Benson v. Eastern Building & Loan Ass'n

The action was brought on certain certificates or contracts by which the defendant agreed to pay to the plaintiff in satisfaction of his shares the sum of one thousand dollars at the expiration of seventy-eight months from the date of the certificates provided the plaintiff made the periodical payments therein required. The venue of the ) action was laid in the county of Oswego. Judgment was a rendered dismissing the complaint on the ground that it was Uprovided by said certificates that “ any action brought against I this association (defendant) shall be commenced within six months after filing proofs and in the county of Onondaga and state of Hew York.”

We think the disposition of the case below was erroneous. After the plaintiff had established a prima facie case he could be defeated only by disproof of his cause of action by proof of an affirmative defense or by showing that the court | had no jurisdiction of the sub j ect-mattei8. The condition in the certificates, that any action against the defendant should I be brought in the county of Onondaga, did not constitute a \ defense to the cause of action. It did not purport to destroy the plaintiff’s claim but merely to prescribe where that claim should be enforced. ■ The distinction between such an agree

i “ But the remedy does not depend on contract, but upon i law, generally the lex fori, regardless of the lex loci con- | tractus, which regulates the construction and legal effect of J the contract. * * *

! “We do not mean to say that many of these are stipulations which it would be unlawful to make, or void in their creation, if made on good consideration, or that they do not become executory contracts upon which an action would lie, and upon which damages, if any were sustained, might be recovered. Still they would not be conditions annexed to the contract, to defeat it if not complied with, and so to be used by way of defense to an action upon it.”

In Daley v. People's Building, Loan & Saving Association ( 178 Mass. 13 ), where the provision in the contract was substantially the same as that now before us, the Supreme Court of Massachusetts held that the condition was effective to prevent any action on the contract being brought in the ■ courts of that state. In the opinion there delivered the case of Nute v. Hamilton Ins. Co. is not overruled, but distinguished in the fact that in the earlier case the stipulation prescribed in what county the action should be brought, while in the later case it required the action to be brought in another-state, New York. We do not see that the difference in circumstance justified any distinction in principle. In the latter case the learned court said, referring to such a condition in the agreement: “ It plainly purports to attach a condition to the contract, and we are of opinion that it does so effectually.”

Mor does the condition go to the jurisdiction of the court. That jurisdiction is prescribed by the Constitution of the state and the statutes passed under it. It can neither be added to nor subtracted from by the agreement of the parties. It is true that “ Parties, by their stipulations, may in many ways make the law for any legal proceeding to which they are parties, which not only binds them, but which the courts are bound to enforce ” (Matter of N. Y., L. & W. R. R. Co., 98 N. Y. 447 ), but the jurisdiction of the court is beyond the agreement of the parties. Moreover, in this state there is but one Supreme Court; the court when it sits in Onondaga county . and when it sits in Oswego county is éxactly the same court.

Therefore, the condition in the contracts, if valid (and it may be so in this case, since the principal office of the defendant being in the county of Onondaga that was a county in I which the Code authorized the action to be brought), affected j only the venue of the action. If in violation - of the stipulation the plaintiff brought his action in another county, the defendant’s remedy was to move to have the place of trial ‘'-changed to that in which the plaintiff had agreed it should be

The judgment should be reversed and a new trial granted, costs to abide the event.

O’Brien, Bartlett, Martin, Vann and Werner, JJ. (and Parker, Ch. J., in result), concur.

Judgment reversed, etc.