Keagy v. Commonwealth

The opinion of the court was delivered, by Lowrie, C. J. Johnston became responsible for the recognisance in favour of Christian Keagy by buying the land on which it was charged, and afterwards he bought a judgment of Brenneman against Keagy, and thus obtained a right of set-off to the amount of it: afterwards, and without notice of this purchase, Shannon obtained an assignment of the recognisance and sued on it. Can Johnston set off against the recognisance the judgment against Keagy thus purchased before the recognisance was [73] assigned in fact and of record ? Why not ? Every purchaser of a chose in action takes it subject to all the equities which the debtor may then have, when not previously inquired of concerning his defences: and surely this purchased judgment gave him an equitable right of set-off. So say all the cases, and none of them referred to conflict with this principle. The value of recording the assignment of the judgment by Brenneman to Johnston was only to prevent it from being again sold to some one else: it does not at all affect this case; and so with the assignment of the recognisance. The purchase of it without recording the assignment, made Shannon’s title to it complete, subject to any equitable set-off then held by Johnston. The case of Rider v. Johnston, 8 Harris 190, goes even further than this, and would allow Johnston to set off any claims purchased against his creditor, even after the assignment of his debt, if he had no notice of the assignment. I thought at the same time this was going too far, but perhaps not. Judgment reversed, and judgment for the defendant on the case stated, with costs, and record remitted.