SMITH . SMITH.

said Perrin M. Smith is entitled to the said surplus," the order thereupon proceeds to adjudge it to him.

It is very manifest that the order thus made cannot be supported. Looking first at the petition of Perrin M. Smith, it would appear that his foreclosure suit proceeded upon the assumption that there were several parties who. had, or might have, better rights to the surplus than himself; for he makes the heirs of Mary Ann Smith parties defendant, which could only be on the supposi tion that she owned, or was interested in, the equity of redemption; and he also joins other parties, who were only proper defendants if they had become purchasers or incumbrancers subsequent to the mortgage. All of these parties were entitled to notice of the presentation of the petition, that they might contest the right of the peti tioner, and assert any they might suppose to exist in themselves. Benjamin Smith, if living, was also entitled to notice, that he might show that the judgment had been satisfied.

Moreover, aside from any question there may be, whether the rights of complainant under the levy were not entirely cut off by the foreclosure sale, the petition fails to show any equity, since it does not appear from it that Benjamin Smith had any right in, or claim to, the land when the levy was made, but the petition inferentially asserts the contrary. If a sale had taken place, and it had appeared that Benjamin Smith had had some claim to the land at the time of the levy, which was enlarged or perfected afterwards, a very dif ferent question would be presented from that which is now before us, where the execution creditor seeks to reach, through a levy not followed by sale, the proceeds of lands not owned by his debtor when levied upon.

If we could look at the facts set up in the counter petition for the purpose of supplying the defects in the other, we should find that they do not aid the first

SMITH V. SMITH.

petitioner. It is true that petition shows the equity of redemption to have been in Benjamin Smith at the time of the levy, if the deed of the wife to him was valid; but it also shows that Benjamin Smith had deceased since the sale, so that, if he was owner of the equity of redemption when the sale was made, the surplus moneys became personalty by the sale, (Bogert v. Furman, 10 Paige, 496; Sweezey v. Willis, 1 Bradf., 495,) and his personal representatives were entitled to be heard before the moneys were adjudged to the petitioner. It appears, therefore, that, of the three classes of persons who were entitled to dispute with the petitioner the right to this surplus, two-the subsequent purchasers or incumbrancers, and the representatives of Benjamin Smith are not before the Court at all. There is a still further difficulty-that the order made on the petitions was made solely on the admissions of the infant heirs, who were not only incompetent to make any admissions which would bind absent parties, but they could not even make any which should bind their own interests.

The order was also erroneous in awarding costs against the infants. Costs are usually awarded either because the party, in the assertion of an unfounded claim, has brought another into Court to defend his rights; or because, by the neglect to perform a legal duty, or by some wrongful act, he has compelled another to come into Court to assert his rights. The costs in this case were not caused by the infants. Their assent would not have enabled the appellees to obtain the surplus moneys without a resort to this proceeding; and if there was reasonable ground for believing that they were entitled to these moneys, it was the duty of whoever represented their interests to present the facts to the Court.

Although these errors in the order were not pointed

NEWBERRY v. TROWBRIDGE.

out on the argument, yet, as they all either affect prejudicially the rights of infants, or go to the jurisdiction of the Court to make any such order, they cannot be waived by consent of these parties, and we cannot overlook them.

The order must be reversed, with costs to the appellants, and the cause remanded for further proceedings.

CHRISTIANCY and CAMPBELL JJ. concurred.
MARTIN Ch. J. did not sit in this case.

Henry W. Newberry and Walter C. Newberry, Executors of Oliver Newberry, v. Charles C. Trowbridge and John Owen.

Indorser's liability-proof that note was discounted for his benefit not admissible. The indorser of a promissory note, for whose benefit the note is discounted, does not thereby incur any other liability than that of his indorsement; and, therefore, in an action by the assignees of a bank against the indorsers of a note, it was held not competent to show that a note, in renewal of which the one in suit was made, was discounted by the bank for the benefit of one of the indorsers, and that the money was paid to him.

Held, also, in such case, that it was not competent for the plaintiffs to show that the note, in renewal of which the one in suit was given, was purchased of the maker thereof by one of the indorsers for a sum less than its face, as such evidence could have no tendency to fix the legal liability of the indorser to pay the note.

Receiver's sale of note what was said to be due not evidence. -In a suit upon a promissory note purchased at a receiver's sale, evidence by defendant, to show what was stated to be due on it at the time of such sale, is not admissible. Sale of note pending suit-set off. Where, in a suit by the assignees of a bank, against the indorsers of a promissory note past due when assigned, the note, pending suit, became the property of another, it was held that the suit did not thereby abate, but might be prosecuted for the benefit of such purchaser, and that the note was subject to any set off which could have been made against it in an action by the bank itself.

Set off by defendant of individual claim after death of co-defendant. -And where in such case, pending suit, one of the defendants died, and the survivor held a certificate signed by one of the plaintiffs as acting assignee of the bank, certifying that he had deposited a certain sum with the assignees, and that the same.

constituted a claim in his favor against the assets of the bank, it was held that the amount due on such certificates was proper matter of set off in favor of such defendant.

Indorser-tender by, in depreciated bank bills its effect. A tender by the indorser of a note, of the sum due thereon in depreciated bank bills, without explanation, is, in legal effect, an offer of compromise, and not of payment, and cannot operate as a waiver of notice, or an unqualified acknowledgment of liability by him.

Indorser-part payment by, in depreciated bank bills - its effect. -The mere fact of part payment of a promissory note by an indorser in depreciated bank bills, will not have the effect of an unconditional acknowledgment of liability to pay the whole.

Indorser - when his knowledge of defective notice must be shown. Nor will proof of part payment by an indorser, in any case, have such effect, where it appears that the notice of protest was insufficient to bind him, without further showing that, at the time of such payment, the indorser had knowledge that due notice had not been given.

Heard April 11 and 12.

Error to Wayne Circuit.

Decided May 9.

The facts are sufficiently stated in the opinion.

Newberry & Pond and G. V. N. Lothrop, for plaintiffs in

error:

1. The testimony tending to show Oliver Newberry's ownership of, and dealings in regard to a note, in payment or renewal of which the note sought to be recovered upon appears to have been given, was wholly irrelevant.

The issue was, whether the proper steps had been taken to fix the liability of Oliver Newberry and Benjamin B. Kercheval, as indorsers of the last-mentioned note; and if not, whether said Newberry and Kercheval had, by their subsequent conduct, waived any laches in that respect.

Being thus irrelevant and immaterial, unless it can be seen that said testimony could not by any possibility have injured the defendants, its admission was fatally erroneous. Underhill v. N. Y. & H. R. R. R. Co., 21 Barb., 489; Myers v. Malcolm, 7 Hill, 292; F. & M. Bank v. Whinfield, 24 Wend., 420; Clark v. Vorce, 19 Wend., 232.

NEWBERRY D. TROWBRIDGE.

2. The seventh assignment of error is well taken. The testimony offered was admissible, as tending to show the amount due on said note.

It had already appeared that O'Flynn, (or Mrs. O'Flynn,) was the real party in interest in this suit, and the owner and holder of said note; that he (or she,) claimed title through said Conant, into whose possession said note had come as receiver in a suit to which the plaintiff's were parties defendant, and who had sold the same to O'Flynn. Conant, whilst so in possession of said note, had authority, and it was his duty, to receive payments thereon. His statement, or admission, therefore, made whilst he so held said note, as to the amount claimed to be due and unpaid thereon, would, as against himself and those claiming under him, be prima facie evidence of the extent of the amount so due and unpaid.

3. The ninth assignment of error is based upon the rejection of the evidence offered to establish a claim by way of set off.

The ground of the rejection of this testimony was, that there were several defendants, and that the debt proposed to be set off was not due to them all jointly. Subdiv. 6 of §4213, Compiled Laws.

It is true that the suit was originally against several defendants, but upon the death of Kercheval it ceased to be so. §4212, §4213, Compiled Laws. And the notice of set off was filed by leave of Court after his death.

4. The tender made in depreciated bank bills was a conditional offer to pay, or an offer to pay in a particular manner, and not having been accepted, was not evidence of a waiver of the laches in giving notice, or an admission of liability.-Taylor v. Jones, 2 Camp., 106, note; Standage, et al., v. Creighton, 5 C. & P., 406; 1 Parsons on Notes and Bills, 600; Crain v. Colwell, 8 Johns., 384; Agan v. McManus, 11 Johns., 180; Sice v.

13 MICH,- – R.