NAMES NOT VALID TRADE MARKS.—Generic names, and merely names of articles, are not valid trade marks, as "Extract of Wheat," and "New York Cough Remedy." A trade name of a firm, a corporate name, or the name of a publication, although they are not strictly trade marks, are, nevertheless, of the same nature as a trade mark, and will be protected in the same manner.
UNFAIR COMPETITION.—The most common way in which trade marks and trade names become the subject of litigation, is in connection with unfair competition. By this term we mean, ordinarily, the imitation by one person, for the purpose of deceiving another, of the name, device, or symbol used by a business rival. The courts act in such cases upon the theory that the public should be protected, and should not have other goods pawned off on it in place of something else which a person thinks he is getting. This matter of unfair competition is the subject of much litigation in the courts, and one or two illustrations will show how the question arises. For example: In an English case, decided in 1897, the plaintiff had manufactured and sold a relish which was made under a secret recipe and was sold under the name "Yorkshire Relish." The defendant then put a sauce on the market resembling it, and sold it under the name of "Yorkshire Sauce." The court held that the plaintiff was entitled to an injunction. In the case of the International Silver Co. v. the Rogers Co., 66 N. J. Equity 119, the court enjoined the use of the word "Rogers" in the corporate title of the William H. Rogers Corporation, on the ground that its use was a part of the proceedings by which the public were deceived. In this case a manufacturer of silverware, in Plainfield, N. J., was attempting to trade upon the reputation of the "1847" brand of plated silver made by the Rogers Company of Connecticut, which company was at the time of the action, a constituent part of the International Silver Co. The Connecticut Company had built up a large and good reputation by a long period of sales of its silverware to the public under its trade devices, and the use of its business name. The New Jersey Company was simply attempting to trade on that reputation, which is almost always the case in unfair competition.
CONFLICT OF LAW.—Although we have referred to the uniform legislation in the various topics of commercial law which we have been considering, there is still much in the subject of conflict of law which concerns the student of commercial law. International law is commonly divided into two branches, public and private. Public is that which regulates the political intercourse of nations with each other; private, that which regulates the comity of States in giving effect in one to the municipal laws of another relating to private persons. Conflict of law is one division of the broader subject of international law and is frequently called private international law. In the sense in which we are now using the term, the various States of the Union are considered as foreign to each other. The problems embraced in this topic and their bearing on commercial law may be more fully appreciated if we take a simple illustration. A stock broker with offices in New York City seeks to sell the stock of a new oil mining company to a purchaser in Indiana. The sale is one which is not allowed by the Indiana "blue sky" law. New York has no such law. The sale is effected by means of circulars and correspondence between the New York broker and the Indiana purchaser. Is this transaction to be governed by the law of Indiana or of New York? Its validity will depend upon our answer to that question and this is the type of question one has to answer on the subject of conflict of law. With approximately forty different "blue sky" laws in the country at present, and the great number of stock transactions carried on between the States, the importance of this topic may be appreciated. Again, even where we have a uniform act as, for example, the Uniform Negotiable Instruments Act, there are still differences in the law in some States. Each statute must be interpreted by the courts, and although the judges are sincere in their efforts, it can not be expected that we will always have a uniform interpretation of the same act by the courts in each and every jurisdiction of the United States.
FUNDAMENTAL PRINCIPLES.—There are several fundamental principles we should keep in mind before we turn to the specific branches of commercial law as affected by our topic. The term comity is one of common use in conflict of law and is defined as the recognition which one nation or State allows within its territory to the legislative, executive, or judicial acts of another nation or state. Comity is not a matter of right, but a courtesy, and one country may exercise its right and prohibit citizens of other countries from suing in its courts. Of course the various States of the United States are not as completely free in this matter as separate countries, because of the provision in the Federal Constitution guaranteeing to the citizens of each State all the privileges and immunities of citizens in the several States. There are still many questions which are not affected by the Federal Constitution. For example, a suit is brought in New Jersey upon a contract of suretyship made in New York by a wife for her husband. There is a statute in New Jersey prohibiting a married woman from doing this. New York has no such statute. Shall the New Jersey court enforce the contract which the parties made in New York but which they could not have made in New Jersey? Under the principle of comity a New Jersey court has held valid such a contract. Again, it is entirely conceivable that a person living in Turkey might make a binding contract to marry three women at the same time. Suppose the Turk before the time for performing the contract arrives, comes to New York and then refuses to marry the three women. Could they sue him for a breach of contract in the New York court? Clearly not. Here they would be asking the New York court to enforce a contract which while admittedly valid, when made in Turkey, is decidedly against the public policy of any monogamous country. Comity being a courtesy, not a right, would not require a New York court to recognize the Turkish contract. In our illustration of the wife acting as surety, no question of public policy was involved and hence there was no impropriety in New Jersey recognizing as valid her contract, although such a contract could not have been made within the State of New Jersey.
CONFLICT OF LAW AS RELATING TO THE STATUS OF PROPERTY.—As we have pointed out heretofore, property is divided into real property and personal property. Reference should be made to the distinctions between these two kinds of property as described in a preceding chapter. Suppose A dies intestate in Texas owning real property in New York. The law relating to the descent of real property is different in Texas from that in New York. A's heirs wish to know by which law this New York real estate will be governed. It is almost universally recognized that all matters concerning the title and disposition of real property are determined by what is known as the lex loci rei sitae, that is, the law of the place where the property is situated. Accordingly the heirs in Texas would be governed by the law of the State of New York and, similarly, if A had also owned property in Illinois, that property would be governed by the Illinois law. Suppose, also, A had owned $50,000 worth of stock in various corporations and he kept one-half of this stock in his safe deposit box in Galveston and the other half in New York City. While the dominion of a State over personal property within its borders is complete, nevertheless by virtue of the principles of comity, the rule has been recognized almost from time immemorial that personal property is governed by the law of the domicile of the decedent at the time of his death. Hence A's stocks (and bonds for that matter) would be divided according to the law of Texas whether they were in his safe deposit box in Galveston, New York City, or Chicago. It follows, when no rights of creditors intervene, that the law of the domicile of the testator will control in regard to his will of personal property, and the law of the place where the real property is situate will control in regard to it.
CONFLICT OF LAW AS RELATING TO CONTRACTS.—It is a general principle of contract law that the construction and validity of a contract is governed by the lex loci contractus, the law of the place where the contract is made. When the contract is made in one jurisdiction and is to be performed in another, the question becomes more difficult. The Supreme Court of the United States, in Scudder v. Union Nat. Bank, 91 U. S. 406, has laid down the following rules in reference to the law governing contracts in cases in which the place of making and the place of performance are not the same. "1. Matters bearing upon the execution, interpretation and validity are determined by the law of the place where the contract is made; 2. Matters connected with the performance are regulated by the law of the place where the contract by its terms is to be performed; 3. Matters relating to procedure depend upon the law of the forum (i. e., the court where the case is heard)." These three general rules have been adopted and applied by many jurisdictions in a long line of cases involving every conceivable kind of contract. But perhaps it is even more generally stated, when the contract is to be performed in a place other than the place where it is made, that the law of the place where the contract is to be performed will determine the validity, nature, obligation and effect of the contract, or, in other words, in case of conflict the lex loci solutionis (the law of the place of performance) will prevail over the lex loci contractus. Although these statements at first seem somewhat contradictory, we may always apply another rule which is a sound test for the determination of the proper law to be applied. We may properly say that the intention of the parties should control and it is generally agreed that the law of the place where the contract is made is, prima facie, that which the parties intended to govern the contract, and in the absence of a contrary intention ought to control. It frequently happens that a contract made in one State is sued upon in the courts of another State. The law governing the procedure in the trial of this case will be the law of the forum, that is of the State where the case is tried, regardless of what the law may be on the same matter in the State where the contract was made. There may be, for example, a peculiar rule as to a wife's being able to testify on the contract in question. This rule will be enforced by the court although no such rule existed in the State where the contract was made. There is no great hardship in the application of such principles because the courts of the State where the contract was made are open to the parties, and if they wish to avail themselves of the services of a court in a different jurisdiction they must take it as they find it with its rules of procedure.
ILLUSTRATION.—There is another type of contract which involves the question of conflict of law to which attention should be called. The facts in the case of Fonesca v. Cunard Steamship Company 153 Mass. 553, illustrate this point. A passenger on one of the steamships of the Cunard Steamship Company bought a ticket in Liverpool for Boston and on the ticket was a clause providing that the steamship company should not be liable for any damage to a passenger's baggage during transit, regardless of whether the steamship company was negligent in handling the baggage. When the passenger arrived in Boston, and her trunk was delivered, it was found that the contents had been damaged by sea water due to the steamboat company negligently leaving a porthole open. The passenger sued, and the Massachusetts court held there could be no recovery for the damage, for, although such a clause exempting a carrier for his negligence was not valid under the Massachusetts law (and in fact the law of practically all American jurisdictions), nevertheless, since the law of England permits such a clause, and this was an English contract, the ticket having been bought in Liverpool, the passenger was bound by the terms of her contract. There are many kinds of contracts of transportation of baggage, of passengers and of telegraph messages, involving the carrying out of such contracts in many different States. Not all of the decisions in the various States of this country are harmonious. We must expect to find many such problems in business and the answer is often one that requires most careful study on the part of a lawyer.
CONFLICT OF LAW AS RELATING TO NEGOTIABLE PAPER.—There is not so large a field for questions of conflict of law to come up in negotiable paper as in some of the other topics we have been considering. Forty-seven States have now passed the Uniform Negotiable Instrument Law. But, as we have pointed out, the interpretation of this law in the various States is not invariably uniform. Suppose a promissory note has six indorsers. Every indorsement is governed by the law of the State where it was made, and should there be a different law in this matter, we would at once have a question in conflict of law. Again, in determining the negotiability of a document made in one place and payable in another, we have a further question in conflict of law. The authorities do not agree here although perhaps we may say the majority hold that the law of place or payment controls. These problems will be considered in the text-book on Negotiable Instruments.
CONFLICT OF LAW AS RELATING TO INTEREST AND USURY.—We find a variety of usury laws throughout the United States. Some few States allow the lender to charge any rate of interest. Others allow a fixed rate, usually 6%, and provide that the lender forfeits both principal and interest if he charges more. Still others allow a fixed rate and provide that interest only is forfeited if a higher rate is charged. It is easy to see that a contract made in one State may be sued upon in another State and the usury laws of the two States may be entirely different. We may say as a general rule that usury laws do not offend any principles of public policy. There is nothing wrong in asking a New York court, where the legal rate of interest is 6%, to enforce a contract made in a State where a higher rate is allowed. On the other hand, no New York court would allow citizens of New York simply to date a contract Boston, Massachusetts, and provide for a 10% interest rate, thereby hoping to evade the New York Usury law, when, except for the date on the contract, it was in reality wholly a New York contract.