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In Buchanan v. Rowland, (7) Kirkpatrick, C. J., to be within the statute of limitations. But though gives the history of this presumption on the law. “By not within these statutes, like mortgages, they are the common law,” says he, “there was no stated or liable to presumptions of payment; aud it is thought fixed time for the bringing of actions. The law was to be quite clear that wheu the circumstances are always open; satisfaction was never presumed. In the such, as would induce the court to presume the payprogress of society however it was soon found neces- ment of a mortgage, the same presumption would be sary to supply this deficiency by statute, and to com- made with reference to these bonds. It is, says Chanpel men to prosecute their rights within a reasonable cellor Kent, a well-settled rule, both at Jaw and in time or to abandon them forever. Hence we find equity, that a mortgage is not evidence of a subsisting from the reign of Henry I, a succession of statutes, debt, if the mortgagee never entered and there bas narrowing the latitude of the common law in this re- been uo interest paid or demanded for twenty years. spect, and limiting the time in which actions might be These facts alone authorize and require the presumpbrought to shorter and shorter periods, until they bad tion of payment." brought it down in most cases to twenty years only,

(B.) and in many to a still shorter time. The reasons upon

1. A. claims certain land under a mortgage due in which these statutes are founded, Sir William Black- October, 1794, and made by B. It appeared that B.'s stone tells us are, first, that the law will not dis- heirs were in 1819 iu possession of the land. The preturb an actual possession in favor of a claim which sumption is tbat the mortgage is paid. (10) has been suffered to lie dormant for a long and un

In case 1 it was said: “In furtherance of justice, reasonable time; secondly, that it presumes that and the more effectually to secure the rights of the he who has for a long time had the andisturbed pos- parties iu the investigation of questions in issue, and session of either goods or lands, however wrongfully especially in ancient transactions the law calls to its obtained at first, has either procured a lawful title or

aid the doctrine of presumption under which the jury made satisfaction to the injured, otherwise he would

are authorized to find the existence of certain facts as have been sooner sued; and thirdly that it judges to which there is no direct evidence, but which are, that such limitations tend to the prevention of innu

under the rules of law to be reasonably inferred from merable perjuries, the preservation of the public tran

certain other facts whieh are well established by the quillity, and what it values perhaps more than all, the evidence in the case. These presumptions when they suppression of contention and strife among men. Tak

(10) Howland v. Shurtleff, 2 Metc. 26 (1810); Jarvis v. Albro, ing these great fundamental principles then thus re

67 Me. 310 (1877); Trash v. White, Brown Ch. 291 (1791) and cognized by successive statutes as the basis of their conduct, the courts of justice built up upon them a

notes; Christophers v. Sparks, 2 Jac. & W. 235 (1820); Sibson system rxtending beyond the letter of the statutes

v. Fletcher, 1 Ch. Cas. 59; Leman v. Newnham, 1 Ves. Sr.

51 (1747); Toplis v. Baker, 2 Cox, Ch. 118 (1789); Jackson v. themselves. They were professedly founded in part

Wood, 12 Johns. 242 (1815); Livingston v. Livingston, 4 Johns. upon the presumption that lawful titles may have been acquired under possessions tortiously taken, and

Ch. 287 (1820); Wanmaker v. Van Buskirk, 1 Saxt. Ch. 685: 23

Am. Dec. 748 (1832). In Tripe v. Marcy, 39 N. H. 449, the that satisfactions may bave been made upon contracts

court said, that the presumption that when the mortgagor is in their origin undisputably valid, but that the evidence thereof after lying so long may be destroyed by permitted to retain possession of the land for twenty years

without interruption, the mortgage debt has been paid or the all-devouring tooth of time. The judges only ex

had no valid existence is established on great authority, cittended this principle to cases, which though not

ing Trak v. White, 3 Brown Ch. 289; Christopher v. Sparks, within the letter, were yet within the reason and

2 Jac. & W. 10; Hughes v. Edmonds, 9 Wheat. 497 ; Dexter v. spirit of the law. Lord Hale, I think, is said to be the

Arnold, 3 Sum. 152; Dunham v. Minard, 4 Paige, 443; Bacon first man that ventured upon this course; he was fol

v. McIntyre, 8 Metc. 86; Heyer v. Pruyne, 4 Paige, 443; Higlowed by Holt, and then came Lord Mansfield with ginson v: Mein, 4 Cranch, 415; Collins v. Tenney, 7 Johns. 279; a still bolder step; the judges in chancery in the mean

Jackson v. Davis, 5 Cow. 130. “But we are not prepared to time, keeping equal pace, if not even going beyond

hold that this presumption arises short of twenty years from the courts of law. * * * The same ground has

the time the inortgage debt becomes due, otherwise we might been taken and the same course pursued by succeding

be asked to presume a debt paid before the stipulated time of judges down to this day; so that nothing can be bet

payment had arrived. This presumption arises from the ter settled than that they do extend the principles of

long delay to enforce payment; but surely no such delay can these statutes by analogy only to cases within the rea

be charged until the time has arrived when the creditor is enson and spirit, though not within the letter of them.

titled to demand it. In this respect the presumption accords And upon this analogy this presumption of payment, with the general provision of our limitation laws which limit as appears by Lord Mansfield, is wholly founded.” suits to the time prescribed after the cause of action has ac

crued. Upon these principles no presumption of payment ILLUSTRATIONS.

exists in this case. When the mortgagee is in possession, (A.)

the right of the mortgagor will be barred in twenty years 1. By statute certain bonds are given by an heir at

from the entry after breach of condition. So if the mortgagee law which are a lien on the lands descending to him.

suffer the mortgagor to remain in possession twenty years After twenty years the presumption (they not being

after breach of condition, payment is presumed. In both within the limitation law) is that they are paid.(8)

cases the time is reckoned from the breach of condition. In 2. A suit is brought in 1834 on a bond made in 1800, a the first the mortgagee is usually entitled to the possession payment having been made on it in 1801. The presump

upon the execution of the mortgage, and until the debt betion is that it is paid. (9)

comes due the mortgagor cannot by payment entitle himself In case 1 it was said: “Bonds given by the heir en

to enter, He can of course then do nothing to interfere with titled to elect under the act to direct descents are by

the mortgagee's possession, and until the debt has become the terms of the act of Assembly made lieus on

due, no presumption can arise against him." Tripe v. Marcy, the lands for the purchase of which they are given

supra ; Evans v. Huffman, 5 N. J. (Eq.) 360 (1846). No such

; until paid; and therefore they are supposed not

presumption of payment can arise against a mortgagee or his

assigns in possession, when the mortgagor became insolvent (7) 51. J. (L.) 728 (1820).

apd died before the debt became due, and when his vendee (8) Boyd v. Harris, 2 Md. Ch. 210 (1850).

of the equity of redemption also became insolvent before the (9) Delaney v. Robinson, 2 Whart. 503 (1837); Denniston v. maturity of the debt removed from the State, and never McKeen, 2 McLean, 252 (1840).

afterward returned. Brobst v. Brock, 10 Wall. 519 (1870).

arise from lapse of time and forbearance to assert claims rest upon the principle so strongly pervading the course of meu's actions in relation to their rights that individuals will appropriate to their own use and subject to their own control that to which they have the legal right, and that an abandonment for a great length of time of a legal interest without any attempt enforce it, furnishes reasonable ground for the inference that the party has in some way parted with his interest or discharged his claim. This principle so reasonable in itself operates beneficially in quieting controverted titles and closing stale demands, and also protects individuals from gross injustice, arising from loss of evidence as to ancient transactions. A question has been sometimes raised whether the doctrine of presumption arising from the lapse of time and total neglect to take any measure to enforce a claim, could properly be applied to the case of a mortgage of real estate; and in some of the English cases the doctrine was advanced that the common law presumption applicable to bonds, judgments, etc., arising from a delay of twenty years to enforce the same did not apply in the case of a mortgage, as in such cases the legal estate was in the mortgagee and the mortgagor was a mere tenaut at will, and his possession was therefore the possession of the mortgagee. But this doctrine was repudiated by Lord Thurlow in the case of Trush v. White, (11) aud by the Master of the Rolls in Christopher v. Sparke, (12) in very strong language; and the cases of debts secured by mortgages are placed on the same footing with other demands, and held liable to be defeated by the same presumptions arising from lapse of time and laches of the mortgagee. In our own court the principle was applied in the case of Inches v. Leonard, (13) under circumstances however of greater delay, than in the present case in asserting the claim of the mortgagee. It was a case of a mortgage of forty years' standing, where there had been no possession by the mortgagee, and no attempt in the meantime to euforce the mortgage; and the court held that the plaintiff could not maintain the action. The doctrine that where the mortgagee has never entered under his mortgage and no interest has been paid for twenty years on the same, these circumstances authorize the presumption in fact that the mortgagee has been discharged by payment or otherwise is ove of frequent application.''(14)

(C.) 1. It is proved that a testator long since dead left considerable personal property. The presumption arises that legacies charged upon his real and personal estate have been paid.(15)

2. B. by his will left a legacy to F. appointing C. his executor. The legacy was to be paid in 1803. In 1829 F. brought a suit against C. for the legacy. The presumption is that it was paid.(16)

“Legacies," it was said in case 1, “not being within the statute of limitations, fall within the rule of presumption. After a lapse of twenty years bonds and other specialties, merchants' accounts, legacies, mortgages, judgments, and indeed all evidences of debt excepted out of the statute are presumed to be paid. The court will not encourage the laches and indolence of parties, but will presume after a great length of

time some compensation or release to have been made.''

(D.) 1. It appears that from 1807 to 1813, H, was an inhabitant of the town of S., and was assessed for taxes. In a suit brought in 1840, the presumption is that these taxes are paid.(17)

2. An assessment was made in 1837 on the property of A. The presumption is, in 1862 that it has been paid.(18)

Taxes, it was said in case 1, cannot have any higher character than debts due by specialty and of record. As to these a presumption of payment arises after the lapse of twenty years if there is no evidence to repel it, and to show that the debt is still unsatisfied. The assessment is in the nature of a judgment, and the warrant for the collection operates like an execution. There is no reason therefore why the same principle should not be applied in both cases.

(E.) 1. A suit is brought on a judgment recovered more than twenty years before. The presumption is that it has been paid.(19)

(F.) 1. A man conveyed in 1826 his interest in some land to a trustee for the payment of certain creditors and the balance to his wife. In 1847 the law will presume that the debts have been paid and the trust executed.(20)

RULE II. The presumption under rule 1 does not arise from lapse of time alone short of twenty years; but a shorter time, in connection with other circumstances, may raise a presumption of fact that payment has been made.

“When we hear of less than twenty years being left to the jury," it was said in a Pennsylvania case, “it must be uuderstood to have been in connection with other circumstances.”(21) This seems to be well settled.122)

A legal presumption of payment of a bond or cop. enant given for the payment of money does not arise from mere lapse of time where the bond or covenant has not been due for twenty years before commencemeut of suit or proceedings for the recovery of the

(17) Hopkinton v. Springfield, 12 N. H. 328 (1841).
(18) Fisher v. Mayor of New York, 6 Hun, 64 (1875).

(19) Bird v. Inslee, 23 N. J. (Eq.) 363 (1873); Kensler v. Holmes 2 S. C. 483 (1871); Miller v. Smith, 16 Wend. 425 (1836); Inches v. Leonard, 12 M ass. 379 (1815); Barned v. Barned, 21 N.J. (Eq.) 245 (1870). From less than twenty years the presumption does not arise. Daby v. Ericsson, 45 N. Y. 786 (1871); Tesley v. Nones, 7 S. & R. 410 (1821).

(20) Drysdale's Appeal, 14 Penn. St. 531 (1850); Webb v. Dean, 21 id. 31 (1853).

(21) Henderson v. Lewis, 9 S. & R. 384 (1823); Ross v. McJunkin, 14 id. 364 (1826); Ross v. Darby, 4 Munf. (Va.) 428 (1815).

(22) Brubaker v. Taylor, 76 Penn. St. 83 (1874); and see Graves v. Steel, 3 La. Ann. 280 (1848); Briggs' Appeal, 93 Penn. St. 485 (1880): Sadler v. Kennedy, 11 W. Va. 187 (1877); Calwell , Prindle, id. 307 (1877); Daby v. Ericksson, 45 N. Y. 786 (1871); Clark v. Hopkins, 7 Johns. 556 (1811); Stocker v. Johnson, 6 B. Mon. 408 (1846). In Didlake v. Robb, 1 Woods, 682, Hill, J., said: "Aside from the statute of limitations,

the rule is well settled that after a debt has remained due and payable for sixteen years, the law holds such lapse of time as prima facie evidence of payment, which prima facie evidence may be rebutted by proof of a subsequent promise to pay, or some reasons why suit was not brought ; and after the lapse of twenty years the presumption of payment becomes conclusive.” It would be hard to say where the judge found such a rule announced as well settled. It is loose language of this kind in judicial opinion that occasions so much confusion and uncertainty in the law.

(11) 3 Brown Ch. 289. (12) 2 Jac. & W. 223. (13) 12 Mass, 379.

(14) Collins v. Terry, 7 Johns. 278; Jackson v. Wood, 12 id, 242; Jackson v. Pratt, 10 id. 381; Giles v. Barremore, 5 Johns. Ch.552.

(15) Fuhsman v. London, 13 S. & R. 386; 15 Am. Dec. COS (1825); Hayes v. Whitall, 13 N. J. (Eq.) 241 (1861).

(16) Foulk v. Brown, 2 Watts, 212 (1834); Bentley's Appeal, 99 Penn, St. 504 (1882).

a

amount thereby due and payable. If a shorter period, note matured R. came to G. wanting to sell him some eren a single day less than twenty years, has elapsed, the stock in a company, on the ground that he needed the presumption of satisfaction from mere lapse of time money, and after much persuasion G. purchased the does not arise. While the mere lapse of twenty years stock. Nothing was said about the note. The pre. without explanatory circumstances affords a presump-sumption arises that the note was paid.(30) tion of law that the debt is paid, even though it be due In case 1 it was said: “It was fifteen years, four by specialty, still payment may be inferred by the months and twenty-five days after the sealed note of jury from circumstances with the lapse of a shorter the plaintiff's testator matured before this action was period of time than twenty years. When an action is instituted for its recovery. No legal presumption of brought on a bond or covenant for the payment of payment such as unrebutted the court would be bound money, if twenty years elapse between the time of its to declare as a conclusion of law arose in that time, becoming due and of the institution of the action or for the authorities all agree in fixing twenty years, proceeding, the defendant may without pleading the from analogy to the English statute of limitations statute of limitations rely upon presumption of pay ·

concerning real estate, as the period necessary to such ment; and upon issue joined on plea of payment, pay

a presumption. But the question is whether the time ment may be inferred by the court or jury from cir- that did elapse was competent in connection with such cumstances coupled with a lapse of a shorter period circumstances as were offered to go to the jury as than twenty years.(23)

ground for their presuming payment of the note. In Colsell v. Bula Lord Ellenborough said: “ After * * * * The competency of such evidence does a lapse of twenty years a bond will be presumed to be not depend on a particular period of years, though its satisfied; but there must either be a lapse of twenty effect will be proportioned to their number. The preyears, or less time coupled with some circumstance sumption strengthens as the time approaches to twenty to strengthen the presumption. Here, if it has been years, and the circumstances needed to establish it may proved that the parties had accounted together, after be measured by a diminishing scale. The further the the money became payable, it might have been in- time stops short of twenty years the more cogent and ferred that it was included in the settlement; but as decisive must be the circumstances relied on. Just as there is no evidence of this, and as twenty years have the further we advance beyond twenty years we require not elapsed since the bond was forfeited, it cannot be more persuasive circumstances to rebut the legal preconsidered as discharged.”

sumption. Twenty years assumed as the point for that

presumption, the scale is reversed by which we measure ILLUSTRATIONS.

the circumstances that tend to establish or counter

vail it. In both instances it is for the jury to apply the 1. K. gave C. in 1837 & sealed note payable in sixty

proofs under the direction of the court. If evidence days. After both K. and C. were dead an action was

be offered which in the judgment of the court will, in brought (in 1852) on this note. C. had a running ac

connection with the lapse of time, reasonably tend to count at K.'s store from 1836 to 1839, and payments

convince the jury that the sealed debt has been paid were made to amounts more thau the note during this

short of twenty years, or that it has not been paid, time. K. resided near C. until his death. These facts

notwithstanding that period, it is the duty of the raise the presumption that the note was paid.(25)

court to receive it, and to submit it to the jury with 2. An action is brought on a bond payable in install

such instruction as shall enable them to estimate it at ments. Nineteen years and ten months have elapsed

what it is really worth. The point to be attained is since the last installment became due, and another in

moral conviction of a fact, and whilst it is not to be stallment bad become payable more than twenty years founded on evidence insufficient to conviuce reasonabefore the suit was brought. The judge instructed the

ble men, we are not to exact mathematical certainty, jury that as to the last installment they may aud as to

nor to expect more than moral demonstration." the other they must presume payment.(26)

“More than sixteen years," it was said in case 3, 3. A judgment was recovered in 1857. In 1874 (16“ had elapsed. A legal presumption of payment does years) a sci. fa. was issued to revive it. The defendant not indeed arise short of twenty years, yet it has been swore that be expected to prove that it had been fully often held that a less period, with persuasive circumpaid out of the proceeds of a sheriff's sale of his laud, stances tending to support it, may be submitted to a in the proceeds of which the plaintiff had participated ; jury as a ground for a presumption of fact.” that he could not state the payments, being unable In case 4 it was said: “The rule is well established after search to obtain the sheriff's docket. Held, that that where the period is short of twenty years the prethe presumption of payment arose.,27)

sumption of payment must be aided by other circum4. A transcript of a justice of the peace was filed in stances beyond a mere lapse of time. But exactly & Superior Court nineteen years after the judgment what these circumstances may be never has been nor was rendered. The justice was not called nor the never will be defined by the law. There must be some docket produced, and there was nothing to show circumstances, and where there are any it is safe to whether an execution had ever been issued. The pre- leave them to the jury. Here there were several cir. sumption arises of payment.(28)

cumstances. No certificate was given by the justice 5. A debt ou a bond due eighteen years and a half that he had issued execution, to which there was a reis sued on. It appears that during this time the cred- turn of nulla bona; and this was important, as the recitor was a poor man and the debtor a rich one. The ord still remained before the justice, who might represumption of payment arises. (29)

ceive the money or collect it by execution. And there 6. R. sued G. on a note payable in 1860; the action was the pregnant circumstance that the plaintiff prowas brought in 1872. On several occasions after the duced hearsay evidence that the transcript was genu(2) Calwell v. Prindle, 19 W. Va. 640 (1882); citing Sadler v.

ine, and that the justice had said that the docket was Kennedy, 11 id. 187; Perkins v. Hawkins, 9 Gratt, 656; Gold

lost. The justice was not produced himself to show hawk v. Duane, 2 Wash. O. C. 323.

tbat the docket was lost and that search was made for (24) 1 Camp. 27 (1807).

it. This would have been unnecessary if the transcript ("5) King v. Coulter, 2 Grant's Cas. 77 (1853).

had been entered in any reasonable time; but (25) Miller v. Evans, 2 Cranch, C. C. 72 (1813).

after the lapse of nineteen years and seven months it (27) Moore v. Smith, 81 Penn. St. 183 (1876).

would seem to be a reasonable duty on the part of the (28) Diamond v, Tobias, 12 Penn. St. 312 (1849).

plaintiff, and the absence of which might fairly be (29) Hughes v. Hughes, 54 Penn. St. 241 (1867).

(30) Garnier v. Renner, 51 Ind. 374 (1875).

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taken into consideration.

* On the whole nate at the date of the expiration of the lease of No. we think the judge did not err in submitting all the 18 Green street, profits to be ascertained as soon as circumstances in evidence to the jury, from which, if practicable after the closing of the books each year. they were satisfied, they might infer, or presume pay

(Sigued)

“JAMES TALCOTT, ment."

“HENRY ADAMS." In case 5 it was said: “That a complete legal pre- On or about December 22, 1882, James Talcott presumption of payment of a bond or other instrument of sented to the assignees a claim against the assigned eslike nature does not arise short of twenty years is well

tate for $170,000 for unliquidated damages for breach settled; but it has also been well settled that a shorter

of the contract above set forth. Ou October 30, 1883, period, aided by circumstances which contribute to judgment was entered on the report of Hamilton Cole, strengthen the presumption of payment by lapse of Esq., referee, dismissing said claim and adjudging that time, may be submitted to a jury as grounds for the said assignees recover $777.46 cost and disbursements. presumption of the fact of payment. Slight circum- From this judgment Talcott appeals. stances may be given in evidence for that purpose in

Hugh Porter, counsel for assignees. proportion as the presumption strengthens by the lapse of time; but still they must be such as aid the Chambers, Boughton & Prentiss, counsel for Talcott, presumption arising from time. They must be, as it claimant. is said, persuasive that the time would not have been DALY, C. J. The claim of damages for & breach of suffered to elapse had the debt remained unpaid. * contract was not provable as a debt under the assign

* To aid the presumption of payment from the ment. lapse of time the defendants offered evidence of what It has been settled by a long series of decisions that they calle, the needy circumstances of the obligee and unascertained claims for damages are not provable as the easy and solvent circumstances of the obligor. No debts in proceedings in bankruptcy; that in claims doubt *

* evidence to prove this is entirely for damages arising from breaches of contract in iocompetent.”

demnity bonds and other possible liabilities the damIn case 6 the court said: “The circumstauce was of ages must be ascertained and fixed before the act of such a nature as tended strongly to support the theory bankruptcy unless the contingent liability is one that that the note had been paid. The conduct of R. on has been specifically allowed by statute, and the actual that occasion was wholly inconsistent with the idea prospective value of which at the time of the bankthat the note was unpaid. He was pressed for money, ruptoy is capable of being ascertained by some mode and if the amount of the note was then due him and

of computing or estimating. Ex parte Marshall, i his partner from G. it is hardly possible that he would | Montagu & Ayrton, 118; Ex parte Thompson, 1 Monnot then have demanded its payment."

tagu & Bligh, 219; Ex parte Tyndal, 1 Deacon & Chitty,

John D. LAWSON. 291; Yellop v. Evarts, 1 Barn. & Adol. 698; Bourman ST. LOUIS, Mo.

v. Nash, 9 Barn. & Cress. 145; Allwood v. Partridge, 4

Bing. 209; Lancashire Coal Co., Montagu, 27; Wooly ASSIGNHENT FOR CREDITORS- UNLIQUIDATED v. Smith, 3 Com. Bench, 610. CLAIM FOR DAMAGES NOTDEBT":

Formerly in bankruptcy proceedings in England the PROVABLE AGAINST AS

claim had to be due at the time of the act of bankSIGNEE.

ruptcy, and the liability upon a promissory note uot due until afterward was not provable. But this was

relaxed by provisions in subsequent statutes which alNEW YORK COMMON PLEAS, GENERAL TERM.

lowed contingent liabilities to be proved; where as be

fore stated, the value could be estimated, and under TALCOTT v. HAZARD.

our own bankruptcy act claims for unliquidated deProspective profits depending entirely for their existence upon mands arising out of any contract or promise were al.

the fluctuations of the markets and the chances of busi- Jowed; but unless where changes have been made in ness are not recoverable as damages.

tbis way by statute the rule has been as above stated. Where the claims arising from a breach of contract are of The reason of it was, as the bankrupt under the act this character, unliquidated and uncertain, they are not

was to be discharged from his debts, the proceeding debts within the meaning of the provisions of an assignment for the benefit of creditors as to the “

was to be strictly confined to what was regarded as a

payment of just debts."

debt; and for the further reason that the creditors To entitle the creditor to a dividend of the insolvent's estate

whose claims were ascertained and fixed when the the liability must be ascertained and fixed at a sum cer- bankrupt went into or was brought into bankruptcy, tain.

were entitled to share in the distribution of his estate On the 14th day of July, 1882, the claimant, James

as soon as it was gathered in, and were not to be de Talcott, and Henry Adams, one of the said firm of R. layed by claims against him sounding in damages & H. Adams, made and executed an agreement, of

which it might take years to determine. It was said which the following is a copy :

that the assets were not to be locked up pending such

“July 14, 1882. uncertaiu litigations, but that matters were to be ad“James Talcott to take the lease of the stores 83 and justed according to the relative liabilities of the bank. 85 Greene street for balance of the term, and to sell on rupt, as they were ascertained and known at the time commission for R. & H. Adams all their goods in stock of the act of bankruptcy, and as his estate then existed. and the entire production of their mills during the That it was not proper to keep the property,or a certain term of this agreement, 7% per cent. commission, and part of it, until it was ascertained whether somebody at the expiration of this lease to assume the lease of No. who had a claim for damages, which it might take 18 Green street or for three years, until the expiration of years to determine, would recover any or not. Ex said lease; also it is understood tbat if required James parte Marshal, 1 Mont. & Ay. 118. In which connecTalcott is to advance in cash or acceptance of R. & H. tion I may inention that I have known cases in our Adams, drafts not to exceed two-thirds market value own court in which actions for the recovery of damof goods; also to pay Henry Adams and William ages through mistakes and new trials remained in the Adams together 25 per cent of the net profits of this court for ten years before they were finally deterbusiness for selling the goods and taking general over- | mined. sight of this business under Mr. Talcott's supervision, The grounds upon which unascertained olaims of the said business to date from July 15, 1882, and to termi- the nature of the one bere presented were not allowed

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to be proved as debts in bankruptcy, apply with equal is not embraced in that proceeding; and as in that force in cases of voluntaryassignments for the benefit of case the liability of the insolvent at the time of the ascreditors, and indeed more so, because there the instru- signment was merely contingent, that is, upon the nonmeut itsell provides how and to the payment of wbat payment afterward of the note by the maker; it was debts the property assigned shall be applied; and un- held that the holder of the note was in no way affected less the assignment is impeachable for fraud or other by the insolvent's discharge, but might maintain an wise invalid, the question is one to be gathered from a action thereafter against him; which was reaffirming fair construction of the instrument and not from the substantially a prior decision of Chancellor Kent in provisions of any statute. Bishop on Assigoments, Frost v. Carter, 1 Johus. Cas., in which the chancelch. 27.

lor, then a judge of the Supreme Court, held that the The assignment is not set forth in the case as made insolvent's proceedings extended only to such debts up; but its provisions as to the manner in which the as were due at the time of the assignment. That assigned estate is to be applied is stated in the defend- “such debts must be specific, and certain sums of ant's points to be, as is usual iu such instruments, that money to which the creditor can make oath as being the estate is to be converted into money and applied justly due or to become due at some specific time; and to the payment of the just debts of the assignors. unless the creditor at the time of the assignment be

The question then is, what is to be understood as able to produce and verify such a debt, he will not be debts within the intention of the assignment?

entitled to receive from the assignees his dividend of "A debt," says Sir John Cross in E.c parte Thompson, the insolvent's effects, nor will he be barred from his Montagu & Bligh, 219, “is a demand for a sum cer- future action against the insolvent." And this rule tain," "and it is," says Commissioner Fontblanque in that the liability at the time of the assigument must Ex parte Marshal, 1 Montague & Ayrton, 118, “a sum be ascertained and fixed at a sum certain, whether actually ascertained. That there must be," he says, payable before or after the assignment to entitle the "an ascertained debt, and not an unliquidated de- creditor to a dividend of the insolvent's estate, has mand or liability, is sustained by all the cases, legal been recognized in many other cases both in this State and equitable. It must be a debt existing and ascer- and elsewhere. tained at the time of bankruptcy.

The Under the act, N. Y. Laws of 1877, ch. 466, regulatdistinction," he says, “ between debt and damages has ing voluntary assignments, the creditor at the time always been rigorously adhered to."

specified in the notice must come in and prove his The same exposition of what is considered a debt is to claim or he is debarred from participating in the disbe found in our own cases. “Itimports," says Monell, tribution of the estate. Kerr v. Blodget, 48 N. Y. 62. C. J., in Zinn v. Ritterman, 2 Abb. (N. S.) 262, 263, “a The act, section 13, contemplates that the creditors shall sum of money arising on contract, and not a mere prove their claims, and it is the practice to do this by claim for damages, in which it was held that in our in- an affidavit. solvent acts it does not extend to actions where the Iu this case there could be no compliauce with the damages are unliquidated."

rule laid down by Chancellor Kent in Frost v. Carter, In the Matter of Denny, 2 Hill, 220, which was a pro- supra, for there was no debt of a certain or specific ceeding in this court under the Insolvent Debtor's amount due at the time of the making of the assignAct, which as first enacted allowed the trustees to sue ment, or in fact any debt due them, for it was by the for debts or demands, but which was afterward lim- making of a general assigument for the benefit of ited to debts, it was held that the word “demand" is creditors that Adams and Horne put it out of their of much broader import than the word “debt," and power to perform the agreement made by Adams with would embrace rights of action belonging to the debtor Talcott, and it is this wbich Talcott relies upon as conbeyond those which could be called debts.

stituting a breach of the agreement. It is upon this In Losee v. Bullard, 54 How. Pr. 320, where a stock- that his claim rests, so that the claim did not come holder of a corporation was sought to be made liable into existence until after the assigument. under the statute for a debt, it was held that a claim for The referee bas found that the making of a general damages was not a debt within the meaning of the assignment by R. & H. Adams, and their consequent statute.

inability thereafter to manufacture and supply Talcott In Kimpton v. Bronson, 45 Barb. 625, where the with goods did not amount to a breach of the agreequestion of what was a debt under the United States meut. He has found however that Talcott was entistatute making treasury' notes a legal tender for tled to receive for sale under the agreement the goods debts, it was held that the voluntary payment of a spe- which were manufactured and in the hands of R. & H. cific sum of money in discharge of an obligation was Adams at the time of the assignment, but that it did within the meaning of that statute the discharge of a not appear that Talcott had suffered any loss or damdebt.

age by these goods not being consigned to him. In Kennedy v. Strong, 10 Johns., it was held that The referee in his opinion states generally that there under the insolvent act goods received by the insolv. was nothing before him upon which it would have ent as a factor or trustee was not a debt within the been possible for him to have estimated the amount of meaning of the insolvent act, that the insolvent's dis- profits that would or might have been realized if the charge would in no way affect it, but that he remained contract had been fulfilled. That any estimate on the equally liable to be sued upon it as well after as before facts before him would have been purely speculative his discharge; and in the Mechanics & Farmers' Bank, and wanting in that reasonable certainty which the etc., v. Capron, 15 Joh:18. 467, it was held that the in- | law requires. This conclusion was, I think, undoubtsolvent's liability as iudorser of a promissory note, edly correct so far as regards the claim for loss of which was not due at the time of his discharge, did not profits on goods to be manufactured thereafter and deconstitute a debt which was or could be discharged by livered during the whole period for which the agreethat proceeding, which extended only to debts that ment was to run. In the affidavit of the claim Talcott were due at the time of the assignment of the insolv- swore that the insolvent firm was justly indebted to ent's estate, or debts contracted before that time and bim in the sum of $170,000 for damages arising from payable afterward; that it was a general and well-set- the breach of the contract, but upon his examination, tled role that if the creditor at the time of the assign- through varivus errors and mistakes, the amount ment by the insolvent debtor has not a certain debt sworn to in his affidavit as $170,000 was reduced by due or owing to which he can attest by oath so as to him to $130,000. entitle him to a dividend of the insolvent's effects, it The greater part of this claim, as thus reduced to

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