ing. It may, however, be stated in general, that whatever belongs to the obligation of the contract is regulated by the lex domicilii, or the lex loci contractûs, and whatever belongs to the remedy for enforcing the contract is regulated by the lex fori.92

192 Limitations and Prescription. — A rule simply limiting the time within which proceedings at law may be commenced, is properly called a rule of limitations. Such rules are established by positive enactment, by the legislative power, and are called, in England and America, "statutes of limitations." They rest on the policy of the State, ut sit finis litium; although they are further justified by the presumption that a stale claim is not a valid claim. In the absence of a statute of limitations, rules have been laid down by the courts, as in chancery and admiralty, against stale claims, and the periods of time are usually fixed by analogy to the statutes of limitations in like cases; but, as courts cannot properly enact an arbitrary rule on grounds of public policy, such judicial rules rest on the presumption that the claim is satisfied, or was never valid, and sometimes admit of evidence to rebut the presumption. But the legislative enactments of later times, as now construed by the courts, are absolutely extinctive of a right of action, irrespective of its merits, on general grounds of policy; and an action so barred is not maintainable. Limitations are applied alike to criminal and civil proceedings, and to suits to try the right of ownership or use in corporeal things, whether movable or immovable, as well as to suits on mere personal obligations. Now, as these statutes are rules of repose, resting on the policy of the State, it seems reasonable that any State may apply them to all suits in which the aid of its tribunals is invoked; whether the parties are citizens or aliens; whether the thing in dispute is within or without the territory of the State, and be movable or immovable, corporeal or incorporeal. It is true, that a statute of limitations indirectly operates upon title to property, and has the same effect in aid of the party sued as a defensive prescription, and so it may be argued that they belong to the laws of property and not of mere remedy; but it is impossible, in international law, to be governed by these indirect operations. The tribunal may simply decline to lend its aid to the plaintiff or actor, on the ground of a domestic policy of repose prescribed by the sovereign power; and other nations cannot complain, if no discrimination is made against their citizens.

It has sometimes been said, that the continental writers treat statutes of limitations as part of the law of property and obligations, and therefore not necessarily to be governed by the lex fori. Savigny and Fölix have been adduced as instances. But any language that may be cited to that effect will be found to relate to prescription, and not to mere rules of limitation. Rules of prescription relate directly to ownership, or title in a thing, and are part of the law of property. This is especially the case in the Roman law, and in the systems of those countries whose basis is the Roman law. Prescription, by those systems, is not merely defensive, but creative. As all personal rights in things may be said to originate in occupancy, the Roman law has recognized a possession, begun in a certain manner and continued for a certain time, as creative of a positive title. Such possession does not merely afford presumption of some acts necessary to create title, as of original occupation of a thing unoccupied, or of a transfer from the previous owner, but it is itself a prescribed mode of lawful acquisition. For this reason, it was required to originate bonâ fide and justo titulo; that is to say, the possession must have been begun in an honest belief of a right, justified by an apparently regular proceeding. Without attempting to follow the Roman law from the strict usucapio, through the pretorian edict, to the imperial constitutions, it is enough to say, that such a possession, continued for the appointed time, gave all the

If the tribunal is called upon to apply to the case the law of the country where it sits, as between persons domiciled in that country, no difficulty can possibly arise. As the obligation of the contract and the remedy to enforce it are both derived from the municipal law, the rule of decision and the rule of proceeding must be sought in the same code. In other cases, it is necessary to distinguish with accuracy between the obligation and the remedy.

The obligation of the contract, then, may be said to consist of the following parts:

1. The personal capacity of the parties to contract.

2. The will of the parties expressed, as to the terms and conditions of the contract.

elements of an affirmative title. And these rules respecting creative and defensive prescription belonged to a distinct class from the rules limiting the commencement of actions; and the latter were of less consequence for the protection of rights inherent in things, as the system of prescriptions was so effective for both creative and defensive purposes.

Without attempting to settle the doubts that involve the subject of prescription, in the interesting early history presented by Bracton and Coke, it may be said, that, in the systems of the United States and England, resting on the common law, the titles of parties in possession have been secured rather by limitations of actions, extinctive of remedies by parties out of possession, than by systems of acquisitive prescription. Yet, in the common law, whatever it was originally, and notwithstanding dicta from high authority to the contrary, prescription may be considered as having become limited to incorporeal rights, as of easements or servitudes on land, and to have required an origin adverse to the general title, and to rest upon a presumption of a grant made by the proprietor in derogation of that title. This places it in a very different light from the prescription of the Roman law. In the English and American systems, statutes of limitations furnish a sufficient defence in case of suits brought to assert title to corporeal property, absolute or usufructuary; and, wherever title is involved, and a party must prove his title affirmatively or defensively, the courts allow the possessor the benefit of a prescription analogous to the statute of limitations on the same subject, as a presumption of title.

These considerations show that care must be observed in examining the writings of continental jurists, when treating of limitations and prescription in private international law. And it is thought the result will be found to be, that the law of the forum is to govern when the rule is directly extinctive of remedies, whatever indirect effect it may have on proprietary rights; and that, if the rule invoked is not merely and directly extinctive or prohibitory of the remedy sought, like a statute of limitations, but is a rule applicable to the merits of the case, and part of the law directly governing rights and titles in the subject-matter of the suit, like a usucaption or prescription, then the law of the forum is not to govern, as such; and it becomes an independent inquiry whether a law of that character is to be drawn from the domicil, the situs rei, or the place of the making or executing of a contract.

Savigny, System, liv. viii. 270. Fölix, Droit Intern. Privé, § 100. Story's Conflict of Laws, §§ 576-581. Westlake's Pr. Intern. Law, §§ 250-252. New Am. Cyclopæ dia, xiii. tit. Prescription. Blackstone's Comm. ii. 263.] — D.

3. The external form of the contract.

The personal capacity of parties to contract depends upon those personal qualities which are annexed to their civil condition, by the municipal law of their own State, and which travel with them wherever they go, and attach to them in whatever foreign country they are temporarily resident. Such are the privileges and disabilities conferred by the lex domicilii in respect to majority and minority, marriage and divorce, sanity or lunacy, and which determine the capacity or incapacity of parties to contract, independently of the law of the place where the contract is made, or that of the place where it is sought to be enforced.

It is only those universal personal qualities, which the laws of all civilized nations concur in considering as essentially affecting the capacity to contract, which are exclusively regulated by the lex domicilii, and not those particular prohibitions or disabilities, which are arbitrary in their nature and founded upon local policy; such as the prohibition, in some countries, of noblemen and ecclesiastics from engaging in trade and forming commercial contracts. The qualities of a major or minor, of a married or single woman, &c., are universal personal qualities, which, with all the incidents belonging to them, are ascertained by the lex domicilii, but which are also everywhere recognized as forming essential ingredients in the capacity to contract. (a)

§ 144. How far bankruptcy ought to be considered as

Bank

a privilege or disability of this nature, and thus be re- ruptcy. stricted in its operation to the territory of that State under whose bankrupt code the proceedings take place, is, as already stated, a question of difficulty, in respect to which no constant and uniform usage prevails among nations. Supposing the bankrupt code of

93

(a) Pardessus, Droit Commercial, Part VI. tit. 7, ch. 2, § 1. [93 Extra-territorial Effect of Bankrupt Laws. The main question as to what are termed bankrupt or insolvent laws is, whether they attempt to relieve the bankrupt ever afterwards from the obligation of his contract, or only regulate the remedies creditors may afterwards pursue to enforce contracts still legally valid and enforceable. If the latter, they belong to the laws of remedies; if the former, to the laws of contracts and of property. If a contract is made and to be executed in a certain country, it derives its character from the laws of that country, and may be dissolved by its laws. But the laws of one country cannot operate to dissolve a contract made and to be performed in another, and against parties not within its jurisdiction. This is the rule in the courts of the United States. Kent, ii. 393. Story's Conflict of Laws, Redfield's note, § 341 a. Baldwin v. Hale, Wallace, Sup. Ct. Rep. i. 223. Ogden v, Saunders, Wheat. xii. 213. If the laws in question can fairly be held to be merely

any country to form a part of the obligation of every contract made in that country with its citizens, and that every such contract is subject to the implied condition, that the debtor may be discharged from his obligation in the manner prescribed by the bankrupt laws, it would seem, on principle, that a certificate of discharge ought to be effectual in the tribunals of any other State where the creditor regulative of the remedies upon contracts admitted to be valid, the law of the forum must prevail; as each country can control the remedial processes to be pursued or permitted in its own courts. The bankrupt-laws of most countries seek to sequestrate and transfer to assignees all personal property wherever situated. But, in the United States, it is held, that, as such transfer is not an act of the owner in the course of business or in the exercise of his will, but an operation of municipal law, proprio vigore, and often in invitum, the law of nations does not give it an operation in foreign countries over personal property situated there, so as to transfer the title. If a foreign creditor finds, in his own country, personal property of a bankrupt, and proceeds against it to satisfy a debt which his own country does not hold to have been dissolved by the laws of the bankrupt's domicil, he can satisfy his debt in full from this property. The title of the assignee in bankruptcy will, however, be respected by comity, if the rights of no citizen entitled to proceed against the property are involved. It is matter of State policy how far a title to personal property derived from the act of law of a foreign country as part of its municipal remedial system, and not from the act of the owner, shall be respected in the country where the property is situated. The rule of reciprocity should always be favored, if it be actual and just, and is not a nominal reciprocity offered by the gaining party. If the foreign assignee in bankruptcy, claiming by act of law of his own State, seeks to get into his possession property of the bankrupt lying in another country, by aid of the courts of that country, it is a question of the policy of the country where the suit is brought, whether the assignee may sue in his own name, or shall be required to sue in that of the bankrupt; for the difference may materially affect defences and set-offs. Kent's Comm. ii. 400-408, and cases there cited. The British bankrupt-acts contemplate a transfer of the title of all property wherever situated, and of debts due the bankrupt wherever the debtor may be; and the British courts are compelled, on principles of reciprocity, to allow validity to bankrupt titles, under foreign laws, to personal property in England, as against English creditors. Real property in England is not subject to distribution under foreign bankrupt-laws. No country is obliged to recognize a foreign bankrupt appointment as a valid transfer of lands within its own jurisdiction. Each nation is entitled to determine for itself the forms and requisites for the transfer of lands. In the United States, the separate States determine for themselves those forms and requisites. The result would seem to be, that a foreign bankrupt assignment would have no effect to transfer title in lands. If, however, the foreign assignee in bankruptcy should procure conveyances from the bankrupt in accordance with the laws of the State where the lands lie, and thus effect a transfer of them, in order to add the proceeds to the fund under his control, there would be no obstacle except direct proceedings against the land by resident creditors. In such case, their attachments of the lands to satisfy their debts would prevail over such conveyances recorded subsequently to the attachments, and over all conveyances made and recorded prior thereto, unless they be bonâ-fide transfers from the bankrupt to a creditor or a purchaser for a valuable consideration, such as would have been valid against the attaching creditor if there had been no bankrupt proceedings. See, on all the points embraced in this note,

may bring his suit. If, on the other hand, the bankrupt code merely forms a part of the remedy for a breach of the contract, it belongs to the lex fori, which cannot operate extra-territorially within the jurisdiction of any other State having the exclusive right of regulating the proceedings in its own courts of justice; still less can it have such an operation where it is a mere partial modification of the remedy, such as an exemption from arrest, and imprisonment of the debtor's person on a cessio bonorum. Such an exemption being strictly local in its nature, and to be administered, in all its details, by the tribunals of the State creating it, cannot form a law for those of any foreign State. But if the exemption from arrest and imprisonment, instead of being merely contingent upon the failure of the debtor to perform his obligation through insolvency, enters into and forms an essential ingredient in the original contract itself, by the law of the country where it is made, it cannot be enforced in any other State by the prohibited means. Thus by the law of France, and other countries where the contrainte par corps is limited to commercial debts, an ordinary debt contracted in that country by its subjects cannot be enforced by means of personal arrest in any other State, although the lex fori may authorize imprisonment for every description of debts. (a)95

Story's Conflict of Laws, § 403-423. Kent's Comm. ii. 392, 400-408. Ogden v. Saunders, Wheat. xii. 213. Oakley v. Bennet, How. xi. 44. Woolsey's Intern. Law, §§ 71, 72. Belton v. Valentine, Curtis's Rep. i. 168. Booth v. Clark, How. xvii. 322. Milne v. Moreton, Binney, vi. 353. Holmes v. Remsen, Johnson, xx. 229. Blake v. Williams, Pickering, vi. 286. Merlin, Répertoire, § 1, 3, art. 10, pp. 412-416. Henry on For. Law, 127–135, 175. As to the extra-territorial effect of a discharge under proceedings in bankruptcy, see infrà, note 94.]—D.

[In the United States, the discharge of a debtor from the obligation of his contract, given by the bankrupt-law of the State of his domicil, is recognized only as to contracts made and to be performed in that State. Supra, note 93. In other words, such a discharge is recognized only in cases where a law affecting the contract itself, in its construction and obligation, would be recognized. A discharge in bankruptcy is held to be a proceeding judicial in its nature, and binding only on persons subject to the jurisdiction of the State, or who have voluntarily submitted themselves to it. As to debts really contracted within a State by debtors residing abroad, or debts contracted before the passage of the bankrupt-law, a foreign bankrupt discharge is no defence. Baldwin v. Hale, Wallace, Sup. Ct. Rep. i. 223. Story's Conflict of Laws, Redfield's note, § 341 a. The English rule seems not to differ from this. Potter v. Brown, East. v. 124. Smith v. Buchanan, Ib. i. 6. Shallcross v. Dyzort, Glyn & J. ii. 87. Quin v. Keefe, H. Bl. ii. 553. Lewis v. Ogden, B. & A. iv. 654.]—D. (a) Bosanquet & Puller's Rep. i. 131, Melan v. The Duke of Fitz-James. [The question of the liability of the body to arrest is now considered as part of the law of remedy, and to be sought for in the law of the forum, both in England and