67 Ala. 549 | Ala. | 1880
— It is very certain the demands now attempted to be set-off were not available in a court of law, because they were not subsisting at the commencement of the action. A demand, available as a set-off in a court of law, must be such as the defendant could, at the commencement of suit, have made the foundation of a separate, independent action against the plaintiff. A surety, therefore, paying the debt of the principal for which he was bound, after the commencement of suit against him on a debt due the principal,
In the absence of all intervening equities, courts of equity put the same construction on statutes of set-off as do courts of law — they follow the law. The only intervening equity which can be supposed to withdraw the demands of appellant from the operation of the rule at law, is the insolvency of the Tallassee Manufacturing Company at the time of his indorsement of the bills of exchange for the accommodation of the company. Insolvency is recognized as a distinct equitable ground for the allowance of the set-off of demands which at law could not be made available.— T. C. & D. R. R. Co. v. Rhodes, 8 Ala. 206; Donelson v. Posey, 13 Ala. 752 ; Wray v. Furniss, 27 Ala. 471; Carroll v. Malone, 28 Ala. 521. But it is the insolvency of the original creditor against whom the set-off is preferred. No case in this court has, as yet, gone so far as to declare that the insolvency of an intermediate assignee, against whom a set-off is preferred, will justify the interference of a court of equity, and a departure from the fixed construction of the statute in courts of law.
Upon what principle can the court interfere, and vary the construction of the statute ? While it is true that the assignee of a paper, not negotiable, takes it subject to all the equities to which it was subject in the hands of the assignor, this is here understood to mean the equities existing between the original parties, and not equities which may arise as to other parties in the course of the transfer of the paper. Tison v. People’s Saving & Loan Association, 57 Ala. 323. It is these equities only the assignee risks ; and if the risk of others were devolved upon him, as is said in Blair v. Mathiott, 46 Penn. St. 265, it would put an end to the transmission of such choses in action altogether, a thing which the law has no policy in discouraging. — Downey v. Thoup, 63 Penn. St. 322. If equity should intervene, and embarrass
The appellee became the holder'of the note on a valuable consideration, whether it was taken as a mere pledge for the payment of pre-existing debts, or upon a new consideration— the giving of further time for the payment of such debts — subject to no other equities than such as, before notice of the assignment, existed between the appellant and the original payees, not subject to such mere equities or rights as set-off, as may have arisen between the appellant and the Tallassee Manufacturing Company. If, before notice of the assignment, the appellant had paid the note to the company, or if, when the bills were indorsed, or at any time before notice of the assignment, there had been, upon a new consideration, an agreement between him and the company, that he should pay the bills in satisfaction of the note, it may be he would have an equity superior to that of the appellee. That is not the ease now presented.
Affirmed.