Case ID: nc_1-3/html/0003-01.html
Source: Caselaw Access Project
Author: {"author": "Johnston, Judge. Taylor, Judge. Macay, Judge.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

June Term, A. D. 1800.
    James Hogg, Surviving Executor, &c. against Samuel Ashe, Esq.
    THIS was an action of debt brought in the Superior Court of Law, for the district of Hillsborough, on a writing obligatory executed by the defendant on the 9th day of December, 1778, to Robert Hogg and Samuel Campbell, merchants and copartners; by which he bound himself to pay them three years after the date thereof, but if a peace should be concluded sooner between Great-Britain and America, then six months thereafter, £95 15s 1d. sterling money.
    The declaration, states that on the day of in the year of our Lord, 1780, Robert Hogg died, having made and duly published his last will and testament in writing; and thereof appointed James Hogg, William Hooper, and James Burgess, executors; that on the 21st day of December in the same year, by indenture bipartite, bearing date the same day and year between James Hogg of the one part, and Samuel Campbell by the name and description of Samuel Campbell of New-Hanover, of the other part; the said Samuel Campbell, by and with the content of William Hooper and James Burgess, for and in consideration of four negro slaves, that same day sold and delivered to him by James Hogg, and in consideration of divers other matters and things thereafter to be performed by the said James Hogg, for the use and benefit of the said Samuel Campbell, did transfer and set over all his, the said Samuel Campbell’s right, title, and interest; that is to say, one moiety of all debts or sums of money remaining due, and owing to the Copartnership of Hogg and Campbell, or the Survivor thereof, or to the representatives of the deceased partner, for or by reason of the said Co-partnership, from whomsoever the same was due, upon account, bill, bond, note, agreement, or other writing, and all the claim and interest of him the said Samuel Campbell to the said debts: To have, hold, receive, and take the said debts, and every of them to the said James Hogg, his heirs, executors, &c. without account to the said Samuel Campbell: And he the said James Hogg, by the said indenture, did covenant with the said Samuel Campbell, that he would take upon himself the payment of all debts due by the Copartnership to divers persons, and would at all times thereafter indemnify the said Samuel Campbell, his heirs, &c. from all actions, suits, &c. that might or should be brought against him, by reason thereof; and that he, the said James Hogg, would discharge and keep harmless the said Samuel Campbell, his executors, &c. of, and from all the debts which at the time of the death of Robert Hogg were due from the Copartnership, and which at the making of the said indenture were then due and owing on account of the Trade and Copartnership, between the said Robert Hogg and Samuel Campbell.
    After the execution of this indenture, Samuel Campbell attached himself to the British enemy, and left this country, and was thereby rendered incapable of carrying on suits at law. At an Assembly, held at Fayetteville, on the 18th November, 1786, an act was passed, entitled, “An act to enable the executors of Robert Hogg deceased, to maintain and defend suits, under the regulations therein, mentioned which, after reciting that it had been represented and proved to the General Assembly, that the said Samuel Campbell, while he was a citizen of this state, and before he withdrew from his allegiance to it, did assign, and set over, for a good and valuable consideration, all his right, title, and interest, in and to all the debts due to all the said Copartnership, to James Hogg, one of the executors and devisees of the said Robert; and that the said Samuel, by withdrawing himself, was disabled by himself or by others, to bring suits in his own name, and that by the death of Robert Hogg, the only mode of maintaining suits for the recovery of debts due to the said Copartnership, agreeably to the laws then in force, must be in the name of the said Samuel Campbell, surviving Copartner of Hogg and Campbell; and that thereby the executors of the said late Robert Hogg, were utterly prevented from recovering the just debts due to the Copartnership so aligned, and were disabled to carry the Will of the said Robert into execution, and to pay his just creditors. It is therefore enacted, that the said James Hogg, William Hooper and James Burgess, be, and they were thereby authorised and empowered to maintain suits as well in law as in equity in the names of them the said William Hooper, James Hogg and James Burgess, stiling themselves executors of the said Robert Hogg, and in the names of the survivor or survivors of them, to sue for, and recover all monies due to the Copartnership, in their names as executors, and to have recoveries as fully and as amply in the same manner as Samuel Campbell himself could, if he had remained a true and faithful citizen of this state, and had never assigned his interest in the Copartnership to the said James Hogg.
    After the passing of the act of Assembly, William Hooper and James Burgess, died; and on the 20th day of April, 1796, James Hogg, as the surviving executor of Robert Hogg, dec. brought this suit, to which the defendant pleaded “ Gene“ ral issue, set-off, and notice of set-off, payment “ at and after, &c.”
    In the year 1789, the defendant recovered against Campbell, the sum of £500 for Negroes, of the defendant, said to have been carried away by Campbell, when he attached himself to the enemy. At the trial of the cause, the plaintiff produced the bond declared on, as also the deed of assignment, and the act of Assembly, mentioned in the declaration, and on this rested his case. The defendant offered the judgment recovered by him against Campbell, as a set-off, which was objected to by the Counsel for the plaintiff: the objection was sustained by the Court, (Haywood and Stone, Judges, at April term, 1797,) and the plaintiff had a verdict for the value of the sterling money, mentioned in the bond, but the jury having given, no interest, the plaintiff moved for, and obtained a new trial, and the cause being tried at April term, 1799, the Jury found the bond declared on, to be the act and deed of the defendant, that the sterling money therein mentioned to be of the value of £212 15 9, and assessed the plaintiff’s damages to £119 3 9 and costs: subject to the opinion of the Court on the following questions, viz.
    
    1. Whether the bond declared on, is within the description of these debts, which James Hogg is entitled to sue for, under the act of 1786?
    2. Whether the bond declared on, is within the description of these debts assigned by Samuel Campbell to James Hogg, by the deed of assignment recited in the declaration?
    3. Whether the defendant is entitled to a deduction of the judgment aforesaid as a set-off against the amount of the sum found by the jury.
    Upon which questions the cause now came on to be argued.
    
      Williams, for Plaintiff
    
    All demands which are unliquidated, and which found only in damages, are incapable of being set off: those demands for which an action of debtor indebitatus assumpsit will lie, can only be set off. Principal and essential requisite to a debt, in order to its being set off, is that it should be mutual. Cowper’s Reports 56, Iredell’s Rev. 172: The debts here claimed are not mutual. The debt claimed by the plaintiff, was contracted with the partners as joint merchants: The judgment obtained by the defendant, and now offered as a set-off, is obtained against Campbell in jure proprio, for a tort done to the defendant in carrying away his Negroes, a transaction which cannot by any means relate to the partnership concerns, and which took place after the death of Robert Hogg, the other partner, and the consequent dissolution of the partnership. There is no instance of a set-off having been allowed, where the debt demanded is not due to the same persons precisely as the debt to be set off is due from. If this judgment shall be allowed to be set off, the deceased partner, Robert Hogg, would be subjected to pay a judgment recovered against Campbell for a wrong of his own. If one man receive rent for another, after his death, by appointment in his life time, and then be sued by the executors, he cannot set-off a debt due from the deceased; because the deceased never had any cause of action against him, Bull, 180; and so here the defendant never had any cause of action against the plaintiff’s, and therefore ought not to be allowed to set off this judgment against him. With regard to the party against whom it may be set off, I take the distinction to be this. Where the debt offered to be set off is recoverable and payable out of the same fund that the debt to be recovered in the action goes to increase, it may set off. Where two plaintiff’s sue, and the sum offered to be set off can be recovered of one of them only, it cannot be set off; or where one sues, and the sum offered to be set off is due from that one and another, it cannot be set off; because in either case, the two actions cannot be reduced to one, by a set-off, without doing an injury to a third person, by subjecting him to the effects of an action, to which, before the act of set-offs, he would not have been subject. The act did not mean to extend the action of the defendant to a person not liable to it, without the act; but only to give him the effect of an action against the plaintiff, to which the plaintiff was liable without the act, but not subject to by way of set-off; and the law is so, with respect to partnership dealings; the defendant cannot, by execution upon a judgment against one partner in his private capacity, seize and fell the whole partnership effects; he can only seize and fell the share of the partner against whom he has judgment, and the vendee becomes tenant in common with the other. If he cannot affect the other’s share by judgment and execution, surely he cannot do it by set-off, which is in lieu of an action. Salk. 392. It is true, indeed, that by the death of Robert Hogg, the remedy to recover the partnership debts survived to Campbell; but it is the remedy only which did so, the interest of the deceased did not. It is a rule in the Law Merchant, that jus accrescendi inter mercatores locum non habet. 4 Term, 123, 5 Bac. Abr. 580, 589. The interest of Robert Hogg, upon his death, survived to his executors, though the right to recover and get in the debts due to the partnership, survived to Campbell, who, by no conduct of his own, could burthen the share of his deceased partner with any incumbrance other than that to which it was subject at his decease. Though Campbell’s share might have been liable had no assignment been made, yet as it was assigned, and for a valuable consideration, and that assignment legalized and confirmed by the act of Assembly, before the defendant obtained his judgment against him, his share passed to the assignee, and is not subject in his hands to this demand. From the time of the assignment, Campbell had neither interest in, or remedy to recover this debt. He and his property are liable to the defendant’s action on the judgment, and the defendant is liable for the bond to the action of other persons, where recovery will go to increase the fund of the assignee, which is not liable to pay the debt due to the defendant, and therefore the plaintiff is not such a person against whom the defendant's demand can be set off.
    
      
      Haywood, for the defendant.
    The debt here offered to be set off is not unliquidated, but is reduced to a certainty by judgment. All the cases cited by the plaintiff’s counsel in support of the position that unliquidated damages cannot be set off, do not apply to this case. It is wholly immaterial whether before judgment the demand was for damages uncertain or not. Whatever may have been the origin of the defendant’s judgment, when the damages were ascertained and judgment rendered for them, they thenceforward were of equal dignity with a debt due by bond. Every set-off is in lieu of an action; and when the sum offered as a set-off can be recovered in an action of debt, &c. it may be set off: And there can be no doubt but an action of debt will lie on the judgment against Campbell.
    I admit that mutuality of debts is necessary, in order to a set-off; but the legal interest is only to be considered in a court of law : The assignment at belt vests but an equitable interest in the assignee; and the interest in his hands is subject legally to all the incumbrances it was before, had the assignment not been made. The share of the debts assigned is still legally considered due to the assignor. The assignment to third persons, operates nothing; and so far as it regards the legal interest of the parties, leaves them precisely in the same situation they were in before it; and laying aside the act of Assembly, a judgment recovered against Campbell might be set off against a debt to be recovered by himself: That act, for the furtherance of justice, has vested the executors of the deceased partners with the right of suing; but the debts recovered do, in contemplation of law, belong to Campbell. The executors by legislative creation are the representatives of the copartnership, and acting for it in the place of the surviving partner, and are subject to all such demands and actions as he is, and of course to an action for this debt, and consequently to the set-off. Viewing the case in this light, both the interest of Campbell, and Campbell himself by his representatives the executors, are now before the court. This ought to be considered as the action of Campbell, to recover a debt which, both now and when recovered, the law deems payable to himself; consequently the debt sued for, and the debt offered as a set-off, are mutual debts within the meaning of the act of Assembly, and are clear of the objection endeavoured to be raised for want of mutuality. The act of Assembly is in derogation of the common law, and ought to be construed strictly. 5 Bac. Abr. 650, 10 Mo. 282. By it, the executors of Robert Hogg are empowered to sue, naming themselves his executors; but they do not sue as executors, they are put in the place of the surviving partner—they represent him ; they are enabled to recover, not for the purpose of paying over to the assignee or his representatives, but for the purpose of paying the partnership debts; they are, for any thing expressed to the contrary in this act, to pay the balance to the person entitled by law to receive it, and that person is the surviving partner. They can only recover in cases where he might, were he not disabled; and they are subject in like manner as he would be were the suit brought in his own name.
   Johnston, Judge.

The judgment pleaded as a set-off being founded on a cause of action which arose subsequent to the alignment by Samuel Campbell of his interest in the copartnership of Hogg and Campbell to James Hogg, cannot operate to discharge a debt due from the defendant to Hogg: and Campbell, which debt, appears to have been comprehended in the assignment. I am therefore of the opinion, that judgment should be entered for the plaintiff.

Taylor, Judge.

The question for the opinion of the court is, whether this judgment recovered by the defendant in the year 1789, can be set off in this action, which is founded on a bond to which the plaintiffs acquired an equitable title in 1780, and a legal one in 1786. As to the effect of the assignment unaided by the act of Assembly, I cannot subscribe to the argument which asserts that it is a mere nullity, and therefore to be entirely disregarded in a court of law. The common law rule which for the purpose of avoiding maintenance, prohibits the assignment of a chose in action, doth not, by its original meaning and spirit, require, nor hath the practical application of it justified, a construction so minutely rigorous. If a chose action is assigned for lawful cause, as for a just debt, it is to some purposes valid even at law. If the lawful cause is wanting, it is neither good in law or in equity. Bro. Abr. pl. 3. If one assign a bond over, though it be not in its nature assignable, yet it is a good agreement that the assignee shall have the money to his own use. 12 Mod. 554. In the same case, there will be found an instance of a master’s assigning an apprentice-bond to another, the contract for which was held good between themselves. An assignment of a chose in action has been held a good consideration for a promise, 2 Bl. Rep. 820. And the power of assignment has, for the convenience of commerce, been extended to respondentia-bonds Ibid, 1272. The case of Wench against Kaly, 1 Term Rep. 619, and the others therein referred to, shew how far, and under what circumstances, a court of law has recognized the real, though not the nominal parties to the suit, and protect their interest, whenever they were made known in a proper manner. All these cases serve to shew, that regard his been paid to such transactions, to a certain degree at least.

But the case of Deering vs. Carrington, 12 W. 3. B. R. proceeds to a still greater length in the protection of such rights. “Where a bond is as-“signed over wish a letter of attorney therein to “sue, and a covenant therein not to revoke, but “that the money should come to the use of the “assignee, although the assignee be dead, yet the “court will not stay proceedings in a suit upon a “bond in the obligee's administrator’s name, tho “prosecuted without his consent, for that those as-“signments to receive the money to the assignee’s “own use, with covenants not to revoke, and also “with a letter of attorney in them, although they “do not vest an interest, yet have so far prevailed “in all courts, that the grantee hath such an inte-“rest, that he may sue in the name of the party, “his executors and administrators,” It seems to me, that on the authority of this case, a court of law might take notice of such an assignment as is there described, as to all purposes except suing in the name of the assignee: For if he may use the name of the obligee, and even of his representatives after his death, against their consent, and prosecute the suit to judgment, notwithstanding any attempt on their part to stay the proceedings. If he may do these things, ought his right to be defeated by a release given to them, or payments made after notice of the alignment, or by any supervenient claim against the obligee?

The great change which has taken place in the contracts of men, from the improved state of society and the increase of commerce; the desire of giving facility to these transactions by which the circulation of a great proportion of the wealth of the country is promoted, and the superior estimation in which personal property is now held from what it formerly was, have contributed gradually to relax the rule from the rigour in which ancient writers have laid it down, as far as it respects personality. Indeed the rule itself contemplates a distinction between a chose in action real, and a chose in action personal; for Broke, after stating an instance wherein a chose in action personal may be assigned, proceeds thus: "But a chose in action real, as entry he cannot grant over, and it is not “like to a chose in action personal or mixed, as debt, &c.” Hard. pl. 14. I am aware, and candour induces me to state, that many of the decisions I have referred to, have been considered by an able judge as usurpations of a Court of Equity. Bauerman vs. Radenius, 7 Term Rep. 666. To this opinion I must oppose the observations of another able Judge, in Maske vs. Miller, 4 Term Rep. 340, the practice of this country (in respect of which I will state two cases in addition to those formerly mentioned; one was the case of Fleming vs. Theames, tried at Fayetteville, in which I was counsel: It was an action of covenant brought upon an agreement for the delivery of specific articles, the interest in the paper was fairly assigned to a third person, and a memorandum to that effect was endorsed upon the writ. Before the trial, a release was executed by Fleming to Theames, who attempted to avail himself of it, but the court, without hesitation, rejected it. The other, - vs. Wilkinson, was tried before Judge Haywood and myself at Halifax October term, 1799; the circumstances of which were nearly similar): And lastly, though with less confidence, my own opinion, that it is conformable to a correct, though liberal interpretation of the law.

If justice can be attained in a court of law, without violating the fundamental maxims upon which it proceeds, the parties ought not to be turned aside by refinements merely technical. What has been so often and so beneficially done, may safely be followed; and the security of men’s rights requires that it should be, if upon examination it does not militate with those established principles which it is our duty to preserve.

2dly. But the Legislature in 1786, confirmed what the parties had done in 1780, and added the only circumstance it required to give it complete legal validity, the right of suing in the name of the assignee. The act does not profess to interfere with the rights of third persons; nor ought it to receive a construction that will in the least degree impair them. Whatever claim then existed against Campbell, in the shape of legal sets-off, were preserved to his debtors, who, if they might have enforced them against him at the period of the assignment, may also, as I conceive, against his assignees. This is a fair construction of an act of Assembly authorising an assignment for a particular purpose. Even in negociable instruments, if endorsed after they become due, the law is different on account of the general quality of negociability conferred on them by statute. But what were the rights of the defendant when the assignment was confirmed? They were altogether vague and indeterminate, possessing no legal existence, and manifestly incapable of forming the subject of a set-off. Until judgment was rendered for the damages assessed by the jury, the defendant had no claim for any specific sum; in legal consideration, his right was not merely defined, but acquired by suit and judgment; and when this took place, Campbell was no longer his creditor.

It is worthy of remark, that the preamble of the act states that the assignment was made to James Hogg, one of the executors and devisees of Robert Hogg, for a good and valuable consideration; and the inconvenience sought to be remedied, is the disability of the executors of Robert Hogg to recover the partnership debts, and thereby to carry the will of Robert into execution, and pay his just debts, These two circumstances strongly indicate, that Robert Hogg was substantially, as well as formally entitled to all the partnership rights, and that the recoveries authorised by the purview, were to be applied according to the direction of his will. But however this may be, it is clear that the act gives them a right to recover all that Campbell himself was entitled to at that time: More than this would be derogatory to the rights of others, not parties to the act, and therefore unjust; Less than this, would be to leave the rights of the assignees at the mercy of Campbell, who, if he could rightfully charge them with a shilling after the act assignment, either by his torteous acts or by contracting debts, might incumber the property assigned to the full extent of its value, and thus render the act of Assembly nugatory. For these reasons, I think the plaintiff should have judgment.

Macay, Judge.

I am of opinion, that the bond declared on, is within the description of those debts which James Hogg, the plaintiff, is entitled to sue for, under the act of 1786, and is also within the description of those debts assigned by Samuel Campbell to James Hogg by the deed of assignment recited in the declaration, and for the reasons given, the judgment obtained by the defendant against Campbell, cannot be admitted as a set-off.

Judgment for plaintiff.