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CHAPTER XVI.

LOCUS CELEBRATIONIS; LOCUS SOLUTIONIS; AND LOCUS CONSIDERATIONIS.

§ 157. Locus Celebrationis

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Place where Contract becomes finally Binding. In most cases, the locus celebrationis of an executory contract is perfectly plain. There is nothing to complicate the situation when the parties meet together in a given State, and then and there enter into a binding agreement. The place where the binding contract is thus entered into will be the locus celebrationis.

But frequently cases arise in which overtures are made or the preliminaries are discussed in one State, while the contract becomes finally binding only after some other act is done elsewhere; or cases may arise where the parties to the contract are widely separated from each other, the contract being entered into by correspondence or telegram, or through an agent. In cases of this sort more difficulty is experienced in ascertaining the locus celebrationis of the contract.

It may be laid down as a general proposition that a contract is not "made" until it becomes complete and binding upon the promisor. As soon as the final act is done, and the minds of the parties meet, the promisor becomes irretrievably bound, and the contract is made. The situs of that final act necessary to bind the promisor is the locus celebrationis of the contract.1

1 Milliken v. Pratt, 125 Mass. 374, 28 Am. Rep. 241; Hill v. Chase, 143 Mass. 129, 9 N. E. 30; Shoe & Leather Bank v. Wood, 142 Mass. 563, 567, 8 N. E. 753; Bell v. Packard, 69 Me. 105, 31 Am. Rep. 251, 252; Western Transportation Co. v. Kilderhouse, 87 N. Y. 430, 438; Wayne Co. Bank v. Low, 81 N. Y. 566, 572, 37 Am. Rep. 533; Wood v. Ins. Co., 8 Wash. 427, 36 Pac. 267; Barrett v. Dodge, 16 R. I. 740, 19 Atl. 530; Keiwert v. Meyer, 62 Ind. 587, 30 Am. Rep. 206, 208; Hart v. Wills, 52 Ia. 56, 2 N. W. 619, 621; Voorheis v. Society, 91 Mich. 469, 51 N. W. 1109; State Mut. Ins. Co. v. Brinkley Co., 61 Ark. 1, 29 L. R. A. 712; Mut. Ben. Ins. Co. v. Robison,

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In Waldron v. Ritchings, the plaintiff, who was at the time in New York, agreed with the defendant, the manager of an opera in Philadelphia, to go there and make her debut. She was assured, if she did not fail in the estimation of the public and the press, of an engagement upon terms specified in the negotiation between the parties. It was held that the contract was not made in New York, but in Philadelphia, upon the fulfilling the test of success.

Notes, deeds, and other contracts of that character do not become completed and binding contracts merely by the fact of the promisor's signing them. They must also be delivered. Hence, if the signing occurs in one State, while the delivery takes place in another, the latter State, not the former, is the locus celebrationis. Thus, where a bond for the purchase price of land in Delaware was signed and sealed in Pennsylvania by a married woman, but was delivered to the payee in Delaware, the locus celebrationis of the bond was held to be Delaware, not Pennsylvania.

So, the place where an offer is accepted (until which acceptance it is not binding) is the locus celebrationis of the contract, being the place where the minds of the parties meet. Hence, if

54 Fed. 580; Knights, etc. Indemnity Co. v. Berry, 1 C. C. A. 561, 50 Fed. 511, 513; Hicks v. Ins. Co., 9 C. C. A. 215, 60 Fed. 690, 692; Tilden v. Blair, 21 Wall. 241, 246. But see Beverwyck Brewing Co. v. Oliver, 69 Vt. 323, 37 Atl. 1110.

29 Abb. Pr. N. s. (N. Y.) 359; s. c. 3 Daly, 388.

3 Freeman's Appeal, 68 Conn. 533, 37 Atl. 420; Akers v. Demond, 103 Mass. 318, 324; Hubbell v. Land Co., 95 Tenn. 585, 32 S. W. 965; Watson v. Lane, 52 N. J. L. 550, 20 Atl. 894, 895; Sheldon v. Haxtun, 91 N. Y. 124; Cook v. Litchfield, 9 N. Y. 279; Buchanan v. Bank, 5 C. C. A. 83, 55 Fed. 223. See Suit v. Woodhall, 113 Mass. 391, 394.

4 Baum v. Birchall, 150 Penn. St. 164, 24 Atl. 620. See also Phipps v. Harding, 17 C. C. A. 203, 70 Fed. 468, 471; Carnegie Steel Co. v. Construction Co. (Tenn.), 38 S. W. 102; Bell v. Packard, 69 Me. 105, 31 Am. Rep. 251, 252; Lawrence v. Bassett, 5 Allen (Mass.), 140.

Armstrong v. Best, 112 N. C. 59, 17 S. E. 14; Hyde v. Goodnow, 3 N. Y. 266, 270; Vassar v. Camp, 11 N. Y. 441; Trevor v. Wood, 36 N. Y. 309; Suit v. Woodhall, 113 Mass. 391, 394; Whiston v. Stodder, 8 Mart. (La.) 95, 13 Am. Dec. 281; Dord v. Bonaffee, 6 La. Ann. 563, 54 Am. Dec. 573; Claflin v. Meyer, 41 La. Ann. 1048, 7 So. 139.

a person in one State sends to a person in another a letter or telegram, containing an offer or proposal, which the latter there accepts by letter or telegram, the contract is complete when the letter of assent is deposited in the post office, properly addressed, or when the reply message is delivered to the telegraph company for transmission. The locus celebrationis is thus definitely fixed. at the place where the letter of acceptance is mailed or the message delivered for transmission, and not the place where it is received or addressed, or where the offer was first made."

By parity of reason, the question whether goods shipped in. one State upon an order from another constitutes a sale in the former State depends upon the further question whether the parties have done every act necessary to make a binding sale. before the goods leave the former State. Thus if the consignor there delivers the goods to a carrier as the agent of the consignee, the sale is complete there; if the carrier is the agent of the consignor, the sale only becomes complete upon the delivery by the carrier to the consignee or his agent, and the place where that occurs is the locus celebrationis. So also, if the goods are sent C. O. D., the locus celebrationis of the contract of sale is the place where the assignee accepts them.8

Upon the same reasoning, it would seem clear that a contract, intended to create a joint obligation, made by one promisor in one State, and by him sent to another promisor in another State to be signed by him there, should be regarded as made in the latter State, for only upon the signing of the contract by the second promisor does the contract become binding upon either."

• Milliken v. Pratt, 125 Mass. 374, 28 Am. Rep. 241; Vassar v. Camp, 11 N. Y. 441; Wayne Co. Bank v. Low, 81 N. Y. 566, 572; Sheldon v. Haxtun, 91 N. Y. 124, 131; Bell v. Packard, 69 Me. 105, 31 Am. Rep. 251, 252; Baum v. Birchall, 150 Penn. St. 164, 24 Atl. 620; Perry v. Iron Co., 15 R. I. 380, 5 Atl. 632; Atlantic Phosphate Co. v. Ely, 82 Ga. 438, 9 S. E. 170; Garrettson v. Bank, 47 Fed. 867, 869; Kellogg v. Miller, 13 Fed. 198, 200.

7 Webber v. Howe, 36 Mich. 150, 24 Am. Rep. 590; Dolan v. Green, 110 Mass. 322. See ante, § 128.

8 State v. O'Neil, 58 Vt. 140, 56 Am. Rep. 557. But see State v. Carl, 43 Ark. 353, 51 Am. Rep. 565.

9 In Bryant v. Edson, 8 Vt. 325, 30 Am. Dec. 472, it was said, under cir. cumstances of this kind, that the locus celebrationis of the contract is the

On the other hand, if the contract is not joint, but several, or joint and several, the locus celebrationis of the contract is severable, each party's contract having its locus celebrationis at the place where it is entered into.10

§ 158. Same-Contracts of Agents.- Questions also frequently arise as to the locus celebrationis of contracts made by agents. It is to be noted, in the first place, that an implied authority of an agent to enter into a contract binding upon his principal depends upon the law of the place where the general authority is given or the agency is created, not that of the place where the alleged contract is entered into.1 In Pope v. Nickerson, the question arose as to the authority of the master of a ship to bind the owner by certain bottomry bonds valid by the law of the port, but not by the law of the principal's country. The court held that the law of the latter State must govern the extent of the agent's authority. In the course of his opinion, Judge Story said: "Any other rule would subject the principal to the most alarming responsibility, and be inconsistent with that just comity and public convenience, which lies at the foundation of private international law. . . . The authority confided by the principal is in all such cases measured, as to the interpretation and extent of that authority, by or according to the law of the place where it is given by the lex loci and not by the laws of a foreign country, of which the principal is or may be wholly ignorant, and by whose regulations he is not bound."

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But if a person acts as an agent in one State for a person in another, which act is unauthorized, but is afterwards ratified, or the principal becomes otherwise estopped to deny the agent's

State where the eontract is first signed. But in that case the real inquiry was not as to the locus celebrationis, but as to the locus solutionis, which is always a question of the parties' intention. See post, § 159.

10 Glenny Glass Co. v. Taylor, 99 Ky. 24, 34 S. W. 711. See Pugh v. Cameron, 11 W. Va. 523, 532; Findley v. Hall, 12 Ohio, 610.

1 Pope v. Nickerson, 3 Story, 465, 476; Freeman's Appeal, 68 Conn. 533, 37 Atl. 420, 421. See Arayo v. Currell, 1 La. 528, 20 Am. Dec. 286, note. And so it is also with an express authority, where the question is as to the principal's capacity to give the authority. Freeman's Appeal, supra.

23 Story, 465, 476.

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authority, it would seem that the scope of the authority in such case should depend upon the law of the State where the agent's act is done. Thus, in McMaster v. Ins. Co., a statute of Iowa provided that " any person who shall hereafter solicit insurance ... shall be held to be the soliciting agent of the insurance company, anything in the application or policy to the contrary notwithstanding." It was held that a foreign insurance company should be bound by the acts in Iowa of the person liciting" the insurance, though it was expressly stipulated in the policy that the party who brought the insurer and insured together was the agent of the insured, and that the company should not be held responsible for his acts or declarations.

In Brooke v. R. R. Co., a shipping clerk of a railroad company, in collusion with a consignor, issued in New York a fictitious bill of lading, with the consignor's draft upon the consignee attached, without the actual receipt of the goods therein specified. The consignee lived in Philadelphia. He paid the draft and then sued the railroad company because of the fraudulent act of its agent. It was held by the Pennsylvania court that the liability of the principal for the agent's act was to be determined in accordance with the law of New York, the place where the agent's fraud was committed.

The same principles apply also with respect to the liability of a firm for the acts or contracts of a partner. If by the law under which the partnership is created the liability of a member of the firm is limited, this limited liability will not be increased merely because the act or contract of another of the partners or of the firm itself is done or made in another State, under whose laws the members of the firm would be liable to the fullest extent.

Thus, in King v. Sarria," the defendant, Sarria, resided in Cuba, and was a special partner of a firm organized and doing business there. The Spanish law (prevailing in Cuba) touching limited partnerships had been complied with so as to limit

* 78 Fed. 33, 37. See also Mut., etc. Ins. Co. v. Robison, 54 Fed. 580; N. Y. Life Ins. Co. v. Russell, 23 C. C. A. 43, 77 Fed. 94.

108 Penn. St. 530, 1 Atl. 206, 208.

69 N. Y. 24, 25 Am. Rep. 128. See Baldwin v. Gray, 4 Mart. N.s. 192.

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