The burden of showing an agreement of this kind is upon the debtor. 1 Payment in bank bills. As paper money is in universal use, it is well settled that a payment in good bank bills not objected to at the time, is a good payment, and where no objection is made to the character of the money, it will be a sufficient tender. 2 The creditors, however, may require specie. 3 There is a limitation in the statute of the amount that can be paid in five-cent nickels or copper cents. Where the bank bills are forged, as they are not what they purport to be, they do not constitute payment. 4 The forged bills, however, must be returned within a reasonable time to the person from whom they were received, and the same rule applies to spurious coin. 5 If bank bills are genuine and the bank solvent when the payment was made, they will constitute payment, although the bank should soon afterward become insolvent. If, however, the party paying knew that the bank was insolvent at the time of making the payment, it will not constitute satisfaction of the debt. Such bills are placed on the same footing as a forged bill, being of no value. 6 In Lightbody v. Ontario Bank, infra, Savage, Ch. J., Noel v. Murray, 13 N. Y. 167; Freeland v. Van Campen, 36 How. Pr. 29. 2 Snow v. Perry, 9 Pick. 542; Warren v. Mains, 7 Johns. 476; Wheeler v. Knaggs, 8 Ohio, 169; Hoyt v. Byrnes, 2 Fairf. 475; Tiley v. Courtier, 2 Cromp. & J. 16 n.; Wright v. Reed, 3 T. R. 554; Ball v. Stanley, 5 Yerg. 199; Polglass v. Oliver, 2 Cromp. & J. 15; Brown v. Saul, 4 Esp. 267; Noe v. Hodges, 3 Humph. 162; Seawell v. Henry, 6 Ala. 226. 3 Coxe v. State Bank, 3 Halst. 211; Donaldson v. Benton, 4 Dv. & Bat. 435. 4 U. S. Bank v. Bank of Ga., 10 Wheaton, 333; Thomas v. Todd, 6 Hill, 340; Markle v. Hatfield, 2 Johns. 455; Young v. Adams 6 Mass. 182; Simms v. Clark, 11 Ill. 137; Ramsdale v. Horton, 3 Barr, 330; Hargrave v. Dusenbury, 2 Hawks. 326; Anderson v. Hawkins, 3 Id. 368; Pindall v. N. W. Bank, 7 Leigh, 617; Mudd v. Reeves, 2 Harris & J. 368; Eagle Bank v. Smith, 5 Conn. 71; Keene v. Thomas, 4 Gill & J. 463. 5 Pindall v. N. W. Bank, 7 Leigh, 617; Simms v. Clark, 11 Ill. 137. 6 Wainwright v. Webster, 11 Vt. 576; Gilman v. Peck, Id. 516; Fogg v. Sawyer, 9 N. H. 365; Frontier Bank v. Morse, 22 Me. 88; Lightbody v. Ontario Bank, II Wend. 1, 13 Wend. 101; Houghton v. Adams, 18 Barb. 545 says: "The question is, which of these parties shall sustain the loss which has happened in this case. "Both were equally ignorant of the failure of the Franklin Bank when the note was passed. Upon principles of justice and honesty, it would seem that whoever parts with that which is valuable should receive value for it; and he who receives value should give value in return. When a bank fails, its notes are of no value, or nearly so, and the loss should fall upon those in whose hands the notes are when the failure happens. Any other doctrine, I apprehend, would lead to innumerable and atrocious frauds. Were the knowledge of the party the criterion by which to determine the liability of a person passing notes of a broken bank, those in possession of such paper might be induced to pass it to others who were ignorant of the failure of the bank." Payment by check. In order to make the drawer liable, there must be a demand of payment of the drawee, as the check is not a promise on the part of the drawer to pay, but an undertaking that the drawee shall accept and pay.1 If, however, the drawer had no funds in the bank on which to draw, no demand of payment is necessary, unless the bank had previously permitted the drawer to overdraw his account and paid his checks. A check drawn without funds and with no expectation of its being paid, need not be presented. Payment by letter. Where payment is made by transmitting the money by mail, and it is lost, the person sending the money must bear the loss unless he was directed to send it in that manner, or such was the usual course of business. 2 Payment by whom. Payment by the debtor himself or by an agent is a valid payment, and, where there are several debtors, a payment by one is satisfaction for all. 3 And payment by a stranger extinguishes the demand. 4 Payment to the creditor himself is always sufficient. If payment is made to an agent of the plaintiff or to an attorney at law, his employment by the creditor must be proved; 1 Murray v. Judah, 6 Cow. 484; Gough v. Statts, 13 Wend. 549. 2 Warwicke v. Noakes, Peake, 67; Walter v. Haynes, Ryan & M. 149; Wakefield v. Lithgow, 3 Mass. 249. 423. 3 Thorne v. Smith, 10 C. B. 659. but payment of a judgment to the attorney who recovered it would be sufficient. 1 It has been held, however, that payment to an agent employed by the attorney, or the attorney's clerk, if not authorized to receive it, was not a good payment. 2 Payment made to a person sitting in the counting-room of the creditor, with the account books near him, and apparently intrusted with the business of the house, will be sufficient. 3 But it will not be sufficient if not made in the usual course of business and on a collateral transaction. 4 A payment made to one of several parties, trustees or executors, is sufficient. 5 Joint deposit in bank. Where a number of persons, not partners, jointly deposit money in a bank, all must join in drawing it out; otherwise the bank will not be justified in paying the same. Payment by delegation. If a debtor instructs a banker to place to the credit of his creditor a sum of money to be applied in the payment of his indebtedness to him, and a transfer of the account is actually made on the books of the bank at the request of the creditor, although the bank was, in fact, insolvent, and soon after closed its doors, the insolvency not being known to either party, it is a good payment." 7 Payment may be inferred from circumstances, as where in the ordinary course of dealing, when the security is paid it is delivered to the party who pays it; therefore, a security found in the debtor's possession after its maturity is presumed to have been paid. 8 1 Langdon v. Potter, 13 Mass. 219; Jackson v. Bartlett, 8 Johns. 361; Branch v. Burnley, 1 Call, 147; Lewis v. Gamage, I Pick. 347; Kellogg v. Gilbert, 10 Johns. 220. 2 Yates v. Freckleton, 2 Doug. 623; Fairy v. Turner, 2 T. Y. R. W. 128. 200. 3 Barrett v. Deere, M. & Malk. 4 Sanderson v. Bell, 2 C. & M. 304. Porter v. Taylor, 6 M. & S. 156; Stone v. Marsh, R. & M. 364; Cane v. Read, 3 Atk. 695; Bryant v. Smith, IO Cush. 169. 6 Innes v. Stephenson, I Moody & R. 145. 7 Hughes v. Kellogg, 3 Neb. 195. * Brembridge v. Osborne, 1 Stark. 374; Weidner v. Schweigart, 9 S. & R. 385. The rule does not apply, however, in an action for contribution between joint promisors.1 Payment may be presumed from lapse of time, from the usual course of trade or from the ordinary course of dealing between the parties. So a receipt for last quarter or a year's rent raises the presumption that all rents previously due have been paid. 2 Appropriation of payments. If a debtor owe his creditor several debts upon distinct causes, and pay him a sum of money, he has a right to direct its application in such manner as he shall see fit, provided he does so at the time of payment. If he fail to do so, the creditor may apply it to such debts as he shall deem proper. 3 Payments applied by law. When the debts due by a debtor to his creditor are of different characters, and general payment is made, which neither party applies, the law will apply it upon the debt the relief from which will be most beneficial to the debtor; as where there is a mortgage and an account, or judgment and account, the law will apply the payment to the mortgage or the judgment in preference to the account, because that is deemed to be most beneficial to the debtor. 5 If the debtor makes no appropriation to a particular debt, still the creditor cannot apply it to a debt which is controverted by the debtor, because equity requires that he shall act in good faith with his debtor. He must apply the payment therefor to a debt about which there is no dispute. 6 Exceptions to right of creditor. Where a debt is due from one as executor or administrator, and also personally, the creditor cannot apply a general payment to the former debt, unless it was so intended, because the right to receive payment would depend upon the quantity of the assets, proof of claim, etc. So, if one claim is absolute and the other contingent, as where the debtor is surety or guarantor, the debtor must apply the payment on the absolute debt.7 When a payment has once been applied to one of several debts, neither party alone can change it, but both may do so. Answer. In pleading payment the defendant may say, in answer to the petition of the plaintiff, that on the 18——, he paid to the plaintiff the sum of $ satisfaction of the goods set forth in said petition. day of in full If he claims a deficiency in the goods, he may plead part payment and deficiency, thus, that the defendant, in answer to the petition of the plaintiff, alleges that on the —— day of he paid to the plaintiff the sum of $-- on account of the goods set forth in said petition, and redelivered to the plaintiff the following articles therein described [describe articles], of the value of $————— For a second defense the defendant may allege that among the articles furnished by the plaintiff to the defendant were certain goods, as three two-horse corn plows, which are charged in gross at $75; said plows were to be made of the best quality of steel, be highly polished and free from rust, whereas, in fact, the molding plate of said plows was made from an inferior article of steel and covered with rust. The defendant at once notified the plaintiff to take said plows away and replace them with plows which conformed to the contract, but said plaintiff then refused and still refuses so to do. Said plows, if perfect and conformed to the contract, would be of the value of $75, but are worth not to exceed the sum of $15. The defendant therefore prays, etc. Performance, to be effectual as a defense, must have been by him who was bound to do it, and whatever was necessary for the full discharge of the duty must be done by him. A mere readiness to perform will not discharge him from his liability, unless he make that manifest by tender or an equivalent act.1 Under the code either party may allege that he has duly performed all the conditions on his part to be performed, and it is unnecessary to plead such performance in detail. In other words, it is not necessary to state the facts constituting the performance, but a general allegation that the party duly per1 Cranley v. Hillary, 2 M. & S. Haldane v. Johnson, 8 Exch. 689. 120; Rowe v. Young, 2 Brod. & B. 165; |