issue, and paid 17737. 98. 4d. into Court. In calculating this sum, Enderby sought credit for all sums paid by Gilpin to the plaintiff after the 24th September, 1817, without giving credit for any sums received after that day by Gilpin, on account of the plaintiff. The Court of Common Pleas, on the authority of Clayton's case, held this mode of calculation right; and, as Enderby had paid into Court more than the amount of what was due to the plaintiff at the expiration of the partnership, they gave judgment of nonsuit.

IV. 2. But it is to be remarked, that in stating the principle of payment which is now under our consideration, Sir William Grant applied his observations to those accounts only which are in the nature of a banking account. In Clayton's case, which is the foundation of all the modern decisions on this subject, he says "This is the case of a banking account, where all the sums paid in form one blended fund, the parts of which have no longer any distinct existence. There is no room for any other appropriation, than that which arises from the order in which the receipts and payments take place, and are carried into the account. Presumably it is the sum first paid in that is first drawn out. It is the first item on the debit side of the account, that is discharged or reduced by the first item on the credit side. The appropriation is made by the very act of setting the two items against each other. Upon that principle all accounts current are settled, and particularly cash accounts." Now, it may be inferred from these observations, that in accounts current of a different nature, where there is room for appropriation other than that which arises from the order of the receipts and payments, such other appropriation will be deemed necessary in order to reduce the retiring partner's debt. Suppose for instance, as in the case of Newmarch v. Clay (a), that goods are regularly furnished to a firm, for which they as regularly pay by bills, and that an account is kept of the goods furnished, and the bills paid. In such case, if a partner retire, and the accounts go on as before, the bills drawn after his retirement will not, like money payments, go in discharge of the debt due from him on this account current, unless such bills be specifi

(a) 14 East, 239.

cally appropriated to that purpose; because the bills so drawn are the property of the new firm, and are primâ facie appropriated to the payment of the debts of that firm.

This was assumed in the case of Newmarch v. Clay, where the only question was, whether there was sufficient evidence of the appropriation to discharge the retiring partner. The plaintiffs brought their action for goods sold and delivered, against Clay and W. and T. Lumb. It appeared that Clay had been a secret partner with the Lumbs, and that this secret partnership was dissolved by consent on the 1st December, 1808; after which the business was carried on by the Lumbs only. The goods had been uniformly furnished at a credit of six months on bills. By the account, as produced at the trial, it appeared that the amount of goods delivered, up to the time of the dissolution, was 2617. 19s. 10d., and that the first item on that side of the account, after the dissolution, was-1809, May 26, To goods at do., (i. e. at six months credit), due 26th November, 527. 12s. The amount of payments up to the time of the dissolution was £130, and the items next following on that side of the account were, "1809, March 25, By bill £65," "January 16, By bill, £100," (which bills were dishonoured); and then-" December 1, By bills 1417. 1s." It appeared by the date of the dishonoured bills, that Clay was interested in them; they would clearly therefore, if good, have been applicable to the discharge of the 2617. 19s. 10d. It was proved that the payments contained on the credit side of the account, were all paid without any express appropriation at the time; and even when the last bills for 1417. 18. were received, there was no specific agreement that that sum was to be applied in part discharge of the dishonoured and returned bills of £65 and £100; but these latter were in fact delivered up at the time. Under these circumstances, the question was, whether the last item of credit for 1417. 18., should be added to the other sum of £130, and applied in discharge of the 2617. 19s. 10d., (in which case the plaintiffs would be overpaid by the new partnership to the amount of 91. 1s. 2d.), or whether it should be applied in discharge of the 527. 12s., as well as to the 2617. 19s. 10d. (in which case there would be due to the plaintiffs 431. 10s. 10d.) It was urged on behalf of the defendant Clay, that the act of taking up the dishonoured bills, upon the payment of the bills for 1417. 18., which sum was more than sufficient to cover all former debts, was evidence of

an implied appropriation of the latter bills to the purposes intended to have been answered by the former; and that Clay therefore was entitled to the benefit of such appropriation. And the Court of King's Bench were of that opinion. "There might," observed Lord Ellenborough, " be a special application of a payment made, arising out of the nature of the transaction, though not expressed at the time in terms by the party making it; and here the payment of the bills for 1417. 18. was evidenced by the conduct of the parties to have been made for the purpose of taking up the antecedently dishonoured bills, in the discharge of which the defendent Clay was interested; for, upon receiving this payment, the dishonoured bills were delivered up."

In the preceding case, if the bills for 1417. 1s. had not been specifically appropriated to that purpose, they would not have been applied in discharge of the retiring partner's debt. On the contrary, inasmuch as they were the property of the new partnership, they would have been considered as applicable to the discharge of the debts of that partnership only. In the same manner, where a sum of money can be deemed as the specific property of the new partnership, it will be applicable to the discharge of the debts of that partnership only. In the case of Thompson v. Brown (a), the plaintiff brought an action against Brown and Weston for goods sold and delivered. The defendants became partners in trade on the 1st January, 1824, and continued so until the 1st January, 1825. Before the partnership, Brown was indebted to the plaintiffs, who were ironmongers, in the sum of £64, and, during the partnership, goods were supplied on the partnership account to the amount of £210. Early in the year 1824, Brown paid to the plaintiff, on the general account, a check for £60; and, after the dissolution, £150 was paid, expressly for the partnership debt, by Weston, Brown having become insolvent. It was doubtful, on the evidence, whether the check was the property of the partnership, or the sole property of Brown; and it was contended, for the plaintiffs, that the payment (of that check) having been made without any appropriation, the defendants

(a) 1 Mood. & Malk. 40. The new partnership, it will be perceived, arose on the accession and

not the retirement of a partner; but the principle is the same.

were at liberty to apply it to the first items in the account, and in that case the defendants, as partners, would still be liable for the balance of the partnership debt. Abbott, C. J.-" The general rule certainly is, that when money is paid generally, without any appropriation, it ought to be applied to the first items in the account; but the rule is subject to this qualification, that when there are distinct demands, one against persons in partnership, and another against one only of the partners, if the money paid be the money of the partners, the creditor is not at liberty to apply it to the payment of the debt of the individual that would be allowing the creditor to pay the debt of one person with the money of others. (To the jury) The question for you is, was this check the property of the partner or not?"-Verdict for the defendants.

IV. 3. To render an appropriation of payment by the act of the party valid, it must be made at the time of payment, if made by the payor (a), and within a reasonable time after payment, if made by the payee. Sir William Grant was inclined to hold, according to the principles of the civil law (b), that the appropriation, even if made by the payee, must be made at the time of payment. But cases might be stated, where such a rule, if strictly adhered to, would be productive of injustice; and it is manifestly at variance with the decisions on this subject in the Courts of common law. On the other hand, those Courts have been inclined to favour the creditor too much, and have in many cases "extended the proposition-that if the debtor does not apply the payment, the creditor may make the application to what debt he pleases-much beyond its original meaning, so as in general to authorize the creditor to make his election when he thinks fit." In a modern case, however, the Court of King's Bench came to a very just decision on this important subject. Thus, in Simson v. Ingham (c), an action on a bond was brought by Bruce & Co., bankers, against the

(a) It is not necessary, however, that a person owing money on two different accounts, should declare the appropriation of it at the time of payment; it is sufficient if it can be collected from other circumstances, that he intended, at the time of pay

ment, to appropriate it to one account specifically. Shaw v. Picton, 4 Barn. & Cres. 715; Waters v. Tompkins, 2 C., M., & R. 723.

(b) Dig. lib. 46, tit. 3, ss. 1, 3. (c) 2 Barn. & Cres. 65; 3 Dowl. & Ryl. 249.

heirs and devisees of Benjamin Ingham. The bond was given by Ingham and another, bankers, at Huddersfield, to the plaintiffs, their London correspondents, conditioned for remitting money to provide for bills, and for the repayment of such sums as Bruce & Co. might advance on account of persons constituting the Huddersfield Bank. The damages were assessed by an arbitrator at £13,845, subject to the opinion of the Court upon the following facts: The house of Bruce & Co. were in the habit of sending to the Huddersfield bank monthly statements of their accounts. Benjamin Ingham died in September, 1811. The last statement sent previously to his death was for the month of August. The balance of that account was greatly in favour of Bruce & Co. No alteration in the account was made in the books of Bruce & Co. immediately on the death of Benjamin Ingham; but, during the residue of that month and a part of October, the remittances made by the Huddersfield bank, and the payments made for them by Bruce & Co., were entered in continuation of the former account. Before, however, any account was transmitted to the Huddersfield bank subsequent to that for August, Bruce & Co., in consequence of a communication with their solicitor, opened a new account, and in that inserted all the remittances and payments made subsequent to the death of Benjamin; and in November, they transmitted to the Huddersfield bank statements of two accounts. The first of these accounts was thus intitled :"Debtors, Messrs. B. and J. Ingham & Co., (old account), in account with Bruce & Co., creditors;" and the first item on the debit side was the balance of August. The second account was in the same form, but intitled new account." This account began on the 16th September, without any balance brought forward, and contained the remittances and payments made during that month, subsequent to the death of Benjamin, and also those made in the month of October. From this time the old and new accounts were kept separate in the books of Bruce & Co. The Huddersfield bank did not appear to have ever objected to the accounts being kept separately by Bruce & Co., although in their own books they only kept one account. The arbitrator was of opinion, that, under these circumstances, the balance due on the death of Benjamin Ingham was not discharged by subsequent payments by the new firm; accordingly, after making certain allowances for dishonoured bills, he

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