Where a bill is drawn in one country and is payable Sec. 71in another, the due date thereof is determined according to Due date. the law of the place where it is payable. 9 protest evidence. (f) If a bill or note, presented for acceptance, or payable Foreign out of Canada, is protested for non-acceptance or non-pay- prima facie ment, a notarial copy of the protest and of the notice of dishonor, and a notarial certificate of the service of such notice, shall be received in all courts, as prima facie evidence of such protest, notice and service. 10 1 It has not been usual to define, by legislative enactment, the principles which are to guide the Courts in the interpretation of contracts which are controlled in their construction or effect by foreign laws. The municipal laws of a nation have no force extra-territorially; and foreign laws affecting contracts have been treated by the Courts as facts and circumstances of the same materiality to the determination of the rights of the parties, as are other facts which are required to be proved in litigation on a contract made within the jurisdiction. "It is difficult to conceive upon what ground a claim can be rested, to give to any municipal laws an extraterritorial effect, especially when those laws are prejudical to the rights of other nations, or to those of their subjects. It would at once annihilate the sovereignity and equality of every nation, which would be called upon to recognize and enforce them, or compel it to desert its own proper interests and duty to its own subjects, in favor of strangers, who were regardless of both. A claim so naked of any principle or just authority to support it, is wholly inadmissible: " Story on Conflict of Laws, s. 32. Every nation must judge for itself what is its true duty in the administration of justice in its domestic tribunals. It is not to be taken for granted that the rule of the foreign nation is right, and that its own rule is wrong. The true foundation on which the administration of international law must rest is, that the rules which are to govern, are those which arise from mutual interest and utility, from a sense of the inconveniences which would result from a contrary doctrine, and from a sort of moral necessity to do justice, in order that justice may be done to us in return Ibid., s. 35. 2 This clause deals with the "validity as regards requisites in form" of a bill of exchange; and prescribes (1) that the law of the place of issue shall determine the requisites in form of the bill, and (2) that the law of the place (or places) of acceptance or indorsement shall determine the requisites in form of such acceptance or indorsement. By the second clause of the proviso, where a bill issued out of Canada, and therefore a foreign bill, conforms, as regards form, to the laws of Canada, it may be treated as valid between all persons who become parties to it in Canada; Sec. 71. so that a foreign bill, although invalid in its own country, may, if otherwise in the Canadian form, be enforced against those who had become parties to it in Canada. Clause (b) deals with the contract of drawing accepting and indorsing a bill; and prescribes that the contract shall be interpreted according to the law of the place where such contract is made; but the proviso to this clause exempts from its operation inland bills indorsed in a foreign country. The opinion of jurists, which has been recognized in the decisions of the English and American Courts, is that the contract, in respect of the circumstances essential to its validity, and the rights and obligations which result from it, is governed by the law, either of the place in which it is made, or in that of which it is to be performed. The place in which it is made is presumed to be that in which it is to be performed; unless the contract expresses that it is to be performed in some other place. Hence the law of the country in which the contract is made is that by which it is to be entirely governed, unless its performance is to take place elsewhere. The jurists treat as the forms and solemnities of the contract, whatever formality or ceremony, either as to time or place, or manner of making the contract, or as to its form, whether it may be by parol, or must be in writing, its attestation or authentication, and whatever the law renders essential to the perfection and validity of the contract, and requires to be observed, as the condition on which it recognizes the existence of the contract: 3 Burge on Colonial and Foreign Law, 758. Thus if the law of the country where the contract is made, annuls a contract if made on a Sunday, or in a particular place, as a prison or a tavern; contracts made in violation of such law, would be void in whatever country they were sought to be enforced. So a contract made in Canada, which under the provisions of the Statute of Frauds, is required to be in writing and signed by the party to be bound, would be invalid in every other country. But a patrol contract made in a foreign country whose law authorizes a similar contract by parol, would be valid and enforceable in Canada. It does not appear to have been sanctioned as yet, that if both the parties to a bill are foreigners, they should be presumed to contract according to the law of the country with which they are acquainted, namely that of the place of their domicil, and not according to the law of the place with which they are unacquainted, though the contract may have been made there: 3 Burge on Colonial and Foreign Law, 776. 3 The cases make a distinction between a contract void for want of a stamp, by the law of the country where made; and its rejection for want of a stamp, as evidence in the Courts of such country. If for want of a stamp, a contract made in a foreign country is void, it cannot be enforced here; but if for want of the stamp required by the revenue laws of the foreign state, it cannot be received in evidence there, it is nevertheless, admissible in evidence here: Bristow v. Sequeville, 5 Ex. 275. The rule is the same in the United States, that if the stamp is required on a contract as a mere revenue imposition, the want of it will not be noticed in foreign Courts. But where a contract, for want of a stamp is void by Sec. 71. the law to which it is subject, it is void everywhere: Wharton's Conflict of Laws, s. 688. It has been laid down as a settled principle, that no nation is bound to protect, or to regard, the revenue laws of another country; and therefore a contract made in one country, by subjects or residents there, to evade the revenue laws of another country, is not deemed illegal in the country of its origin. This principle has been strongly argued against as being inconsistent with good faith, and the moral duties of nations: Story on Conflict of Laws, s. 257. Unfortunately from a very questionable subserviency to mere commercial gains, it has become an established formulary of the jurisprudence of the common law, that no nation will regard or enforce the revenue laws of any other country; and that the contracts of its own subjects made to evade or defraud the laws or just rights of foreign nations, may be enforced in its own tribunals: Ibid, s. 245. There would seem to be other reasons for not enforcing the revenue laws of a foreign country. Such laws are for the collection and enforcement of Crown or State dues, which are imposed upon the subjects of the foreign country for the support of their government. From necessity, it is the universal practice of nations to attach a penalty to a breach of their revenue laws; and it is a universally conceded maxim that the penal laws of one country are, under no circumstances whatever, to be executed in another; and even under our extradition treaties the "crime" must be one defined by Canadian law. Besides being penal, there is a variety of rules for the administration of the revenue laws of foreign nations. Some provide no relief against a breach; others give a limited time within which the duty or tax may be paid; others increase the quantum of the duty or tax, and allow it to be paid up to the time of trial. The forum of litigation would have no jurisdiction to grant relief, where such is permitted by the foreign law; and it has no machinery to enforce the original or increased duty or tax; for the foreign government has no revenue officer for the collection of such duty or tax within its jurisdiction. And if the forum recognized such revenue laws in general, it would have to enforce them in their details. The general words of this clause clearly exclude the rules of the foreign law as to evidence ; but they are extensive enough to prevent the recognition or application of any rule of a foreign law which makes the contract in a bill or note void, as well as inadmissible as evidence, for want of a stamp. ILLUSTRATIONS. A bill drawn by a domiciled Scotchman when in Paraguay upon a drawee in Scotland, who did not accept, in favor of a Frenchman residing in Paris, is an inland bill between drawer and payee, and the Court will not give effect to the law of Paraguay, that such bill is void for want of a stamp: Stewart v. Gelot, 9 Sess. Čas. 3 Sec. 1057. A holder may recover in an English Court on a bill drawn in France on a French stamp, although, in consequence of its not being in the form required by the French code, he had failed in an action which he had brought on it in France: Wynne v. Jackson, 2 Russ. 351. Sec. 71. This clause of the proviso is a modification of the rule prescribed in subs. (a); and allows the Court, in an action on a bill issued out of Canada, and therefore a foreign bill, to exclude evidence of the foreign law; and to deal with the case as between the parties who had negotiated, held or become parties to it, as if it were an inland bill. It sometimes happens that the evidence of foreign experts, peritus virtute officii, as to the law of their own country, is conflicting; and in the case of Re Marseilles R. & L. Co., 30 Ch. D. 603, the learned judge intimated that upon the evidence of French experts, he would have had great difficulty in saying what was the law of France, with regard to the facts before him. Such a case of difficulty was observed upon by Lord Langdale, M. R., in an earlier case as follows: If the utmost strictness were required in every case of proving foreign laws, justice might often have to stand still; and there may, therefore, be cases in which the judge might, without impropriety, take upon himself to construe the words of a foreign law, and determine their application to the case in question, especially if there should be a variance, or want of clearness, in the testimony: Nelson v. Bridport, 8 Beav. 537. Where the foreign law differs from our law, it should be pleaded: Hope v. Caldwell, 21 U. C. C. P. 241; Robertson v. Caldwell, 31 U. C. Q. B. 402. ILLUSTRATIONS. A bill was drawn and accepted in Paris, payable in England;-Held, that although the rule is that the validity and interpretation of a contract are governed by the law of the country where made, yet the consequences of non-payment are to be governed by the law of the country where the payment was contracted to be made; and the default having been made in England, interest was payable according to English, and not the French, law: Cooper v. Earl Waldegrave, 2 Beav. 282. B. acted as agent in Malta for A., for the purpose of buying and remitting to him in England, bills on England, on account of money received by B. in Malta. In the course of the agency he purchased bills in Malta, and indorsed them to A. without any reservation in the indorsement as to his liability-Held, that in the absence of special circumstances, shewing that any liability was intended by the general mercantile law, which must be taken to be in force in Malta, that B. was not liable to A. upon the bills being dishonored: Castrique v. Buttigieg, 10 Moore P. C. 94. A bill of exchange was drawn in France by a domiciled Frenchman in the French language, but in the form of an English bill; it was accepted by an English company, to which it was addressed, and was then indorsed in France by the drawer to an Englishman, but in a form which was invalid according to the French law;-Held to be an English bill of exchange for all purposes: Smallpage's and Brandon's Cases, 30 Ch. D. 596. 5 This clause deals with the interpretation of the contract of drawing, accepting, and indorsing, a foreign bill ; but the proviso exempts from its operation, inland bills indorsed in a foreign country. The contract of the drawer and indorser of a foreign bill is not an engagement to pay the bill at the place in which it is drawn, but to guarantee that it shall be accepted and paid there by the person on whom it is drawn; and on his default, that they will re-imburse the holder the prinicipal damages, in the place where the contract is made; that is where it was drawn in the one case, and in the other where it was indorsed: 3 Burge on Colonial and Foreign Law, 773. The lex loci contractus determines the rate of damages which are recoverable. The drawer is liable for those given by the law of the place where the bill is drawn ; but the indorser is liable for those given by the law of the place where he indorsed the bill: Ibid. But the case of indorsing an inland bill in a foreign country is appropriately made subject to the laws of Canada. An inland bill is, by its definition in s. 4 a home contract, and is not subject to foreign law; and therefore all its incidents as to form, and the rights and liabilities of the parties to it, must conform to the law of its own country. ILLUSTRATIONS. If a bill is drawn in one country and payable in another, and dishonored, the drawer is liable according to the lex loci contractus, and not the law of the country where the bill is made payable: Allen v. Kemble, 6 Moore, P. C. 31. A bill drawn, accepted and payable in England, was indorsed in France according to English law, but not according to the law of France. The drawer who was the indorser, and indorsee were, when the bill was made and indorsed, subjects of France, resident and domiciled there ;—Held, that the contract of the acceptor must be governed by the law of England, and therefore the indorsee could maintain an action in England against the acceptor: Lebel v. Tucker, L. R. 3 Q. B. 77. A bill was drawn in France upon and accepted by the drawee in London, and indorsed in France, but not so as to convey to the indorsee, according to the French law, any property in, or right to sue upon, the bill there in his own name ;-Held, that by the law of France such indorsement operated as a procuration, and entitled the indorsee to sue in his own name, and that therefore the acceptor was liable to an action in this country at the suit of such indorsee: Bradlaugh v. De Rin, L. R. 3 C. P. 538; L. R. 5 C. P. 473. See Story on Conflict of Laws, (8th ed.) p. 440n. A bill drawn and indorsed in England upon French subjects, was accepted by them in Paris, and was payable on the 5th October, 1870. Before that date, the French Government in consequence of the FrancoGerman war, enlarged the time for the payment and protesting of bills of exchange, by which the bill did not become payable until the 5th September, 1871;-Held, that the enlargement of the time of payment did not release the indorsers: Rouquette v. Overmann, L. R. 10 Q. B. 520. But see the next case. The rights and liabilities of the indorser and indorsee of a bill depend upon the law of the place where the contract of indorsement is made: Horne v. Rouquette, 3 Q. B. D. 514. By the law-merchant a bill of exchange may be indorsed abroad, and the indorser undertakes some liability in respect of such indorsement abroad which raises a contract between the immediate indorser and indorsee: Ibid. A. in England drew a bill on B. in a foreign country, which, after having been negotiated through another foreign country, was presented to B., who refused to pay because the law of the country in which he resided, prohibited such payment ;-Held, that the drawer was liable for the whole amount of the re-exchange between the different countries: Mellish v. Simeon, 2 H. Bl. 378. Sec. 71. |