Keene Five Cent Sav. Bank v. Reid

Citations

• 123 F. 221
• 59 C.C.A. 225
• 1903 U.S. App. LEXIS 3981

Syllabus

<p>1. Mortgages—Construction—Stipulation for Maturity on Default.</p> <p>A provision in a mortgage that in case the sum secured, or any part thereof, or any interest thereon, is not paid when the same is due, or if the taxes assessed against the property, or any part thereof, are not paid when the same are by law made due and payable, “then the whole of said sum and sums and the interest thereon shall and by these presents become due and payable,” is not self-operative, but is for the benefit of the creditor, and intended to give him an option, and it does not render the principal sum due and payable in advance of the time specified on the face of the note because of a prior default in the payment of interest or taxes, so as to start the statute of limitations to running, unless the holder elected in some way to treat it as due at an earlier time in consequence of the default.</p> <p>2. Federal Courts—Following State Decisions—Construction of Contracts.</p> <p>The proper interpretation of a private contract presents a question of general law, concerning which the federal courts are entitled to express an independent judgment, unless the contract is one relating to the sale or conveyance of real or personal property,, and it contains words or phrases that, in virtue of local decisions, have acquired a definite meaning, and have thus become rules of property within the state.</p> <p>8. Mortgages—Construction—Provisions in Note for State Laws.</p> <p>A provision in a note that “this note and the coupons hereto attached * * * are to be construed by the laws of the state of Kansas” means the statutes of the state with reference to negotiable instruments, and the rights and liabilities of the parties thereto, and does not comprehend the decisions of local courts construing like contracts that had been or might thereafter be announced; nor can it be extended so as to make the decisions of the local courts the governing law with respect to the construction of the provisions