Chaffin v. Hanes, 15 N.C. 103, 4 Dev. 103 (1833)

Dec. 1833 · Supreme Court of North Carolina

15 N.C. 103, 4 Dev. 103

Nathan Chaffin v. Michael Hanes, et al.

A debt due an administrator by his intestate, is, in law, paid the instant assets applicable to it- are received, and nothing ex post facto will set it up again; as where an administrator was the obligee of a bond executed by his intestate and another, it was held to be satisfied by the receipt of assets rightfully applicable to it, although the obligee was af-terwards compelled to pay other bond debts of his intestate, to which he was surety.

Whether an obligee administering upon tie estate of one of several oblis’ors destroys his re-

Debt upon a bond executed by one William W. Chqf-jin as principal and the defendants as sureties, payable to the plaintiff.

Peeas — non estfachim. Payment — and an accord and satisfaction.

On the trial before Settee, Judge, at Rowan, on the last Spring Circuit, the defence was that the principal debtor died in the year 1823, and that letters of administration upon his estate issued to the plaintiff, who received assets to an amount exceeding the debts of dignity superior to the one in suit, and of the bond debts for which he might retain. His Honor ruled this to be a satisfaction of the debt, as the presumption of law was that an administrator had applied the assets to his own debts as soon as he could do so in a legal course of administration. The plaintiff offered to prove that there were bond debts of the intestate to which he was surety, and which he had been compelled to pay, which with debts of a higher dignity, and the bond debts which he might retain, exceeded the amount of assets — but his Honor thinking that fact could not affect the defence, a verdict was returned for the defendants, and the plaintiff appealed. N

Jfash and Badger for the plaintiff.

No counsel appeared for the defendants.

RurriN, Chief-Justice.

The effect simply of the ad- . . . . ‘ . . miuistration of the creditor on the estateot one of the ob-ligors, is not to be determined in this case, because the de- ' fend ants have not pleaded that fact. The material pleas are payment and satisfaction: the defendants choosing to re]y on the merits, and fact of satisfaction, rather than on the ground that the creditor, by his own act of admin-¡storing, had suspended and. thereby extinguished his remedy.

On the trial upon these issues, it apeared in evidence' that the plaintiff is the administrator of William W. Ghvffin, a co-obligor with the defendants, and received assets more than sufficient to pay this, and all other bond debts of the intestate to himself. The court held, that the debt was satisfied by the receipt of assets to a larger amount; and also rejected evidence offered by the plaintiff, that the intestate owed bond debts to other persons, in which the plaintiff was his surety, and which he had paid off to the amount of the assets received by him.

The first position is in conformity to the case of Muse v. Sawyer, (N. C. T. R. 204,) which is directly in point, where the plaintiff was the executor of the obligee instead of the obligee himself.

From that, the correctness of the second position seems to be a necessary consequence. If the plaintiff were a creditor by several bonds, to a larger amount than all the assets that have come to his hands, in reason and justice he ought to be at liberty to apply the assets to such of his bonds as he chose, and the law in case he had not actually applied them, would presume him to apply them to those debts for which the creditor had no other security but the single bond of the intestate. But if the administrator be a creditor by bond, and also by simple contract, the assets are first applicable to the former debt, and must be so applied. The doctrine of retainer is founded upon the idea that the debt is extinguished by the receipt of assets, whenever those assets can in the course of administration be legally applied to the debt. It does not appear in the record, whether the plaintiff paid the bonds in which he was surety, before or after he administered. But beit either way, theresultis the same. If before, the debt to the plaintiff in respect of such payments, was a simple contract; and this, as a bond debt is first to be paid. If after, the assets were before appropriated by law and at the instant they were received, to t!ie bond debt to the plaintiff. The x residue after deducting this debt, was the assets to which other bond creditors could resort. When the debt becomes extinct by reason of the receipt of assets, if is extinguished for all purposes andas to all persons, as well co-obligors, as the heir of the deceased obligor; for, says Lord Holt in Wankford v. Wankford, (Salk. 305) having assets, amounts to payment, and another obligor in the bond cannot be sued. Being thus extinguished, it can never be revived by any subsequent acts of the administrator, such as the application of the assets to other debts of inferior dignity, or even of the same dignity fall-ng due, or acquired by him, after tbc'asscts were legally applicable, and had been by the law applied to this bomb

it seems that ?le act°f. I829, surety who has Pai>-Uhe debt of a against his estate ^^ha™of^thef principal creditor, “¿LImus both surety and ^ surety to one pay j*^3e‘^rectIy

This case having occurred prior to 1829 is not affected by the act of that year, fe. 22.) Indeed had it occurred afterwards, it is clear that it could not operate m favor of the plaintiff, if he paid off the bonds after he obtained letters of administration because fiie statute only gives to demands, paid by the surety, the dignity, in liis hands, which they had in those of the origina! creditor; and as bonds held by the original eral-ifcor, they were postponed to the right of retainer in the plaintiff of the debt due to himself. For the sa®e reason it is at least doubtful whether the law would hot be the same, had the plaintiff paid the bonds before administration ; though possibly in that case, lie might be considered as then holding them as bonds due to himself. But upon that question, the court gives no opinion ; as fhe facts to raise it are not found in the case.

Per Curiam — Judgment affirmed.