made at the office or place of business of the company. Under the act of 13th of June, 1833 (Purdon's Dig. 286), a service is good made anywhere in the State within the jurisdiction of the court from which the writ issued, if made upon one of the officers designated by that act. The framers of that act, in prescribing the methods of service upon corporations, carefully avoided requiring the service to be at the office or place of business of the corporation. They designated the officers upon whom service should be made, and left them in other respects in the same condition as natural persons. As a natural person may be sued anywhere in the State where the summons can be lawfully served upon him, so a corporation, which has a legal existence in Pennsylvania, is in like manner liable to be sued anywhere in the commonwealth where jurisdiction can be obtained by a proper service of the summons. A corporation has no greater privilege in this respect than a citizen, and it would be strange if it had.

It is not necessary therefore in the present case to call to our aid the act of 21st of March, 1849, or to interpret that act, and decide the question so strenuously argued by the learned counsel for the defendants, whether that act applies to foreign corporations which have no office or place of business in Pennsylvania. It may well be that their interpretation of the act of 1849 is a correct interpretation. Whether it is or is not we do not decide. The corporation defendant in the present case is a corporation which has a lawful existence in Pennsylvania. It is liable to be sued in every part of the sovereignty from which its corporate character is derived, if service can be made upon the proper officer. Here the service was made upon the president of the corporation, who is the proper officer to be served, whether we regard the rule of the common law or the express directions of the act of 1836. We can see no reason therefore why they should not be liable to answer the plaintiff's suit in this jurisdiction.

Rule discharged.

R. L. Ashhurst, Esq., for the rule.

D. J. Myers and F. C. Brewster, Esqs., contra.

[Leg. Int., Vol. 36, p. 26.]

E. A. GREENE, Assignee of WILLIAM R. STEWART, vs. THE
NATIONAL SECURITY BANK.

A voluntary assignee for benefit of creditors may maintain an action for proceeds of the assigned estate deposited in the assignor's name after the assignment without notice to the bank.

The relationship between a bank and its depositor is that of debtor and creditor. A bank may retain money in its hands on deposit as set-off against notes of the depos itor held by it not matured at the date of the assignment.

Sur rule for new trial.

On January 21, 1878, William R. Stewart made a general assign. ment to the plaintiff for the benefit of creditors. The assiguor had a deposit account with the bank, defendants, in which, at the date of the assignment, the balance in favor of Stewart was $1,709.03. The assignee employed the assignor as clerk. The latter continued the deposit account with defendants in his own name, made new deposits of moneys realized from the assigned estate, and drew checks, the proceeds of

which were used for the assignee, or accounted for to the assignee. On February 16, 1878, the balance in said deposit account to the credit of William R. Stewart was $4,900.45. Plaintiff then presented the check of Stewart, drawn to the order of plaintiff, as assignee, for the whole of this balance. The bank refused to pay that check, but paid plaintiff $2,670.66.

This suit was commenced on February 19, 1878, for the difference between the $2,670.66 and the $4,900.45, being $2,229.79, with interest. Learning then for the first time of Stewart's insolvency and assignment, defendant denied the right of plaintiff to sue in his own name for any part of the amount claimed, and further claimed to set off or recoup the amount of two promissory notes, one dated November 12, 1877, payable three months after date, due February 15, 1878, for $987.41; the other dated November 15, 1877, at five months, due April 18, 1878, for $1,242.38. Both these notes were drawn by the assignors, William R. Stewart & Co., in favor of Stokes.

The judge who tried the cause instructed the jury to find for the plaintiff for only the difference between $1,709.03 and the $2,229.79, for which suit was brought, with interest. Thus allowing the bank to set off or retain the amount in its hands at the date of the assignment as against the two notes; the verdict being for $548.80.

Upon the argument of the rule, John Fallon, Esq., for plaintiff, cited to sustain the right of action, Frazier vs. Bank, 8 W. & S. 18; Bank vs. Jones, 6 Wright, 541; Stair vs. Bank, 5 P. F. S. 368.

The debtor of an insolvent decedent's estate cannot have set-off for claim not due at the death: Cramond vs. Bank, 1 Binn. 64; Bosler vs. Bank, 4 Barr, 32; Bank's Appeal, 12 Wright, 57.

This case decided by Bank of Mt. Joy vs. Gish, 12 P. F. S. 13; Fogerty vs. Trust Co., 25 P. F. S. 125; Myers vs. Davis, 22 N. Y. 489; Jeffryes vs. Agra Bank, 2 Eq. Cases L. R. 674.

Edward H. Weil and R. C. McMurtrie, Esqs., for defendant, cited: The plaintiff cannot sue at law: Fulton's Estate, 1 Smith, 204.

Insolvency introduces the jurisdiction in equity, and entitles the debtor to set-off or retain for a debt due but not payable: Peters vs. Soame, 2 Vernon, 428; Ex parte Hanson, 12 Ves. Jr. 348; Vulliamy vs. Noble, 3 Meriv. 621; Mann vs. Dungan, 11 S. & R. 75; Haukey vs. Smith, 3 T. R. 507; Agra Bank vs. Hoffman, 34 L. J. Ch. 285.

Opinion delivered January 11, 1879, by

ELCOCK, J.-Set-off has its origin in the Roman law, where it was administered under the name of compensatio. It was known in the early period of chancery in England as stoppage, and was administered for a great number of years in that court before it became a statutory enactment. The injustice apparent from the administration of the old bankrupt laws, without the allowance of set-off, is well expressed by Lord Mansfield, when he said: "The natural sense of mankind was first shocked at the doctrine, they thought it hard that a person should be bound to pay the whole that he owed to a bankrupt, and receive only a dividend of what the bankrupt owed him." Being unknown at common law, the remedy induced by this hardship was afforded in bankruptcy by Statute 4 Anne, c. 17, and generally in cases of mutual debts by 2d and Sth George II.

The early advancement of American legislation is shown by our Defalcation Act in Pennsylvania, passed in 1705, 1 Smith's Laws, 49, which was twenty years before the statutes of George II. Being a more liberal act, it allows unliquidated cross-demands to be set off, avoiding circuity of action, and approaching nearer an equitable mode of administering right than any known species of civil legislation.

By our act the defendant may give in evidence against the plaintiff's demand any bond, bill, receipt, account or bargain, and so much thereof as has been found to be paid shall be defalked from plaintiff's claim. This in Pennsylvania is commonly called legal set-off, although not a proper title. But whatever refinement may be created by the statutory enactments in this and other countries, in Pennsylvania, by our admirable system of administering equity through the common law forms of action, where the defendant in an action at law, if in an equity court as complainant, would be entitled to a decree and relief for his set-off, he can now give the same facts in evidence, and obtain the same relief in the action at law: Morgan vs. The Bank of North America, 8 S. & R. 73, 88; Murnay vs. Williamson, 3 Binney, 135; Frantz vs. Brown, 1 Penrose & Watts, 257.

This action, brought to recover the amount of money claimed to have been deposited by plaintiff in the name of Stewart, without notice to the bank, can be maintained under the rulings in Frazier vs. Erie Bank, 8 W. & S. 18; Bank of Northern Liberties vs. Jones, 6 Wr. 541; Stair vs. York City Bank, 5 P. F. S. 368.

It is true the rights of an assignee for the benefit of creditors rise no higher than those of his assignor; neither he nor the creditors are purchasers for value, and he holds subject to all equities which can be applied to his assignor: Krause vs. Beitel, 3 Rawle, 199; Fulton's Estate, 1 Smith, 211. But being entitled to the custody of the money, and accountable for it thus deposited in another's name, he can maiùtain the action for it.

Undoubtedly, if the notes of Stewart held by the bank had matured before the assignment, the bank could appropriate the money owing to Stewart on deposit account at the date of the assignment in payment of them. The question now raised is whether the bank can hold the moneys in its hands on deposit at the time of the assignment against the two notes which had not then matured.

If any equity springs from the fact of Stewart's insolvency in favor of the bank, then it can hold, or stop, or defalcate, or set off or defend to that extent. The relationship between a bank and its depositor or customer is simply that of debtor and creditor, for no car-mark follows the deposit, and the banker uses the same in the general purpose of his business. The bank becomes a creditor of the maker of the notes when it discounts the same, and his debtor when he makes deposits. The maker's debt is created when he issued his note; it is true, the time to maturity is his right before payment can be demanded, but the debt exists from the time of issuing the note. The maker has an undoubted right to waive this time and anticipate it by payment. Where a maker becomes insolvent and makes a general assignment of all his estate for the benefit of all his creditors, is it unreasonable to say that he waives further time upon his credit, and expressing his insolvency or inability

to pay then, or at maturity, by such act, mature all his debts. He has the power; do not his acts show its exercise? Time on his note is of no further importance to him, and his other creditors have no greater rights than he granted them. In bankruptcy, since Statute of 4th Aune, a creditor whose debt was not due had a right to prove it and secure a dividend, and it is deducible from the general scope of the authorities, that insolvency has long been recognized as a distinct equitable ground of set-off: Story's Eq. Jurisp., § 1430; Peters vs. Soame, 2 Vern. 428; Hanson Exp., 12 Ves. 348; Vulliamy vs. Noble, 3 Meriv. 621; Haukey vs. Smith, 3 T. R. 507 and 374; 1 Y. & Coll. 427. In a late English case, Agra Bank vs. Hoffman, 34 L. J. Ch. 285, the bankers retained the balance of a customer to answer a future liability which might arise in respect of bills which they had discounted for him to a much larger amount than the balance, and the customer brought au action against the bankers for damages for having dishonored his checks, and for the amount of his balance. After the action was commenced, several of the above bills to a larger amount than the balance were dishonored. Upon a bill filed by the bankers against the customer for an account and for an injunction to restrain the action at law, the court (considering there was a substantial question to be tried in equity) upon motion made during the sittings in London, at which the trial of the action was to take place, granted an injunction restraining the action at law.

In Denman vs. Boylston Bank, 5 Cushing, 194, it was held that where the maker of a promissory note which had been discounted at bank became insolvent, having money on deposit in such bank, that the amount of the note might be set off against the amount of the deposit, although the note was not payable until afterwards; and upon the same principle was decided Aldrich vs. Campbell, 4 Gray, 284; Receivers vs. The Patterson Gas Co., 3 Zabriskie, 238; Morrow vs. Bright, 20 Mo. 299; Clarke vs. Hawkins, 5 R. J. 219; Brazleton vs. Brooks, 2 Head. 194; Graves vs. Hull, 27 Miss. 419; Mann vs. Dungan, 11 S. & R. 75. And to this we may add the remarks of the able editor of Smith's Leading Cases, Vol. 2, p. 378, when, after reviewing all the authorities upon this subject, he says: "We may believe with the courts of Massachusetts and Rhode Island, that in settling an insolvent estate, justice is best promoted by allowing mutual debts to balance each other without regard to the period when they fall due."

It has been urged with great ability by the learned counsel for plaintiff that, under the ruling of Bosler vs. The Bank, 4 Barr, 32, which decided that a debt not due at the time of the death of the testator, or intestate insolvent, could not be set off (affirmed in the Farmers' and Mechanics' Bank's Appeal, 12 Wright, 57), by analogy a debt not due at the time of the assignment for the benefit of creditors could not be set off by a debtor of the assignor. The difference, however, is very marked. A decedent's estate is administered by a system of laws in which everything has relation to the time of his death. This may be a law of necessity, but in an assigned estate, the assignor living, no such rule applies. The act of God having terminated the relationship of continuous or mutual credit the creditor cannot complain, and cannot have his set-off, because the law administers the assets at the time of

death, and creditors and heirs become interested, whilst the assignor has his liberty of anticipating payment of providing for a residue after payment, and passes his estate and all his rights, subject to all equities which apply to himself. His assignee is but his hand in the distribution of his estate. This distinction has already been made in Jordan vs. Sharlock, 3 Norris, 368, (being a case in principle much like the present) where Chief-Justice Agnew said: "At the moment of his death the law took possession of his estate for the benefit of his creditors, he being insolvent. It was not the case of a mere voluntary transfer; but new rights spring into being on the instant of his death. But a voluntary assignment has no such effect. It does not alter the status of the rights of creditors, as death does of the decedent's estate. It is true the duties and obligations of the assignee are regulated by law, but the transmission of the estate to them is the merely voluntary act of the debtor." The tendency of the decisions appears to us to destroy any such analogy as that sought to be established.

It is true that in New York and Michigan, in the cases of Wells vs. Stewart, 3 Barbour, 40; Keep vs. Lord, 2 Duer, 84, and Lockwood vs. Beckwith, 6 Mich. 168, it has been determined that a claim not due could not be set off against insolvent assigned estates, but those cases were determined under the construction of the particular statute of setoff in New York, and the claims being upon independent and disconnected demands, which forbid their admission.

Custom, as well as the equity of commercial law, favors this set-off, for unless a bank can presume upon the right to stop or retain deposits on account of discounts afforded to its customers, even in anticipated insolvency, a great restriction will necessarily be cast by the banks upon their honest but poor depositors or customers. Bankers should have the same rights as in principle is applied by the merchant who, shipping his goods, upon learning of his customer's insolvency, stops them in transitu, and thus saves or retains his goods or property. Banks discount commercial paper upon the faith of their customers' deposits, and the floating balance in their hands is regarded as the business security for their discounted paper. Commercial law, with its fountain in equity, would be destroyed under the restricted and circuitous rules of the common law.

The question as to making deposits and the drawing of checks by the assignor after the assignment, without notice to the bank of the assignment, does not become of importance in this discussion. Nor does the fact that one of the notes was not due at the date of bringing this suit, nor the fact that one of the notes was discounted for Stewart and the other purchased in the market, as the bank had no knowledge of Stewart's insolvency.

Upon the whole case, and a consideration of the authorities herein cited, we affirm the rulings upon the trial, and the rule for a new trial is discharged.

Rule discharged.