HOUSE OF REPRESENTATIVES.
MONDAY, January 30, 1871.The House met at 2 o'clock P. M., pursurant to adjournment. The order of prayer by the Rev. Mr. Chamberlain, of the Fifth Presbyterian Church.
The journal of Friday's proceedings were read and approved--till--
On motion of Mr. ABBETT, the further reading was dispensed with.
STATE CLAIMS.
The SPEAKER announced the order of bills, &c. from the Senate.
The Senate joint resolution to authorizie the Attorney General to prosecute State Claims coming up--
On motion of Mr. STONE it was referred to the Committee on Public Expenditures.
The SPEAKER then turned to the calendar of the House of Representatives.
Mr. Zenor's bill [H. R. 88] authoring Coroners to appoint special Constables in certain cases coming up--it was laid over on the notion of Mr. Wilson.
DISPENSING DRUGS, &C.
Mr. Hawley's bill [H. R. 119], to regulate the dispensing of drugs, medicines, and chemicals, coming up on the third reading in the House of Representatives.
Mr. Browning and Mr. Ballenger objected generally to some features of the bill.
It was rejected on the first vote yeas--14, nays 66.
COMMERICAL PAPER.
Mr. Stone's bill [H. R. 72], to amend the 16th section, chapter 6, concerning promissary notes, bills of exchange, &c., coming up on the third and last reading--
Mr. STONE explained, that the object of the bill is to require all parties bringing suits on notes now collectable under the law merchant, payable in bank, to brings suit in the county where the maker resides. The people in every county are compromising such suits, rather than go up into a remote part of the State to defend them.
Mr. BALLENGER. Does the bill provide the restriction in regard to all notes?
Mr. STONE. Yes; to all cases governed by the law merchant.
Mr. NEFF gave a case of the evil sought to be remedied. A party from Richmond came into Putnam county and sold a thrashing machine right, which turned out to be worth less. He took the note negotiable and payable to him, and he went to Richmond and sued the note. By this bill the holder would have had to come to Putnam county to bring his suit.
page: 179[View Page 179]Mr. CALKINS, of Fulton, insisted that every man who is sued on his paper ought to have the right to be sued in the county where he resides, and showed the injustice of the operation of our commercial laws, which enables parties to negotiate promisory notes and compel the makers of them, if they have any defense to go any where in the State to defend or to pay their notes at the pleasure of the assignee, and he sighted cases of injury and wrong under it, wherein citizens of his own county have been sued in Indianapolis on their notes issued at home. As the statute now is the maker of the note or any party to it may be sued in the county where the assignor resides.
Mr. RUDDELL considered that in all actions of debt actions should be brought where any of the parties reside. He considered that abuses of the law complained of did not grow out of the law itself. It seemed to him that this bill would be an interference of very doubtful propriety. It seemed to him that gentlemen, in order to correct an evil, are likely to interfere with the commercial relations of all the people of the State. It seemed to him to be right, where there are more parties than one to a promissory note, that the note may be sued on in any county where any one of the several parties may reside, If this is right in a majority of cases of action for debt, then it is right in the cases of the character referred to. If gentlemen can make this applicable to the venders of patent rights alone who are going about fraudulently obtaining signatures to notes payable in bank, knowing that they may bring suit in county of the assignor, I should gladly vote for it. But if, in order to remedy this one evil, they are going to interfere with our ordinary mode of administering justice in the State--making a greater evil than the one they propose to remedy--then I must be against it. At present parties may issue their notes, governed by the law merchant, and they pass currently as bank paper--as the ordinary currency of the country--as currently as bills of exchange. He urged at some length that it would not be wise for the destruction of the single evil and abuse of the law by patent right venders; it was entirely too much to propose the destruction of the law merchant in toto. He hoped gentlemen would consider the bill seriously. It seemed to him like revolutionizing all our ideas of commercial law and the customs of trade
Mr.TAYLOR said he should be compelled to vote against the bill for reasons somewhat different from those already stated. It was one of the fundamental principles that should govern every legislator that laws should be passed on general principles--not to meet an emergency. Laws are made for all time to come--and a good law will stand the test of time. Now the law merchant, as it has been said, is as old as the common law; and it has remained in this country without change by legislation. No Legislature from the State of Indiana has ever ventured to make an innovation upon the law merchant as we have received it from our ancestors. All the judges and lawyers concur in holding it as the wisest and most important part of the law. Mr. T. proceeded at some length to show that for the purpose of meeting a temporary emergency it would be most unwise, and the General Assembly should not undertake to make the rash innovation upon the law merchant which is proposed in this bill.
Mr. CALKINS, of Fulton. Ought not the judgment to be rendered in the county where the property, out of which it is to be made, will be found?
Mr. TAYLOR. It is not necessary, I think. If the principle of the bill obtains in the State, we shall have to make much more radical changes in the law than this bill proposes. You will have to repeal the statute by which you may bring suit in any county where either of the makers, etc., reside; and you will have to go within as many counties as there are, may be, in which these different parties live. Under the law, merchant, the original makers and the assignors, are equally liable, and they may be sued all together, or any one of them, at the option of the holder of the note. The passage of this bill would be to undermine the foundation of our commercial law, and unwise in the extreme.
Mr. BALLENGER dissented somewhat from the remarks of the gentleman from Allen, [Mr. Taylor] The statutes in the several States of the Union are uniform as to the law merchant. If the maker, acceptor and endorser of a note are all held for its payment, it does not follow that they all shall be sued in one action. The laws of the different States are not uniform as to this. In this State the acceptor and the drawer only shall be sued. They issued the note--the drawer and the acceptor--they are the parties looked to for the payment. And there is nothing inequitable in requiring the holder of the note to sue on it in the county where they live. But now this kind of paper is subject to great abuses. Every lawyer knows that it has become a uniform practice to procure sworn assignments to admit of suits being brought in a foreign county--a practice harassing to the acceptor and maker, to an indefinite extent. Now this bill does not propose to release the endorser at all, but it proposes simply that suit shall be primarily instituted against the maker and accepter. They may sue the endorser if they wish, but they must do it in his own county. I say this is just and right. It is not overturning the commercial law, because it is no part of the commercial law that suit shall be brought against all the parties in the same suit. All that this bill proposes is, that the maker and acceptor shall be sued in the county where they live, and where the consideration was received. When he had concluded--
Mr. CUNNINGHAM took the floor in defense of the bill. If he understood the bill, it was to prevent those patent right venders from taking advantage of honest farmers by getting their names on commercial paper. He considered that it would make the com- page: 180[View Page 180] mercial law all the better, and it would prevent impositions upon honest, not ignorant, men.
Mr. DAVIDSON considered that it did not make any dangerous innovation. It provides that the notes shall be sued in the county where the maker lives; neither does it drive the holder of the paper into two suits. As the law now stands, the suit may be brought where any one of the endorsers resides. This bill does not change any principle involved in bills of exchange; but the note holder must sue in the county where some one of the endorsers lives. It is time that nearly every question which is litigated in promissory note cases arises not between the endorser end the holder, but between the maker and the holder. But it is equally true that commercial paper has not been until of late years much used in trade, and but few men will be sharp enough to take a note in bank. Commercial paper used to be kept strictly among commercial men. It is not so now. Every man who makes and sells a plow, a thrashing machine, &c., takes his notes payable in bank; and these notes he assigns, and their makers are compelled to pay them wherever be may reside in the State. Now it is this abuse of commercial paper in these late days which is contemplated and corrected in this bill. It may be that this 16th section sought to be amended is simply the common law; but this does not change the fact that there are abuses perpetrated upon unsuspected parties, by taking their paper payable in bank, which makes it worth more than the original debt for the maker to go to the county where the holder resides. By this bill, if the maker of a note wishes to set up a defense, he shall be entitled to do it in the county where he resides, and where are his witnesses. He gave examples.
Mr. STONE, I am not a lawyer--never have been--but do not know what I may be. I am sorry to be compelled to differ somewhat from my friends here. I do not want to do anything to destroy a good law or a good practice. I do not know what the law on that subject was prior to 1861. I find in 1861 that the legislature passed this particular section. It's that old--how much older, I don't know. The cases in point of the abuses, sought to be remedied in the eastern portion of the State are numerous. Mr. S. gave one of these instances in which a farmer was presented with his note in bank when he was willing to swear that he never signed it. And the party holding it said to him, "this looks very much like a swindle, I confess; but now if you do not pay me I will go back into the northern part of the State and sue you, or I will make a composition with you now." And this generally ends in a composition which precludes the setting up of any defense where fraud has been practiced. This bill was drawn up by a good lawyer in my county, and I do not believe it will interfere with the rights or privileges of any body or with the law merchant, and I believe it proposes strict justice between all persons.
Mr. SANSBERRY stated the argument in favor of the bill and the objections to it. The question litigated on promissory notes was generally as to the consideration--scarcely ever as to the assignment. Men in that business will always show that the assignment was made in good faith. He rather preferred that the bill should be amended in this way: That where a note is given for a patent right it shall not have the dignity of commercial paper. That, he thought, would be right enough. But the bill now applies to all paper alike. Upon commercial paper there is but one inquiry to be made; that is: Is the signature genuine? This being so, even if there was a failure in the consideration in it, it would make no difference. The maker can't put that in as defense. He considered this was not the section that should be amended, but the sixth section of the act of 1861. Let this bill affect vendors of patent rights, and let the law merchant alone.
Mr. ST. JOHN had no reverence for any law that give immunity to fraud, nor for its antiquity. By all means the suits on such notes should be in the county when the maker resides. He gave cases where parties have been made agents and unwittingly signed notes payable in bank, and soon after notified that the the holder was compelled to assign them, and they are sued on them in a distant part of the State. The operation of this law mentioned in these cases was not fair and equal. In reply to the gentleman from Allen [Mr.Taylor] he quotes the authority that no law should exist when the reason for it had ceased. He saw no commercial relation that would be affected injuriously by the passage of this bill. When he had concluded--
Mr. SANSBERRY moved to recommit the bill, with instructions to amend so as to make the provisions of the bill applicable only to notes given for patent rights, and to declare that such notes shall not be considered and treated as commercial paper.
The motion was rejected.
The question on the passage of the bill was then taken, and resulted--yeas 61, nays 5--so the bill passed the House of Representatives.
RAILROADS.
Mr. Hines' bill, [H. R. 79,] to extend the time for the completion of railroads, and to legalize the acts of certain railroad directors, coming up on the final reading--
Mr. HINES explained that this is a bill to legalize the acts of the Mt. Vernon and Grayville R. R. Co., who have graded and laid down some iron, and have consolidated with an Illinois company. It is to give time beyond the two and a half years allowed in the first charter; so that if they do not go on and build the road the original stockholders in Posey county will have a right to the roadbed. He understood that the bill will not interfere with any other railroad. It was a bill of much interest to the tax payers of his county, and to the citizens of Mt. Vernon.
Mr. McDONALD understood that this bill would also secure certain interests repre- page: 181[View Page 181] sented here by Mr. Stanley and Mr. Britton in the northern part of the State, refering to the Eel River Railroad, whose interests were in a similar condition with those of the company prepresented by his friend from Posey. [Mr. Hines.] It will equally protect both these interests. We have examined the bill carefully in connection with the railroad laws of the State, and we think it is right. He hoped the bill would pass.
Mr. BALLENGER considered that we have had several acts passed, giving a greater length of time in which certain railroad corporations might be allowed to complete their roads, so that he hardly knew from his imperfect hearing of the bill, as it was read, whether he ought to vote for it or not. It seemed to him that these bills have been passed too much in the interest of contractors and speculators.
Mr. McDONALD. This bill is to protect the people against contractors--that do not want to complete the roads at all.
Mr. HOOKER. The people of Posey county were very generally interested in this bill. He lived in an adjoining county, and knew that that is the general feeling in Posey.
Mr. MINICH. Does this bill allow all contractors a greater length of time to build?
Mr. HINES (in his seat). It does not apply to the contractors at all.
The vote on the final of the bill was reported, yeas 55, nays 8; so there being no quorum, the bill does not pass.
The SPEAKER. The bill will lie on the table.
On motion of Mr. WILSON, at 4:20 o'clock the House adjourned.
