a written authority from the vendor, to pay the money to the solicitor, and does not apply to those cases in which the authority could not be given. In re Bellamy and Metrop. Board of Works, 24 Ch. D.386, C. A., diss. Baggallay, L.J. Possession of a negotiable security is evidence of authority to receive payment. Story on Agency, s. 104, citing Owen v. Barrow, 1 N. Ř. 103. See further, as to payment of a bill of exchange, cheque, or promissory note, the Bills of Exchange Act, 1882, s. 59, ante, p. 367. Payment to the factor who sold the goods, and who was known to sell as such, is good against the principal, though made prematurely. Fish v. Kempton, 7 C. B. 687. A special defence of payment to agent D., of whom the plaintiff bought the goods, believing him to be the principal, must state that D. was ostensible owner of the goods by permission of the plaintiff. Drakeford v. Piercy, 7 B. & S. 515.

As a general rule, when a person employs an agent to receive a debt he must receive it in money, and if the agent sets it off against a debt from himself, the creditor cannot rely on this as payment. Barker v. Greenwood, 2 Y. & C., Ex. 418; Scott v. Irving, 1 B. & Ad. 605; Sweeting v. Pearce, 7 C. B., N. S. 449; 29 L. J., C. P. 265; 9 C. B., N. S. 534; 30 L. J., C. P. 109, Ex. Ch.; Pearson v. Scott, 9 Ch. D. 198; though if the principal knew that there was a general usage of the trade or market, in which the transaction took place, that debts should be set off in this way, and he did not object to it, he would be taken to be bound by the usage. Stewart v. Aberdein, 4 M. & W. 211, cited ante, p. 407, and Sweeting v. Pearce, supra. So, where goods are bought through a broker, and the purchaser pays for them by an advance on his general account with the broker, before the delivery of the goods, it is a question for the jury whether by the custom of the trade such payment is good as against the principal. Catterall v. Hindle, L. R., 2 C. P. 368, Ex. Ch. So, payment to a clerk or servant by cheque, bill, or note, is good, if it be in the usual course of business; Thorold v. Smith, 11 Mod. 87, 88; or, if the cheque, &c., is subsequently paid; Bridges v. Garrett, L. R. 5 C. P. 456, Ex. Ch., per Blackburn, J.; and see Williams v. Evans, L. R., 1 Q. B. 352, 354: even though the payment was by cheque payable to order, which the clerk cashed at the bankers by forging the indorsement; for the payment by the banker is protected by 16 & 17 Vict. c. 59, s. 19, and Bills of Exchange Act, 1882, s. 60, ante, p. 371. Charles v. Blackwell, 2 C. P. D. 151, C. A. The defendant having purchased copyhold land was admitted by his solicitor C., who had been appointed by the steward of the manor as his deputy to admit the defendant. The defendant gave C. a cheque, crossed by C.'s request, to C.'s bankers, for the amount of the lord's fine, steward's fees, and C.'s charges as his solicitor. The amount of the cheque was duly paid to C.'s bankers, who retained the money in discharge of a debt due to them by C. It was held a good payment of the fine by the defendant as against the lord. Bridges v. Garrett, L. R., 5 C. P. 451, Ex. Ch. But, payment to a particular agent, e.g., an auctioneer, must not be made by bill. Williams v. Evans, supra; and see Sykes v. Giles, 5 M. & W. 645. As to the form in which a bill given to an agent should be drawn, see Hogarth v. Wherley, L. R., 10 C. P. 630.

A payment to one of several persons who have deposited money in a bank, and who are not partners, is not good as against the others. Innes v. Stephenson, 1 M. & Rob. 145; Stewart v. Lee, M. & M. 158. But, a payment to one partner is payment to all; and a receipt by one, is prima facie evidence of payment against all; but it may be rebutted by proof that it was given in fraud of the other partners in order to defeat the action. Farrar v. Hutchinson, 9 Ad. & E. 641.

Payment by agent.] Payment by an agent will support an averment of

Payment by Agent.-Appropriation of Payments.

619

payment by the principal, though the latter has not in fact repaid the agent. Adams v. Dansey, 6 Bing. 506.

Payment by one of several partners is payment by all; but where one of several partners paid a sum of money to a creditor, in consideration that the creditor would assign the debt to a trustee for the partner, it was held that, in an action brought by the trustee, in the name of the creditor, against the partnership, the above facts did not support a plea of payment. M'Intyre v. Miller, 13 M. & W. 725. Where it was agreed between A., B., and C., that A. should advance money to B. in anticipation of money of B. that was coming into A.'s hands, and on receiving in the meantime the security of C.'s acceptance, which was to be satisfied out of such money; it was held that, on receipt of B.'s money by A., it might be relied on by C. as payment by him, in an action against him by A. on the acceptance. Hills v. Mesnard, 10 Q. B. 266. In an action against the surety of A., a bankrupt, there was a plea of payment by A., and acceptance in satisfaction by the plaintiff: held, on issue taken on the plea, that a payment by A. to the plaintiff, which was recovered back by A.'s assignees as a fraudulent preference, would not support the plea, and that the verdict and judgment of the assignees was evidence, but not conclusive, for the plaintiff to show that the payment was illusory. Pritchard v. Hitchcock, 6 M. & Gr. 151. See also Petty v. Cooke, L. R., 6 Q. B. 790.

Payment by a third person, if made on behalf of the defendant, accepted by the plaintiff, and adopted by the defendant, is a good defence. Simpson v. Eggington, 10 Exch. 845; 24 L. J., Ex. 312; Belshaw v. Bush, 11 C. B. 191; 22 L. J., C. P. 24; Kemp v. Balls, 10 Exch. 607; 24 L. J., Ex. 47. But, where payment is made by an unauthorized agent, the creditor and agent may, before the debtor has affirmed the payment, rescind the transaction, and the creditor repay the money, and the payment is then at an end; Walter v. James, L. R., 6 Ex. 124. So, payment by a third person, without the debtor's knowledge, and not on behalf of the defendant, but as an advance for the creditor's convenience, is no payment, though pleaded as such by defendant. Lucas v. Wilkinson, 1 H. & N. 420; 26 L. J., Ex. 13.

Appropriation of Payments.] In general, the party who pays money has a right to direct the application of it; but where money is paid to a creditor generally, without any specific appropriation by the party paying, and the creditor has several demands against the party paying, he may apply the money paid to whichever of those demands he pleases. Hall v. Wood, 14 East, 243, n.; Clayton's case, 1 Mer. 572.

The appropriation by the debtor need not be express; it may be inferred from conduct or circumstances indicating his intention. S. C.; Newmarch v. Clay, 14 East, 239. The intention of the debtor ought to be notified at or before the time of payment. Mayfield v. Wadsley, 3 B. & C. 357. But, the creditor need not apply it to any particular demand at the moment of payment; he has a right to make the application at any subsequent period; nor will an entry in his private books applying it to a particular demand, but not communicated to the party paying, preclude him from applying it afterwards to another demand. Simson v. Ingham, 2 B. & C. 65; see also Grigg v. Cocks, 4 Sim. 438. The creditor, in such cases, might, even before the Judicature Acts, have applied the payment to the discharge of a prior and purely equitable demand, and have sued his debtor at law for the subsequent legal debt. Bosanquet v. Wray, 6 Taunt. 597. But, this could only be done if the equitable debt were of agreed and ascertained amount; for it was not competent for the creditor to apply it in satisfaction of some equitable demand, the amount of which could only be ascertained by an account in equity or

general settlement of partnership. Goddard v. Hodges, 1 Cr. & M. 33. It seems, however, that the Judicature Acts have now abolished the distinction between a legal and an equitable demand, though in some cases it cannot be ascertained if the latter exists until an account has been taken. The creditor may apply it to a debt barred by the Statute of Limitations; though we have seen that part payment, so appropriated by the payee only, will not per se take the whole debt out of the statute. Mills v. Fowkes, 5 N. C. 455. See ante, pp. 607, 608. Where the party paying is indebted to the party receiving for a sum due from his wife, dum sola, and also on another demand, the party, receiving may apply the money to the first demand. Goddard v. Cox, 2 Str. 1194.

In some instances, and in the absence of any proof of special appropriation, the law will direct or presume the application of money paid generally. Of this nature are accounts current with bankers and others, where there are various items of debt on one side and credit on the other, occurring at different times, and no special appropriation is made by the parties; successive payments will then be applied to the discharge of antecedent debts in the order of time in which they stand. Story, Eq. Jurisp. § 459, b. ; Kinnaird v. Webster, 10 Ch. D. 139. Such cases stand on the presumed intention of the debtor, or of both parties, arising out of the nature of the dealings be tween them. Thus, where one of several partners dies while the partnership is in debt, and the surviving partners continue their dealings with a particular creditor, who joins the transactions of the old and new firm in one entire account, the payments made from time to time by the surviving partners will be applied to the old debts; per Bayley, J., Simson v. Ingham, 2 B. & C. 72; Clayton's case, 1 Mer. 572; Brooke v. Enderby, 2 B. & B. 71 ; Hooper v. Keay, 1 Q. B. D. 178; Accord. L. & County Bank v. Ratcliffe, 6 Ap. Ca. 722, D. P. So, payments by a debtor, from time to time, to surviving partners, upon one general account, including an old debt due to the former firm, will be applied in the first place to such old debt. Bodenham v. Purchas, 2 B. & A. 39. But, where the old debts are not brought into the new account, general payments on the account are not to be considered as made in discharge of an old debt. Simson v. Ingham, 2 B. & C. 65. When the circumstances rebut the presumption as to the intention of the debtor the rule above laid down as to appropriation of payments will not apply. Thus where a person in a fiduciary capacity, though not strictly a trustee, draws out, for his own private purposes, sums from a mixed fund of his own and of trustee moneys, it is presumed that he draws out his own moneys only, as otherwise he would commit a fraud. Knatchbull v. Hallett, 13 Ch. D. 696, C. A., diss. Thesiger, L. J. Where there are distinct demands, one against persons in partnership, and another against one only of the partners, if the money paid be the money of the partners, the creditor is not at liberty to apply it to the debt of the individual. Thompson v. Brown, M. & M. 40. Where goods are from time to time supplied to a mining company, conducted on the cost-book principle, and a payment is made on account of these goods to the seller generally, he is entitled to apply these payments in satisfaction of items of his claim, which accrued due before a fresh partner entered the firm, although the payment was made after that event. v. Jackson, 36 L. J., C. P. 108.

Geake

In the absence of special application by either party, there is no rule by which a general payment is applied on any principle, grounded on the comparative burden of different debts, or with reference to the interest of the debtor or of his sureties. Mills v. Fowkes, supra. Thus the law will not, in favour of a surety, direct the application of money, paid generally, to the discharge of the debt secured, without some circumstances to show that it was so intended; Plomer v. Long, 1 Stark. 153; Williams v. Rawlinson, 3

Appropriation of Payments.-Payment by a Bill or Note. 621

Bing. 71; and where a surety joined in a money bond to secure advances by a bank to his principal, and it appears that the security was intended, though not expressed, to be a continuing one, payments will not be applied to the extinction of the bond in preference to later debts. Henniker v. TVigg, 4 Q. B. 792; City Discount Co. v. McLean, L. R., 9 C. P. 692, Ex. Ch. The case of Marryatts v. White, 2 Stark. 101, occasionally cited in proof of the doctrine that payment will be applied in favour of sureties, is one in which the evidence tended to show that the payments were, in fact, made by the debtor in relief of the surety, and not on account of an earlier debt, to which creditor claimed to apply it. See also Kinnaird v. Webster, 10 Ch. D. 139. The surety, on a promissory note given to secure a loan to a member of a money club, cannot rely on the monthly subscriptions and premiums paid by his principal, as payments in reduction of his liability on the note. Wright v. Hickling, L. R., 2 C. P. 199.

When A. has a demand against B.'s wife as executrix, and also another demand against B. in his own right, and B. makes a general payment, A. cannot apply it to the former demand; for the obligation to pay it depends on whether or no there are assets. Goddard v. Cox, 2 Str. 1194. Where there are two demands, one legal and the other illegal, and a general payment is made, the law will apply it to the discharge of the legal demand. Wright v. Laing, 3 B. & C. 165. But, the party receiving money may himself apply it to a demand for spirituous liquors supplied in quantities not amounting to 20s. at a time, for the stat. 24 Geo. 2, c. 40, ante, p. 595, only prevents the seller from maintaining an action therefor. Cruickshanks v. Rose, 1 M. & Rob. 100, cor. Ld. Tenterden, C. J. And in such a case, the creditor may apply the payment to the demand for spirituous liquors, although his particulars claim the whole demand and he may make the appropriation at any time before the matter comes before the jury. Philpott v. Jones, 2 Ad. & E. 41. The same principle would seem to apply to a demand for beer, &c., falling within the provisions of the County Courts Act, 1867, (30 & 31 Vict. c. 142), s. 4, ante, p. 596.

Payment by a bill or note.] If a bill or note payable to bearer is delivered without indorsement, a distinction has been drawn between the cases in which it has been given in exchange for goods or other securities, sold at the time, and those in which it has been given in payment of a pre-existing debt. The former transactions amount, it is said, to a barter of the bill, with all its risks. Fenn v. Harrison, 3 T. R. 757, 759; Ex pte. Shuttleworth, 3 Ves. 368; Camidge v. Allenby, 6 B. & C. 373, 381. But, when the security is delivered in payment of a pre-existing debt, the delivery does not operate as payment, unless the transferee make the security his own by laches (as to which vide post, pp. 622, 623); Ward v. Evans, 2 Ld. Raym. 928; Camidge v. Allenby, supra. Bank notes, other than those of the bank of England, seem to fall within this rule. S. CC.; Moore v. Warren, 1 Str. 415; Turner v. Stones, 1 D. & L. 122 ; Robson v. Olliver, 10 Q. B. 704; Timmins v. Gibbins, 18 Q. B. 722; 21 L. J., Q. B. 403; Lichfield Union v. Greene, 1 H. & N. 884; 26 L. J., Ex. 140; see Byles on Bills, 12th ed., pp. 159, et seq.; Chitty on Bills, 11th ed., pp. 369, 370.

The legal effect of accepting, on account of a debt, a bill, or note, not treated as cash, is that of a conditional payment. It implies an agreement to suspend the remedy on the original demand during the currency of the bill or note; Griffiths v. Owen, 13 M. & W. 58, 64; Belshaw v. Bush, infra; except in the case of specialty debts, or rent, in which last cases no such implication is held to arise; Davis v. Gyde, 2 Ad. & E. 623; Worthington v. Wigley, 3 N. C. 454; Belshaw v. Bush, 11 C. B. 191, 204; 22 L. J., C. P. 24, 29; Bramwell v. Eglinton, 5 B. & S. 39; 33 L. J., Q. B. 130. A bill

given by a stranger and received by the creditor on account of the debt has the same effect as one given by the debtor, if such payment be adopted by him. Belshaw v. Bush, ante, p. 621; Constable v. Andrew, 2 Cr. & M. 298. Taking a bill "for and on account, and in payment of the price," is not a satis faction of the debt, but only a conditional payment. Bottomley v. Nuttall, 5 C. B., N. S. 122; 28 L. J., C. P. 119; Keay v. Fenwick, 1 C. P. D. 745, C. A. Where a purchaser gives the seller an order upon a third person entitling him to receive cash, instead of which the vendor elects to take a bill. in such case, though the bill is dishonoured, the purchaser is discharged. Vernon v. Boverie, 2 Show. 296; Smith v. Ferrand, 7 B. & C. 19. But, it is otherwise if the order is upon the purchaser's agent, and the seller takes from him a cheque which is dishonoured. Everett v. Collins, 2 Camp. 515. Where the master of a vessel took from the freighter's agent abroad, who was furnished with funds to pay him the freight, a bill upon a third person, which was dishonoured, it was held by Gibbs, C.J., that the freighter was not thereby discharged. Marsh v. Pedder, 4 Camp. 257.

There may be some difficulty in saying precisely what is the duty of a creditor to whom a cheque is sent by his debtor in discharge of the debt. The question is, whether the debtor has the right to throw on his creditor the burden of accepting the cheque as payment, or sending it back, and this would in some cases depend on the usages of trade and the previous dealings between the parties. If there were no such right, then the sending the cheque would go for nothing; if there were any such right, then the creditor, by retaining the cheque, might reasonably be presumed to have accepted it in discharge of the debt. The whole is a question of fact, which is, perhaps, best left to the decision of the jury; see Pearce v. Davis, 1 M. & Rob. 365; Boswell v. Smith, 6 C. & P. 60; Hough v. May, 4 Ad. &. E. 954. Vide ante, p. 617.

Proof that bills have been given for a debt (and qy. that the bills are due) is prima facie evidence of payment, without showing that such bills were in fact paid, and it is for the plaintiff in an action for goods sold to show that they have been dishonoured. Hebden v. Hartsink, 4 Esp. 46; Stedman v. Gooch, 1 Esp. 4. So, if a cheque be received as cash, this is evidence of payment at the time it was so received without showing that it was subsequently honoured Carmarthen & Cardigan Ry. Co. v. Manchester & Milford Ry. Co., L. R., 8 C. P. 685, cited ante, p. 529. The vendor of goods received an acceptance of the vendee, and returned it with a request to make it payable at a banker's; but the vendee kept the bill; it was held that there was no defence to an action for goods sold. Widders v. Gorton, 1 C. B., N. S. 576; 26 L. J., C. P. 165.

By the Bills of Exchange Act, 1882, 45 & 46 Vict. c. 61, s. 80, (replacing the Crossed Cheques Act, 1876, 39 & 40 Vict. c. 81, s. 9), cited ante, p. 374, "where the banker on whom a crossed cheque is drawn in good faith and without negligence pays it if crossed generally, to a banker, and if crossed specially, to the banker to whom it is crossed, or his agent for collection being a banker, the banker paying the cheque and, if the cheque has come to the hands of the payee, the drawer, shall respectively be entitled to the same rights, and be placed in the same position, as if payment of the cheque had been made to the true owner thereof."

Where a negotiable bill or note has been received by the creditor and afterwards lost, this is an answer to an action on the original consideration. Crowe v. Clay, 9 Exch. 604; 23 L. J., Ex. 150, Ex. Ch. See also the cases, ante, pp. 324, 325, and Charles v. Blackwell, 2 C. P. D. 151, C. A., ante, p. 618. If the value of the security be diminished by the creditor's laches or misconduct, it is made his own, and operates as payment of the debt. Alderson v. Langdale, 3 B. & Ad. 660, 663; Camidge v. Allenby, Lichfield Union