Coates v. Preston

• Decision Date: 31 March 1883
• Citation: 1882 WL 14348,105 Ill. 470
• Parties: ISAAC P. COATESv.DAVID PRESTON et al.
• Court: Illinois Supreme Court

105 Ill. 470

1882 WL 14348 (Ill.)

ISAAC P. COATES

v.DAVID PRESTON et al.

Supreme Court of Illinois.

Filed at Ottawa Nov. 20, 1882.Rehearing denied March Term, 1883.

APPEAL from the Appellate Court for the First District;--heard in that court on appeal from the Superior Court of Cook county; the Hon. JOSEPH E. GARY, Judge, presiding.

Messrs. SHUFELDT & WESTOVER, for the appellant:

A debt due by a co-partnership can not be set off in an action by a member of the firm to recover his individual demand. Debts, to be set off, must be mutual between the parties. Gregg v. James, Breese, 143; Hinkley v. West, 4 Gilm. 136; Hilliard v. Walker, 11 Ill. 644; Walker v. Chovin, 16 Id. 489; Phelps v. Reeder, 39 Id. 172.

Section 3, chapter 77, of the Revised Statutes, does not cover partnership obligations. The purpose of that section is, to make obligations joint in form, but executed by several, joint and several. Marine Bank v. Ferry's Admrs. 40 Ill. 255; Gage v. Mechanics' National Bank, 79 Id. 62.

A partnership obligation is distinct and different from a “joint obligation.” 1 Parsons on Contracts, 11, 30; Parsons on Partnership, 346.

Partnership contracts were always considered, in one sense, joint and several; and the statute, therefore, has no reference to such contracts. The rule of law, that in an action against partners all must be joined, exists now as well as before the act. Ladd v. Griswold, 4 Gilm. 25; Mason v. Tiffany, 45 Ill. 392; Silverman v. Chase, 90 Id. 37; Lindley on Partnership, 295, 298.

Mr. MORTON CULVER, for the appellees:

The note of the firm was joint and several, and being several as to Gardner, his deposit could be used, so far as applicable, toward the liquidation of the note. Rev. Stat. 1874, chap. 76, sec. 3.

Where a note is joint and several, any one of the makers thereof may be sued separately. Moore v. Rogers, 19 Ill. 347; Powell v. Ketelle, 1 Gilm. 491; Ballance v. Samuel, 3 Scam. 380; Marine Bank v. Terry, 40 Ill. 255; Conover v. Hill, 76 Id. 342; Gould v. Sternberg, 69 Id. 531; Gage v. Mechanics' National Bank, 79 Id. 62; Coombs v. Steele, 80 Id. 101; People v. Harrison, 82 Id. 84.

Where each of several defendants against whom a judgment is rendered, is liable for the payment of the entire demand, such judgment may be set off against a judgment obtained by one of the defendants against the holders of the first mentioned judgment. Waterman on Set-off, secs. 231-3; White v. Rogers, 6 Blackf. 436; Pate v. Gray, Hemp. 155; Owen v. Wilkinson, S. C. (N. S.) 526; Culver v. Barney, 14 Wend. 162; Fletcher v. Dyche, 2 T. R. 32; Dunn v. West, 5 B. Mon. 376; Branch State Bank v. Morris, 13 Iowa, 136; Stadler v. Parmlee, 10 Id. 23; Lemon v. Stephenson, 36 Ill. 49; Carson v. Barnes, 1 Ala. 193; Hurdle v. Hanner, 5 Jones, (N. C.) 360; Bean v. Cabaness, 6 Ala. 343; Hutchins v. Riddle, 12 N. H. 464.

Mr. CHIEF JUSTICE SCOTT delivered the opinion of the Court:

This suit was brought by Isaac P. Coates, against the firm of Preston, Kean & Co., who are described as bankers doing a general banking business, and was brought on a check drawn by Schuyler S. Gardner on defendants, for the sum of $2190, payable to his own order, and afterwards indorsed by him in writing on the back of the check, and then delivered to plaintiff. The defence, shortly stated, is, that Gardner, the drawer of the check, was, at the time, a member of the firm of Colby, Gardner & Co., which firm was then indebted to the defendant banking firm in a sum in excess of the sum specified in the check, and that at the date the check was presented to defendants for payment, had not then, and has not since had, to his credit in their bank a sum exceeding $2111.46; that plaintiff was not, at any time prior to the commencement of this suit, a bona fide owner or holder of the check in suit for value paid by him, and that defendants would allow, as a set-off, the indebtedness of Colby, Gardner & Co. to them, which was then in judgment, the full amount of $2111.46, against the claim of plaintiff. To a special plea setting up these facts with the usual formality, the court overruled the demurrer interposed by plaintiff, and rendered judgment for defendants. That decision was affirmed in the Appellate Court, and now plaintiff brings the case to this court on appeal.

It is conceded in the argument, any defence to this action may be made that could be made had Gardner, the drawer of the check, brought the suit in his own name to recover the amount due him from the bank. But could the defence set up in the plea be sustained against Gardner if he were suing? It is apprehended it could not. It is a familiar principle that debts, to be the subject of set-off, must be mutual between the parties to the action. That is not the case here. The debt offered to be set off is the debt of the firm against the claim of one of the individual partners. That can not be done, and so this court held in Hilliard v. Walker, 11 Ill. 644.

It is a misapprehension to suppose section 3, chapter 76, Revised Statutes 1874, changes the practice in this respect. Even if that section of the statute has...