on the demand admitted, rather than on the one in dispute, at the time of making such payment.12

121. Communication of Intention to Creditor; Burden of Proof.— When a debtor, on making a payment to his creditor, intends that it shall be applied to a particular debt or a particular item of a debt, he must communicate such intention to his creditor, but no writing or other particular form of communication is required; 18 neither is it necessary that the application be made known to the creditor in person but if communicated to his agent it is sufficient to bind him.14 Accordingly an entry in his books of account by the debtor is not sufficient to determine the application in his favor, where the entry is not brought to the attention of the creditor.15 When a person indebted to another on more than one account makes a partial payment, the burden of proving that at or before the time of such payment he directed its application to a particular debt, as pleaded by him, and that this direction was made known to his creditor, is upon the debtor.16 But where a creditor claims that a certain payment was made on an illegal or unenforceable demand the burden is on him to establish that fact by sufficient evidence.1 17

122. By Creditor.-An application of a payment by a creditor may be made either expressly or by implication.18 If he enters the debits and credits in a general account, as they occur, this will be considered, in the absence of evidence to the contrary, as a general application of the credits to the debits in the order of time in which the debits occur, thus paying first the debt first due; 19 but the right of election is not conclusively shown by book entries until communicated to the other party.20 Thus the maker of a note carrying interest at a usurious rate will not be held to have intended a general payment to be applied on interest merely because the payment was so applied on the books of the bank without his knowledge. A letter from a creditor to his debtor at the time when a payment is made, showing how the money has been applied, is on the debtor's failure.

12. Tayloe v. Sandiford, 7 Wheat. 13, 5 U. S. (L. ed.) 384; Perot v. Cooper, 17 Colo. 80, 28 Pac. 391, 31 A. S. R. 258.

13. Stone Co. v. Rich, 160 N. C. 161, 75 S. E. 1077, Ann. Cas. 1914C 244 and note.

14. Note: 96 A. S. R. 48,

15. Stone Co. v. Rich, 160 N. C. 161, 75 S. E. 1077, Ann. Cas. 1914C 244 and note.

Note: L.R.A.1916D 1256.

16. Stone Co. v. Rich, 160 N. C. 161, 75 S. E. 1077, Ann. Cas. 1914C 244, Note: 96 A. S. R. 80.

R. C. L. Vol. XXI.-8.

113

20. Note: 96 A. S. R. 79.

1. Richmond Second Nat. Bank v. Fitzpatrick, 111 Ky. 228, 63 S. W. 459, 62 L.R.A. 599. jl q J

Jov est ri. 10 sen..

to object to such application admissible in evidence to support the contention of the creditor as to the application of the payment. Where several notes given in a single transaction are written on one sheet of paper an indorsement of a payment on the back thereof as being made on the "within notes" was to be one application pro rata and not a payment on the particular note which happened to be on the opposite side of the paper from the indorsement. The burden is on the creditor where he claims to have applied a payment to a debt other than the one in suit to prove both debts, and the application of payments thereon.

123, In General.-So far as possible the operation and effect of payments have been discussed in connection with other questions treated in this article, such as payments to particular persons, by particular persons, and in a particular manner. In another place will be found a discussion of the operation and effect of payment in bank notes, Confederate money, counterfeit and base coin, stolen funds, property, checks, drafts and notes. In other articles in this work will be found a discussion of the effect of the payment of a -maller sum in discharge of a larger, and the effect of a part pay ment as reviving a debt barred by the statute of limitations.1 10 The fact that a person makes a payment on a claim presented against him does not amount to an admission of the legality of the claim so as to preclude him from defending an action for the balance on, the ground of its illegality.11

69

124. By Joint Obligor. It is a general rule that the payment of a joint debt by one of the joint debtors is a discharge of it as to all.1 Accordingly a payment of one of two separate judgments obtained on the same demand discharge both, though one judgment was against the principal, and the other against the surety.18 Likewise. a payment by a partner, under a compromise, of a specific sum in satisfaction of a partnership debt discharges it, and it cannot be kept alive by an agreement between the creditor and the paying partner

to enable the latter to collect it from his copartner.14 But a payment by a joint debtor who does not stand in a fiduciary relation to the other debtor is regarded in the light of a purchase where, for the purpose of keeping the joint security alive, he takes an assignment in the name of a stranger.15

125. Payment of Debt as Extinguishing Security; Lien of Third Person. A mortgage being a mere security for a debt, it must follow that the payment of the debt, whether before or after default, will operate as an extinguishment of the mortgage.16 Indeed, in those courts, with some few exceptions, where the common law view of mortgages is the most strictly adhered to, payment of the debt is held to revest the estate without a reconveyance in the mortgagor.12 A judgment on a bond and a mortgage given for the same debt are so far parts of the same transaction that the satisfaction of one is presumed to be a payment and satisfaction of the other, as between the parties, and puts the burden of proof on the creditor to show a different intent, or that the debt is not actually paid.18 The payment of a judgment by the debtor to the creditor will not operate to dis charge an attorney's lien thereon.19 1997

1126. Payments on Sunday. In those jurisdictions wherein there are statutes prohibiting the doing of acts of one's secular calling on the first day of the week, commonly called Sunday, a payment made on that day is illegal,20 but it nevertheless is quite effective to dischargé the obligation. And if it is retained it is thereby ratified and made valid and operates as a discharge of the obligation pro tanto. This is so because the parties are in pari delicto, and the court will neither allow the debtor to recover the money so paid, nor permit the creditor to keep it and then sue for the original amount of indebtedness.

127. In General,-Under the code system of pleading, payment is new matter constituting a defense and must be pleaded by the

14. Le Page v. McCrea, 1 Wend. (N. Y.) 164, 19 Am. Dec. 469.

15. Sherwood v. Collier, 14 N. C. 380, 24 Am. Dec. 264.

16. See MORTGAGES, vol. 19, pp. 439440.

17. McMillan v. Richards, 9 Cal. 365, 70 Am. Dec. 655. See also MORTGAGES, vol. 19, pp. 440-442.

18. Meigs v. Bunting, 141 Pa. St. 233, 21 Atl. 588, 23 A. S. R. 273 and note.

19. Hobson v. Watson, 34 Me. 20,

56 Am. Dec. 632. And see ATTORNEYS AT LAW, vol. 2, p. 1080.

20. Notes: 5 L.R.A. (N.S.) 243; 19 Ann. Cas. 240. See generally, SUNDAYS AND HOLIDAYS.

1. Campbell v. Davis, 94 Miss. 164, 47 So. 546, 19 Ann. Cas. 239 and note. Note: 15 L.R.A. (N.S.) 243. 2. Note: 19 Ann. Cas. 240.

3. Cranson v. Goss, 107 Mass. 439, 9 Am. Rep. 45.

Notes: 15 L.R.A. (N.S.) 243; 19 Ann. Cas. 240.

defendant, and it cannot be proven under a general denial, either in bar or mitigation of recovery. In England the whole common law practice of receiving evidence of payment, and other special defenses under the plea of nil debet or non assumpsit, has been swept away by statute, making the practice there similar to the new system of pleading under the code in the United States. Nothing is admissible under the general denial which does not controvert an allegation in the complaint that the plaintiff is bound to prove to make a prima facie case. The complaint, it is true, ordinarily avers that the instrument sued on has not been paid; still, proof of that averment is not ordinarily required, and therefore it is not put in issue by a general denial, though there are authorities opposed to this view. There seems, however, to be a well settled exception to this rule. Where an allegation, not stated as a conclusion of law, is so framed that an issue is presented by the traverse on the fact of the amount due, proof of payment is admissible without an affirmative plea in the nature of a further defense.10 Thus where a person sues to recover a balance due, which he alleges not merely as a conclusion of law but as a fact, and which he must prove in order to sustain his action, it is well settled that the defendant may show payment under a general denial, because the amount of the indebtedness, being the only fact alleged by which it may be said to exist, it is traversable; and, being traversed, it is proper to show payment under the issue thus formulated, to refute the fact of its existence.12 Where payment is made in advance of a sale it need not be pleaded in an

4. Harvey v. Denver, etc., R. Co., 44 Colo. 258, 99 Pac. 31, 130 A. S. R. 120; Hubler v. Pullen, 9 Ind. 273, 68 Am. Dec. 620; Field v. New York, 6 N. Y. 179, 57 Am. Dec. 435; McKyring v. Bull, 16 N. Y. 297, 69 Am. Dec. 696 and note; North Pennsylvania R. Co. v. Adams, 54 Pa. St. 94, 93 Am. Dec. 677.

Notes: 42 A. S. R. 317; Ann. Cas. 1912B 487.

5. Hubler v. Pullen, 9 Ind. 273, 68 Am. Dec. 620; Landry v. Baugnon, 17 La. 82, 36 Am. Dec. 606; McKyring v, Bull, 16 N. Y. 297, 69 Am. Dec. 696 and note; Robertson v. Robertson, 37 Ore. 339, 62 Pac. 377, 82 A. S. R. 756 and note.

"

69 Am. Dec. 696.

Note: Ann. Cas. 1912B 487.

8. Harvey v. Denver, etc., R. Co., 44 Colo. 258, 99 Pac. 31, 130 A. S. R. 120; Hubler v. Pullen, 9 Ind. 273, 68 Am. Dec. 620.

9. Harvey v. Denver, etc., R. Co., 44 Colo. 258, 99 Pac. 31, 130 A. S. R. 120 (stating the rule in California).

Notes: 61 Am. Dec. 60; Ann. Cas. 1912B 487.

10. Robertson v. Robertson, 37 Ore. 339, 62 Pac. 377, 82 A. S. R. 756. Notes: 61 Am. Dec. 61; Ann. Cas. 1912B 487.

11. Jones v. El Reno Mill, etc., Co., 26 Okla. 796, 110 Pac. 1071, Ann. Cas. 1912B 486 and note; Parker v. Mayes,

Notes: 61 Am. Dec. 61; Ann. Cas. 85 S. C. 419, 67 S. E. 559, 137 A. S. 1912B 488.

6. McKyring v. Bull, 16 N. Y. 297, 69 Am. Dec. 696 and note. See also DAMAGES, vol. 8, p. 619.

7. McKyring v. Bull, 16 N. Y. 297,

R. 912.

12. Robertson v. Robertson, 37 Ore. 339, 62 Pac. 377, 82 A. S. R. 756; Parker v. Mayes, 85 S. C. 419, 67 S. E. 559, 137 A. S. R. 912.6-60 WF PI

action for the price of the goods, for payment in advance would mean that the goods were furnished on an executed consideration in pursuance of an antecedent duty, and that there never was a debt due for them for a single instant. Even where the transaction is a cash sale and the payment is made at the same moment that the goods are furnished payment need not be specially pleaded.18 A defendant cannot avail himself of the defense of payment after the commencement of the suit, unless he also pays the costs as well as the debt.14

128. Proof of Payment under General Issue.-Prior to code practice, and in jurisdictions where the common law system of pleading still prevails, evidence of payment is admissible under the general issue in debt and assumpsit.15 But evidence of a payment pendente lite cannot be given in evidence under the general issue. Such defense must be set up by a plea of puis darrein continuance, 16

129. Sufficiency of Plea.-Nothing is pleadable as payment except money, or something agreed to be accepted in lieu thereof.17 Accordingly a plea of payment is bad if it merely alleges that the defendant delivered certain negotiable notes to a third person on account and on behalf of the plaintiffs, without averring that such third person was the agent of the plaintiffs, or that the notes were accepted in full satisfaction and discharge of the debt.18 No subject of set-off can be treated as in any sense payment and cannot be thus pleaded.19 A plea of payment must allege the facts on which it is based and if it does not do so it will be held bad on demurrer.20 So it is held that a plea of partial payment, which sets forth neither the time, place nor amount of payment, is insufficient.1 If the defendant undertakes to set forth an itemized statement of payments made to the plaintiff, all payments which he has made should be set forth, and evidence of any items not pleaded is not admissible. Under a

15. Crews v. Bleakley, 16 Ill. 21, 61 Am. Dec. 323; McKyring v. Bull, 16 N. Y. 297, 69 Am. Dec. 696 (stating rule); Beals v. See, 10 Pa. St. 56, 49 Am. Dec. 573; Manville v. Gay, 1 Wis. 250, 60 Am. Dec. 379.

Notes: 61 Am. Dec. 59; Ann. Cas. 1912B 487.

16. Boyd v. Weeks, 2 Den. (N. Y.) 321, 43 Am. Dec. 749.

18. Bird v. Caritat, 2 Johns. (N. Y.) 342, 3 Am. Dec. 433.

19. Burton V. Willin, 6 Houst. (Del.) 522, 22 A. S. R. 363. See SETOFF AND COUNTERCLAIM.

20. Hancock v. Yaden, 121 Ind. 366, 23 N. E. 253, 16 A. S. R. 396, 6 L.R.A. 576.

1. Thomas v. Clarkson, 125 Ga. 72, 54 S. E. 77, 6 L.R.A. (N.S.) 658. The plea of payment in this case was as follows: "That he is informed and believes that some credit or credits should be placed upon said notes, and asks that the plaintiff be made to make a full accounting for the same under

17. Burton V. Willin, 6 Houst. (Del.) 522, 22 A. S. R. 363; Hancock v. Yaden, 121 Ind. 366, 23 N. E. 253, oath." 16 A. S. R. 396, 6 L.R.A. 576.

2. Lapham v. Kansas, etc., Oil, etc.,