Our statute (C. S., 416) provides that no acknowledgment - or promise is evidence of a new or continuing contract, from which statute of limitations runs, unless it is contained in some writing, signed by the party to be charged thereby, “but this section does not alter the effect of any payment of principal or interest.” And in our decisions construing the section it is held that the same does not restrict or modify in any way the effect of a payment under the general principles prevailing in this jurisdiction when the statute was enacted. Battle v. Battle, 116 N. C., 161; Bank v. Harris, 96 N. C., 118; Riggs v. Roberts, 85 N. C., 152.
Considering the record in view of this position, the question presented is whether the facts in evidence on the part of plaintiff, accepted as true and interpreted in the light most favorable to him, permit the reasonable inference or finding that there was a payment by defendant on plaintiff’s account as claimed by him within three years next before action brought (24 December, 1921), and under circumstances constituting a renewal of defendant’s indebtedness. In this connection it is well understood that mutual debts do not per se extinguish each other, and that in order for one-to constitute a payment of another, in whole or in part, there must be an agreement between the creditor and the debtor that the one shall be applied in satisfaction of the other, in whole or pro tanto, according to the respective amounts.
Thus, in Bank v. Harris, supra, it is held: “The effect of section 172 of The Code is to leave the law as it was prior to the adoption of the *523Code of CÍYÍ1 Procedure as regards tbe effect of a partial payment in removing tbe bar of tbe statute of limitations. Tbe-fact tbat tbe maker of a note bas a claim against tbe bolder, wbicb tbe bolder endorses as a credit on tbe note without tbe assent of tbe maker, will not be such a partial payment as will rebut tbe statute of limitations, but an agreement to apply one existing liability to another is such a partial payment as will stop tbe operation of tbe statute, although tbe endorsement is never actually made on tbe note.”
In 30 Cyc., a payment is said to be “a delivery by tbe debtor or bis representative to tbe creditor, or bis representative, of money or something accepted by tbe creditor as tbe equivalent thereof, with tbe intent on tbe part of tbe debtor to pay tbe debt, in whole or in part, and accepted as payment by tbe creditor.” And in support of this definition tbe author cites, among other cases, Borland v. Bank, 99 Cal., p. 89, to tbe effect “Tbat payment, like a sale, can result only from tbe mutual agreement of tbe parties tbat tbe transaction shall have that effect, and without such consent tbe transaction cannot be treated by tbe court as a payment.”
And in 21 R. C. L., Title, Payment, sec. 3, it is said: “Tbe authorities agree tbat to constitute payment, tbe money or other thing must pass from tbe debtor to tbe creditor for tbe purpose of extinguishing tbe debt, and tbe creditor must receive it for tbat purpose.”
And, as pertinent to tbe inquiry, tbe authorities further bold-tbat, in order to constitute a renewal of an account or obligation otherwise barred by tbe statute of limitations, tbe alleged payment must be made and received “under circumstances permitting tbe inference tbat tbe debtor did so in recognition of tbe existence of tbe debt and of bis obligation to pay tbe same.” Supply Co. v. Dowd, 146 N. C., 191; Battle v. Battle, supra; Riggs v. Roberts, supra.
On a proper application of these authorities, and tbe principles they approve and illustrate, we must conclude tbat if any payment was made by defendant on plaintiff’s account, it took place not when tbe bouse was built by plaintiff, in 1898, but in January, 1919, when, according to plaintiff’s version, it was agreed between tbe parties tbat defendant’s claim for building tbe bouse should be credited as a payment on plaintiff’s account. And, on tbe facts in evidence, plaintiff is entitled to have tbe issue submitted to tbe jury on tbe question whether it was agreed between tbe parties in 1919 tbat defendant’s claim for building tbe bouse should be then received as a payment on tbe entire account,of plaintiff or on any part of same, and if so, what part:
There should be a new trial of tbe issue, and it is so ordered.
New trial.