This was an action of assumpsit on five several promissory notes made by the firm of Wells Sappington, payable to the order of W. J. Sooy, and by them endorsed in blank, and which afterward came to the hands of B. P. Shreve, the decedent of the plaintiff, the first dated June 26, 1851, at four months, for $500, the second, July 17, 1851, at four months, for $500, the third, August 11, 1851, at four months, for $500, the fourth, August 28, 1851, at four months, for $500, and the fifth, dated September 18, 1851, at four months, for $583.50. The date of the endorsement which was in blank, was entered on the back of the notes, and was July 28, 1856. The pleas were non assumpsit, payment, set-off, accord and satisfaction, *Page 225 and the statute of limitations, the latter of which was disposed of in the preceding case, on demurrer. The execution and endorsement of the notes and that the makers of them had no funds at the place where they were made payable, when they matured, and that they were not endorsed until after their maturity, were admitted and the notes were thereupon put in evidence.
The counsel for the defendants then offered in evidence a duly authenticated copy of the record of a judgment at the suit of W. J. Sooy, v. Wells Sappington for $3340, real debt $1670, recovered October 11, 1851, in the Court of Common Pleas for Burlington County in the State of New Jersey. The case had been argued almost exclusively on the questions involved and presented by the pleas in the case, which so far as it was necessary now to advert to them, were payment, set-off and accord and satisfaction. Now, what is meant by these several pleas respectively as they appear by the record? They are general and in the usual form of memorandum pleas entered in brief on the docket, but they are to be regarded and considered for the purposes of this case and at the present stage of it, precisely as if they had been drawn out at length and stated and filed in full and regular form on the record. And so viewed, the first remark which the court had to make with reference to them, was that they were between the parties on the record to this suit, Philip C. Jones, administrator of Benjamin P. Shreve, deceased, who was the endorsee of the promissory notes on which this action is founded, from the firm of W. J. Sooy, the payees of them, as the plaintiff, and the late firm of Wells Sappington, who were the makers of them, as the defendants; and the pleadings and issues joined in the case, as well as the action, were between these parties, the plaintiff and the defendants just mentioned, and no other persons.
The first of these pleas as we have stated, is the plea of payment, which means and imports in contemplation of law, as it stands on the record, a money payment, or a full and complete satisfaction and discharge in what was equivalent to it, of the whole of the promissory notes in question, to Benjamin P. Shreve in his life-time, by Wells Sappington, the defendants. But the record of the judgment confessed in New Jersey by the defendants to W. J. Sooy, is no evidence of payment under this plea and does not support, or sustain it; first, because it was not a payment to Benjamin P. Shreve, deceased, the endorsee *Page 231 of the notes, in whose right this action is brought and prosecuted by the plaintiff as his administrator; and secondly, because if it had been otherwise and had been confessed to him in his life-time, and not to another, it should then have been specially pleaded, alleged and proved as a payment to him, that is to say, that he accepted the bond and the judgment confessed upon it, in satisfaction and discharge, or in other words, in payment and extinguishment of the sums due to him on the promissory notes as the endorsee thereof. For the bond and judgment were not to him; nor could there be any ground whatever, for this reason, if there were no other, for presuming that they were so accepted by him. But even, if the bond and judgment had been given and confessed to him, at the time when they appear from the record, to have been given and confessed to W. J. Sooy, the payees of the notes, they would still fail to sustain the plea of payment on the ground of the legal presumption, or implication contended for and relied upon by the counsel of the defendants in the argument, because the notes had not then matured, nor any of them, nor was the debt created by them, or any of them, by that time due and payable, to any one, either the original payees W. J. Sooy, who then held them, or Shreve who afterward and after their maturity, came into possession of them by endorsement. For this presumption of law, that a debt, or security of an inferior grade is extinguished by a security of a higher nature, can only apply in the absense of any proof of an intention, or understanding between the parties to the contrary, when the debt, or security of lower grade alleged to be extinguished by the security of a higher nature, was due and payable at the time when the security of higher grade was given and taken. And this remark applies as well to the promissory notes whilst they were yet in the hands of W. J. Sooy, the payees of them, to whom the bond was given and the judgment was confessed by the defendants, but before their maturity and endorsement, as whilst they were in *Page 232 the hands of Shreve, the deceased, by virtue of the endorsement of them after their maturity.
Much that we have said on the subject of this plea of payment and the issue joined upon it, applies with equal force and propriety to the next plea we shall notice, which is the plea of accord and satisfaction. As we have before remarked with reference to the first plea which we have noticed, this plea of accord and satisfaction, as it stands in its brief and memorandum form upon the record, means and imports, accord and satisfaction of the debt or demand sued for in this action, not to somebody else, but to the plaintiff in the action, that is to say, to Benjamin P. Shreve, in whose right it is instituted. But as the object and purpose of the defence in entering it briefly and concisely as it appears on the docket, was doubtless to show and prove under it, as under the pea of payment similarly entered, not that the accord and satisfaction was to the plaintiff, Shreve, the endorsee of the notes, but to the payees and original holders of them, W. J. Sooy, before their endorsement of them, and whilst they were yet the holders of them, we are content to consider it for the present in that aspect simply; and so viewing it, if the evidence which had been adduced had sustained the plea as they intended and designed it to be viewed and considered, we should be obliged to say to the jury that it was a complete bar to this action. For as the plea when drawn out in full and regular form would allege all that it is usual and material to aver in such a plea when drawn out, it would not only allege the specific character and foundation of the accord and satisfaction, but also that it was received and accepted by the adverse party in discharge and satisfaction of the demand to which it was pleaded. And in this light, as we have before said, we must contemplate and regard the plea. And if these promissory notes had then matured and then been due and payable to the payees and original holders of them, W. J. Sooy, when the bond was given and judgment was confessed upon it by the defendants to them, we might *Page 233 have been content to leave it to the jury to presume that the bond and judgment upon it, were for the same debt for which the promissory notes which are an inferior kind of security, had previously been given by the defendants to them. But in the absence of any proof whatever, as to the intention, or understanding between those parties to the bond and promissory notes as to this matter; and as they do not appear upon their face, or from the evidence to be securities for the same debt due originally from the defendants to the firm of W. J. Sooy, although of different grades; and more particularly as it clearly appears from the promissory notes themselves, that they had not then matured and were not yet due and payable to those persons, and being also in the aggregate for a much larger sum than the real debt on the bond and judgment, and for that reason not appearing to be for the same debt, the jury cannot presume, for the law does not imply, and cannot presume or imply in such a case, that the two classes of securities were given and accepted for the same debt; and therefore the defendants have also failed to sustain their plea of accord and satisfaction, even in the light and aspect in which they designed it should be viewed and considered by us.
As to the last plea relied upon, and which we shall now notice, the plea of set-off, it is not even pretended by the counsel for the defendants, that the bond and judgment of which we have already so frequently spoken, are any defence under this plea, or constitute any proof in support of it. It is contended, however, by them, that the fund, or at least, the balance thereof, amounting to $600 in the hands of the assignees of the defendants, who were also W. J. Sooy, under the proceedings before the Surrogate in New Jersey, is a subject of legal set-off in this action to the debt and demand sued for by the plaintiff. To constitute a legal set-off under our statute, they must be mutual debts due the parties in the same right in which they sue and are sued in the action. They must also be legal demands for which an action at law *Page 234 could be maintained. A trust fund is not such. The fund referred to, was in the hands of the trustees under the assignment and the statute of that State, for distribution among the creditors of the defendants, and as such in their hands it was a trust fund, and no action will lie at common law against a mere trustee. But here the same inherent objection arises as in the other two pleas, but even in a more palpable and evident manner; for it is not a plea to the demand of the plaintiff in this action, is not mutual in its character, and is not due at all from the plaintiff to the defendants, but from other parties, if due from any one, and much less is it due from the plaintiff to the defendants in the same legal right in which they are now sued by him. It is therefore no defence to the action, and consequently the sum demanded under it by the defendants, cannot be considered, or allowed by the jury in making up their verdict, which must be for the plaintiff, and for the aggregate amount of the promissory notes in evidence, with interest on each from the day of its maturity.