Case Name: ARNOLD VS. NIESS
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1879-03-24
Citations: 1 Walk. 115
Docket Number: 
Parties: ARNOLD VS. NIESS.
Judges: 
Reporter: Reports of cases decided by the supreme court of pennsylvania which have been omitted from the regular reports
Volume: 1
Pages: 115–117

Head Matter:
ARNOLD VS. NIESS.
An endorser on a note can set off a deposit in the bank in a suit by the assignee in bankruptcy of the bank.
' The endorser’s liability is fixed by due notice of non-payment even though there be no protest.
Error to Court of Common Pleas of Berks County.
Case, by William A Arnold, assignee in bankruptcy of the Reading Savings Bank, against Daniel Niess, on the following promissary note:
$500. Reading, Pa., Sept. 17,1877.
Sixty days after date I promise to pay to the orde r of Daniel Niess, at the Reading Savings Bank, five hundred dollars, without defalcation, for value received.
Daniel K. Niess.
Endorsed “Daniel Niess.” Protested November 19th, 1877.
Defendant’s affidavit of defence averred as follows :
“The defendant, endorser on the note in suit, received no notice of protest. Defendant had to his credit on the books of the said Reading Savings Bank; at the time of its suspension, to wit: November 16th, 1877, in the neighborhood of $675 ; that he had said sum to his credit there also at the time the' note fell due, and that in any event he would be entitled to set off this sum against said note, which would more than pay the note in suit with costs. All of which facts the defendant is able and willing to prove upon the trial of the case.”
It was admitted, and it is to be taken as part of the affidavit of defence, that the Reading Savings Bank made a voluntary deed of assignment, for the benefit of creditors, to George D. Stitzel and H. A. Muhlenberg, November 17th, 1877. That on December 7,1877, creditors of the said Reading Savings Bank filed their petition in the District Court of the United States, for the Eastern District of Pennsylvania, in Bankruptcy, to have the said Reading Savings Bank adjudicated a bankrupt; that the said voluntary assignment, for the benefit of creditors, was set forth in said petition as one of the Acts in Bankruptcy ; that on the 19th of December, 1877, said Reading Savings Bank was adjudicated a bankrupt, and said William A. Arnold was appointed Assignee in Bankruptcy, and acquired the note and right to sue as such assignee.
A rule for judgment for want of a sufficient affidavit of defence was discharged by the Court below on August 10, 1878, in the following opinion by
Sassaman, J.:
“The affidavit of defence sets forth that defendant, endorser on the note in suit, received no notice of protest. It does not deny protest, nor notice of presentment and non-payment of the maker. An endorser is fixed by due notice of non-payment; a protest is not requisite: Stephenson vs. Dickson, 12 Harris 148. The liability is fixed thus, and without further plaintiff would be entitled to judgment. The next point of defence is more serious — so far as the affidavit goes. The defendant, who, upon non-payment and notice thereof, becomes liable, although an endorser, as' a principal debtor on note, avers that he had an amount in plaintiff’s bank, with a balance due him greater than the amount of the note in suit. We do not see that an endorser, after his liability attaches, stands in any position different from the maker, in relation to the holder of a promissory note. It is impossible also for us to see that the relations of the assignee, under a voluntary assignment to a debtor of his assignor, differs from the relations of an assignee in bankruptcy to a debtor of the bankrupt. In the case of Jordan et.al., Assignees of the City Bank vs. Sharlock, 3 Norris 366, it was held that in a suit by assignees, under a voluntary assignment for the benefit of creditors, upon a note by the . assignor, which did not fall due until after the assignment, the creditor may set off a debt due him by the assignor at the time of the assignment. And it was further held that such a debtor, the maker of a note, might set off his deposit in bank at the time of the assignment, against the note. Believing then that an endorser and a maker of a note, after their liabilities are fixed, hold precisely similar relations to the discharge of. their obligations, we hold that either one of them, if sued, might set off his counterclaim in such suit in satisfaction of his obligation to pay. For the present we would follow the decision of the above case, which we think applies here.”
Rule discharged. Judgment accordingly.
Plaintiff took this writ, assigning for error the action of the Court in discharging the rule for want of a sufficient affidavit of defence.
A. G. Green and H. C. G. JReber for plaintiff in error
argued. In a suit by an assignee of an insolvent bank the debtor should not be allowed to set off a claim: Bosler vs. Exchange Bank, 4 Barr 32; Light vs. Leininger, 8 Barr 403; Beaver vs. Beaver, 11 H. 167; F. & M. Bank’s Appeal, 12 Wr. 57; City Bank vs. Sharlock, 3 N. 366.
D. and James N. Ermentrout, Esqs., contra:
The Court was right in allowing the set off. U. S. Revised Statutes, Sect. 5044 & 5073; Wain vs. Bank of N. America, 8 S. & R. 87; Frantz vs. Brown, 1 P. & W. 257; Hunt vs. Gilmore, 9 P. F. S. 450. Assignee stands in place of assignor, and is not a purchaser. Cook vs. Tullis, 9 B. R. 433; Matts vs. Goodman, 2 Hilton 275, 2 Vern 428; Bigelow vs. Folger, 2 Metcalf 255; Faull vs. Tinsman, 12 Casey 111; Rev. Stat. U. S., 5047; Aldrich vs. Campbell, 4 Gray 284; Receivers vs. Patterson Gas Co., 3 Zab 283; 2 Smith’s Leading Cases, 378. The assignee is only the hand of the assignor. Fulton’s Estate, 1 P. F. S. 211. The assignee took the claim subject to set off. Jordan vs. Sharlock, 3 Norris 369; Stewart’s Assignee vs. Bank, 6 W. N. C. 399.

Opinion:
The Supreme Court affirmed the decision of the Court below on March 24, 1879, in the following opinion :
Per Curiam.
We affirm this judgment upon the opinion of the learned judge below. Writ of error dismissed at the cost of plaintiff, and procedendo awarded.