them as if such were the fact, the principal cannot sue for the price, without giving the purchaser the benefit of any set-off he may have acquired against the agent individually in ignorance of his true character, and under circumstances not calculated to raise a doubt in the mind of a reasonable person that the agent was not the party beneficially entitled (u).

A town agent, an attorney, sued by a client of his country principal for the recovery of money received by the town agent in a particular cause, has no right to deduct from such money the general balance due to him from the country attorney's principal; but only the costs in the particular suit conducted by him (the town agent) for the client, in which the money was recovered (x).

4. Of Set-off in case of Bankruptcy.

In the case of a bankruptcy there is a particular statute which extends the law of set-off to mutual credit between the parties.

The statute 6 Geo. 4, c. 16, s. 50, enacts, "that where there has been mutual credit given by the bankrupt and any other person, or where there are mutual debts between the bankrupt and any other person, the commissioners shall state the account between them; and one debt or demand may be set against another, notwithstanding any prior act of bankruptcy, committed by such bankrupt before the credit given to, or the debt contracted by him; and what shall appear due on either side on the balance of such account, and no more, shall be claimed or paid on either side respectively; and every debt or demand hereby made proveable against the estate of the bankrupt, may also be set-off in manner aforesaid against such estate: provided that the person claiming the benefit of such set-off had not, when such credit was given, notice of an act of bankruptcy by such bankrupt committed."

The demand alluded to in the above enactment must be a bonâ fide one, and a claim which would eventually lead to a

(u) Ante, 223; George v. Claggett, Peake's Add. C. 131; and see Warren v. M‘Kay, 1 M. & W. 591.

The

vendee in the above instance should plead the set-off specially; Carr v. Hinchcliff, 4 B. & C. 547; 7 D. & R.

42, S. C., post, 855.

(x) Moody v. Spencer, 2 D. & R. 6; White v. Royal Exchange Assurance, 7 Moore, 249; 1 Bing. 20, S. C.; and see Dicas v. Stockley, 7 C. & P. 587; ante, 545, note (†).

debt from the bankrupt (y). Therefore where upon a dissolution of partnership the defendant agreed to pay his co-partners 68177. 9s. 8d. as his share of the liabilities of the firm, they taking the effects and assets, and undertaking to pay a debt of 51,8911. 12s. due from the firm to a third person; and after the dissolution they became bankrupts, and never paid such third person; it was held, that in an action by their assignees for the 68177. 9s. 8d. the defendant could not set-off the undertaking of his co-partners to pay the 51,8917. 12s. to such third person (z). But a plea of set-off is available, and may be pleaded to a special declaration of assumpsit by the assignees of a bankrupt for not paying for goods by a bill of exchange, though the declaration state that the bankrupt lost the benefit and use of such bill, and his estate was diminished in value, to the damage of the assignees and creditors (a).

The holder of a bill or note of the bankrupt is entitled to credit for the amount against a debt due from him to the estate, although he did not take up the instrument until after the bankruptcy, provided he held it at any time before the bankruptcy occurred (b).

In general it must be shown by a defendant sued by the assignees, and claiming credit in respect of a bill or note of the bankrupt, that he, the defendant, held the instrument before the act of bankruptcy (c), or if defendant had no notice thereof before the fiat was issued. And where A., the holder of a bill, returned it to his indorser before the bankruptcy of the acceptor, and entirely closed the account and transaction as to such bill with such indorser, it was held, in an action by the assignees of the acceptor against A., that the latter could not, by taking

(y) Hulme v. Muggleton, 3 M. & W. 30, where the demand set off arose out of the defendant's having accepted an accommodation bill for the bankrupt; Gibson v. Bell, 1 Bing. N. C. 746; Abbott v. Hicks, 5 Bing. N. C. 578; and see cases there cited; and see the following cases as to mutual credit, Key v. Flint, 8 Taunt. 21; 1 Swanst. 30; Chit. jun. B. 1000, S. C.; Ex parte Wagstaff, 13 Ves. 65; Chit. jun. B. 732, S. C.; Buchanan v.. Findlay, 9 B. & C. 744; Chit. jun. B. 1441, S. C.; Rose v. Sims, 1 B. & Ad. 521; Chit. jun. B. 1510, S. C.; Dick

back the bill from the indorser, for the purpose of claiming credit for the amount, set off the same against a debt due from him to the bankrupt before his bankruptcy (d). And where to an action by the assignees of a bankrupt for the price of a phaeton, for which the defendant had agreed to pay ready money, the defendant pleaded a set-off in respect of a bill drawn by H., accepted by the bankrupt, and indorsed by H. to the defendant; a replication that after the bill was dishonoured, H. indorsed it to the defendant without consideration, in trust that defendant should purchase the phaeton of the bankrupt, and hand it over to H., and fraudulently attempt to set off the bill against the price of the phaeton was held a sufficient answer to the claim of set-off(e).

There cannot be any set-off to an action for money had and received by the defendant to the use of the assignees of a bankrupt, either before or after the bankruptcy (ƒ).

5. Of the Pleadings in regard to a Set-off, and the Evidence in support thereof.

The New Rules on Pleading (g) require that the defence of set-off and mutual credit shall be specially pleaded, and a notice of set-off is no longer available (h). The plea must aver that the plaintiff "before and at the time of the commencement of the suit was (i) and still is (k)" indebted to the defendant in the amount claimed by him. It may be pleaded to a part of the plaintiff's demand; and where there are several counts in the declaration, the defendant may plead a set-off as to "£ parcel of the monies in the declaration mentioned," without specifying of what particular amount mentioned in the several

(d) Belcher v. Lloyd, 10 Bing. 310; 3 M. & Sc. 822, S. C.; Fair v. M'Iver, 16 East, 130.

(e) Lackington v. Combes, 6 Bing.

N. C. 71.

(f) Wood v. Smith, 4 M. & W. 522; Groome v. Mealey, 2 Scott, 171; 2 Bing. N. C. 140, S. C.

(g) Regulæ Generales, Hilary Term, 4 Will. 4, Assumpsit, 3-Debt, 3.

(h) Graham v. Partridge, 1 M. & W. 395; see form of pleas, replications, &c. Chitty, jun. Prec. Pleading, 387. It is said to have been decided,

that under a set-off for money had and
received the defendant cannot give in
evidence an over-payment to the plain-
tiff; Hampton v. Jarrett, 2 Esp. Rep.
560, coram Eyre, C. J., sed quære.
Under a set-off for money paid for
plaintiff, the defendant may prove
payment of bills of exchange for the
plaintiff at his request; Fletcher v.
Lee, coram Lord Ellenborough, C. J.
Sittings after Michaelmas Term, 1817;
2 Stark. Ev. 2d ed. 726.

(i) Ante, 847, note (q).
(k) Id.

counts such sum is part (1). A plea of set-off should be pleaded only to so much of the plaintiff's demand as the defendant's setoff will cover; a plea of set-off is not divisible; it cannot be found distributively, partly for the defendant and partly for the plaintiff; therefore where the defendant under a plea of set-off to the whole declaration proves a sum of money owing to him from the plaintiff less than the amount of the claim which the plaintiff has established, the defendant is not entitled to have a verdict entered for him on the issue taken on the plea of set-off for the amount which he has so proved, but the issue must be found for the plaintiff; though it would be otherwise where the defendant by all his pleas taken together covers the whole cause of action (m).

If it has been arranged between the plaintiff and defendant by special agreement that a demand, not otherwise the subject of a set-off, shall be so in their particular case, such agreement must be specially pleaded, and the ordinary plea of set-off will not suffice (n). So a defendant may to an action for goods sold plead that he bought them of the plaintiff's factor as the apparent principal, and that he has a set-off against him (0).

The plaintiff may reply, denying the set-off; the proper form of the replication is, "that he the plaintiff was not nor is indebted to the defendant as alleged." If he replies that he never was indebted," he cannot give evidence that the set-off or any part of it has been paid (p). The plaintiff' may also reply that the defendant's set-off, or part of it, is barred by the statute of limitations (q).

It is a rule that one plea cannot be used as evidence by the plaintiff to prove a fact denied in another; and therefore the particulars of the defendant's set-off cannot be called in aid by the plaintiff to support his debt, the same being denied by the general issue (r).

(1) Noel v. Davis, 4 M. & W. 136; 7 Dowl. 48, S. C.

(m) Tuck v. Tuck, 5 M. & W. 109; 7 Dowl. 373; Kilner v. Bailey, 5 M. & W. 382; Moore v. Butlin, 7 Ad. & El. 595; 2 Nev. & P. 436,S C.

(n) France v. White, 6 Bing. N. C. 33; 8 Dowl. 53, S. C.; see forms and law, Chit. jun. Precedents in Pleading, 392, 393.

(0) Ante, 223; and see form of plea and replication, Chit. jun. Precedents

in Pleading, 394.

(p) Brown v. Daubeny, 4 Dowl.

565.

(1) The statute must be replied specially, Chapple v. Durston, 1 C. & J.1; Gale v. Capern, 1 Ad. & El. 103; such replication admits the set-off.

(r) Harrington v. Macmorris, 5 Taunt. 282; Miller v. Johnson, 2 Esp. R. 602; Stracey v. Blake, 1 M. & W.

172.

In general the defendant must adduce the same evidence in support of a set-off, as he would be bound to produce if he were suing for the recovery of the debt claimed to be due to him.

Proof of the delivery and payment to the plaintiff of a check on the defendant's banker, is not sufficient evidence of a debt in order to support a set-off, unless it be shown upon what consideration, and under what circumstances, the check was given (s). Where there are cross demands, and the defendant pleads a setoff, the plaintiff is not obliged to prove the whole of his account in the first instance, but may prove only the balance which he claims; after the defendant has proved his set-off, the plaintiff may prove other parts of his account to show that a larger sum was due (t).

Where there is a set-off against the plaintiff's demand, which the defendant pleads, but does not appear at the trial to offer evidence in support of it, the plaintiff may either take a verdict for the whole sum he proves to be due to him, subject to be reduced to the sum really due on a balance of accounts, if the defendant will afterwards enter into a rule not to sue for the debt intended to be set off; or, it is said, he may take a verdict for the smaller sum, with a special indorsement on the postea as a foundation for the Court to order a stay of proceedings if another action should be brought for the amount of the set-off (u). A verdict against a defendant on his plea of set-off estops him from bringing an action against the plaintiff for the same demand; and a replication to a plea of such verdict that at the former trial the plaintiff was not prepared to support his plea of set off, is bad (x).

The Court of Conscience Acts do not apply to cases where the debt, being originally above the limited amount, is reduced under it by means of a set-off(y).

(s) Aubert v. Walsh, 4 Taunt. 293; see further, ante, 750.

(t) Williams v. Davies, 1 C. & M. 464.

(u) Laing v. Chatham, 1 Camp. 252; Chapman v. Drunning, 1 Chit. R. 178; Tidd, 8th ed. 721; 9th ed. 668

(x) Eastmure v. Lawes, 5 Bing. N. C. 444; 7 Dowl. 431.

(y) Pitts v. Carpenter, Stra. 1191; Fitzpatrick v. Pickering, 2 Wils. 68; M'Collam v. Carr, 1 B. & P. 223;

Cook v. Johnson, 2 Price, 19; Gobed v. Birt, 2 Chit. R. 394; Cottle v. Langman, 9 Moore, 625; Fomin v. Oswell, 1 M. & Sel. 393; and see Fleming v. Davis, 5 D. & R. 371; aliter where the debt is reduced by the statute of limitations, Bailey v. Chitty, 2 M. & W. 28; Moreau v. Hicks, 2 Ad. & El. 782; ante, 805, note (p); and see Chitty & Hulme's Statutes, tit. "Requests," in notes.