Burns Mortgage Co. v. Hardy

94 F.2d 477, 1938 U.S. App. LEXIS 4441
CourtCourt of Appeals for the First Circuit
DecidedJanuary 26, 1938
DocketNo. 3304
StatusPublished
Cited by3 cases

This text of 94 F.2d 477 (Burns Mortgage Co. v. Hardy) is published on Counsel Stack Legal Research, covering Court of Appeals for the First Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Burns Mortgage Co. v. Hardy, 94 F.2d 477, 1938 U.S. App. LEXIS 4441 (1st Cir. 1938).

Opinion

BINGHAM, Circuit Judge.

This is an appeal from a judgment of the federal District Court for New Hampshire in an action at law in favor of the defendant. It appeárs that on ' September 17, 1936,-the plaintiff brought an action of covenant upon a promissory note for $5,-666.67, payable in twelve quarterly installments, alleged to be under seal and to have been executed and delivered for a valuable consideration .October 10, 1925, to the Atlantic Shores Corporation, a Florida corporation having its principal-place of business in that slate, and setting forth a copy of the note, payments of principal and interest as indorsed thereon, signed by Edwanj H. Hardy, after whose name is printed the word “seal” inclosed within a parenthesis, but with no wax seal or wafer attached. It was further alleged that, prior to maturity, the payee, for a valuable consideration, indorsed and delivered the note to one Mary V. Reardon, without notice of any infirmity in the note or defect in the title thereto, who, after maturity, for a valuable consideration, transferred and delivered the same to the plaintiff. Subsequently the original note was filed in the case disclosing that no wax seal or wafer was attached to it following the signature of the maker, but bore the word “seal” printed as above stated.

The defendant, on March 15, 1937, demurred to the declaration on the grounds (I) that the plaintiff's declaration did not set forth facts sufficient, to constitute a cause of action; and (2) that the alleged cause of action was barred by the statutes of limitation, chapter 329 of the New Hampshire Public Laws, and particularly section 3 thereof.

Thereafter a hearing was had on the demurrer. and, on March 31, 1937, the District Court rendered an opinion in which it held .that inasmuch as, under the law of ' New Hampshire, the law of the forum, an instrument not bearing a wax seal or wafer is not a specialty or contract under seal (Douglas v. Oldham, 6 N.H. 150; Cutts v. Frost, Smith, N.H., 309) and as the law of the forum determined the form of action to be brought (Le Roy v. Beard, 8 How. 451, 12 L.Ed. 1151; Bank of The United States v. Donnally, 8 Pet. 361, 8 L.Ed. 974; Douglas v. Oldham, supra; Cutts v. Frost, supra) the declaration should have been in assumpsit and not in covenant, and sustained the first ground of demurrer. As to the second ground, after setting out sec[479]*479tions 3 and 4 of chapter 329 of the New Hampshire Public Laws, it considered the question whether the six-year limitation to personal actions prescribed in section 3, chapter 329 or section 4 of that chapter permitting an action on a contract under seal to be brought within twenty years after the cause of action accrued, applied, and reached the conclusion that, inasmuch as statutes of limitation were remedial in character they were governed by the law of the forum (Bank of United States v. Donnally, supra; McElmoyle v. Cohen, 13 Pet. 312, 10 L.Ed. 177; Connecticut Valley Lumber Company v. Maine Central Railroad, 78 N.H. 553, 103 A. 263), and as the note sued on was, under New Plampshire law, a simple contract and not a contract under seal, the action was barred by force of section 3; it not having been brought within six years after the cause of action accrued.

Thereafter, on April 3, 1937, the plaintiff moved to amend its declaration by striking out the word “covenant” in the first line and inserting in its place the word “assumpsit” and by inserting after the word “seal” in the last line of the first paragraph the words “under the laws of the place of making.” After the amendment was made, the plaintiff was granted a rehearing, but at its close the court adhered to its previous decision.

The plaintiff, before amending its declaration, took no exception to the ruling of the court that the note, under the law of New Hampshire, was a simple contract, not one under seal, and that the declaration should be in assumpsit, not covenant. And in its argument and brief on this appeal it admits that the form of action is remedial and governed by the law of the forum and that, in determining the form of action, the District Court was authorized to determine whether, by the law of the forum, the contract sued upon was a simple contract and not a contract under seal, basing its action for so doing upon Le Roy v. Beard, 8 How. 451, 12 L.Ed. 1151, and other cases cited. This appears in its brief (p. 17) where it says: “In yiew of the fact that the rule of Le Roy v. Beard, supra, is so well settled, the appellant took no exception to the ruling of the Court below on the first ground of demurrer, and amended its declaration from covenant to assumpsit. The Court was undoubtedly correct, under the law as it stands today, in deciding that so far as the form of. action was concerned, the law of New Hampshire decided whether or not the note was sealed.” See Restatement of the Law, Conflict of Laws, § 587, b. 1; 11 American Jurisprudence, Conflict of Laws, §§ 186, 188.

The plaintiff’s position as to the ■ second ground of demurrer relating to the statute of limitations is' that, although it concedes that the law of the forum governs the form of action, including the question whether the instrument is a simple contract or one under seal, it is not inconsistent for it to contend that the instrument is a sealed one for the purpose of the statute of limitations. But there can be no doubt that the position taken as to the statute of limitations is entirely inconsistent with that taken as to the form of action, for, in either case, the question is one of procedure depending upon the law of the forum, and if, according to that law, the contract is a simple contract calling for a personal action, as the District Court here determined when considering the first ground of demurrer, then there is no question to be determined as to what statute of limitations applies, for section 3 of chapter 329 points out that the six-year limitation applies. Section 3 provides:

“Personal Actions. Actions of trespass to the person and actions for defamatory words may be brought within two years, and all other personal actions within six years, after the cause of action accrued, and not afterward.”

Applying that statute, the plaintiff’s action is barred. 11 American Jurisprudence, Conflict of Laws, § 127.

But if the question of the form of action had not been raised and decided in the court below and the defendant had only pleaded the statute of limitations, the court would then have had to determine whether the applicable statute of limitations was the six-year limitation or the twenty-year limitation provided for in section 4. Section 4 reads as follows:

“Specialties. Actions' of debt upon judgments, recognizances and contracts under seal may be brought within twenty years after the cause of action accrued, and not afterward.”

In determining whether the latter section would apply, the court would have to construe the section and determine what the words “contracts under seal,” as there employed, mean, and, as the words are embraced in a New Hampshire statute, the [480]*480question is necessarily to’be determined by the law of that state. It cannot, with reason, be contended that the Legislature of New Hampshire, in enacting section 4, intended that the words “contracts under seal” should define or embrace any contracts other than those which were regarded by the laws of New Hampshire to be contracts under seal. It surely did not mean to include within those wo.rds contracts which might be regarded as under seal by the laws of Florida, statutory or otherwise, or of any other state or country.

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Bluebook (online)
94 F.2d 477, 1938 U.S. App. LEXIS 4441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/burns-mortgage-co-v-hardy-ca1-1938.