in writing for the payment of money, or any article of property, and all judgments . are negotiable by indorsement, or written assignment, in the same manner as bills of exchange and promissory notes."

Messrs. Benet & Cason, for respondent: The law applicable to this appeal has been settled by Sibley v. Young, 26 S. C. 415.

Simpson, Ch. J., delivered the opinion of the court:

The complaint in the action below alleged partnership of plaintiffs, appellants, and also of S. O. Young, respondent, and W. H. Napier, as Young & Napier; that in Augusta, Ga., on May 7, 1883, Young & Napier made their certain sealed note due December 15, 1883, payable to plaintiffs or order, for $1,000 with interest from maturity at 8 per cent, and 10 per cent attorney's fees, at any bank in the City of Augusta. That Young duly ratified said sealed note, subsequent to its execution, credit of $597.73, April 4, 1885.

The respondent answered admitting partnership "of Young & Napier; denied other allegations of complaint. For defense, that the partnership of Young & Napier was formed for general merchandise; that the sealed note was executed by Napier without defendant's knowledge or consent; that it was beyond the scope of the partnership business; that defend ant never ratified the note."

At the trial the plaintiffs requested His Honor to charge:

"1. That ratification of a sealed note executed by partners in the partnership name may be either express or implied so as to bind the partner not signing;

"2. That ratification becomes binding if made with a knowledge of all material circumstances, or if made with the intention of assuming the risk without inquiry;

"3. That when an individual deliberately, whether with full knowledge or without inquiry, ratifies the act or conduct of another, no question arises respecting the facts of ratification;

"4. That the laws of Georgia govern in construing the contract; that under said laws a sealed note payable to order is negotiable, and as such is within the scope of the partnership

business."

The charge of the Judge is found in full in the brief.

The jury found for the defendant. A motion for a new trial was refused. The plaintiffs appealed upon the following exceptions:

I. On refusals to charge: (1) that ratification of a sealed note made by one partner in the partnership name, by the partner not signing, may be either express or implied; (2) that ratification becomes binding, if made with a knowledge of all material circumstances, or if made with an intention to assume the risk without inquiry; (3) that when an individual deliberately, whether with full knowledge or without inquiry, ratifies the act or conduct of another, no question arises respecting the fact of ratification; (4) that the laws of Georgia govern in construing this contract; that under said laws a sealed note payable to order is negotiable, and as such, is within the scope of the partnership business.

II. To the Judge's charges in charging: (1) that the contract in question must be governed by the laws of South Carolina; (2) that ratification cannot be presumed; (3) that ratification is incomplete without a knowledge of the act awaiting ratification; (4) that S. O. Young must have known that the note in question was a sealed note, before he could ratify it; (5) that the ratification must have reference to this particular $1,000 note dated May 7, 1883.

III. To the order overruling motion for new trial, and in holding: (1) that unless Young knew that the note was under seal when he executed the mortgage there is no ratification; (2) that the laws of Georgia did not govern the principles involved in the present case.

The charge of the Judge is not obnoxious to the first exception. He stated to the jury that ratification might be proved by direct testimony, or that if they were satisfied from all the testimony that Young had ratified the note, that would be sufficient. This was in substance saying, as requested, that ratification might be either express or implied.

The main question, however, in the case, is whether His Honor erred in refusing to affirm those requests which were intended to draw from him a charge that it was not essential for Young to know the character of the note, whether sealed or not, in order to have ratified it, and that it might be ratified by certain conduct on his part, either with or without knowledge or inquiry. This His Honor not only refused to charge, but, on the contrary, directly charged that knowledge of the character of the note by Young was absolutely necessary before ratification could be made. The correctness of this ruling is the main question raised in the exceptions to refusals to charge, to the charge and to the rulings of His Honor in refusing the motion for a new trial; and to this we will address ourselves.

It will be conceded that one partner has no power in this State to bind the firm by a sealed note, because such a note is not within the scope of the partnership; that question, therefore, need not be discussed. It will also be conceded, however, that one partner may be authorized to bind the firm by a sealed note, or such a note may be ratified by the other partners after it has been executed, in either of which events it becomes the note of the firm, and may be enforced as a firm note.

In the case before the court it is not contended that Napier was authorized in advance, by the respondent, Young, to execute the note in question. But it is urged that it was subsequently ratified; and that is the turning point of the case.

Now, whether it was ratified is a question of fact; but what constitutes ratification may be and was made below in this case, by the re quests to charge, a question of law. The Judge was called upon to say whether a certain state of facts would in law amount to a ratification.

Now, what is ratification? Ratification is the affirmance and approval of an act, giving sanction and validity to something done by another. Can this be done without the party charged with such approval knowing the nature of the act approved? What facts would be sufficient to satisfy a jury that said party knew

the nature of the act when he affirmed it, in any special case, would be a matter for the jury; but we do not understand how a judge could charge, as matter of law, that it was not necessary for the ratifier to know the nature and character of the act ratified.

In the case below, the act claimed to have been ratified was the giving of a sealed note, which Young was not responsible for unless he afterwards ratified it; and the Judge was called upon to instruct the jury that it could have been ratified by Young without his knowing that the note was a sealed note; in other words, that the act might be ratified without Young knowing what the act was. We do not see how this could be possible.

True, the circumstances relied on in this case might have been sufficient to satisfy the jury that Young did know the character of the act claimed to have been ratified by him, if they had gone to the jury without the legal question raised in the requests. But the Judge was not authorized to say this, because then he would have been invading the province of the jury as to the force and effect of testimony; and when he was requested to charge, in substance, that Young might ratify his partner's sealed note without knowing that it was a sealed note, we do not see how he could have done otherwise than he did.

But in addition to all this, the case of Sibley v. Young, 26 S. C. 415, between these same parties, we think is conclusive. In that case the same question above was raised in several exceptions, and it sustains the Judge here.

The other exceptions, except the one in reference to the application of the laws of Georgia to this case, are determined by what we have already said; they therefore need no further notice.

It seems that there was evidence before the Circuit Judge, that specialties in the State of Georgia are by statute made negotiable by indorsement; and this note having been made in Georgia, and payable there, it is claimed to be within the scope of the partnership business in that State, and should therefore be held here within said scope.

We do not see that it follows that, because notes not previously negotiable have been made negotiable, they are binding on parties who did not make them. They may be binding on parties who did make them, with a new feature of negotiability attached; but we do not

see how they could reach a party not connected with the making. For instance, Napier made the sealed note in question, and he is bound to a negotiable note under the statute of Georgia; but Young had no agency in making this note, as matter of fact, and hence how could the statute of Georgia be construed as holding him liable?

More than this; at common law it is not the absence or the presence of a negotiable feature in a note that places it beyond the power of one partner to bind his firm thereby, or beyond the scope of the partnership; but it is the presence of a seal on the note that has this effect. One partner can bind his firm at common law, by a negotiable promissory note, or by a note not negotiable, but yet not under seal; but he cannot, as we have said, by a sealed note, and this is because of the seal.

This may be technical, but it seems to be the law; and the law is what we are after.

It is the judgment of this Court that the judgment of the Circuit Court be affirmed. McGowan, J.: I concur.

McIver, J., dissenting:

It seems to me that the new element introduced into this case, by the testimony showing that, in Georgia, notes under seal have, by statute, been made negotiable instruments, distinguishes this case from the former decision, in a case between the same parties (26 S. C. 415) where no such testimony was adduced.

The note in this case was made in Georgia, was payable there; and therefore "its nature, validity, interpretation and effect" must be determined by the law of that State. Consequently, under that law it must be regarded as a negotiable paper, just like a bill of exchange or promissory note, notwithstanding the seal attached to it.

So regarded, it seems to me that it is such a paper as may be executed by one partner in the name of, and binding upon, the firm, when given for the purposes of the partnership, as this note unquestionably was; for partnership dealings are usually carried on with just such paper.

I think, therefore, that the Circuit Judge erred in refusing to charge the jury as indicated in plaintiff's fourth request, and that, for this reason, the judgment below should be reversed, and the case remanded for a new trial.

v.

Wenzel SEYK et al., Respts., MILLERS NATIONAL INSURANCE CO., Appt.

(.......Wis........)

1. After liability actually attaches under a policy of insurance the entire relation between

NOTE.-Contract governed by lex logi contractus.

the parties is changed from that of insurer and insured to that of debtor and creditor, and clauses in the policy which provide that certain acts or omissions of the insured shall invalidate it are thereafter inoperative.

2. The provision of Wisconsin Revised Statutes, 1943, conclusively establishing the value of insured real property when wholly destroyed, at the amount of

loss on such buildings to be paid by the defendant (if otherwise liable) is $1,102.13. This sum was ascertained by an award of arbitrators, determining the amount of the loss on such buildings, made pursuant to a submission of the matter by the parties to such arbitrators.

Other material facts in the case are stated in the opinion.

The jury found specially that the loss by the burning of such buildings exceeded all the insurance thereon, and that the loss was total. The court held that the policy was governed by the above statute, and allowed the plaintiff's $1,785 on account of the loss of the buildings. Judgment was entered for the plaintiffs June 11, 1888, for $8,490.82 damages, and for costs. Soon after, and before this appeal was taken, the plaintiffs duly entered a remission of $116.56 of that amount, thus reducing the damages to $8,374.26.

The defendant appeals from the judgment. Mr. Myron H. Beach, with Messrs. Ellis, Greene & Merrill, for appellant:

The rights of the parties under this contract and its operation and effect depend upon the law of the place where the contract was made and to be performed, viz.: at Chicago, Illinois. Story, Confl. L. 8th ed. pp. 325, 376, 451; Donnelly v. Corbett, 7 N. Y. 500.

The policy having been executed on applica

erence, is not concluded or affected by the award. Mahagan v. Mead, 63 N. H. 130.

It is not material whether mortgagee could or could not maintain an action in her own name. If she brings suit in the name of the insured, her interest as the real plaintiff will be as fully protected as if she were the plaintiff of record. Scoby v. Blanchard, 3 N. H. 175, 176; Cameron v. Little, 13 N. H. 23; Webb v. Steele, 13 N. H. 230, 239; Duncklee v. Greenfield Steam Mill Co. 23 N. H. 245; Jordan v. Gillen, 44 N. H. 424: Folsom v. Orient F. Ins. Co. 59 N. H. 54; Hall v. Fire Asso. of Phila. (N. H.) 6 New Eng. Rep. 203.

Fire insurance; value of property in case of total destruction.

The market value of property destroyed controls in estimating the loss. Fisher v. Crescent Ins. Co. 33 Fed. Rep. 544.

Stipulation in policy for submission to arbitration. A stipulation in a policy, making appraisal of the amount of loss or damage a prerequisite to suit on it, is legal. Wolff v. Liverpool, L. & G. Ins. Co. (N. J.) 12 Cent. Rep. 811.

tion received in Chicago, and the policy being mailed at Chicago to the applicant, Chicago is the place of the contract.

May, Ins. § 66; Hyde v. Goodnow, 3 N. Y. 266; Western v. Genesee Mut. Ins. Co. 12 N.Y. 258; Northampton Mut. L. S. Ins. Co. v. Tuttle, 40 N. J. L. 476; Huntley v. Merrill, 32 Barb. 626; Lamb v. Rowser, 6 Ins. J. L. 375. 7 Biss. 315, 372; Assurance Co. v. Perault, 26 Law Case Jur. 382; Wright v. Sun Mut. Ins. Co. 6 Am. L. Reg. 485; S. C. on app. 64 U. S. 23 How. 412 (16 L. ed: 529); Whitcomb v. Phanix Mut. L. Ins. Co. 8 Ins. L. J. 624, 8 Rep. 642: Shattuck Mutual L. Ins. Co. 4 Cliff. 598, 7 Ins. L. J. 937, 7 Rep. 171; Desmazes v. Mut. Ben. L. Ins. Co. 7 Rep. 136, 7 Ins. J. L. 926.

It was also the place of performance, since a contract must be performed where made and dated unless some other place is specified.

Clark v. Ins. Co. 10 U. C. Pr. Rep. 313; Ward v. Harris, 8 L. R. In. 365; Clark v. Ins. Co. 6 Ont. 223; Assurance Co. v. Perault, 26 Law Cas. Jur. 382; Hull v. Augustine, 23 Wis. 383; 2 Parsons, Cont. 8th ed. 712 et seq. *582.

The policy being an Illinois contract, section 1943, Revised Statutes of Wisconsin, cannot control it.

Story, Confl. L. 424.

The submission and award as to the loss on the buildings are valid and binding. May, Ins. § 493.

An invalid award by referees to assess damages on a loss, under a fire insurance policy, has no effect on the rights of the parties. Soars v. Home Ins. Co. 1 New Eng. Rep. 534, 140 Mass. 343.

Where the arbitration provided for in the policy was a common-law one, it was revocable at the option of either party; and a penalty of forfeiture cannot be enforced against either making the revocation; and it is no defense to plaintiff's action. Nurney v. Fireman's Fund Ins. Co. 6 West. Rep. 639, 63 Mich. 633.

It is revocable by either party, in spite of a provision "that no suit or action against this company shall be sustainable till after the award shall have been filed," etc. Commercial Union Assur. Co. v.

Hocking, 6 Cent. Rep. 915, 115 Pa. 407.

Arbitration becomes imperative only after written request for one has been made. Where the request is optional with either party, and neither of them has availed himself of the right, it must be deemed waived by both; and the insured is left to the mode of redress provided by law. Nurney v. Fireman's Fund Ins. Co. supra.

Where a policy provides for a submission to arbitrators of any differences touching any loss or damage, whose award should determine the amount of such loss, but not decide the question of the liability of the insurer, and that no action could be maintained until an award fixing such claim, the submission is a condition precedent to the right of the assured to recover; and the action should be for the amount as fixed by the award. Carroll v. Girard F. Ins. Co. 72 Cal. 297.

When submission to arbitrators is for appraisal of damages only, under fire insurance policy, a valid award, although evidence of damage in action on policy, will not support an action on the award. Soars v. Home Ins. Co. 1 New Eng. Rep. 534, 140 Mass. 343.

Refusal of a company to pay the loss, without claiming anything under a provision in the policy for arbitration of the claim, is a waiver of the right to insist upon it in bar of an action. Western H. & C. Ins. Co. v. Putnam, 20 Neb. 331.

Where an agreement to arbitrate contained the condition that such submission should not be taken as a waiver on the part of the company of the conditions of the policy, it was error for the court to submit to the jury the question of waiver. Briggs v. Fireman's Fund Ins. Co. (Mich.) 8 West. Rep. 124.

If one arbitration fails because of the bad faith of the company in the selection of an arbitrator, the insured need not submit to another, but may bring an action for loss. Uhrig v. Williamsburgh City F. Ins. Co. 2 Cent. Rep. 415, 101 N. Y. 362.

terms.

The policy and Charter, § 11; Lothrop v. Greenfield, S. & Mut. F. Ins. Co. 2 Allen, 82. The question of the "true value of real propcrty when insured, and the amount of loss and measure of damages when destroyed," may be submitted to and determined by arbitration, and the parties are bound by the award in-

Bammessel v. Brewers F. Ins. Co. 43 Wis. 463; Thompson v. Citizens Ins. Co. 45 Wis. 388. The law implies an agreement to abide the result of an arbitration from the fact of submission.

Smith v. Morse, 76 U. S. 9 Wall. 76 (19 L. ed. 597).

The contract of insurance sued on in this action is a contract under the laws of Illinois. The lex loci contractus controls the nature, construction and validity of contracts. Mehlhop v. Pettibone, 54 Wis. 652; Lamb v. Bowser, Biss. 315, 372; Northampton Mut. L. 8. Ins. Co. v. Tuttle, 40 N. J. L. 476.

A contract of insurance, even of buildings constituting a part of the realty, is a contract of indemnity solely, and not one affecting real estate in such a manner as makes it fall under the lex rei sitæ.

Wood, Ins. § 2.

The rules laid down, and the principle recognized, in applying the lex rei site, in construing contracts, as to whether they fall under it or not, do not apply to personal contracts indirectly affecting real estate.

Blydenburgh v. Cotheal, 5 N. J. Eq. 631; Story, Confl. L. § 351 d.

If the contract is not in itself immoral, although it is expressly prohibited by the statute of the State in which the suit is brought to enforce it, the courts administering the comity of that State will not refuse to enforce such a contract made by one of its own citizens in a State, the laws of which permit the contract.

Brown v. Am. Finance Co. 24 Blatchf. 384, 31 Fed. Rep. 516 and authorities cited.

Messrs. Turner & Timlin, with Mr. John Watawa, for respondents:

The "Valued Policy Law," Rev. Stat. § 1943, must apply to this case, because:

1. This foreign insurance company has asked for and obtained license to contract business in this State under Revised Statutes, SS 19151919. By so doing it submitted itself and its contracts to the laws of this State.

Milnor v. N. Y. & N. H. R. Co. 53 N. Y. 367. 2. The Valued Policy Law is a statute of Wisconsin, founded in public policy.

Reilly v. Franklin Ins. Co. 43 Wis. 449; Thompson v. St. Louis Ins. Co. 43 Wis. 462; Thompson v. Citizens Ins. Co. 45 Wis. 389.

The laws of the forum, which are based upon or form part of the public policy of the State, must govern all foreign contracts, no matter what is the lex loci contractus. This must be so or the policy of the State could be set at nought by the simple expedient of making a contract beyond its boundaries.

Story, Conf. L. § 259; Bank of Augusta v. Earle, 38 U. S. 13 Pet. 519 (10 L. ed. 274);

Before the company can insist upon the condition that the assured are bound by the agreement to arbitrate, it must show that it admitted the validity of the policy and its liability under it, and that the only question between the parties was the question of damages.

Wood, Fire Ins. p. 748; Mentz v. Armenia F. Ins. Co. 79 Pa. 478.

The arbitration was unfairly made, and on its face it was not final and complete, so that it might have been lawfully disregarded in any event.

Soars v. Home Ins. Co. 1 New Eng. Rep. 534, 140 Mass. 343; Canfield v. Watertown F. Ins. Co. 55 Wis. 419; Berryman, Ins. Dig. 134, 135.

Lyon, J., delivered the opinion of the court: 1. The first question to be determined is whether the defendant company is liable at all on the policy in suit. This question arises out of the following facts: The company does business on the mutual plan, and as a part consideration for the policy the plaintiffs executed to it its premium or deposit note for $2,750 as a basis for assessments to pay losses. The bylaws of the company provide that if a policy holder neglects, for thirty days after notice thereof, to pay any assessment on his note, his policy "shall be null and void and of no effect until such payment is made.'

The plaintiffs were notified September 5, 1887 (which was after the insured property had been burned) that an assessment of $192.50 had theretofore been duly made upon their deposit note. They have never paid this assessment, and it is claimed that the policy thereby became forfeited, or, at least, that no action can be maintained upon it until the assessment is paid. An examination of the language of the above by-laws will show that its scope and effect is misapprehended, and that the nonpayment of the assessment falling due after the loss does not, by its terms, result in defeating an action upon the policy. The provision in the policy that it shall be null and void in the contingency named necessarily means that the contract of idemnity written therein shall thus become null and void. But, before the delinquent assessment became payable, such contract of indemnity ceased to exist, and there was nothing upon which the provision could operate. reason of the destruction of the insured property, the obligation of the insurer to pay the loss became absolute, subject only to the conditions that due proofs of loss should be made. Thus the relation of debtor and creditor existed be tween the parties when the plaintiffs made default in respect to the assessment, and it is immaterial that the amount of loss was not actually due when the assessment became payable.

By

The by-laws do not provide that a default after loss shall forfeit such indebtedness, but only the contract of indemnity; and when the default occurred there was no contract to be forfeited. But had the by-laws contained the additional provision that a default in the payment of an assessment after the liability of the insurer on the policy had become fixed and absolute (which it does not), we should then have the question decided in Dogge v. Northwestern National Insurance Company, 49 Wis. 501, and