#### B. B. Little, Appellant, v. Lew I. Sturgis, Appellee.

1 Bills and notes: pleadings: demurrer. In an action on a note by a purchaser frorti the assignee of a bank, where the answer was in two counts, the first admitting its execution but denying ownership and demanding proof, the second alleging as a set-off an unpaid deposit account against the bank and praying that the note be adjudged paid and extinguished thereby, a demurrer to the answer as a whole should not have been sustained since the first count put the plaintiff to some measure of proof.

2 Banks: insolvency: set-off. Where a note payable to an ín-solvent bank was long past due when assigned to plaintiff by the bank’s assignee for creditors,'the maker was entitled to set off against the note the amount of his deposit account with the bank.

3 Assignment for benefit of creditors: extinguishment' of claim. Neither the filing of a claim nor the payment1 of a dividend thereon less than the amount due will extinguish such claim in a general assignment for the benefit of creditors, but the creditor’ may afterward enforce payment from the debtor.

4 Estoppel. Neither the assignee of a bank nor the holder of a depositor’s note by assignment from the assignee can "insist that as the note was not applied in extinguishment of the maker’s deposit account and the maker’s dividends w.ere therefore increased he was estopped to resist payment of the note to the extent of the unpaid portion of the deposit.

*Appeal from Fayette District*Court.— HoN. L. E. Eellows, Judge.

Wednesday, April 12, 1905.

Action upon a promissory note. To the answer of the defendant a demurrer was interposed, and this was overruled. Plaintiff *appeals.*

Affirmed.

*Jay Qoolc,*for appellant.

*299
      *■Ainsworth & Estey,*for appellee.

Bishop, J.

From the petition it appears that tbe note in suit was executed by tbe defendant to tbe Citizens’ Bank of Oelwein in June, 1895, and provides for tbe payment of $10 four'months after date; that in 1900 said bank made an assignment for tbe benefit of creditors; under tbe statute, to Jay Cook, and in February, 1900, tbe latter, as assignee, sold and delivered said note to tbe plaintiff. Tbe answer is in two counts. In tbe first tbe execution of tbe note sued upon is admitted, but defendant denies, upon information and belief, and demands proof of, tbe ownership of sucb note by plaintiff. In tbe second count, by way of further answer, and as a counterclaim or offset, tbe defendant says that at tbe time of tbe assignment by tbe bank it was indebted to him on account of moneys on deposit in tbe sum of $910.84, and that a claim therefor was duly filed with Jay Cook, as-signee; that the indebtedness represented by said cláim remains unpaid, except that upon a dividend declared by said assignee there was paid to defendant tbe sum of $18.21. It is then said that no demand was ever made for payment of said note by said assignee, and that at tbe time of tbe assignment thereof to plaintiff tbe same bad been fully paid and extinguished by the indebtedness due defendant from said bank. Tbe prayer of tbe answer is that tbe note be adjudged paid, and that tbe same be surrendered to defendant, and that be have bis costs. Tbe demurrer is addressed to tbe answer as a whole, and is as follows: “ Tbe facts stated do not entitle, defendant to tbe relief demanded,' for that the claim of tbe defendant against tbe bank having been filed with tbe assignee, and defendant having received bis *yro rata,*share of tbe dividend paid and settlement made by tbe assignee of said bank with tbe creditors thereof, which settlement was an adjudication and termination of said claim.” Manifestly tbe demurrer was properly overruled, because, by tbe allegation of tbe first count of tbe answer, *300plaintiff was put to some measure of proof. *Darr v. Lilley,*11 Iowa, 4; *McPhail v. Hyatt,*29 Iowa, 137.

We think it was properly overruled as to the second count of the answer. We are not quite sure that we understand the language employed in the demurrer, but assume that it was intended to assert that, having filed his deposit claim with the assignee, and having received a dividend thereon, the defendant was in no position to resist payment of the note here sued upon. We do not understand such to be the law. Had this suit been brought by the bank, the defendant could have offset against the same so much of his deposit account as would have been sufficient to constitute payment, and of this no one can have any doubt. Now, under a general assignment for the benefit of creditors, a claim filed is not extinguished by the fact of such filing, or by the payment of'a dividend thereon less in amount than the face of such claim. The creditor may offset his claim against any claim held against him by the assignee, if such there be, and this because in such respect the assignee is clothed with no rights other or different from those which obtained in favor of his assignor. So, too, a creditor who has filed his claim, and who may have received a dividend thereon, is not precluded from afterwards enforcing payment of the balance due him by proceeding against his debtor by judgment or by other lawful means. *Sperry v. Gallagher,*77 Iowa, 107; 4 Cyc. 271.

As the note in suit was long past due when it came to' the possession of plaintiff, by familiar doctrine his rights must be measured by what would have been the right of the original payee and the subsequently appointed assignee of such payee.

It is said in argument that, as the amount of the note was not applied in extinguishment of the deposit account, the dividend paid to defendant was proportionately increased, and therefore he ought not to be heardTo resist payment of such note. Perhaps the other creditors may have complained *301of this, but, as the assignee could not have been beard to assert sucb matter, we do not see bow plaintiff can be in any better *position.*— Affirmed.