Burgess v. Tucker

5 Johns. 105

Opinion

Thompson, J.

delivered the opinion of the court. This was an action of debt upon a bond, conditioned for the performance of an award. By the pleadings and assignment of breaches, it appears, that the award was in favour of the plaintiff, for the sum of 12 dollars and 59 cents, for the recovery of which this action was brought. The defendant, pursuant to his plea and notice, offered in evidence, as a set-off, a promissory note, drawn by the plaintiff to one Chappel, and duly indorsed to the defendant. This was objected to, but admitted. And the questions now presented to the court are, whether any set-off was admissible in this case; and if so, whether it ought not to be against the penalty, and not against the award.

We think the set-off was properly admitted. The statutes in England, and our act, allowing a set-off, have always been considered as very beneficial acts, tending to prevent circuity of action. It is laid down by Montagu,

Footnotes

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* (p. 18.) that a set-off cannot be pleaded to a debt on bond, conditioned for the performance of covenants, where damages are to be assessed by a jury, nor to an action for general damages, in covenant or assumpsit; but a set-off may be pleaded to an action of debt, covenant, or assumpsit, for a sum certain. Is not the present action for a sum certain ? The plaintiff claimed nothing more than the 12 dollars and 59 cents. Had the action been upon the award, and not upon the bond, no objection certainly could have been made to the set-off. The action, though in form upon the bond, is in substance upon the award; and to exclude the set-off would be yielding substance to form. In order to allow a set-off, the plaintiff’s cause of action must be such, that it would have been a good set-off for him, had he been the defendant. (2 Johns. Rep. 155.) Suppose the parties in this case changed, and the action had been by the defendant against the plaintiff, upon this note. What possible objection could there have been against the plaintiff’s setting off the award. The sum is certain, liquidated, and precisely ascertained. _ Wherever the debt is so certain, that an indebitatus assumpsit would lie for it, it may be set off. (Cowp. 56.) The English statutes on this subject are in substance the same as ours; so that their decisions upon the construction of their statutes, are in point as to the construction of ours. (2 Johns. Rep. 155.) In the case of Collins v. Collins, (2 Burr. 825.) Lord Mansjield says, that before the statute, the actual payment of money in discharge of the demand was exactly upon the same footing as the set-off of a debt is now put upon; and a plea of payment of a sum of money sufficient to discharge the whole demand, was just the same, then, as the set-off of a debt large enough to balance the whole demand is now. It was a full answer to the plaintiff’s demand; and he could have no judgment at all against the defendant. The setting off of mutual debts has pecóme .equivalent to actual payment, and a balance shall be struck, as in equity and justice it ought to be. To apply these principles to the case before us; would it not have been competent for the defendant to have craved oyer of the bond and condition, and set out the award, and plead payment of the 12 dollars and 59 cents ? If so, it necessarily follows, that such payment may be shown by a set-off. This case likewise decides, that notwithstanding the set-off being- allowed, the penalty of the bond remains as a security against all future breaches, which is an answer to one of the difficulties suggested by the plaintiff’s counsel. In this case also, the condition of the bond was not only for the payment of an annuity, but for the maintenance of a certain person therein named; which shows, that the right of set-off to bonds is not confined to cases where the condition is for the payment of money only. The set-off may be good as to one part of the ' condition, and not as to another. We do not understand our statute, (24 sess. c. 90.) as saying, or implying, that a set-off to an action on the penalty of a bond, is confined to cases where the condition is for the payment of money only. It only declares, that when the action is for the recovery of a penalty for the non-payment of money only, the sum bona fide and in equity due, and not the penalty, shall be deemed to be the debt due. Bui: were it necessary to go thus far, I should consider, that the bond in question, by the award, became substantially a bond for the payment of 12 dollars and 59 cents.

In order to determine the right of set-off, we may look at the state of things disclosed by the pleadings, and the object and intention of the bond; we are not confined to what appears on the face of it. In the case of Fletcher v. Dytche, (2 Term Rep. 32.) the bond was conditioned for the performance of certain work within a stipulated time, and on failure thereof, for the payment of a weekly sum thereafter, until the work was finished. The work not being finished within the time, the sum of 40/. became forfeited, according to the provisions of the bond, and this sum was allowed, to be a good set-off. This bond, upon the face of it, was not conditioned for the payment of money, but for the performance of work ; and whether the weekly forfeiture could ever become payable, was, at the time of the execution of the bond, contingent and uncertain, but was made certain by matter ex post facto. Upon the face of the bond, nothing was due to the obligee; and whether any thing ever would become due, depended altogether upon subsequent events, to be established by proof, dehors the bond. The only question with the court was, whether the set-off, offered in evidence, had not become certain and li- - quidated damages. So, in the case before us, the bond, upon the face of it, is for the performance of certain engagements, in their nature uncertain and contingent, at the time of the execution of the bond ; but which became certain by the subsequent award, which, so far as respects the 12 dollars and 59 cents, may be considered as liquidating the damages.

2., Whether the set-off must be against the penalty. The only breach assigned, which was relied on, was the non-payment of the 12 dollars and 59 cents; that is the teal amount of the plaintiff’s demand, and for which the 1 suit must be deemed to have been brought. In the case of Nedriff v. Hogan, (2 Burr. 1025.) there was an attempt to set off the penalty; and Lord Mansfield said, this is clearly most unjust, and contrary to the intention of the acts of parliament, that the whole penalty should be admitted to be pleaded by way of set-off, when perhaps a very small sum was really due, for such damages as the defendant had actually sustained. If the penalty be not the sum to be set off, it would seem to follow, as a necessary consequence, that it is not the sum against which the set-off is to be made.

The motion for a new trial must be denied.

Motion denied.

Law of Setoff