Savage v. Laclede Bank

Cooper, J., delivered the opinion of the court. If the claim filed by the defendants as a set-off belonged to them, and not to them jointly with other persons not sued, it could not be availed of in this action. The bill of exchange sued on is payable to the order of W. H. Powell and was by him indorsed to Moorman, who indorsed it to the plaintiff. The debt attempted to be set off is not one due by the payee, but by Moorman, the indorser. The statute, Code of 1880, § 1124, declares, “And in all actions on any such assigned promissory note, bill of exchange, or other writing for the payment of money or other thing, the defendant shall be allowed the benefit of all want of lawful consideration, failure of consideration, payments, discounts, and set-offs made, had, or possessed against the same previous to notice of assignment in the same manner as though the suit had been brought by the payee.” The purpose of this statute is to give the defendant the benefit of any of the defenses enumerated which exist in his hands as against the party with whom he dealt, against the note or writing in the hands of a subsequent holder; but it would be extending the scope of the provision far beyond its terms and beyond the evil intended to be remedied to construe it as' authorizing a set-off held against a remote indorser to be interposed against a subsequent holder of the paper. A like statute in Alabama received this construction at an early day in that State. Stocking v. Toulmin, 3 Stew. & Porter 35. Judgment affirmed.