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to be within the statute of limitations. But though not within these statutes, like mortgages, they are liable to presumptions of payment; and it is thought to be quite clear that when the circumstances are such, as would induce the court to presume the payment of a mortgage, the same presumption would be made with reference to these bonds. It is, says Chancellor Kent, a well-settled rule, both at law and in equity, that a mortgage is not evidence of a subsisting debt, if the mortgagee never entered and there has been no interest paid or demanded for twenty years. These facts alone authorize and require the presumption of payment."

(B.)

In Buchanan v. Rowland, (7) Kirkpatrick, C. J., gives the history of this presumption on the law. "By the common law," says he, "there was no stated or fixed time for the bringing of actions. The law was always open; satisfaction was never presumed. In the progress of society however it was soon found necessary to supply this deficiency by statute, and to compel men to prosecute their rights within a reasonable time or to abandon them forever. Hence we find from the reign of Henry I, a succession of statutes, narrowing the latitude of the common law in this respect, and limiting the time in which actions might be brought to shorter and shorter periods, until they had brought it down in most cases to twenty years only, and in many to a still shorter time. The reasons upon which these statutes are founded, Sir William Blackstone tells us are, first, that the law will not disturb an actual possession in favor of a claim which has been suffered to lie dormant for a long and unreasonable time; secondly, that it presumes that he who has for a long time had the undisturbed possession of either goods or lands, however wrongfully obtained at first, has either procured a lawful title or made satisfaction to the injured, otherwise he would have been sooner sued; and thirdly that it judges that such limitations tend to the prevention of innumerable perjuries, the preservation of the public tran quillity, and what it values perhaps more than all, the suppression of contention and strife among men. Taking these great fundamental principles then thus recognized by successive statutes as the basis of their conduct, the courts of justice built up upon them a system extending beyond the letter of the statutes themselves. They were professedly founded in part upon the presumption that lawful titles may have been acquired under possessions tortiously taken, and that satisfactions may have been made upon contracts in their origin undisputably valid, but that the evidence thereof after lying so long may be destroyed by permitted to retain possession of the land for twenty years

1. A. claims certain land under a mortgage due in October, 1794, and made by B. It appeared that B.'s heirs were in 1819 in possession of the land. The presumption is that the mortgage is paid. (10)

the all-devouring tooth of time. The judges only extended this principle to cases, which though not within the letter, were yet within the reason and spirit of the law. Lord Hale, I think, is said to be the first man that ventured upon this course; he was followed by Holt, and then came Lord Mansfield with a still bolder step; the judges in chancery in the meantime, keeping equal pace, if not even going beyond the courts of law. * * *The same ground has been taken and the same course pursued by succeding judges down to this day; so that nothing can be better settled than that they do extend the principles of these statutes by analogy only to cases within the reason and spirit, though not within the letter of them. And upon this analogy this presumption of payment, as appears by Lord Mansfield, is wholly founded.”

ILLUSTRATIONS.
(A.)

1. By statute certain bonds are given by an heir at law which are a lien on the lands descending to him. After twenty years the presumption (they not being within the limitation law) is that they are paid. (8)

2. A suit is brought in 1834 on a bond made in 1800, a payment having been made on it in 1801. The presumption is that it is paid.(9)

In case 1 it was said: "Bonds given by the heir entitled to elect under the act to direct descents are by the terms of the act of Assembly made liens on the lands for the purchase of which they are given until paid; and therefore they are supposed not (7) 5 N. J. (L.) 728 (1820).

(8) Boyd v. Harris, 2 Md. Ch. 210 (1850).

(9) Delaney v. Robinson, 2 Whart. 503 (1837); Denniston v. McKeen, 2 McLean, 252 (1840).

In case 1 it was said: "In furtherance of justice, and the more effectually to secure the rights of the parties in the investigation of questions in issue, and especially in ancient transactions the law calls to its aid the doctrine of presumption under which the jury are authorized to find the existence of certain facts as to which there is no direct evidence, but which are, under the rules of law to be reasonably inferred from certain other facts whieh are well established by the evidence in the case. These presumptions when they

(10) Howland v. Shurtleff, 2 Metc. 26 (1840); Jarvis v. Albro, 67 Me. 310 (1877); Trash v. White, Brown Ch. 291 (1791) and notes; Christophers v. Sparks, 2 Jac. & W. 235 (1820); Sibson v. Fletcher, 1 Ch. Cas. 59; Leman v. Newnham, 1 Ves. Sr. 51 (1747); Toplis v. Baker, 2 Cox, Ch. 118 (1789); Jackson v. Wood, 12 Johns. 242 (1815); Livingston v. Livingston, 4 Johns. Ch. 287 (1820); Wanmaker v. Van Buskirk. 1 Saxt. Ch. 685; 23 Am. Dec. 748 (1832). In Tripe v. Marcy, 39 N. H. 449, the court said, that the presumption that when the mortgagor is

without interruption, the mortgage debt has been paid or had no valid existence is established on great authority, citing Trak v. White, 3 Brown Ch. 289; Christopher v. Sparks, 2 Jac. & W. 10; Hughes v. Edmonds, 9 Wheat. 497; Dexter v. Arnold, 3 Sum. 152; Dunham v. Minard, 4 Paige, 443; Bacon v. McIntyre, 8 Metc. 86; Heyer v. Pruyne, 4 Paige, 443; Higginson v. Mein, 4 Cranch, 415; Collins v. Tenney, 7 Johns. 279; Jackson v. Davis, 5 Cow. 130. "But we are not prepared to hold that this presumption arises short of twenty years from the time the mortgage debt becomes due, otherwise we might be asked to presume a debt paid before the stipulated time of payment had arrived. This presumption arises from the long delay to enforce payment; but surely no such delay can be charged until the time has arrived when the creditor is entitled to demand it. In this respect the presumption accords with the general provision of our limitation laws which limit suits to the time prescribed after the cause of action has accrued. Upon these principles no presumption of payment exists in this case. When the mortgagee is in possession, the right of the mortgagor will be barred in twenty years from the entry after breach of condition. So if the mortgagee suffer the mortgagor to remain in possession twenty years after breach of condition, payment is presumed. In both cases the time is reckoned from the breach of condition. In the first the mortgagee is usually entitled to the possession upon the execution of the mortgage, and until the debt becomes due the mortgagor cannot by payment entitle himself to enter. He can of course then do nothing to interfere with the mortgagee's possession, and until the debt has become due, no presumption can arise against him." Tripe v. Marcy, supra; Evans v. Huffman, 5 N. J. (Eq.) 360 (1846). No such presumption of payment can arise against a mortgagee or his assigns in possession, when the mortgagor became insolvent and died before the debt became due, and when his vendee of the equity of redemption also became insolvent before the maturity of the debt removed from the State, and never afterward returned. Brobst v. Brock, 10 Wall. 519 (1870).

some compensation or release to have been (D.)

1. It appears that from 1807 to 1813, H. was an inhabitant of the town of S., and was assessed for taxes. In a suit brought in 1840, the presumption is that these taxes are paid.(17)

2. An assessment was made in 1837 on the property of A. The presumption is, in 1862 that it has been paid.(18)

Taxes, it was said in case 1, cannot have any higher character than debts due by specialty and of record. As to these a presumption of payment arises after the lapse of twenty years if there is no evidence to repel it, and to show that the debt is still unsatisfied. The assessment is in the nature of a judgment, and the warrant for the collection operates like an execution. There is no reason therefore why the same principle should not be applied in both cases.

(E.)

1. A suit is brought on a judgment recovered more than twenty years before. The presumption is that it has been paid. (19)

arise from lapse of time and forbearance to assert time
claims rest upon the principle so strongly pervading made."
the course of men's actions in relation to their rights
that individuals will appropriate to their own use and
subject to their own control that to which they have
the legal right, and that an abandonment for a great
length of time of a legal interest without any attempt
enforce it, furnishes reasonable ground for the infer-
ence that the party has in some way parted with his
interest or discharged his claim. This principle so
reasonable in itself operates beneficially in quieting
controverted titles and closing stale demands, and also
protects individuals from gross injustice, arising from
loss of evidence as to ancient transactions. A ques-
tion has been sometimes raised whether the doctrine
of presumption arising from the lapse of time and
total neglect to take any measure to enforce a claim,
could properly be applied to the case of a mortgage of
real estate; and in some of the English cases the doc-
trine was advanced that the common law presumption
applicable to bonds, judgments, etc., arising from a
delay of twenty years to enforce the same did not ap-
ply in the case of a mortgage, as in such cases the
legal estate was in the mortgagee and the mortgagor
was a mere tenaut at will, and his possession was
therefore the possession of the mortgagee. But this
doctrine was repudiated by Lord Thurlow in the case
of Trash v. White, (11) aud by the Master of the Rolls
in Christopher v. Sparke, (12) in very strong language;
and the cases of debts secured by mortgages are placed
on the same footing with other demands, and held
liable to be defeated by the same presumptions arising
from lapse of time and laches of the mortgagee. In
our own court the principle was applied in the case of
Inches v. Leonard, (13) under circumstances however
of greater delay, than in the present case in asserting
the claim of the mortgagee. It was a case of a mort-
gage of forty years' standing, where there had been no
possession by the mortgagec, and no attempt in the
meantime to enforce the mortgage; and the court held
that the plaintiff could not maintain the action. The
doctrine that where the mortgagee has never entered
under his mortgage and no interest has been paid for
twenty years on the same, these circumstances author-
ize the presumption in fact that the mortgagee has
been discharged by payment or otherwise is one of
frequent application."(14)

(C.)

1. It is proved that a testator long since dead left considerable personal property. The presumption arises that legacies charged upon his real and personal estate have been paid. (15)

2. B. by his will left a legacy to F. appointing C. his executor. The legacy was to be paid in 1803. In 1829 F. brought a suit against C. for the legacy. The presumption is that it was paid.(16)

"Legacies," it was said in case 1, not being within the statute of limitations, fall within the rule of presumption. After a lapse of twenty years bonds and other specialties, merchants' accounts, legacies, mortgages, judgments, and indeed all evidences of debt excepted out of the statute are presumed to be paid. The court will not encourage the laches and indolence of parties, but will presume after a great length of

(11) 3 Brown Ch. 289. (12) 2 Jac. & W. 223. (13) 12 Mass. 379.

(14) Collins v. Terry, 7 Johns. 278; Jackson v. Wood, 12 id. 242; Jackson v. Pratt, 10 id. 381; Giles v. Barremore, 5 Johns. Ch.552.

(15) Fuhsman v. London, 13 S. & R. 386; 15 Am. Dec. 608 (1825); Hayes v. Whitall, 13 N. J. (Eq.) 241 (1861).

(16) Foulk v. Brown, 2 Watts, 212 (1834); Bentley's Appeal, 99 Penn. St. 504 (1882).

(F.)

1. A man conveyed in 1826 his interest in some land to a trustee for the payment of certain creditors and the balance to his wife. In 1847 the law will presume that the debts have been paid and the trust executed.(20)

RULE II. The presumption under rule 1 does not arise from lapse of time alone short of twenty years; but a shorter time, in connection with other circumstances, may raise a presumption of fact that payment has been made.

"When we hear of less than twenty years being left to the jury," it was said in a Pennsylvania case, "it must be understood to have been in connection with other circumstances." (21) This seems to be well settled.(22)

"A legal presumption of payment of a bond or covenant given for the payment of money does not arise from mere lapse of time where the bond or covenant has not been due for twenty years before commencement of suit or proceedings for the recovery of the

(17) Hopkinton v. Springfield, 12 N. H. 328 (1841).
(18) Fisher v. Mayor of New York, 6 Hun, 64 (1875).

(19) Bird v. Inslee, 23 N. J. (Eq.) 363 (1873); Kensler v. Holmes 2 S. C. 483 (1871); Miller v. Smith, 16 Wend. 425 (1836); Inches v. Leonard, 12 M ass. 379 (1815); Barned v. Barned, 21 N. J. (Eq.) 245 (1870). From less than twenty years the presumption does not arise. Daby v. Ericsson, 45 N. Y. 786 (1871); Tesley v. Nones, 7 S. & R. 410 (1821).

(20) Drysdale's Appeal, 14 Penn. St. 531 (1850); Webb v. Dean, 21 id. 31 (1853).

(21) Henderson v. Lewis, 9 S. & R. 384 (1823); Ross v. McJunkin, 14 id. 364 (1826); Ross v. Darby, 4 Munf. (Va.) 428 (1815).

(22) Brubaker v. Taylor, 76 Penn. St. 83 (1874); and see Graves v. Steel, 3 La. Ann. 280 (1848); Briggs' Appeal, 93 Penn. St. 485 (1880): Sadler v. Kennedy, 11 W. Va. 187 (1877); Calwell v. Prindle, id. 307 (1877); Daby v. Ericksson, 45 N. Y. 786 (1871); Clark v. Hopkins, 7 Johns. 556 (1811); Stocker v. Johnson, 6 B Mon. 408 (1846). In Didlake v. Robb, 1 Woods, 682, Hill, J., said: "Aside from the statute of limitations, *** the rule is well settled that after a debt has remained due and payable for sixteen years, the law holds such lapse of time as prima facie evidence of payment, which prima facie evidence be rebutted by proof of a subsequent promise to may pay, or some reasons why suit was not brought; and after the lapse of twenty years the presumption of payment becomes conclusive." It would be hard to say where the judge found such a rule announced as well settled. It is loose language of this kind in judicial opinion that occasions so much confusion and uncertainty in the law.

amount thereby due and payable. If a shorter period, even a single day less than twenty years, has elapsed, the presumption of satisfaction from mere lapse of time does not arise. While the mere lapse of twenty years without explanatory circumstances affords a presump. tion of law that the debt is paid, even though it be due by specialty, still payment may be inferred by the jury from circumstances with the lapse of a shorter period of time than twenty years. When an action is brought on a bond or covenant for the payment of money, if twenty years elapse between the time of its becoming due and of the institution of the action or proceeding, the defendant may without pleading the statute of limitations rely upon presumption of payment; and upon issue joined on plea of payment, payment may be inferred by the court or jury from circumstances coupled with a lapse of a shorter period than twenty years. (23)

In Colsell v. Budd Lord Ellenborough said: "After a lapse of twenty years a bond will be presumed to be satisfied; but there must either be a lapse of twenty years, or less time coupled with some circumstance to strengthen the presumption. Here, if it has been proved that the parties had accounted together, after the money became payable, it might have been inferred that it was included in the settlement; but as there is no evidence of this, and as twenty years have not elapsed since the bond was forfeited, it cannot be considered as discharged."

ILLUSTRATIONS.

1. K. gave C. in 1837 a sealed note payable in sixty days. After both K. and C. were dead an action was brought (in 1852) on this note. C. had a running account at K.'s store from 1836 to 1839, and payments were made to amounts more than the note during this time. K. resided near C. until his death. These facts raise the presumption that the note was paid.(25)

2. An action is brought on a bond payable in installments. Nineteen years and ten months have elapsed since the last installment became due, and another installment had become payable more than twenty years before the suit was brought. The judge instructed the jury that as to the last installment they may and as to the other they must presume payment. (26)

3. A judgment was recovered in 1857. In 1874 (16 years) a sci. fa. was issued to revive it. The defendant swore that he expected to prove that it had been fully paid out of the proceeds of a sheriff's sale of his land, in the proceeds of which the plaintiff had participated; that he could not state the payments, being unable after search to obtain the sheriff's docket. Held, that the presumption of payment arose.(27)

4. A transcript of a justice of the peace was filed in a Superior Court nineteen years after the judgment was rendered. The justice was not called nor the docket produced, and there was nothing to show whether an execution had ever been issued. The presumption arises of payment.(28)

5. A debt on a bond due eighteen years and a half is sued on. It appears that during this time the creditor was a poor man and the debtor a rich one. The presumption of payment arises. (29)

6. R. sued G. on a note payable in 1860; the action was brought in 1872. On several occasions after the (23) Calwell v. Prindle, 19 W. Va. 640 (1882); citing Sadler v. Kennedy, 11 id. 187; Perkins v. Hawkins, 9 Gratt, 656; Goldhawk v. Duane, 2 Wash. C. C. 323.

(24) 1 Camp. 27 (1807).

(5) King v. Coulter, 2 Grant's Cas. 77 (1853). (25) Miller v. Evans, 2 Cranch, C. C. 72 (1813). (27) Moore v. Smith, 81 Penn. St. 183 (1876). (28) Diamond v. Tobias, 12 Penn. St. 312 (1849). (29) Hughes v. Hughes, 54 Penn. St. 241 (1867).

note matured R. came to G. wanting to sell him some stock in a company, on the ground that he needed the money, and after much persuasion G. purchased the stock. Nothing was said about the note. The presumption arises that the note was paid. (30)

In case 1 it was said: "It was fifteen years, four months and twenty-five days after the sealed note of the plaintiff's testator matured before this action was instituted for its recovery. No legal presumption of payment such as unrebutted the court would be bound to declare as a conclusion of law arose in that time, for the authorities all agree in fixing twenty years, from analogy to the English statute of limitations concerning real estate, as the period necessary to such a presumption. But the question is whether the time that did elapse was competent in connection with such circumstances as were offered to go to the jury as ground for their presuming payment of the note. * *** The competency of such evidence does not depend on a particular period of years, though its effect will be proportioned to their number. The presumption strengthens as the time approaches to twenty years, and the circumstances needed to establish it may be measured by a diminishing scale. The further the time stops short of twenty years the more cogent and decisive must be the circumstances relied on. Just as the further we advance beyond twenty years we require more persuasive circumstances to rebut the legal presumption. Twenty years assumed as the point for that presumption, the scale is reversed by which we measure the' circumstances that tend to establish or countervail it. In both instances it is for the jury to apply the proofs under the direction of the court. If evidence be offered which in the judgment of the court will, in connection with the lapse of time, reasonably tend to convince the jury that the sealed debt has been paid short of twenty years, or that it has not been paid, notwithstanding that period, it is the duty of the court to receive it, and to submit it to the jury with such instruction as shall enable them to estimate it at what it is really worth. The point to be attained is moral conviction of a fact, and whilst it is not to be founded on evidence insufficient to convince reasonable men, we are not to exact mathematical certainty, nor to expect more than moral demonstration."

"More than sixteen years," it was said in case 3, "had elapsed. A legal presumption of payment does not indeed arise short of twenty years, yet it has been often held that a less period, with persuasive circumstances tending to support it, may be submitted to a jury as a ground for a presumption of fact."

In case 4 it was said: "The rule is well established that where the period is short of twenty years the presumption of payment must be aided by other circumstances beyond a mere lapse of time. But exactly what these circumstances may be never has been nor never will be defined by the law. There must be some circumstances, and where there are any it is safe to leave them to the jury. Here there were several circumstances. No certificate was given by the justice that he had issued execution, to which there was a return of nulla bona; and this was important, as the record still remained before the justice, who might receive the money or collect it by execution. And there was the pregnant circumstance that the plaintiff produced hearsay evidence that the transcript was genuine, and that the justice had said that the docket was lost. The justice was not produced himself to show that the docket was lost and that search was made for it. This would have been unnecessary if the transcript had been entered in any reasonable time; but after the lapse of nineteen years and seven months it would seem to be a reasonable duty on the part of the plaintiff, and the absence of which might fairly be (30) Garnier v. Renner, 51 Ind. 374 (1875).

On the whole

taken into consideration. * we think the judge did not err in submitting all the circumstances in evidence to the jury, from which, if they were satisfied, they might infer, or presume payment."

In case 5 it was said: "That a complete legal presumption of payment of a bond or other instrument of like nature does not arise short of twenty years is well settled; but it has also been well settled that a shorter period, aided by circumstances which contribute to strengthen the presumption of payment by lapse of time, may be submitted to a jury as grounds for the presumption of the fact of payment. Slight circumstances may be given in evidence for that purpose in proportion as the presumption strengthens by the lapse of time; but still they must be such as aid the presumption arising from time. They must be, as it is said, persuasive that the time would not have been suffered to elapse had the debt remained unpaid. * * * To aid the presumption of payment from the lapse of time the defendants offered evidence of what they called the needy circumstances of the obligee and the easy and solvent circumstances of the obligor. No doubt * * * * evidence to prove this is entirely competent."

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TALCOTT V. HAZARD. Prospective profits depending entirely for their existence upon the fluctuations of the markets and the chances of business are not recoverable as damages. Where the claims arising from a breach of contract are of this character, unliquidated and uncertain, they are not debts within the meaning of the provisions of an assignment for the benefit of creditors as to the payment of just debts."

To entitle the creditor to a dividend of the insolvent's estate the liability must be ascertained and fixed at a sum certain.

On the 14th day of July, 1882, the claimant, James Talcott, and Henry Adams, one of the said firm of R. & H. Adams, made and executed an agreement, of which the following is a copy:

"July 14, 1882.

"James Talcott to take the lease of the stores 83 and 85 Greene street for balance of the term, and to sell on commission for R. & H. Adams all their goods in stock and the entire production of their mills during the term of this agreement, 7% per cent. commission, and at the expiration of this lease to assume the lease of No. 18 Green street or for three years, until the expiration of said lease; also it is understood that if required James Talcott is to advance in cash or acceptance of R. & H. Adams, drafts not to exceed two-thirds market value of goods; also to pay Henry Adams and William Adams together 25 per cent of the net profits of this business for selling the goods and taking general oversight of this business under Mr. Talcott's supervision, said business to date from July 15, 1882, and to termi

nate at the date of the expiration of the lease of No. 18 Green street, profits to be ascertained as soon as practicable after the closing of the books each year. (Signed) "JAMES TALCOTT, "HENRY ADAMS.”

On or about December 22, 1882, James Talcott presented to the assignees a claim against the assigned estate for $170,000 for unliquidated damages for breach of the contract above set forth. On October 30, 1883, judgment was entered on the report of Hamilton Cole, Esq., referee, dismissing said claim and adjudging that said assignees recover $777.46 cost and disbursements. From this judgment Talcott appeals.

Hugh Porter, counsel for assignees.

Chambers, Boughton & Prentiss, counsel for Talcott, claimant.

DALY, C. J. The claim of damages for a breach of contract was not provable as a debt under the assign

ment.

It has been settled by a long series of decisions that unascertained claims for damages are not provable as debts in proceedings in bankruptcy; that in claims for damages arising from breaches of contract in indemnity bonds and other possible liabilities the damages must be ascertained and fixed before the act of bankruptcy unless the contingent liability is one that has been specifically allowed by statute, and the actual prospective value of which at the time of the bankruptcy is capable of being ascertained by some mode of computing or estimating. Ex parte Marshall, 1 Montagu & Ayrton, 118; Ex parte Thompson, 1 Montagu & Bligh, 219; Ex parte Tyndal, 1 Deacon & Chitty, 291; Yellop v. Evarts, 1 Barn. & Adol. 698; Bourman v. Nash, 9 Barn. & Cress. 145; Allwood v. Partridge, 4 Bing. 209; Lancashire Coal Co., Montagu, 27; Wooly v. Smith, 3 Com. Bench, 610.

Formerly in bankruptcy proceedings in England the claim had to be due at the time of the act of bankruptcy, and the liability upon a promissory note not due until afterward was not provable. But this was relaxed by provisions in subsequent statutes which allowed contingent liabilities to be proved; where as before stated, the value could be estimated, and under our own bankruptcy act claims for unliquidated demands arising out of any contract or promise were allowed; but unless where changes have been made in this way by statute the rule has been as above stated. The reason of it was, as the bankrupt under the act was to be discharged from his debts, the proceeding was to be strictly confined to what was regarded as a debt; and for the further reason that the creditors whose claims were ascertained and fixed when the bankrupt went into or was brought into bankruptcy, were entitled to share in the distribution of his estate as soon as it was gathered in, and were not to be delayed by claims against him sounding in damages which it might take years to determine. It was said that the assets were not to be locked up pending such uncertain litigations, but that matters were to be adjusted according to the relative liabilities of the bankrupt, as they were ascertained and known at the time of the act of bankruptcy, and as his estate then existed. That it was not proper to keep the property, or a certain part of it, until it was ascertained whether somebody who had a claim for damages, which it might take years to determine, would recover any or not. parte Marshal, 1 Mont. & Ay. 118. In which connection I may inention that I have known cases in our own court in which actions for the recovery of damages through mistakes and new trials remained in the court for ten years before they were finally determined.

Ex

The grounds upon which unascertained claims of the the nature of the one here presented were not allowed

to be proved as debts in bankruptcy, apply with equal force in cases of voluntary assignments for the benefit of creditors, and indeed more so, because there the instrument itself provides how and to the payment of what debts the property assigned shall be applied; and unless the assignment is impeachable for fraud or otherwise invalid, the question is one to be gathered from a fair construction of the instrument and not from the provisions of any statute. Bishop on Assignments, ch. 27.

The assignment is not set forth in the case as made up; but its provisions as to the manner in which the assigned estate is to be applied is stated in the defendant's points to be, as is usual in such instruments, that the estate is to be converted into money and applied to the payment of the just debts of the assignors.

The question then is, what is to be understood as debts within the intention of the assignment?

"A debt," says Sir John Cross in Ex parte Thompson, Montagu & Bligh, 219, "is a demand for a sum certain," "and it is," says Commissioner Fontblanque in Ex parte Marshal, 1 Montague & Ayrton, 118, “a sum actually ascertained. That there must be," he says, "an ascertained debt, and not an unliquidated demand or liability, is sustained by all the cases, legal and equitable. It must be a debt existing and ascertained at the time of bankruptcy. * * * The distinction," he says, "between debt and damages has always been rigorously adhered to."

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a

The same exposition of what is considered a debt is to be found in our own cases. "It imports," says Monell, C. J., in Zinn v. Ritterman, 2 Abb. (N. S.) 262, 263, sum of money arising on contract, and not a mere claim for damages, in which it was held that in our insolvent acts it does not extend to actions where the damages are unliquidated."

In the Matter of Denny, 2 Hill, 220, which was a proceeding in this court under the Insolvent Debtor's Act, which as first enacted allowed the trustees to sue for debts or demands, but which was afterward limited to debts, it was held that the word "demand" is of much broader import than the word "debt," and would embrace rights of action belonging to the debtor beyond those which could be called debts.

In Losee v. Bullard, 54 How. Pr. 320, where a stockholder of a corporation was sought to be made liable under the statute for a debt, it was held that a claim for damages was not a debt within the meaning of the statute.

In Kimpton v. Bronson, 45 Barb. 625, where the question of what was a debt under the United States statute making treasury' notes a legal tender for debts, it was held that the voluntary payment of a specific sum of money in discharge of an obligation was within the meaning of that statute the discharge of a debt.

is not embraced in that proceeding; and as in that case the liability of the insolvent at the time of the assignment was merely contingent, that is, upon the nonpayment afterward of the note by the maker; it was held that the holder of the note was in no way affected by the insolvent's discharge, but might maintain an action thereafter against him; which was reaffirming substantially a prior decision of Chancellor Kent in Frost v. Carter, 1 Johus. Cas., in which the chancellor, then a judge of the Supreme Court, held that the insolvent's proceedings extended only to such debts as were due at the time of the assignment. That "such debts must be specific, and certain sums of money to which the creditor can make oath as being justly due or to become due at some specific time; and unless the creditor at the time of the assignment be able to produce and verify such a debt, he will not be entitled to receive from the assignees his dividend of the insolvent's effects, nor will he be barred from his future action against the insolvent." And this rule that the liability at the time of the assignment must be ascertained and fixed at a sum certain, whether payable before or after the assignment to entitle the creditor to a dividend of the insolvent's estate, has been recognized in many other cases both in this State and elsewhere.

Under the act, N. Y. Laws of 1877, ch. 466, regulating voluntary assignments, the creditor at the time specified in the notice must come in and prove his claim or he is debarred from participating in the distribution of the estate. Kerr v. Blodget, 48 N. Y. 62. The act, section 13, contemplates that the creditors shall prove their claims, and it is the practice to do this by an affidavit.

In this case there could be no compliance with the rule laid down by Chancellor Kent in Frost v. Carter, supra, for there was no debt of a certain or specific amount due at the time of the making of the assignment, or in fact any debt due them, for it was by the making of a general assignment for the benefit of creditors that Adams and Horne put it out of their power to perform the agreement made by Adams with Talcott, and it is this which Talcott relies upon as constituting a breach of the agreement. It is upon this that his claim rests, so that the claim did not come into existence until after the assignment.

The referee has found that the making of a general assignment by R. & H. Adams, and their consequent inability thereafter to manufacture and supply Talcott with goods did not amount to a breach of the agreement. He has found however that Talcott was entitled to receive for sale under the agreement the goods which were manufactured and in the hands of R. & H. Adams at the time of the assignment, but that it did not appear that Talcott had suffered any loss or damage by these goods not being consigned to him.

The referee in his opinion states generally that there was nothing before him upon which it would have been possible for him to have estimated the amount of profits that would or might have been realized if the contract had been fulfilled. That any estimate on the facts before him would have been purely speculative and wanting in that reasonable certainty which the

In Kennedy v. Strong, 10 Johns., it was held that under the insolvent act goods received by the insolv ent as a factor or trustee was not a debt within the meaning of the insolvent act, that the insolvent's discharge would in no way affect it, but that he remained equally liable to be sued upon it as well after as before his discharge; and in the Mechanics & Farmers' Bank, etc., v. Capron, 15 Johns. 467, it was held that the in-law requires. This conclusion was, I think, undoubtsolvent's liability as indorser of a promissory note, which was not due at the time of his discharge, did not constitute a debt which was or could be discharged by that proceeding, which extended only to debts that were due at the time of the assignment of the insolv ent's estate, or debts contracted before that time and payable afterward; that it was a general and well-settled rule that if the creditor at the time of the assignment by the insolvent debtor has not a certain debt due or owing to which he can attest by oath so as to entitle him to a dividend of the insolvent's effects, it

edly correct so far as regards the claim for loss of profits on goods to be manufactured thereafter and delivered during the whole period for which the agreement was to run. In the affidavit of the claim Talcott swore that the insolvent firm was justly indebted to him in the sum of $170,000 for damages arising from the breach of the contract, but upon his examination, through various errors and mistakes, the amount sworn to in his affidavit as $170,000 was reduced by him to $130,000.

The greater part of this claim, as thus reduced to

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