Great Lakes Transit Corporation v. Marceau

154 F.2d 623, 1946 U.S. App. LEXIS 3204

• Court: Court of Appeals for the Second Circuit
• Decided: March 28, 1946
• Docket: 191
• Status: Published

Opinions

FRANK, Circuit Judge.

1. The Court below found that the parties to the Levisohn-IIeirich retainer intended that any action on the claim should be brought in New York. The compensation proceedings could have been instituted nowhere else, and the Transit Corporation’s principal office is located there. Levisohn’s testimony as to where ihe parties contemplated the bringing of the action is so equivocal that the finding by the trial judge, who heard the testimony on that point, does not appear to us to have been “clearly erroneous.”

If we assume that State law governs, pursuant to Dickinson v. Stiles, 246 U.S. 631, 38 S.Ct. 415, 62 L.Ed. 908, Ann.Cas. 1918E, 501, and that the New York rule of Conflict of Laws therefore applies, pursuant to Klaxon Co. v. Stentor, 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477, we reach the conclusion that the Illinois statute on which Levisohn bases his claim is irrelevant. In Swift & Co. v. Bankers Trust Co., 280 N.Y. 135, 19 N.E.2d 992, 995, the court said that where the parties have not otherwise agreed, “matters bearing upon the * * * interpretation and validity of contracts * * * are determined by the law of the place where the contract is-made,” while “all matters connected with its performance * * * are regulated by the law of the place where the contract * * * is to be performed.” It then went on to say: “The formulation of these general principles has not removed uncertainty and doubt in their application. ‘Interpretation’ of a contract and its manner of performance are so intertwined that the courts often determine pragmatically the question of whether the law of the place where the contract was made or the law of the place where the contract by its terms is to be performed regulates particular matters which ‘bearing upon the interpretation’ of a contract are at the same time ‘connected with its performance.’ Perhaps pragmatic determination may in such cases be indicated by the nature of the problem, and the test whether one rule or the other produces the best practical result may be the safest guide in the search for the intention, actual or assumed, of the parties.” Cf. Goodrich, Conflict of Laws (1927) 246.²

We have found no decisions in New York relating to an agreement such as the one now before us. We think that the New York courts would hold that it is to be interpreted according to the New York internal “law” and not according to Illinois “law.” ³ Whether, if we were free to do so, we would employ the same doctrine of conflict of laws is beside the point. Many decisions in that field of law are, in most jurisdictions, based upon fiction, including much talk about the presumed intention of the parties.⁴ But whether we like it or not (assuming that “federal law” is not here applicable), we must follow what we believe to be the New York rule.

We arrive at the. same conclusion if we regard the agreement as an assignment: It was not an assignment of a contract right but of an interest, by way of lien, in a claim arising from a tort,⁵ and the assignee was to perform future services in New York. In those circumstances, we believe that the New York “law” governs.⁶ Under that “law,” Levisohn has no lien on the judgment recovered by Marcean, as Levisohn did not commence or prosecute any action on Márceau’s behalf.⁷ Consequently we need not decide whether Garrett v. Moore-McCormack, 317 U.S. 239, 63 S.Ct. 246, 87 L.Ed. 239,⁸ over-rules Dickinson v. Stiles, supra, which held that a lawyer’s lien attaching to a judgment obtained under the Federal Employers’ Liability Act, 45 U.S.C.A. § 51 et seq., is a matter to be governed by State law. For, if the Dickinson case were dead, and if “federal law” were applicable, we would reach the same result: Whatever the “federal law” as to lawyers’ “charging liens” may be, we have no doubt that it does not confer such a lien upon a lawyer who has neither brought nor won the suit

2. As there- was substantial ground for concern by the plaintiff over its ability to pay the judgment to Marceau in full discharge of its liability, the bringing of this suit under the Interpleader Act, 28 U.S.C.A. § 41(26), was justified. The plaintiff was therefore entitled to an injunction, and also to a small allowance for attorney’s fees, $100 on this appeal, plus whatever, if anything, shall, on remand, appear to the Court below to be justified. New York Life Insurance Co. v. Miller, 8 Cir., 139 F.2d 657.

Plaintiff chose to retain the use of the $4500.00, and rather than pay the money into court, it" gave a bond. Plaintiff is entitled to receive the cost of the premiums on that bond, but not to an order stopping the running of the interest against it.

Affirmed as to Levisohn; modified in part, affirmed in part, and remanded as to Great Lakes Transit Corp.

2 See also Zwirn v. Galento, 288 N.Y. 428, 43 N.E.2d 474, citing Dyke v. Erie Ry. Co., 45 N.Y. 113, at page 116, 6 Am.Rep. 43, where it was said: “The lea; loci contractus determines the nature, validity, obligation and legal effect of the contract, and gives the rule of construction and interpretation, unless it appears to have been made with reference to the laws and usages of some other State or government, as when, it is to he performed in another place, and then in conformity to the presumed intention of the pwrties, the law of the place of performance furnishes the rule of interpretation.” (Emphasis added.)

3 We are fully cognizant of the fact that the Illinois conflicts rule is not here applicable, but it is interesting to note that the Blinois cases consistently apply the Illinois Attorneys’ Lien Act in comparable situations. See Smith v. American Bridge Co., 194 Ill.App. 500, injury in Indiana, retainer contract made in Indiana, suit to be brought in Illinois; McGlynn & McGlynn v. Louisville & N. R. Co., 313 Ill.App. 396, 40 N.E.2d 539, injury in Kentucky, contract made in Ohio, suit to be brought in Illinois.

4 As to the large element of fiction in .discussion of the parties’ intention, see Beidler & Bookmyer, Inc. v. Universal Ins. Co., 2 Cir., 134 F.2d 828, 830; Kulukundis Shipping Co. v. Amtorg Trading Co., 2 Cir., 126 F.2d 978, 991 .and note 43; United States v. Forness, 2 Cir., 125 F.2d 928, note 26; Zell v. American Seating Co., 2 Cir., 138 F.2d 641, 647.

5 Accordingly, Restatement of Conflicts; § 350 is inapplicable, even assuming it correctly states the New York rule.

6 It is somewhat difficult to ascertain the exact state of the New York rule as to the law governing assignments; some cases seem to draw an analogy to the law of property, while still others apply the ordinary contract rules-. Miller v. Campbell, 140 N.Y. 457, 460, 35 N.E. 651, validity of a “contract of assignment” is governed by the law of the place of malting. See also Jackson v. Tallmadge, 246 N.Y. 133, 158 N.E. 48; and Anglo-California National Bank v. Klein, 162 Misc. 898, 296 N.Y.S. 191, 206. It should be noted that nearly all the New York cases dealing with assignments are those which discuss the validity of the assignment. This is in line with the rule that the validity of any contract is to be governed by the law of the place of making. Cf. Mc-Glynn & McGlynn v. Louisville & N. R. Co., supra, 313 Ill.App. 396 at pages 543 and 544, 40 N.E.2d 539, where the Blinois court speaks of the retainer contract as a partial assignment, but determines the applicable law in terms of the rules which govern all other contracts.

7 N. Y. Judiciary Law Consol. Laws, c. 30, § 475. “From the commencement of an action * * * ' the attorney who appears for a party has a lien upon his client’s cause of action.”

8 See Ricketts v. Pennsylvania R. Co., 2 Cir., 1946, 153 F.2d 757.