39 Conn. 366 | Conn. | 1872
A note for $88.84, payable to John Pitch, on demand with interest, was given him by the defendant on the 21st of February, 1853. On the 26th of August, 1867, this note
In addition to the fact that the plaintiff took this note when more than fourteen years overdue, it appears that lie took it with knowledge that the defendant, the maker of the note, had a claim on book against John Fitch, the payee, and for several years had had such claim, greater in amount than the amount of the note. The plaintiff had been present on two several occasions when John Fitch and the defendant were together for the purpose of settling up all accounts and demands subsisting between them. The last of these meetings was at the plaintiff’s house, and he was told by John Fitch that he intended to apply this note, and other notes held by him against the defendant, to liquidate or set off his indebtedness on book. ' The plaintiff also knew that the defendant understood and expected that the balance due him on book was to be applied to pay the .note, but the parties separated without agreeing as to the exact balance so due, and without actually applying it upon the note. Yery soon after, this note was assigned to the plaintiff, and on the defendant’s refusal to pay it, which was immediately after payment was demanded, this suit was commenced.. The defendant subsequently prosecuted his claim against John Fitch to final judgment,and now holds an execution against him for $250, damages, and $49.08, costs, dated the 22d of June, 1871, which he seeks to set off against this note; denying also that the plaintiff is the equitable and bona-fide holder of the same. The plaintiff insists that he is the bona-fide holder, and that. he is not liable to such set-off.
The question of set-off must be determined by our statute, which is a transcript of the English statute of 2d George II.
We have regarded the decision of the English courts as authorities; our statute upon this subject and theirs being similar, and in some clauses identical. In the earlier cases the courts in England gave the statute a liberal construction, regarding it a remedial one, and thus protected almost every description of equitable interest, even against the claims of assignees, indorsees, &c. The sphere of the influence of this statute seems gradually to have been contracting, and the later cases certainly tend to restrict its application solely to claims between the parties on the record. The cases of Bottomley v. Brooke, 1 T. R., 621, Rudge v. Birch, 1 T. R., 622, Brown v. Davis, 3 T. R., 80, with others which might be quoted, decided in the latter part of the last century, and in the beginning of this, are examples of the former class of these cases. Burrough v. Moss, 10 Barn. & Cress., 558, (21 E. C. L., 128,) Isberg v. Bowen, 22 Eng. Law & Eq., 551, (8 Exch. Rep., 52,), and Oulds v. Harrison, 28 Eng. Law & Eq., 524, are examples of the latter class of cases. Several of the earlier cases have been distinctly overruled; indeed Baron Parke in Isberg v. Bowen says “ they may be considered exploded.” The case of Burrough v. Moss was quoted by this court with approbation in Robinson v. Lyman, 10 Conn., 30, and seems to have had a controlling influence in its decision, for PeteRS, J., said he thought the law was otherwise till he saw that case. The case of Isberg v. Bowen seems to restrict the application of the statute to mutual, legal debts between the parties of record. The action was for freight, due under a charter party. Plea, that the plaintiff entered into the charter party as master of the ship,for and on behalf of and as agent for the owner, that the plaintiff had no beneficial interest in the charter, or any lien on the freight, and that he brought the action solely as agent and trustee for the owner, who was indebted to the defendant in a certain amount, which the defendant offered to set off. This plea was held insufficient on demurrer; the Court of
Turning from the English to the American cases, and going no farther than to the state of New York and to our sister states of New England, we find a great want of harmony in the decisions upon this subject. The statutes of some of
The early decisions in the state of New York favored very strongly the claim of set-off. Furman v. Haskins, 2 Caines, 368, O’Callaghan v. Sawyer, 5 Johns., 118, and Ford v. Stewart, 19 Johns., 342, are examples. In O’ Callaghan v. Sawyer the action was brought by the indorsee of an overdue promissory note against the maker. The defendant claimed to set off a debt due him from the payee and indorser. In the Common Pleas the set-off was denied, but in the Supreme Court the judgment was reversed. The court say: — “The set-off ought to have been received. The note had long been due and dishonored when it was indorsed, and the point has been too long settled and too repeatedly recognized to require any discussion now, that the indorsee takes the note subject to all the equity and to every defence which existed against it in the hands of the original payee.” This was in 1809, and nearly twenty years after the same court, in the case of Johnson v. Bridge, 6 Cowen, 693, overruled this decision, and others of like character, laying down as law that there could be no set-off except as against the plaintiff on the record. This case went to the Court of Errors, and is reported in 5 Wend., 342. On the question, “ Shall this decision be reversed ? ” the court stood twelve to twelve; so it was affirmed. Had the rules of the court permitted the question to have been put in the opposite form, “ Shall this decision be affirmed ? of course it would have been reversed. In a subsequent case, Driggs v. Rockwell, 11 Wend., 504, the Court of Errors re
In the case of Farrington v. The Park Panic, 39 Barb., 645, though it involved no question of set-off, and though it . differs in essential points from the case at bar, yet the rights "of the- holder for value of a promissory note overdue and dishonored; were discussed and considered. The court say, p. 651: “ Tire holder takes it in the light of an assignee from the person from whom he receives it, rather than an indorsee according to the usage of trade, and he therefore takes just such title, and no other, as his assignor had to it at the time of the transfer.”
There are numerous cases in Massachusetts. Holland v. Makepeace, 8 Mass., 418, was an action on two checks, brought by an assignee. • The defendant claimed to set off a note which he had purchased against the payee of the checks, and which he held when the checks were transferred to the plaintiff. The decision was that the note could not be set off, and the reasoning of the court supports the doctrine that set-offs are confined to the parties in the suit. In a subsequent case, Peabody v. Peters, 5 Pick., 1, the same court seemed to recognize as law, that filing an account in set-off is a remedy -that exists only inter parties to the contract. In the case of Sargent v. Southgate, 5 Pick., 312, a different conclusion was arrived at by the same court. That was an action brought •by the indorsee of an overdue promissory note, and the de
In Ranger v. Cary, 1 Metc., 375, in Baxter v. Little, 6 Metc., 7, and in Bond v. Fitzpatrick, 4 Cray, 89, the court recognized the correctness of this decision, notwithstanding the different decisions in England under a similar statute. In Vinton v. King, 4 Allen, 565, Metcalf, J., in summing up the defences available against the indorsee of a promissory note, among others enumerates “ a legal set-off against him .[the payee] to the amount thereof.” The statutes of Massachusetts, as revised after the decision of Sargent V. Southgate, were changed in their phraseology apparently rather to make their provisions clear and specific, and in conformity with that decision, than to enact a new law.
In New Hampshire, in Woods v. Carlisle, 6 N. Hamp., 27, the Supreme Court of that state say — “ We are inclined to think that when a man takes a discredited note, and sues in his own name, when the defendant has a set-off against the indorser, the indorser must be considered the plaintiff within the meaning of the statute. The indorsee stands in the place of the indorser.” The contrary of this doctrine was soon after expressly held by the same court in the case of Chandler v. Drew, 6 N. Hamp., 469. That was an action by the indorsee of a discredited promissory note against the maker, and it was held that a set-off against the indorser could not be made. The court say: “ The indorsee cannot be considered as standing in the place of the indorser, unless the note can be considered as still due to the indorser, or the indorsee, by taking the discredited note, as having made the
The Supreme Court of Maine, in the case of Shirley v. Ford, 9 Greenlf., 83, recognized the right of set-off by defendant against the indorsee of a dishonored bill, of a claim against the payee. In Ward v. Warren, 19 Maine, 23, the case of Sargent v. Southgate is referred to as sound law.
A general examination of the decisions of'our sister states, and the 'courts of the United States, would be entering upon wilds immeasurably spread, already quite too lengthened. To reduce them to order, and 'extract from them any uniform principle, would be quite impossible. We forbear; we should . but lose ourselves in the mazes of legal uncertainty. “ Whether under our statute a set-off can be made,” said Williams, J., in giving the opinion of the court in Stedman v. Jillson, 10 Conn., 50, “in a case where the plaintiff sues in his own right, and the debt is against another person, not a party to the record * * * * no opinion is expressed; on that question learned judges have widely differed.” These differences have been vastly multiplied in the forty years nearly since this opinion was pronounced.
Perceiving, as we do, other grounds, to us abundantly satisfactory, on which to rest our judgment, we shall pass over without deciding, this vexed question of set-off, and thus avoid adding another to the too ■ long list of conflicting decisions.
We advise the Court of Common Pleas to render judgment for the defendant.