costs, damages, and expenses which you may sustain by reason of such payment and the trying of the said action against the said John Hutchinson, and in any manner relating or incidental thereto, you giving me credit for all money you may receive from the said John Hutchinson in such action."

The plaintiff having brought the action against Hutchinson unsuccessfully, the court distinguished this undertaking from the case of an indemnity, and between "sustaining" costs, damages, and expenses, and paying them. They held that the plaintiff sustained damage when the liability was incurred, and that he could recover the costs he was liable for to his own attorney, although he had not paid them, as well as those of the defendant in the other suit which he had paid. Accordingly, the plaintiff has recovered the whole amount of a judgment obtained against him, though he has paid nothing on it, when the defendant agreed to indemnify him against liability,(*) against actions, suits, or claims, (') judgments,(°) debt,(*) or trouble.(*) And where the defendant gave the plaintiff a bond to pay all taxable costs which the plaintiff should "incur and become bound to pay" in a certain suit, it was held that the plaintiff could recover the amount of costs for which judgment had been rendered against him, though he had not paid the judgment.(')

In an early New York case, where a bond was given “to save harmless and indemnify the plaintiffs against their liability as makers of a certain note, and to pay or cause to be paid the said note," it was held that the plaintiffs,

(*) Kirksey v. Friend, 48 Ala. 276; Jones v. Childs, 8 Nev. 121.

() Warwick v. Richardson, 10 M. & W. 284; Cook v. Merrifield, 139 Mass. 139; Conkey v. Hopkins, 17 Johns. 113.

(c) Conner v. Reeves, 103 N. Y. 527; Martin v. Bolenbaugh, 42 Oh. St. 508.

(d) Carman v. Noble, 9 Pa. St. 366.

() Fish v. Dana, 10 Mass. 46.

(Jarvis v. Sewall, 40 Barb. 449.

though they had not paid the note, and were insolvent, were entitled to recover its amount, under the absolute terms of the covenant; but that the plaintiffs could not recover the costs of a suit against them on the note. As to these costs the bond was declared to be purely an agreement to indemnify; and the learned judge (Beardsley) proceeded to say: "Notwithstanding what is said in the case of Chace v. Hinman, I must say that I am not aware of any distinction at common law between an indemnity against damage and one against liability, which warrants a recovery on the latter on simply showing the fact of liability. In both, as I think, there must be evidence of actual damage, by the payment of money or otherwise."1 But the rule laid down here seems to be overruled by the later decisions.

§ 796. Payment.-As we have seen, * the general rule is that the surety cannot proceed against his principal debtor until he has paid the debt; it still remains to be seen what in judgment of law is considered as payThe suit of the surety against the principal is at common law an action of assumpsit, sometimes special, but frequently on the common counts for money paid for the defendant's use; and we now proceed to determine what proofs will satisfy the allegation of pay

ment.

ment.'

1 Churchill v. Hunt, 3 Denio 321. 2 "It is an equitable principle of very general application," says Mr. Chancellor Walworth, in Hunt v. Amidon, 4 Hill 345, 348, "that where one person is in the situation of a mere surety for another, whether he became so by actual contract or by operation of law, if he is compelled to pay the debt which the other in equity and justice ought to have paid, he is entitled to relief against the other, who was in fact the principal debtor. And when courts of law, a long time since, fell in love with a part VOL. II.-34

of the jurisdiction of the Court of Chancery, and substituted the equitable remedy of an action of assumpsit on the common money counts for the more dilatory and expensive proceeding by a bill in equity in certain cases, they permitted the person thus standing in the situation of surety, who had been compelled to pay money for the principal debtor, to recover it back again from the person who ought to have paid it, in this equitable action of assumpsit as for money paid, laid out, and expended for his use and benefit."

It will be perceived at once that this inquiry involves various questions, some of a technical character, and springing from the form of the action, others relating to the substantial rights of the parties. Is the payment of money in all cases necessary? Can the surety, by giving his bond or note in payment of the original debt, raise a claim against the principal? Will the transfer of land, whether by mortgage or deed, be treated as payment? and if so, at what value shall it be computed? These, and similar inquiries, are often complicated and perplexing.

The rule appears to be well settled in this country, though far from being clear in England, that the giving by the surety of his negotiable promissory note, which is received not collaterally, but as actual payment of the original debt, will be held to be payment as against the principal debtor, and that the surety may at once proceed against him for the amount of his note; in other words, the note is treated as money. While on the other hand, it is also held that the giving a bond will not have the like effect, and that, until the payment of the bond, the surety has no claim against his principal.

It is also well settled, that an absolute conveyance of the land by the surety will be sufficient to raise a claim on his behalf against the principal to its full value, and that it will be treated as money paid for the use of the original debtor. An examination of the decisions will best elucidate these rules.

In an early case in the King's Bench,' an application was made to discharge the defendant from custody on filing common bail; and it appeared that the defendant being indebted to one Creswell, the plaintiff Taylor had given Creswell a bond and warrant of attorney, and

1 Taylor v. Higgins, 3 East 169.

paid him £7 or £8 of costs; that this security was accepted as payment and satisfaction of the debt; and it was contended that this was the same as if the debt had been paid in money. But Lord Ellenborough said : "There is no pretense for considering the giving this new security as so much money paid for the defendant's use "; and the rule to discharge the defendant from custody was made absolute.'

On the authority of this case the same point has been decided in New York. The plaintiffs being accommodation indorsers for the defendant, had, on being sued, executed to the holders of the accommodation paper, on the 15th April, 1807, two bonds, one payable in eighteen months and the other in two years, which bonds had not been paid. The plaintiffs, subsequently, were discharged under the insolvent act. The judge charged that the two bonds amounted in law to the payment of the notes, but the jury found a verdict for the defendants. On the motion for a new trial, the court said:

"The question is whether giving a bond, in discharge of the liability of the plaintiffs, is to be considered as a payment of money. . . . . An obligation to pay is not the same thing as the actual payment. A bond has no analogy to cash. . . . . The technical rule operates with perfect justice in this case; for the bond has not, and never will be paid, as the plaintiffs have since been discharged under the insolvent act; and if the money now demanded was to be recovered, their estate would receive it without ever having given an equivalent."

The motion for a new trial was denied.

The rule laid down in this case appears to be the same where a mortgage is given. So where an accommodation indorser gave a mortgage to secure his debt,

'No attention appears to have been paid to the payment of the costs. This case was sustained in Maxwell v. Jame

son, 2 B. & Ald. 51, noticed more fully hereafter.

2 Cumming v. Hackley, 8 Johns. 202.

and subsequently released the equity of redemption, and made a conveyance of the land, the case of Cumming v. Hackley was cited with approbation; and it was held that though the conveyance gave a right of action, the mortgage furnished no basis of claim.1**

797. Payment by note.-* A different rule has been adopted, where the payment, if such it can be called, is made by giving a note. Where the plaintiff became security for the defendant's subscription to a brewers' benefit club, the club called on the plaintiff, and he gave his note for the amount of the subscription.' On the trial of the cause, it being an action of assumpsit for money paid, and the objection being taken that the giving a note was no payment, Lord Kenyon held: "That the club having consented to take the note from the plaintiffs, it was as payment to them of the money due by the defendant; and so the action was maintainable." It is added, that at the next term a new trial was moved for; but the court agreeing with his lordship, the rule was refused.

This authority was much shaken by a subsequent case.' It was an action for contribution. The plaintiffs and defendants united in a promissory note to Batson & Co.; Maxwell took up the note, by giving his own bond to Batson & Co. for the amount. No money was paid. On this state of facts, Maxwell sued Jameson in assumpsit for money paid. Bayley, J., said:

“The plaintiff in this case has paid no money. It is said, indeed, that he has given what was equivalent to it, and that it

1 Ainslie v. Wilson, 7 Cow. 662.

? Barclay v. Gooch, 2 Esp. 571. This case was referred to by the court, in Taylor . Higgins, 3 East 169; but Lord Ellenborough did not commit himself to the correctness of the decision. "Supposing, even," he says,

“the case of the note of hand or bill of exchange, as the current representative of money, to have been rightly decided, still," etc.

* Maxwell v. Jameson, 2 B. & Ald. 51.