Jefferson County Bank v. Chapman

[Spencer, Cb. J. observed, that the court did not mean, in the case of the Bank of Niagara v. M'Cracken, (18 Johns. Rep. 493.) to decide, that the demand of payment of a bank note, not payable at any particularly place, need not be made at the bank, previous to its being offered as a set-off in in a suit brought by the bank. The decision of [324] that point was not necessary in that case ; and he considered the question as now open.] Woodworth, J. delivered the opinion of the Court. The evidence offered by the defendant in the Court below, did not make out a valid defence, because, it did not appear that the defendant wras the owner or possessor of the bills before the commencement of the suit. He relied on the fact, that they bore date previously, a circumstance unimportant and altogether irrelevant; for aught that' appears, he may have obtained the bills after he was sued, and if so, they could not be the subject of set-off. This principle is well settled, in a variety of cases. In Dickson and others v. Evans, (Term. Rep. 57.) the plaintiff brought an action, as assignee of a bankrupt 5 it was held, that the defendant could not set off cash notes issued by the bankrupt, payable to bearer, bearing date before his bankruptcy, unless he showed further, that such notes came to his hands before the bankruptcy. The principle of this case applies : A set-off is in the nature of a cross action ; the defendant must prove every thing necessary to constitute his demand. It is a general rule, that the onus probandi lies on the person who wishes to support his case, by a particular fact, and of which he is supposed to be conusant. In Carpenter v. Butterfield. (3 Johns. Cas. 145.) this point is decided. A debt or demand to be set off under the statute, must be an existing debt or demand, at the time of the commencement of the plaintiff’s suit. The evidence given is defective in this respect, and did not entitle the defendant to a set-off. As the first exception disposes of the cause, we are not called on to decide whether a demand of payment at the bank was necessary. In the case of the Bank of Niagara v. M'Cracken, (18 Johns. Rep. 493.) one question raised on the argument was, that payment of the bills had never been demanded at the Bank of Niagara; but it appeared in evidence that the defendant offered them to the plaintiffs, in part payment of his note, and they refused to receive them. This was equivalent to a demand. I observed in that case, “ that the bills were not payable at any particular [325] place, and would have sustained an action without a demand at the bank.” This was my individual opinion. The case did not require the decision of the Court on that point; nor did the Court intend to decide it. The bank stopped payment in July, 1819, but there is no proof of insolvency; it is merely stated that it had not resumed payment; nor does it appear that an assignment of its property and effects have been made. We are not to intend, that there is a want of ability to discharge all legal demands ; but rather, that owing to the peculiar state of the country, they required time to call in their funds. How, thens can the bona fide purchase of their paper be called a fraud on creditors ? I think it was not. Had the defendant made out in evidence, that he held the notes before the suit was commenced, he would have established his off-set, provided a demand of payment was unnecessary. The Court below erred in admitting the evidence. The judgment must be reversed, and a venire de novo awarded. Judgment reversed.