Long Island Bank v. Townsend

By the Court, Nelson, Ch. J. Assuming that Manly & Clark were principals upon the notes, and the firm bound to take up the paper, it is clear the plaintiffs had no right to apply the private funds of one of the members in their hands in payment without his assent, and the case negatives any such inference. Even had the funds belonged to the partners they could not have been so applied without their assent express or implied; the plaintiffs would have been compelled to resort to their right of set off. But here the cash deposits being made to the credit of the private account of one of the firm, had a suit been brought against them, to recover the amount, the notes could not have been set off against the demand, being held on a different right, and against different parties. A demand against the firm can [206] not be set off against the private claim of one of the partners. (1 Caine, 323; 6, Cow., 261; 3 Wend., 400; Collier on Part., 446, ed. of 1839.) The case of Baker vs. Stackpoole, 9 Cow., 420, is not applicable. There K., the partner, consented to the application, but the creditor sought to retain the money for other purposes and enforce the collection of the partnership demand, refusing to apply it to the extinguishment of that debt. The court held, under such circumstances, he could not wait till K. became further indebted to him, and then appropriate the money to the payment of the new individual indebtedness, leaving the joint demand open and unsatisfied. New trial denied.