VERMONT SUPREME COURT.

3. Testimony that a wife did all her hus-tifying to the offer made? We say it does not. band's business is admissible on the question of her agency in a particular transaction within that time.

NOTE.-Revival of barred debt by application of ¦ move the bar as to the balance of the debt. Blake

This rule has been followed in Maine, the court holding that an application of payment by a creditor to a debt already barred by statute will not re-ion.

Warner, 97 Mass. 8: Haynes v. Nice, 100 Mass. | 265; Call v. Dunning, 4 East, 53; Rex v. Har327, 1 Am. Rep. 109.

The defendant was an incompetent witness as to all matters occurring prior to the appointment of the administrator of Mr. Sanborn.mation that proof of the handwriting of a deRev. Laws, 1003.

qualification. Persons prima facie competent, | as a valid application upon all the notes covwhose competency is questioned, may be ex-ered, provided the payment was so made as to amined on the voir dire in support of their justify such an application. competency, but persons prima facie incompetent cannot testify until their competency has been otherwise established. In Fay v. Green, 1 Aiken, 71, the depositions of certain persons disqualified by interest, unless their interest had been discharged, were received in evidence on the strength of their own testimony therein that such interest had been discharged. The court considered that the testimony by which the interest was removed was the testimony of interested witnesses, and should not have been received. The rule has been recognized in many cases. Botham v. Swingler, 1 Esp. 164; Štate v. Townsend, 2 Harr. (Del.) 543; Mott v. Hicks, 1 Cow. 513, 535, 13 Am. Dec. 550; Stevenson v. Mudgett, 10 N. H. 338, 34 Am. Dec. 155; Bank of Utica v. Mersereau, 3 Barb. Ch. 528, 5 L. ed. 998.

It is held in this State that, when a debtor makes a general payment to a creditor who holds several notes against him, the creditor may apply the payment upon any one of the notes, but cannot divide it among them all. Ayer v. Hawkins, 19 Vt. 26; Wheeler v. House, 27 Vt. 735. This is upon the ground that, although no application is directed, regard must nevertheless be had to the intention of the debtor, and that he cannot be presumed to have intended an application upon more than one of the notes. It is evident, however, that these cases would not be controlling where the debtor had regarded and treated the several notes as constituting one demand, and made the payment in that view. The treatment of the indebtedness in this case seems to have been such as to afford no ground for claiming the general payments to be within the doctrine of the cases above cited. The jury was inments, made to apply on these notes, without specifying any application upon particular notes, the creditor had a right to apply them, as he has upon the notes generally, and that such application would renew the debt; and, although a general exception was taken to so much of the charge as related to the application of payments made generally, this exception was waived in argument. The case states that the evidence of the defendant tended to show that he supposed he was making payments upon three $100 notes, and no more; and the question raised as to the effect of these payments was whether they were a recognition of three notes, or of all the notes. It is not claimed but that the payments were so made that the creditor was justified in applying each payment upon all the notes which the debtor then understood were held against him. The points specially urged upon the court below, and relied upon here, relate to the matter of intent, as affected by the defendant's claimed ignorance of the situation, and by the fact of his physical infirmity.

Testimony that for a period covering the time of the transaction the defendant's wife did all his business, would be evidence tend-structed that if the payments were general paying to show that she was his agent in this transaction. If the testimony which could have been given by the son under the defendant's offer would have covered such a period, it was error to exclude it. But, if his testimony could have related only to a later period, its exclusion was not error. The exceptions are not clear upon this point, but from what appears in them it seems probable that the age of the son was such that the proposed testimony could have referred only to a later period.

The five notes are all of the same date, and are written one below another upon the same sheet. The note maturing last fell due in 1876. The indorsements made previous to October, 1879, are so entered upon the back of the sheet as to be placed on separate notes, and are without words indicating an intention to extend the application to other notes. The indorsements dated October 8 and December 27, 1879, are so entered as to be upon one note, but are written where entries would naturally be made upon the paper as folded and read, "Received on the within notes." The last two indorsements are so extended across the sheet as to be upon all the notes but one, and read, "Received on the within notes.' Upon the note not reached by the writing so extended a separate indorsement was made. The defendant claims that the indorsements of October 8th and December 27th must be treated as applied on the note upon the back of which they are written, and that the indorsements extended across the back of four of the notes must be treated as applied upon the note on which the entries commence. It is insisted that, when a payment is so made as to justify an application by the creditor upon more than one note, such an application can be accomplished only by indorsing the amount paid in separate sums upon the several notes. We are not disposed to so hold. The application here is made in terms upon the "within notes," and we do not think the language of the indorsement is made ineffectual by its position. When notes are held in the form shown here, and an indorsement is made in the words and in either of the methods above stated, we think it must be treated

The defendant was blind at the date of the notes, and has since remained so. On trial, he admitted giving three notes, but denied that more were given. He also admitted making the payments represented by the indorsements, and that he gave no express direction as to their application. But he claimed that, inasmuch as he had knowledge of only three notes, the payments were necessarily made upon those notes, and that there could be no valid application upon any other. In this view, the court was asked to instruct the jury that, to entitle the plaintiff to the benefit of the indorsements on the other two notes as against the statute, it was incumbent on her to prove that the payments were made with knowledge on the part of the defendant that the creditor held such notes against him. The court declined so to charge, and we think properly.

The question whether the defendant executed all the notes was submitted to the jury, and the verdict has established the fact that he did. He knew at the time of the transaction how many signatures he affixed as well as if able to see. If he afterwards understood it

plied by the creditor upon a claim that is barred, but that such application will not revive the unpaid balance of the debt. It is said that no promise to pay the balance of a debt can be implied from a payment which is not intentionally made upon that particular debt. We think, however, that any application which the creditor is justified in making must be followed by the ordinary consequences of a part payment. When the debtor leaves the application to be made by the creditor, or, in default of action on the part of the creditor, by the law, he must be held to have intended such application as may finally be made by the creditor or by the law. Robie v. Briggs, 59 Vt. 443, 4 New Eng. Rep. 506. If we correctly understand the exceptions, the point was raised that the creditor would have no right to indorse anything upon a barred note, unless the defendant knew at the time of the payment, or was informed before the application, that such note was barred. This claim seems to have been made upon the ground that the defendant's blindness entitled him to some special protection. But the creditor's right to make the application does not depend upon the correctness or completeness of the debtor's understanding as to the situation of the demand; and, in the absence of any question of fraud or concealment on the part of the holders of the paper, we do not see how the debtor's deprivation of one of the ordinary means of acquiring information can affect the action which he was willing to take upon such information as he had.

differently, it was because of forgetfulness. | chusetts that a general payment may be apHis claim is not based upon any supposed cancellation of a part of the notes, or supposed transfer of a part to other parties. He made each payment as a general payment upon the Sanborn indebtedness, whatever it was. The general intention with which the payment was made will not be controlled by a consideration of what his action might have been if he had then had in mind that there were five notes instead of three. The payment having been so made as to justify an application upon the notes generally, and that disposition having been made of it, the application cannot now be overthrown on the plea that the debtor was under a misapprehension as to the number of the notes, when his misapprehension was not caused by any act or omission of the creditor. The defendant cites, in support of the contrary view, Roakes v. Bailey, 55 Vt. 542, where it is said that "if the debtor pays with one intent, and the creditor receives with another, the intent of the debtor shall govern." But the proper application of the doctrine is apparent from the facts of that case, and the further views expressed. There, a firm with which the debtor had been dealing was dissolved, and was succeeded by one of its members. The debtor received no notice of the dissolution of the firm, and its successor continued to deliver goods and credit payments upon the same passbook, as if there had been no change. The debtor supposed he was making payments upon the account of the firm, and the successor of the firm treated them as paid upon the subsequent account. The court considered that the debtor was deprived of an opportunity to expressly direct an application by the fault of the creditor, that the circumstances under which the payments were made showed conclusively what the debtor's intention was, and that no right ever existed in the creditor to make the attempted application. It is evident that the facts of the case at bar do not bring it within the decision.

Effect being given to the above applications as made by the creditor, none of the notes have ever been barred except the first one, of which a small part remained unpaid by previous indorsements. It is insisted that a recovery cannot be had upon a note which has been barred unless the payment relied upon to remove the bar was indorsed by the debtor or by his direction; and Pond v. Williams, 1 Gray, 630, and Ramsay v. Warner, 97 Mass. 13, are cited in this connection. It is held in Massa

The defendant claimed that if there was a $50 note it was given for usury. The jury was instructed that if it was given for usury no recovery could be had upon it. This was correct. The jury was further instructed that if the note was given for usury, and the amounts indorsed upon it were paid with an intention that they be so applied, the defendant could not recover them in this suit by receiving credit for them in ascertaining the general balance. If this was erroneous, no harm came from it, for the jury returned a verdict for all the notes, which they could not have done under the instructions given without finding that the note was not usurious. Having found the note was not given for usury, they did not reach the matter in which the instruction complained of was given. Judgment affirmed.

NEW YORK COURT OF APPEALS (2d Div.).

stock for it in violation of U. S. Rev. Stat., § 5201, cannot be denied by sureties of the cashier as a defense to an action on his bond for misappropriation of the stock since only the federal government can set up the invalidity of that transaction.

2. The cashier of a national bank who misappropriates its stock which he has taken in his own name as security for a note to the bank which he indorses in order to evade the prohibition against loans by the bank on the security of its own stock, is guilty of mis

appropriating the property of the bank intrusted to him as cashier and his sureties are liable there

for.

3. Recovering judgment against the cashier of a national bank on his indorsement of a note secured by a transfer of the bank's stock to him individually, which indorsement and transfer were merely an evasion stock is not a bar to an action on his bond for misappropriating the stock, as the remedies are concurrent and not inconsistent.

of the law against loans on the security of the

(December 1, 1891.)

only reason given at any time for assigning the stock to Rutherford instead of the Bank was, as Rutherford told Terbell, because the Banking Act prohibited the Bank from making loans upon the security of its own stock.' "Said cashier, after the transfer aforesaid, put said stock in an envelope, and informed the president of the Bank that it belonged to Terbell, and the Bank thereafter held such stock as security for Terbell's paper, although it held it in Rutherford's name.' December 20, 1883, Terbell made his note for $1,000, and April 1, 1884, another for the same amount, cach payable to the order of Rutherford, and indorsed

APPEAL by defendants from a judgment of by him, and the plaintiff discounted both for

the General Term of the Supreme Court, Second Department, affirming the judgment of a Special Term for Orange County in favor of plaintiff in an action brought to enforce the liability of sureties upon the bond of a bank cashier. Affirmed.

Statement by Vann, J.:

said Terbell, and at the time "held said bankstock as security for the payment" thereof, under the aforesaid agreement. The indorsements of Rutherford "were in form only, and were only done to make the transaction appear regular under the National Banking Laws." The note dated April 1, 1884, was given to take up a note made by Terbell and held by This was an action to recover from the de- the plaintiff on December 12, 1882, or in refendants, as sureties of one Rutherford, cashier newal of a note given for that purpose. Sepof the plaintiff Bank, the value of certain of tember 1, 1886, at the request of Terbell and its securities, alleged to have been converted the plaintiff, Rutherford sold ten shares of said by him. The trial court found the following stock to the defendant Snyder for $1,210, facts: Said Rutherford was cashier of the which was applied on the indebtedness of Terplaintiff, a national bank, from its organiza- bell to the Bank, except a small sum, which tion until March 19, 1887, except during a few was placed to his credit on the books. Up to months in the year 1886, when he was ill. this time the dividends upon the stock had The bond in question, dated February 2, 1887, been credited to Terbell, and after this sale the is in the penalty of $4,000, and contains the dividends upon the twenty shares remaining condition that if said Rutherford "honestly were equal to the interest on said two notes, and in good faith performs all the duties of and they were balanced in that way by the cashier in the Walden National Bank, and all cashier, said Rutherford." January 13, 1887, the duties in any manner incident thereto Rutherford borrowed $1,000 upon his own while acting as such cashier, and also all such note, and for his own use, from the Goshen duties, acts, and work as may be required of National Bank, to which he gave as collateral the said William G. Rutherford by the said security ten shares of said stock. The note Bank or its board of directors which shall from was not paid, and the Bank last named sold time to time be assented to on his part, and in said collateral, and with the proceeds paid the all respects conduct honestly and in good faith note. March 18, 1887, Rutherford borrowed towards or in respect to said Bank, its moneys another $1,000 upon his own note, and for his and securities, and the moneys and securities own use, from the Chase National Bank, and of any other person or persons left in any assigned to it the remaining ten shares of said manner with said Bank, then the above obli- stock as collateral. That note was not paid, gation to be void; otherwise to remain in full and that Bank sold its collateral, and paid its force and virtue." Prior to December 12, 1882, note out of the proceeds. Neither of the notes one Terbell owned thirty shares of the stock so held by the plaintiff was ever paid, alof said Bank, of the par value of $100 per though payment was duly demanded; and no share, and on that day he assigned and deliv- part of said twenty shares of stock was ever ered the same to said Rutherford in his "in- returned to the plaintiff, notwithstanding due dividual name," and thereupon it was trans- demand made of said Rutherford. September ferred to him on the books of the Bank, and 10, 1887, the plaintiff recovered judgment on three new certificates for ten shares each were its notes against Terbell and Rutherford, but, issued to him therefor. At this time Terbell no part thereof having been paid, an offer was was indebted to the Bank to an amount exceed- made to the defendants to assign the same to ing $9,000 upon certain notes made or indorsed them, "but they declined to do anything about by him, and discounted by the plaintiff for his the matter." Upon the request of the defendbenefit. He was not indebted to said Ruther-ants the court also found that the notes made ford, but was in financial difficulties, and wanted to secure the Bank. Said stock was thus transferred to said Rutherford upon the understanding "that it was to be held for the Bank as collateral security for the payment of" said notes. The transfer "took place over the counter of the Bank, while said Ruther ford was acting as its cashier; and the transaction was with him in that capacity." Said Terbell "understood he was dealing with the Bank, and not Rutherford personally; and the

or indorsed by Terbell and held by the plaintiff on December 12, 1882, with two or three unimportant exceptions, had upon them the name of a responsible maker or indorser, in addition to that of Terbell. The trial judge refused to find, upon the like request, that "the transfer of said stock by said Terbell was made to said Rutherford, and held by him in his individual capacity, as a personal matter, and he did not take and hold the stock as cashier for the plaintiff, and as collateral