Extinguishment by Marriage-Death.

§ 1832. A note will be extinguished by the subsequent marriage of the maker and the payee.178 And if the maker dies, no suit can be brought, in some states, against his estate, unless the note is presented for allowance in writing, and within a given time, by the holder or his agent.17 And where a note matures more than two years after the maker's death, and his executor gives a bond to secure it, no action can be brought under the statute against legatees of the maker, unless the note has been presented for allowance within the time prescribed.180

At common law, the death of one joint maker, leaving other survivors, discharged his estate from further liability at law.181 The personal representative of the deceased maker was not liable at law in such case, and could not recover contribution against a co-maker on payment voluntarily made by him.182 But making proof of the holder's claim on a note against the estate of a deceased joint maker does not discharge the liability of the survivor.183

If the holder makes the maker or indorser his executor, he will thereby discharge him from liability at common law.184 And in such case no action will lie against the maker by the administrator cum testamento annexo of the holder, even upon the resignation of the maker as executor.1 And where the maker's debt is extinguished

185

178 Chapman v. Kellogg, 102 Mass. 246; Abbott v. Winchester, 105 Mass. 115; Curtis v. Brooks, 37 Barb. (N. Y.) 476.

179 Marshall v. Perkins, 72 Me. 343.

180 Pratt v. Lamson, 128 Mass. 528.

181 See § 1668, supra. But this is not the law in INDIANA (Eldred v. Bank. 71 Ind. 543); nor in NEW JERSEY (2 Gen. St. p. 2336, § 3). And, after the joint liability is merged in a several judgment even against an accommodation maker, it will not be discharged by his dying before his co-maker. Smith v. Kibbe, 31 Hun (N. Y.) 390.

182 Kennedy v. Carpenter, 2 Whart. (Pa.) 344.

183 Louis V. Triscony, 58 Cal. 304.

184 Byles, Bills, 244; Chit. Bills, 610; Sturleyn v. Albany, Cro. Eliz. 150; Cheetham v. Ward, 1 Bos. & P. 630; Lowe v. Peskett, 16 C. B. 503. And see § 639, supra. Although he dies before obtaining letters testamentary. Wankford v. Wankford, 1 Salk. 305.

185 Tarbell v. Jewett, 129 Mass. 457.

by his appointment as executor, he will be discharged, not only from liability to the payee's estate, but also to any person to whom the note is indorsed after the payee's death.186 But the holder of a note

does not discharge the maker by appointing the maker's executor as his executor.187 And the appointment of the maker himself as executor will be no discharge as to creditors of the holder.18

Discharge in Bankruptcy.

188

§ 1833. The bankruptcy of a debtor, in general, discharges such debts and existing liabilities as are provable against his estate. Thus, the liability of a first indorser to a second will be discharged, although both indorsed for the drawer's accommodation, and the second indorsed without knowledge of the accommodation character of the first.189 If the drawer of a bill becomes bankrupt after its dishonor, although before it is taken up by the indorser, he will be discharged from liability to such indorser.190 And the drawer of a bill is discharged from liability, on becoming bankrupt after it is drawn, but before it falls due.191 On the other hand, if the maker of a note becomes bankrupt, and it is afterwards paid, under compulsion of law, by an indorser, the maker will not be discharged from liability to him; 192 although it has been held that an acceptor, becoming bankrupt after accepting a bill, and before its indorsement or payment by the indorser, is thereby discharged from liability to him. 193

A discharge in bankruptcy is, however, only a discharge of the bankrupt, and not of other parties.194 Thus, if the indorser of a note

186 Freakley v. Fox, 9 Barn. & C. 130; 4 Man. & R. 18; Harmer v. Steele, 4 Exch. 1.

187 Dorchester v. Webb, Cro. Car. 372; 188 Brown v. Selwyn, Cas. t. Talb. 241; 920; Woodward v. Lord Darcy, Plow. 186; 189 Houle v. Baxter, 3 East, 177.

190 Hunt v. Taylor, 108 Mass. 508.

Alston v. Andrew, Hut. 128. Holliday v. Boas, 1 Rolle, Abr. Dorchester v. Webb, Cro. Car. 372.

191 McCarty v. Barrow, 2 Strange, 949; Starey v. Barns, 7 East, 435. But see Brooks v. Rogers, 1 H. Bl. 640.

192 Howis v. Wiggins, 4 Term R. 714.

193 Houle v. Baxter, 3 East, 177.

194 Pine River Bank v. Swazey, 47 N. H. 154. So, the assignor of a note with the name of one maker forged is not discharged by the discharge in

becomes bankrupt, and the note is proved against his estate, it will not bar an action against the maker.195 If, however, the holder joins in a petition for the acceptor's discharge as an insolvent, without the consent of the drawer, he will release the drawer.196 So, if the holder consents to receive satisfaction by an assignment of the maker for the benefit of creditors, it will discharge both maker and indorser.197 But the discharge in insolvency of one joint maker will not bar an action against the other.198 And the maker of a note will not be discharged by the discharge of a party for whose debt the note was given.199

If a note is made by A. to B., and another note by B. to C., with A. as surety, and B. is discharged as a bankrupt, it will extinguish A.'s claim against him as surety, so far as it exceeds the amount of the first note held by B., but no further.200 And, in general, a set-off acquired in good faith by the maker of a note, against the payee, before the bankruptcy of the latter, and before notice of the transfer of the note, will not be defeated by the payee's bankruptcy.201 If a bill is accepted payable at a particular bank, and is forwarded to it for collection and payment, and the bank fails before making payment, it will not be discharged from liability, but the owner may enforce the trust and recover the bill from its receiver.202

In Massachusetts provision is made by statute for waiver of a discharge in bankruptcy by a new promise.203

A discharge in insolvency or bankruptcy is confined, in general, to

insolvency of the genuine maker, and dividends received by the holder from his estate. Spalding v. Gates (Ky.) 41 S. W. 440.

195 Athol Nat. Bank v. Hingham Mfg. Co., 121 Mass. 399. And he may prove against several bankrupt parties, and have dividends from the estate of each. Ex parte Wyldman, 2 Ves. Sr. 113.

196 Lynch v. Reynolds, 16 Johns. (N. Y.) 41.

197 Pontious v. Durflinger, 59 Ind. 27.

198 Tooker v. Bennett, 3 Caines (N. Y.) 4. And this is provided by statute in CONNECTICUT (Gen. St. §§ 531, 1022).

199 Ricketts v. Harvey, 78 Ind. 152.

200 Scott v. Timberlake, 83 N. C. 382.

201 Harwell v. Steel, 17 Ala. 372.

202 Corn Exch. Bank v. Blye, 2 N. Y. St. Rep. 112. And see § 1457, supra. 203 Pub. St. c. 78, § 3. But a part payment "as an installment of a long deferred promise" is not such a waiver. Jacobs v. Carpenter, 161 Mass. 16, 36 N. E. 676.

creditors who are necessarily or voluntarily within the jurisdiction.204 But if a creditor submits to the jurisdiction by proving his claim against the acceptor in a foreign bankruptcy proceeding, he will be bound by the discharge of the acceptor, and will also discharge the drawer, who did not consent or concur in the proceedings.205

Composition in Bankruptcy.

§ 1834. A composition in bankruptcy amounts to a release of the bankrupt; 200 206 but it is not binding upon any party until executed by him; 207 nor upon the bankrupt until he complies with its terms.208 When properly executed, a composition with one joint maker is a discharge of his co-maker.209 So, composition made with any party to a bill, without reserving the holder's rights against subsequent parties, will discharge them.210 Composition made with the acceptor of a bill discharges the drawer.211 But if it is not a voluntary com

204 Kenworthy v. Hopkins, 1 Johns. Cas. (N. Y.) 107. So, as to New York creditor of a foreign bankrupt, although the debt was contracted and payable in the foreign jurisdiction. Phelps v. Borland, 103 N. Y. 406, 9 N. E. 307. So, as to Massachusetts creditor of a foreign corporation discharged by Massachusetts insolvency proceedings, Regina Flour-Mill Co. v. Holmes, 156 Mass. 11, 30 N. E. 176; or as to a foreign creditor of a Massachusetts debtor pleading a discharge in Massachusetts, Phoenix Nat. Bank v. Batcheller, 151 Mass. 589, 24 N. E. 917. And see § 58, supra.

205 Phelps v. Borland, 103 N. Y. 406, 9 N. E. 307. But see Id., 30 Hun, (N. Y.) 362.

206 Steinman v. Magnus, 11 East, 390; Margetson v. Aitken, 3 Car. & P. 338; Bissenger v. Guiteman, 6 Heisk. (Tenn.) 277; Grant v. Porter, 63 N. H. 229. Although it reserves the holder's rights against the indorser. Richardson v. Pierce, 119 Mass. 165.

207 Chit. Bills, 352; Cranley v. Hillary, 2 Maule & S. 120; Oughton v. Trotter, 2 Nev. & Man. 71; Heathcote v. Crookshanks, 2 Term R. 24. Although he had agreed to the composition, and afterwards withdrew his consent. Fellows v. Stevens, 24 Wend. (N. Y.) 294.

208 National Mt. Wollaston Bank v. Porter, 122 Mass. 308.

209 Hall v. Wilcox, 1 Moody & R. 58. And notwithstanding a reservation to the contrary. Simpson v. Henning, L. R. 10 Q. B. 406.

210 Ex parte Smith, 3 Brown, Ch. 1; Pannell v. McMechen, 4 Har. & J. (Md.) 474. But see Schlingmann v. Fiedler, 3 Mo. App. 577, contra.

211 Ex parte Wilson, 11 Ves. 410. So, if one who pays a bill supra protest joins in a petition for the discharge of an insolvent party, he will discharge

position, and is made by operation of law under the statute, the drawer will not be discharged, although the holder was present at the meeting of the acceptor's creditors and voted for the composition.212 If the holder enters into a composition with a drawer, for whose accommodation the bill has been accepted, he will discharge the accommodation acceptor. 213 In like manner, a composition with the maker will discharge an accommodation indorser, although he said that he would continue liable.214

But where a composition with the principal debtor expressly reserves the holder's rights against the surety, the latter will not be discharged.215 So, where it is made at the surety's request.216 So, as to an indorser, who joins with the holder in signing the composition. 217 And after proof made in bankruptcy against co-sureties, one will not be discharged by a composition made with the other.218 And a composition made by the holder with the payee, for whose accommodation the note was made, will not discharge such payee from liability to the accommodation maker (who was not a party to the composition), on his payment of the note.219

the party honored by him, and such party paying the bill cannot recover against prior parties. Lynch v. Reynolds, 16 Johns. (N. Y.) 41.

212 Ex parte Jacobs, 10 Ch. App. 211.

213 Ex parte Glendinning, Buck, 517.

214 Lewis v. Jones, 4 Barn. & C. 506, 6 Dowl. & R. 567. But see, contra. where the maker signed for the payee's accommodation, Mallet v. Thompson, 5 Esp. 178; or where the right is expressly reserved, Nichols v. Norris, 3 Barn. & Adol. 41.

215 Bateson v. Gosling, L. R. 7 C. P. 9.

216 Ex parte Harvey, 4 De Gex, M. & G. 881.

217 Bruen v. Marquand, 17 Johns. (N. Y.) 58; Rockville Nat. Bank v. Holt, 58 Conn. 526, 20 Atl. 669. But see, to the effect that an express agreement is necessary even in such case, In re McDonald, 14 N. B. R. 477, Fed. Cas. No. 8.753.

218 Ex parte Gifford, 6 Ves. 805.

219 Thomas v. Liebke, 81 Mo. 675, affirming 9 Mo. Afp. 424.

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