was handed to him by B. V laid down upon the table B's $488 note, and $12 in cash, and retained the note belonging to B. B objected to this proceeding, but afterwards took the money and note from the table, to prevent their being lost. Held, that his act under the circumstances did not constitute an acceptance of payment. Van Cleave v. Beach, 110 Ind. 269.

Where the debtor offers to the creditor a certain sum in payment of a debt, the amount of which is open and unliquidated, and accompanies his offer with the condition that the money, if taken at all, must be received in full or in satisfaction of the debt, and the creditor receives it, this operates as a payment, even though the creditor, when receiving the money, declares that he will only take it in part satisfaction of the debt, as far as it will extend. McDaniels v. Lapham, 21 Vt. 222; McDaniels v. Bank of Rutland, 29 Vt. 230; s. c., 70 Am. Dec. 406; Cole v. Champlain Transp. Co., 26 Vt. 87; Calkins v. State, 13 Wis. 395; Day v. Murdock, 1 Munf. (Va.) 460.

See also, infra, Part Payment. Compare King v. Phillips, 94 N. Car. 555; Thomas v. Cross, 7 Exch. 728; 21 L. J. Exch. 251.

A payment to a sheriff by the purchaser of land at execution sale of the amount of his bid is none the less a valid payment by reason of the fact that the purchaser at the time gives the sheriff notice not to pay over a certain portion of the money. Spraker v. Cook, 16 N. Y. 567.

Where property of the testator is delivered to a specialty creditor, this will be treated as a payment of the debt, though it was delivered to him as residuary legatee. Stephenson v. Axson, 1 Bailey Eq. (S. Car.) 274.

Defendant had been accustomed to paying his indebtedness to the plaintiff by depositing money to his credit at any one of several banks, the indebtedness not being considered as discharged till plaintiff received notice of the deposit. It was agreed that a particular debt should be paid by depositing the sum due at a certain bank. Held, that the bank thus designated became the plaintiff's agent, and the debt was overcharged by making the deposit, though no notice thereof was given to plaintiff. Exchange Bank v. Cookman, 1 W. Va. 69.

Where items were originally charged to a wife, but were embraced in an account rendered by the creditor against the husband in the usual course of dealing between them, the balance being in the husband's favor, this constitutes a payment of such items. Florance. Michell, 5 La. Ann. 17.

If it is agreed between the parties to a note that payment may be made in a particular manner, a performance of the agreement by the maker before action brought, will be a defense to a suit on the note. Gilson v. Gilson, 16 Vt. 464.

Where contemporaneously with the execution of a written obligation to pay money there is an oral agreement that the obligation is to be discharged by the doing of something other than the payment of money, this agree ment when performed operates as a completed discharge of the obligation. Patrick v. Petty, 83 Ala. 420.

Where contemporaneously with the execution of a promissory note it is orally agreed that, if the maker marries the payee, the latter will dismiss a pending suit for bastardy and breach of promise, and the note shall be deemed satisfied, the maker may set up the performance of this agreement as a payment and a defense to an action on the note. But such defense may be avoided by proof that the agreement of the maker was not merely to marry plaintiff, but also to take care of and treat her as a husband should his wife, and that, though he had married her, he had treated her in a manner so cruel and inhuman as to drive her from his home, so that she was compelled to obtain a divorce. Tucker v. Tucker, 113 Ind. 272.

Where it was agreed at the time of giving the note that the maker should pay the interest and such part of the principal as he could by orders drawn on him by the payee, and by paying the premiums due from the payee to an insurance company, evidence that the agreement was performed by the maker is admissible under a plea of payment. Jones v. Snow, 64 Cal. 456.

Where the agreement is performed in part, and full performance prevented by the act of the payee, this would constitute payment pro tanto. Thus, where, at the time of executing the note, it was agreed between the parties that if the payee lived through the year 1884, and the maker boarded

and cared for her during said year, the note was to be discharged, and the payee died in September, 1884, this constituted a payment of the note pro tanto. Patrick v. Petty, 83 Ala. 420.

An agreement to credit on a note the value of work done does not constitute a payment pro tanto. Cook v. Cook, 24 S. Car. 204; Weeks v. Elliott, 33 Me. 488.

But if the work is done under such agreement it constitutes a payment. Moore v. Stadden, Wright (Óhio) 88. Where suit is pending on a promissory note against maker and indorser, a payment by the indorser is such a payment as will bar a further prosecution of the suit against the maker even for the indorser's benefit. Griffin v. Hampton, 21 Ga. 198.

Same principle applies to payment of judgment. Boggs v. Lancaster Bank, 7 W. & S. (Pa.) 331; Davis v. Barkley, 1 Bailey (S. Car.) 141. Compare Low v. Blodgett, 21 N. H. 121.

The payee of a promissory note agreed with the maker to take it up from an indorsee who was the holder, and in settlement to deliver it to the maker. After it was thus taken up, there was a balance due from the payee to the maker which exceeded the amount of the note. Held, that these facts constituted a payment of the note. Peabody v. Peters, 5 Pick. (Mass.) 1.

Defendant being indebted to a bank was authorized by the latter to discharge such indebtedness by taking up certain notes and certificates of the bank, which had been guaranteed by defendant, and the bank offered to receive them at par in payment of such debt. Held, that the production and lender to the bank of such notes and certificates constituted a complete discharge of the defendant's indebtedness, notwithstanding the fact that such notes and certificates were il legally issued, and the bank was not liable on them. Leavitt v. Beers, Hill & D. Supp. (N. Y.) 221.

The indorser of a protested draft held by a bank procured his note to be discounted by the bank with a view to paying the bill, but having given no direction as to the application of the proceeds, the amount was placed to his credit on the books of the bank, and some time afterwards applied by the cashier to the note which was therefore cancelled and de

livered up to the maker. Held, that the note was extinguished and no action could be maintained on it. Shaw v. Branch Bank, 16 Ala. 708.

If the laws of the place where a vessel touches require that the physician's bill for attendance upon a seaman shall be paid by the vessel before she can leave port, and the amount is paid by the master, this is a payment pro tanto of the seaman's wages, and does not constitute merely a set-off. Pray v. Stinson, 21 Me. 402.

Where the payee of a joint and several promissory note assigns the same to one of the makers, this amounts to a pay. ment; and the note cannot be revived by an assignment by such maker after maturity. Gordon v. Wonsey, 21 Cal. 77.

One who was in debt to a bank made a payment on account in the bank to one of the clerks. On a subsequent day the debtor agreed to lend the clerk the amount so paid, and the clerk took the money and used it, the amount never having been credited to the debtor on the books of the bank. Held, that the debt was extinguished pro tanto. Rhodes v. Hinckley, 6 Cal. 283.

A mortgagor placed in the bank at which the secured note was made payable the money necessary to meet the note, with instructions to the bank to retain the money until proper authority was given to cancel the mortgage and the title to the land for which the note was given should appear perfect. The title proving defective, the mortgagee set about remedying the difficulty. Before this was accomplished the note was transferred to a third person, who filed a bill for foreclosure, and it was held that the payment, being only conditional, was not a bar to the foreclosure. Coburn v. Hough, 32 Ill. 344.

Where the debtor makes an absolute deed of land to the creditor, this constitutes a payment to the extent of the value of the land. So also does a mortgage of land, after foreclosure. Greenl. Evid. (13th ed.), § 524; Fales v. Reynolds, 14 Me. 89. See Hogan v. Hall, 1 Strobh. Eq. (S. Car.) 323.

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While the foreclosure of a mortgage is not in a strict sense a payment, yet the value or the land enures by way of payment. Briggs v. Richmond, 10 Pick. (Mass.) 391; s. c., 20 Am. Dec. 526; Case v. Boughton, 11 Wend. (N. Y.) 106.

Where chattels are mortgaged to secure a debt, a taking and retaining the

chattels, or selling them without a foreclosure, will operate as a payment of the mortgage debt. Landon v. White, 101 Ind. 249. See Hunt v. Nevers, 15 Pick. (Mass.) 500; s. c., 26 Am. Dec. 616; Wright v. Storrs, 32 N. Y. 691; Dismukes v. Wright, 3 Dev. & B. L. (N. Car.) 78.

Where a mortagee who holds two mortgages, one covering real estate and the other personalty, to secure the same debt, forecloses the personal mortgage, takes possession of the property and converts it to his own use, this operates as a payment of the debt and a satisfaction of the realty mortgage, if the value of the personalty exceeds the debt secured. Androscoggin Sav. Bank v. McKenney, 78 Me. 442.

Where a negotiable promissory note was transferred before due as collateral security, and was afterwards paid to the payee, who transmitted the money to the holder, and the holder, in ignorance of the fact that the money was the proceeds of the collateral note, applied it to the payment of the note secured thereby, but not to the collateral itself, this was a discharge of the collateral note. Coleman v. Jenkins, 78 Ga. 605. A, being the holder of B's note, employed an agent to collect the same. B also appointed the same agent to collect certain rents and notes and apply the proceeds to the payment of the note to A. The agent collected for B a sum greater than the amount of B's note to A, but made no credit or endorsement of payment on the note, simply crediting B on his books with the money received. Held, that the note was not paid. Phillips v. Mayer, 7 Cal. 81. Compare Grandy v. Abbott, 92 N. Car. 33, 38; Smith v. Lamberts, 7 Gratt. (Va.) 138.

An agreement between an agent of an insurance company, having authority to receive premiums, and a party insured, that the agent shall become responsible to the company for the premium and the insured become his personal debtor therefor, constitutes a payment of the premium as between the insured and the company. Sheldon v. Connecticut Mut. L. Ins. Co., 25 Conn. 207; s. c., 65 Am. Dec. 565; Bouton v. American Mut. L. Ins. Co., 25 Conn. 542. See Home Ins. Co. v. Gilman, 112 Ind. 7.

But the mere acquittance or release to the agent of his personal debt to the debtor, will not constitute a payment to the principal. Bostick v. Hardy, 30

Ga. 836; Smith v. Morrill, 39 Kan. 665.

Where a party who is indebted to an insurance broker hands to the broker a policy of insurance that the latter may adjust the loss, and upon adjusting it the broker debits the insurance company and credits the insured, this constitutes a payment of the policy, unless the insured dissents at the time. Bethune v. Neilson, 2 Cai. (N. Y.) 139.

Plaintiff, the owner of a note executed by A, placed it in the hands of an attorney for collection. It was then agreed between A and the attorney that the latter should borrow for A from B a sum of money sufficient to pay the note, which was done, A executing a deed of trust to secure B, the lender of the money, and A's note was delivered up to him by the attorney upon the receipt of the money from B. Held, that as soon as the money was thus received by the attorney it operated eo instanti as an extinguishment of the note. Grandy v. Abbott, 92 N. Car. 33.

The owner of certain State bonds, redeemable at the treasury, deposited them with the State treasurer, who afterward, without the owner's authority, took from the treasury money

to the amount of the bonds and converted the same to his own use, cancelling the bonds. He credited himself with the amount as for money paid in the redemption of bonds, and in a settlement with the State was allowed credit for the amount. Held, that as against the owner of the bonds this did not constitute a payment. Bassett v. State, 26 Ohio St. 543.

Where a collector receives for taxes a negotiable order drawn by the selectmen on the town treasurer, this does not, of itself, constitute a payment of the order. Willey v. Greenfield, 30 Me. 452.

The purchaser of a lot from his father-in-law signed his own father's name, to the notes given for the purchase money, and had the lot conveyed to his father. Afterward, in the settlement of the father-in-law's estate, these notes were taken by the son and his wife as part of her distributive share. Held, that this constituted a payment of the notes. Scheerer v.. Scheerer, 109 Ill.

II.

W, a district school teacher, received for a month's salary an order of the district committee on the treasurer, which he transferred, indorsed in blank, to a third person, who in good faith paid him the money on it. This had been the

usual mode of monthly payment for two years. Held, to operate as a payment to W as against a creditor of his who garnisheed the treasurer before the order was presented, and before the treasurer had received notice of the transfer. Seymour v. Over River School District, 53 Conn. 502.

A brakeman took out a policy of insurance, the premium of which was to be paid by instalments, and gave to the insurance company a written order on the railway company by which he was employed to pay such instalments out of his wages as they fell due, which order was delivered to the railway company by the insurance company, in accordance with an existing custom in such cases. The railway company neglected to pay one of the instalments, but the insurance company failed to notify the brakeman of that fact, and within the period covered by such instalment he was killed. Held, that the instalment must be regarded as paid. Lyon v. Traveler's Ins. Co., 55 Mich. 141; s. c., 54 Am. Rep. 354.

A debt may be paid by a third person becoming responsible to the creditor with the concurrence of the debtor. Logan v. Williamson, 3 Ark. 216.

An agrement between maker and payee that the note shall be deemed to be paid by being allowed in discharge of a mortgage from the payee to a third person, does not extinguish the note, unless the assent of such third person is shown. Hewes v. Hanscom, 10 Gray (Mass.) 336.

The holder of a note brought ar action thereon against the maker. At the trial, the plaintiff, against the protest of defendant, credited on the note the amount of an account which he owed defendant, took judgment for the balance, and defendant afterward paid the judgment. Held, that this did not constitute a payment of the account due defendant. Keith v. Smith, 1 Swan (Tenn.) 92.

Plaintiff employed a traveling agent to sell goods, and fixed the minimum prices to be charged therefor. Defendants, who knew the limitations as to prices, bought goods of the agent upon an agreement with him that they should settle for the goods at prices less than the minimum. The agent then sent to plaintiff an order for the goods, with the minimum prices affixed thereto. Plaintiff, in ignorance of the agreement between his agent and defendants, shipped the goods together with a bill there

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of showing the minimum prices, and charged the goods to defendants at those prices. Defendants received the goods and made no objection to the bill, but they settled with the agent at the prices agreed upon between them, and the agent reported to plaintiff that he had received the full sum charged by plaintiff for the goods. Thereupon plaintiff charged the agent and credited the de fendants with the amount of the bill, but there has been no final settlement between plaintiff and his agent. In a suit to recover of defendants the difference between the amount paid to the agent and the face of the bills rendered, held, that the bills had not been paid and plaintiff was entitled to recover. Rogers v. Holden, 142 Mass. 196.

H owing to P for a set of tombstones, made an agreement with S that S should pay P for the stones upon their delivery, H to credit S with the sum upon a demand which he held against him. P was indebted to B upon a past due promissory note, and agreed with B that B should receive payment of S for the stones and apply the amount on the note, S consenting thereto. P thereupon delivered the stones to B with notice to S of that fact. Held, that the transaction amounted to a payment in praesenti of the amount upon P's note to B. Butts v. Perkins, 41 Barb. (N. Y.) 509.

A draft indorsed by defendant for the accommodation of the drawer, and subsequently by plaintiff for the same purpose was discounted at the instance of the drawer, and not being paid by him was taken up by the plaintiff, due notice being given to defendant as first indorser. Subsequently, in order to reimburse the plaintiff, a note was made by plaintiff and indorsed by the defendant, discounted by a bank and the proceeds remitted to the plaintiff. Plaintiff's clerk without his knowledge credited the amount on the books of plaintiff to the drawer of the draft, which act was disaffirmed by plaintiff upon its coming to his knowledge. The note was not paid by defendant, but was taken up by plaintiff. Held, that the discount of the note and the receipt by plaintiff of the proceeds was not an extinguishment of the liability of defendant as first indorser of the draft. Oliphant v. Church, 19 Pa. St. 318.

Plaintiff obtained from defendant an advance of £15,000 upon the security of goods then in transit to M V, consigned to S, and of six bills of exchange

drawn by plaintiff upon S against the shipment and accepted by S. Two of the bills were duly paid. Two of the remaining four having been dishonored, defendants at M V proposed to realize on the goods at once, whereupon plaintiff delivered them a cheque for £2,500 with the request not to sell but to hold the £2,500 as collateral security for S's acceptance, to be returned to plaintiff when all the bills were paid. Shaving failed to pay the remaining bills, defendants proceeded against him at M V, under which proceedings the goods were sold by judicial arrangement, and the bills were cancelled and delivered up to S, without plaintiff's knowledge or consent. The sale of the goods did not produce sufficient, even with the £2,500, to pay all the dishonored bills. Plaintiff brought his action to recover back the £2,500. Held, that while plaintiff might have an accounting against defendants for what they realized or might have realized by means of the securities but for their own acts and negligence, that is, for the real value of the cancelled bills, yet the transaction above recited did not constitute a payment of the bills, and he was not entitled to recover the £2.500. Yglesias v. Mercantile Bank, L. R. 3 C. P. Div. 46; s. c., affirmed on appeal, L. R., 3 C. P. Div. 330; s. c., 30 Moak's Rep. 46, 198.

was trustee of funds belonging to defendant, and also cashier of a bank. He placed in such bank certain sums to his credit as trustee, and gave defendant permission to draw on the bank at pleasure. Defendant accordingly drew cheques repeatedly on the bank, which were always paid up to the time of the death of S. After his death defendant drew two more cheques, the aggregate amount of which was less than the sum standing to the credit of S, as trustee, on the books of the bank. These cheques were paid by the cashier who succeeded S, who did so with the intention of charging them against the balance to the credit of S, as trustee. They were never actually so charged, and the bank soon became insolvent and went into the hands of a receiver, who brought an action to recover the amounts so paid defendant on her two cheques. Held, that, in equity, the money to the credit of S as trustee be

longed to the defendant, and the acts of S amounted, in an indirect way, to a payment thereof to her, and the receiver could not recover it back. Bank of Slatesville v. Waddell, 100 N. Car. 338.

The maker of a promissory note was one of the distributees of the estate of the holder thereof. She agreed with the administrator that before the final settlement of the estate, the amount due on the note should be deducted from her share of the estate in payment of said note. The estate had never been settled, no account had been rendered, and it had never been ascertained what the maker's distributive share would amount to. Held, that this was a mere executory agreement, and not suf ficient to establish a payment. Taylor v. Lewis, 146 Mass. 222.

Compare Gardiner v. Callender, 12 Pick. (Mass.) 374

Where a testator was indebted to the person named as his executor, and by the will leaves certain property to the executor in payment of the debt, the executor cannot, after proving the will, assert his right to take other assets of the estate in payment of his debt, though the property mentioned in the will proves to be of less value than the amount of the debt. Syme v. Badger, 92 N. Car. 706.

Where a clerk in a bank stole money from the drawer of a fellow clerk and delivered it to the cashier, who accepted it in satisfaction of a debt due from the former to the bank, such transaction did not constitute a payment of the clerk's debt. State Bank v. Welles, 3 Pick. (Mass.) 394.

Where a payment is made in a manner not contemplated by the contract, the payee may adopt and ratify it. But if he has a right to elect whether he will ratify or disaffirm it, he must ratify it or disaffirm it as an entirety. Williams v. Jones, 77 Ala. 294.