Bosler v. Exchange Bank

• Decision Date: 21 September 1846
• Citation: 4 Pa. 32
• Parties: BOSLER'S Administrators <I>v.</I> The EXCHANGE BANK.
• Court: Pennsylvania Supreme Court

Page 32

4 Pa. 32

BOSLER'S Administrators v. The EXCHANGE BANK.

Supreme Court of Pennsylvania.

September 18, 1846.

September 21, 1846.

Sept. 18.

ERROR to the District Court of Alleghany county.

Selden and Biddle, for plaintiffs in error.—If the bank are permitted to set off this balance due the estate of the plaintiff's intestate, it will obstruct the settlement of the estate of an insolvent. The death of a party establishes the character of the assets. His administrator becomes a trustee for creditors. The distribution of the assets amongst the creditors cannot be disturbed by any subsequent act or event. If the bank intended to present the note as a set-off, it should have been done promptly. The bank should have refused to honour our drafts or checks.

There cannot be a set-off of a debt due by the intestate in his life-time, if insolvent. Defendant cannot buy a debt and set it off. 2 Rawle, 123. A debt takes rank at the time of death of decedent. 1 Bin. 221. A debt due by deceased in his lifetime cannot be set off against a debt to the administrator. Willes, 264. A debt falling due after death of the decedent cannot be set off against a debt due before his death. 4 Camp. 342; 2 Williams on Executors, 1153. They also cited 8 Eng. Com. Law Rep. 260.

T. Williams, for defendant in error.—The doctrine contended for is not equity. Equity would give a set-off here. Cramond and others, executors of Cramond, v. The Bank of the United States, 1 Binn. 64, is decisive of this case. Here the debts are mutual, and the right of set-off clear and undoubted.

A party is allowed a pro rata set-off. Dorsheimer v. Bucher, 7 Serg. & Rawle, 9. To same point is Poorman v. Goswiler, 2 Watts, 69; Niagara Bank v. Rosevelt, 9 Cowen, 409, and 8 Eng. Com. Law Rep. 260.

Sept. 21. ROGERS, J.

A set-off is allowed in a suit brought either by or against executors or administrators, and the fact that the debt proposed to be set-off was not due at the time of the death of the testator, or intestate, would make no difference if due when suit was commenced, and the estate be solvent. But is a set-off allowable when the estate is notoriously insolvent? We think not, for the simple reason that it would disturb the course of administration. At the death of the testator or intestate, the executor or administrator is the trustee for the creditors, whose right to the assets at that time becomes fixed and determined. Nothing that the executor or administrator can do can alter the course of distribution. If the estate be solvent, the creditors are entitled to receive their whole debt; if otherwise, they have a vested right to a pro rata dividend. It is an unanswerable objection to the decision of the court, that what they assert will be that one creditor may receive the whole amount of his debt, whereas other creditors will receive a pro rata only, lessened by the sum which he has been permitted to set-off; this we conceive is not in accordance with...