action could not be maintained.
Why, then, it is asked, should plaintiff, by stepping across the boundary into Pennsylvania, acquire rights which he has not paid for, and his contract does not give him?
It is argued that the validity of this contract is a question of commercial law, and therefore the mere decisions of the New York courts are not binding, and in the absence of any statute in New York expressly authorizing such a contract, the courts of this State must follow their own views of the commercial, as part of the general common law, though different views may be held as to such law by the courts of New York.
As this argument is one which is frequently advanced, and affects a number of important questions, it is, the court announces, time to say plainly that it rests upon an utterly inadmissible and untenable basis. The court deny that there is such a thing as a general commercial or general common law, separate from and irrespective of a particular State or government whose authority makes it law. It is said that law is a rule prescribed by the sovereign power. By whom, it is asked, is a general commercial law prescribed, and what tribunal has authority or recognition to declare or enforce it outside of the local jurisdiction of the government it represents ? Even the law of nations, the widest reaching of all, is said to be a law only in name. It has but a moral sanction, and the only tribunal that undertakes to enforce it is the Cragin v. New York Cent. R. Co. 51 N. Y. 61; Maynard v. Syracuse, B. &
Ñ. Y. R. Co. 71 N. Y. 180; Wilson v. Nero York Cent. & H. R. R. CO. 97