PART I.

CH. IV.

pay or conferring a new cause of action, it would seem that if the creditor is under disability or the debtor beyond seas at the time an acknowledgment or part payment is made, time would not run till the disability has ceased or the debtor has returned within seas; and this appears in one case to have been assumed without argument (1).

(1) Flood v. Patterson, 29 Beav. 295; 30 L. J. Ch. 486.

CHAPTER V.

PART PAYMENT AND PAYMENT OF INTEREST.

Ir was held soon after the passing of the statute that its effect might be avoided not only by an acknowledgment in words, but by part payment of principal, or by payment of interest; and the effect of such payments is saved from the operation of the provisions of the statute of 9 Geo. IV. c. 14, respecting acknowledgments in writing (1).

The principle of this doctrine is that any such payment is an acknowledgment of the existence of the debt, and from it the law raises an implication of a promise to pay the residue or the principal as the case may be, just as it does from a simple acknowledgment in writing (2). An attempt seems to have been made in two cases (3) to deny the application of this principle to payments of interest, but the attempt was unsuccessful; and in Bamfield v. Tupper (4) it was held that payment within the six years of interest on a note which did not carry interest on the face of it, and on which no demand was proved to have been made, took the debt out of the statute. This case proves that the payment of interest

(1) Fordham v. Wallis, 10 Hare, 225; 22 L. J. Ch. 548.

(2) Morgan v. Rowlands, L. R. 7 Q. B. 493; Green v. Humphreys, 26 Ch. D. 474.

(3) Bealy v. Greenslade, 2 C. & J. 61; Purdon v. Purdon, 10 M. & W. 562.

(4) 7 Exch. 27; S. C. sub nom. Bradfield v. Tupper, 21 L. J. Exch. 6. See In re Rutherford. Brown v. Rutherford, 14 Ch. D. at p. 692.

PART I.

CH. V.

Part ment of

pay

principal

or payment

of interest.

PART I.
CH. V.

Circum

stances must

support implied promise.

on a debt, even though the debt does not properly carry interest, will be a good payment to avoid the statute. But, on the other hand, it is said that payment of principal is no evidence of a promise to pay interest. The case usually cited in support of this proposition is Collyer v. Willock (1); but in that case it was not decided that the debt bore interest, and the whole of the principal was tendered and afterwards paid into court, the defendants denying at the time of the tender that any interest was due. The effect of payment into court as a part payment was not questioned, and the case is in fact governed by the principle stated below, that a payment unless made as part payment of a greater debt does not take the greater debt out of the statute. It is submitted, however, that if a debt properly carries interest, the principal and interest constitute one demand, and therefore payment of the principal or of part of it takes the

interest also out of the statute.

If there are any circumstances attending the payment which rebut the implication of the promise, as, for instance, a refusal to pay the remainder of the debt, no effect can be given to the payment so as to take the case 'out of the statute (2). It follows from this that the payment must be shown to be made, first, on account of some debt; secondly, on account of the debt sued for; and thirdly, as part only of what is due (3). It is for the jury to decide these questions on consideration of the whole of the circumstances given in evidence. Express declarations of the debtor at the time of the payment relied on are of course conclusive, but assertions made by him subsequently to the payment are merely

(1) 4 Bing. 313.

(2) Wainman v. Kynman, 1 Exch. 118; Davies v. Edwards, 7 Exch. 22; 21 L. J. Exch. 4; and see Foster v. Dawber, 6 Exch. 839, 853; 20 L. J. Exch. 385, 392.

(3) Tippetts v. Heane, 1 C. M. & R. 252; 4 Tyr. 772; Holme v. Green, 1 Stark. 488. See Burkitt v. Blanshard, 3 Exch. 89; Linsell v. Bonsor, 2 Bing. N. C. 241.

evidence to which the jury may give what weight they
think proper (1), and they will also be justified in in-
ferring the nature of a payment relied on from the
nature of similar payments made by the debtors at other
times (2). The plaintiff must in all cases give some
evidence that the payment relied on was made on accouut
of some debt; but the circumstances attending the pay-
ment, even without any direct evidence, may be such as
to render it a proper question for the jury whether such
payment could be made for any other purpose (3). When
it is once established that the payment was made on
account of a debt, and no other debt is shown to have
existed between the plaintiff and the defendant at the
time the payment was made, a jury will be justified in
pronouncing that the payment was made in respect of
the debt sued for (4). If more debts than one are due,
and a payment is made which is not specifically appro-
priated, it is a question of fact in respect of which debt
the payment was made (5). If the debt sued for is a
debt definite and ascertained as on a promissory note,
and a payment smaller than the amount of the debt is
proved to have been made in respect of it, it necessarily
follows that the payment must have been made as part
payment, so that the requisites to raise the implied
promise to pay will have been fulfilled; but if, on the
contrary, the amount of the debt is unascertained, as
upon a running account, or for work and labour, it by not
means follows (even assuming the payment to have been
made in respect of the debt sued for) that the payment
was made as part payment, for it might have been in-
tended by the defendant as in full discharge of all he
admitted to be due. In such a case, therefore, there

(1) Baildon v. Walton, 1 Exch. 617, 633.
(2) Worthington v. Grimsditch, 7 Q. B. 479.
(3) Burn v. Boulton, 2 C. B. 476.

(4) Evans v. Davies, 4 A. & E. 840. See Tippetts v. Ileane, 1 C. M. & R. 252; S. C. 4 Tyr. 772.

(5) In re Rainforth. Gwynn v. Gwynn, 49 L. J. Ch. 5.

PART 1.

CH. V.

CH. V

PART I must be evidence that the payment was not intended as in full discharge (1). Hence in the case of a breach of contract for which by the terms of the contract a stipulated sum is to be paid as liquidated damages, the payment of a smaller sum on account of the breach would not keep alive the right to recover the remainder of the stipulated sum without evidence to show that it was intended at the time to be a part payment.

Payment

into court.

Payment

on the eve of bankruptcy.

Payment

of interest.

Payment into court can in no case keep the debt alive; it is equivalent to saying that so much is due and no more (2). Apart from this reason, payment into court would now be ineffectual, for the same reason that an acknowledgment after action brought is (3).

A payment on account of a debt made on the eve of the bankruptcy of the debtor is a good payment so as to revive the debt, if such debt has up to that time been treated by the parties as a subsisting debt; but a payment at such a time on account of a debt, which has been treated as dead and gone, if made fraudulently with the object of giving the creditor a share of the debtor's estate in the bankruptcy, would not avail so as to revive the debt as against the other creditors (4).

With respect to payment of interest, if the payment is shown to have been made as interest, the only question that can in general arise is in respect of what debt it was made. If more than one debt is shown to have been due at the time of the payment either of principal or interest relied on, a question arises whether such payment was made on account of all the debts or was appropriated to any one or more, and if so, to which of them (5). This appropriation need not be proved by any express declara

(1) Burn v. Boulton, 2 C. B. 481, per Maule, J.; Waugh v. Cope, 6 M. & W. 824.

(2) Long v. Greville, 3 B. & C. 10; Reid v. Dickons, 5 B. & Ad. 499; 2 N. & M. 369.

(3) See p. 95.

(4) In re Lane. Ex parte Gaze, 23 Q. B. D. p. 77, per Cave, J. 5) Wycombe Union v. Eton Union, 1 H. & N. 687.