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This right of retainer is equitable in its nature, is independent of statute and is distinct from the technical right of set-off in actions at law.66 It is a right which may be asserted against the assignee of the legatee or distributee,67 or against his heirs or next of kin who succeed to his share of the estate.68

The right to retain the amount of the indebtedness is the same where the debt is due the personal representative in his official capacity, as where the representative has been compelled to satisfy a debt of the legatee or distributee because the decedent was liable therefor as surety, or where the legatee or distributee purchases

69

N. C. 628; Johnston v. Cutchin, 133 N. C. 119, 45 S. E. 522.

In re Taylor (1894), 1 Ch. 671, it is said that a debt due from one to whom a specific legacy has been bequeathed, can not be retained out of the specific property since the debt and the property can not be measured against each other.

Husband's indebtedness for expenses of last illness and funeral of his wife retained out of his share of her estate, see Brand's Exr. v. Brand, 109 Ky. 721, 60 S. W. 704.

As to common law rule requiring the surviving husband to pay the funeral expenses of his wife, see § 1456.

66 Dingle v. Coppen (1899), 1 Ch. 726; Holmes v. McPheeters, 149 Ind. 587, 49 N. E. 452; Holden V. Spier, 65 Kan. 412, 70 Pac. 348; Webb v. Fuller, 85 Me. 443, 22

L. R. A. 177, 27 Atl. 346; Lietman's Estate v. Lietman, 149 Mo. 112, 73 Am. St. Rep. 374, 50 S. W. 307.

67 Wick v. Hickey (Iowa), 103 N. W. 469; Rust's Estate, 14 Pa. Dist. Rep. 317; Boyer v. Robinson, 26 Wash. 117, 66 Pac. 119.

68 Snyder v. Warbasse, 11 N. J. Eq. 463; Girard Life Ins. etc. Co. v. Wilson, 57 Pa. St. 182.

Where the will gives a legacy to one with the direction to deduct therefrom any debt owing from the legatee to the testator, and where by codicil the share given such legatee in the will is given to another, any debt due the decedent from the legatee named in the will is deducted from the share given the legatee under the codicil.-In re De Haven's Estate, 207 Pa. St. 147, 56 Atl. 402.

69 Hopkins v. Thompson, 73 Mo. App. 401; Ramsour v. Thompson, 65 N. C. 628.

property of the estate and gives his note therefor, or otherwise becomes indebted to the estate.70

If the personal representative is indebted to the estate and is also entitled to a distributive share therein, he is required to satisfy his indebtedness, as far as possible, out of the portion coming to him."

§ 1497. The Same Subject: Effect of Bankruptcy or the Statute of Limitations.

There are instances where the personal representative is not authorized to withhold any portion of his share of the estate from a distributee, even though such distributee is indebted to the decedent. Thus, the debt may have been barred by the statute of limitations prior to the date of the decedent's death. In this regard the authorities are conflicting, the English rule being that the amount of the debt due the decedent from a legatee or distributee may be retained out of his distributive share, even though the debt itself is barred by the statute.72 The rule, however, is confined to legatees or distributees, and does not apply to a third person who asserts a legal claim for damages against the estate.78

The English rule is followed in some jurisdictions in the United States;74 in others it is denied on the ground

70 New v. New, 127 Ind. 576, 27 N. E. 154; Haskell v. Hill, 169 Mass. 124, 47 N. E. 586; McGee v. Ford, 5 Smedes & M. (13 Miss.) 769; Miller v. Alexander, 1 Hill Eq. (S. C.) 25.

71 Sanchez v. Forster, 133 Cal. 614, 65 Pac. 1077; Hoffman v. Armstrong, 90 Md. 123, 44 Atl. 1012; Linthicum v. Polk, 93 Md. 84, 48 Atl. 842.

72 Higgins v. Scott, 2 Barn. & Ad. 413; Courtenay v. Williams, 3 Hare 539; Rose v. Gould, 15 Beav. 189; In re Wheeler (Hankinson v. Hayter) (1904), 2 Ch. 66.

73 Dingley v. Coppen (1899), 1 Ch. 726.

74 Holmes v. McPheeters, 149 Ind. 587, 49 N. E. 452; Garrett v. Pierson, 29 Iowa 304; Holden v. Spier, 65 Kan. 412, 70 Pac. 348;

that the English rule, being founded upon the idea that there is an equitable lien upon the distributive share for the payment of any debt of the distributee, is not applicable in those jurisdictions where the claim to the share of the estate is considered a legal claim, just the same as the claim of the estate against the debtor is a legal claim. Each being separate and distinct, if the debt of the distributee can not be collected because barred by the lapse of time, then the personal representative can not withhold the amount of the debt.75

The same conflict of authority arises where the debt of a legatee or distributee has been barred because of a discharge in bankruptcy. The better rule seems to be that if the debtor was discharged in bankruptcy prior to the time of the death of the decedent, the estate is entitled only to a dividend payable in the bankruptcy proceedings, and the amount of the debt can not be retained by the personal representative from the share of the estate to which the debtor is entitled.76 If the legatee or distributee, however, does not become bankrupt until after the decedent's death, any debt owing by him to the decedent or the estate may be retained out of his share of the estate."7

Matter of Warner's Estate, 39
Misc. Rep. (N. Y.) 432, 79 N. Y.
Supp. 363.

75 Noble v. Tait, 140 Ala. 469, 37 So. 278; Holt v. Libby, 80 Me. 329, 14 Atl. 201; Allen v. Edwards, 136 Mass. 138; Boden v. Mier, 71 Neb. 191, 98 N. W. 701; Milne's Appeal, 99 Pa. St. 483.

76 In re Hodgson (Hodgson v. Fox), L. R. 9 Ch. Div. 673; Cherry v. Boultbee, 4 Myl. & Cr. 442.

See, also, Wick V. Hickey (Iowa), 103 N. W. 469.

77 Bousfield v. Lawford, 1 De G. J. & S. 459; In re Watson (Turner v. Watson) (1896), 1 Ch. 925.

81498. What Debts May Be Used as a Set-Off When There Are Conflicting Claims.

The question as to whether or not a defendant in an action for debt is entitled to set-off a debt due him from the plaintiff is largely a matter of statutory regulation, not having been recognized at common law, although recognized in equity. The general rule is that to set-off one debt against another, it must be such a demand that the defendant in his own name, without bringing in the name of a stranger to the suit, may maintain an action of debt upon it against the party bringing suit against him.78 And the debts must be due and owing to and by the parties to the action in the same capacity. The defendant in an action can not claim a set-off for a debt due him in his representative capacity when he is sued individually;" nor a personal debt owing to him when he is sued in his representative capacity; 80 nor a debt due him from the plaintiff in a representative capacity when the plaintiff sues personally for a personal debt;81 nor a debt due him from the plaintiff personally when the plaintiff sues only in a representative capacity.82

These questions arise in actions wherein the personal representative of a decedent seeks to enforce by legal proceedings the collection of a debt due from the defendant

78 Jones v. Blair, 57 Ala. 457; Sullivan v. Nicoulin, 113 Iowa 76, 84 N. W. 978; Howe v. Snow, 3. Allen (Mass.) 111; Kirbs v. Provine, 78 Tex, 353, 14 S. W. 849.

79 Lucas v. Wade, 43 Fla. 419, 31 So. 231; Davis v. Hadden, 115 Ga. 466, 41 S. E. 608; Blood v. Kane, 52 Hun (N. Y.) 225, 6 N. Y. Supp. 353.

80 Menifee's Admrs. v. Ball, 7

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to the decedent or to the estate. The rule varies according to the circumstances. In a suit by an executor or administrator in his representative capacity to enforce the payment of a debt due from the defendant to the decedent during the decedent's lifetime, the defendant can set-off a debt which was due and owing to him from the decedent at the time of his death.88 This rule applies even though the estate be insolvent.84

§1499. The Same Subject: Mutuality of Indebtedness Necessary.

Where the personal representative sues a debtor because of an obligation due the decedent in his lifetime, the debtor can not use as a set-off a claim against the estate or against the decedent if it was not due and payable at the time of the decedent's death.85 And it must be a claim owned by the defendant at the time of the decedent's death, for a claim purchased by the defendant after the death of the decedent can not be used as a set-off against a pre-existing obligation due the decedent in his lifetime.86

Although the decedent at the time of his death owed a debt to the defendant, the defendant can use the same as

83 Jester v. Knotts (Del.), 57 Atl. 1094; Nix v. Ellis, 118 Ga. 345, 98 Am. St. Rep. 111, 45 S. E. 404; Little's Admr. v. City National Bank, 115 Ky. 629, 103 Am. St. Rep. 349, 74 S. W. 699; Conway V. Conway, 3 Sandf. (N. Y.) 650; Jordan v. National Shoe etc. Bank, 24 N. Y. 467, 30 Am. Rep. 319; Hall v. Greene, 24 R. I. 286, 52 Atl. 1087; Lawrence v. Vilas, 20 Wis. 381.

III Com. on Wills-30

84 Palmer v. Steiner, 68 Ala. 400; Light v. Leininger, 8 Pa. St. 403.

85 Naglee v. Palmer, 7 Cal. 543; Harte v. Houchin, 50 Ind. 327; Root v. Taylor, 20 Johns. (N. Y.) 137; Patterson v. Patterson, 59 N. Y. 574, 17 Am. Rep. 384.

86 Woodward v. Laverty, 14 Iowa 381; Sullivan v. Nicoulin, 113 Iowa 76, 84 N. W. 978; Dwight v. Carson, 2 La. Ann. 459.

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