74 N.Y. 467 | NY | 1878
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *469 The point is not well taken, that the answer sets up a counter-claim, and that as there is no reply thereto, the counter-claim is admitted.
In the first place, that position was not taken at the circuit. The trial proceeded as if every matter contested by the parties was fairly and fully at issue. Had the point now taken been raised there, non constat but that an amendment of the pleadings, if the same was necessary, would have been asked for and made.
Again: If it be granted that the allegation of new matter, in this respect, in the answer, be taken as admitted, what is that new matter? It is that the intestate made his note, that the defendant discounted it, that the proceeds were duly credited to him and afterwards paid out, save the balance *472
now in contest, that the note was not paid when due and payable, and that the defendant applied to the payment thereof that balance and charged it against the moneys standing to the credit of the intestate. These are the facts alleged. Upon them the defendant insists in its answer that it is entitled to set-off that sum. The facts alleged were all proven on the trial. The defendant still insisted there that it was entitled to a set-off. Granted, that by reason of no reply, those allegations are admitted to be true, the claim of the defendant, that it is entitled to set-off that sum, is but an averment of what the defendant contends is the legal result from their existence. The lack of a reply does no more than admit that averment, that is, that the defendant so claims. Whether its claim is well founded still remains to be determined by the court. In other words; though the matter set up in the answer be admitted to be true by not replying thereto, or be proven to be true, as it was on the trial; there is still to be determined, whether the courts will accede to the claim of the defendant, that that matter constitutes a right of set-off in the defendant. It is the matter of law arising from those facts which is not yet finally disposed of in this case. A party is not estopped, by not taking issue upon a matter of law averred in his adversary's pleadings. (Bonnell v. Griswold,
The defendant further contends, that it had and continues to have, a banker's lien on the balance of deposit sued for. There is spoken of in the books, what is termed a banker's lien, but it is not a right to retain the balance of a customer's deposit, to pay or apply upon an indebtedness of his to the bank, not yet matured. The passage quoted by the defendant from Morse on Banks: "The rule may be broadly stated, that the bank has a general lien on all moneys and funds of a depositor in its possession, for the balance of the general account," is too broadly stated, and needs the limitation, that the balance of that account must be then due and payable. *473
A lien, is a right of one to retain property in his possession belonging to another, until certain demands of him in possession are satisfied. (Hammonds v. Barclay, 2 East, 227-235.) But mere possession does not give the right. It must arise from contract or operation of law. There was no contract for a lien, in this case. Nor did the law operate to give one. It would be in complete hostility to the whole purport and contemplation of the contract of discount. The purpose, existing and understood by the parties in that act, is, that the customer of the bank may draw out at his pleasure the avails of the discount. After the paper discounted falls due and payable and remains unpaid, unless other rights have intervened, the bank may hold a balance of deposits and apply it towards the payment of the paper. But these deposits in a bank, create between it and the depositor, the relation of debtor and creditor. (Commercial Bk. of Albany v. Hughes, 17 Wend., 100; Ætna National Bk. v. Fourth National Bk.,
It is also contended, that equity will permit and enforce a set-off of a debt not yet due, in cases where by the statute and at law, it cannot be claimed. Doubtless the power to compel a set-off of debts, was exercised by equity, prior to, and independent of, any statute on the subject. (Ex parte Stephens,
11 Ves., 24; Ex parte Flint, 1 Swanston, 30.) But equity follows the statute and the law, unless there are peculiar circumstances presented. (11 Ves., supra; Bathgate v. Haskin,
The case finds a bottom then, on our statute of set-off. (2 R.S., 355, § 23.) It is, in the relation of the claims of the parties, the reverse of Patterson v. Patterson
(
We have examined the books cited for the appellant from the New Hampshire and Massachusetts reports. Matthewson, admr. v.Strafford Bank (
Nor do the late amendments to the Code of Procedure affect the case. It is claimed that section 506 has made a change in the law. It is plain that it has, in words. We are not called upon to say whether or not it has, in substance. This action must be decided upon the law of set-off as it stood when the action was commenced. (Palmer v. Conly, 4 Denio, 374; affirmed,
We are constrained to affirm the order appealed from.
The rule we maintain will not work hardship. If the estate of the decedent is solvent, the creditor has only to await distribution or bring his cross action. If there are any circumstances existing which render it inequitable to deny him a set-off, he may set them up in the action on the demand against himself, and invoke the equity power of the court.
The order should be affirmed, and judgment absolute rendered for plaintiff on stipulation with costs.
All concur, except MILLER and EARL, JJ., absent.
HAND, J., concurs on the ground of stare decisis.
Order affirmed, and judgment accordingly.