Summers v. Carbondale Machine Co. , 116 Ark. 246 ( 1915 )

Smith, J.,

(after stating the facts). Two questions are presented. The first is, whether the change of method of payments and extension of time for payments operated to waive the reservation of the title to the machín-' ery. And the second question is, whether the contract of sale shall be construed according to the laws of this State, where a reservation of title is valid against creditors, or according to the laws of Pennsylvania, where -such a reservation is invalid against creditors.

(1) The first question is settled iby the decision of this court in the case of Hollenberg v. Bankston, 107 Ark. 337. We there held, in effect, that a vendor might grant an extension of time, and might -change the manner of payments, without waiving his reservation of title, provided he did not thereby -cancel the -debt thus secured.

The second is the real question in the case. Appellants lay stress upon the provision in the contract that it should not be binding “until accepted by you (Brat-ton) and approved iii writing by the president and -secretary -of the 'Carbondale Machinery ’Company at its home office -in the city -of Carbondale, State of Pennsylvania. ” But the fact must not be lost sight of that, after its installation, the machinery was to (be finally accepted in this State by Bratton and that the whole contract was made with a view to its performance in this State, where the purchase money notes were executed and dated -and were made payable.

It is conceded that, if this contract is to be construed according to the -laws of the State of Pennsylvania, the reservation of the title to the machinery Is v-oid as to the intervening creditors. But shall it be •so construed?

The principle which -controls here was discussed in the case -of Midland Valley Railroad Co. v. Morgan Bolt & Nut Mfg. Co., 80 Ark. 403, where it was said:

‘‘ ‘ The place where -an obligation -originates is often ■accidental; is remote, sometimes receding from spot to spot, as we search for it; and is extrinsic to the essence of the engagement, and to its subsequent development and efficiency.’ 2 Wharton, Conflict of Laws, § 398. ‘It is different, however, with the place of performance, which, enters into the vitals of the obligation, so far as concerns its fulfillment.’ Id. § 399.

“In this case there was an express agreement that part of the material should be delivered at Shady Point, I. T., by appellee to Kelly for nse in construction of appellant’s road in the Indian Territory, and part for like purpose for the road in Arkansas, at Montreal, Arkansas. Notwithstanding there is but .one contract, when it is to be performed in different jurisdictions, the law of each jurisdiction enters into the essence of the performance in the respective jurisdictions. 2 Wharton on Conflict of Laws, § 815a. Therefore the' law of this contract was in Arkansas for so much of it as was to be performed in Arkansas, and in the Indian Territory for so much of it as was to be performed in the Indian Territory. Wharton, supra; -Story on Conflict of laws, § 280, and note.”

(2) It appears that the order for the machinery was accepted by appellee in Pennsylvania and was shipped from that State; but everything else in connection with this transaction was to occur in Arkansas. The final delivery was to take place upon .completion of the plant, when an acceptance was to be given. The provisions of the contract, including' the payment of the notes, were to be porformed here, and this State was, therefore, the place of performance of the contract, and the validity of its provisions will be construed according to the laws of this State.

The decree is therefore affirmed.