(charging jury). The bond on which this suit is brought, the condition, and the breach, are all admitted; that is, the signing and sealing of the bond, the terms of the condition, and the breach as laid in the declaration. The present defendant was not the principal In the bond, but one of the sureties of .Richard Bache. He signed and sealed it, but contends that he is not liable to any responsibility under it, on several grounds, some of law*, some of fact.
I. He says this bond was never delivered, in the sense of the law, because it was never accepted, without which the delivery is not complete. It is not denied that the defend*1109ant had done all required of him; he had signed, sealed, and delivered it so far as it depended on him. Was an acceptance necessary? I think it was; not only on general principles, but peculiarly so in this case. It was to be approved by the postmaster general; he was to judge of its sufficiency; and until it was approved and accepted, it was no contract between the parties; it could not be a contract on one side only. Whether an acceptance was necessary, is a question of law; and I clearly think it was. Then was this bond accepted? This is a ract for your decision. If the question of acceptance depended on written evidence, or documents alone, it would be for the court, with whom the construction of such evidence is entrusted; but when it depends altogether on parol evidence, or partly oh that, and partly on written testimony, it is for the jury, from a view of both, to decide the fact. In this case the acceptance is asserted on the one side, and denied on the other, not only from the written correspondence between the parties, but also from facts and circumstances, such as the time that elapsed between the receipt of the bond by the postmaster general and the return of it, a conversation held with me, and some other matters, which are enough to make it a mixed question of evidence, partly written and partly parol. But it is the duty of the court to give you some instruction as to the law on the subject. An acceptance of this bond by the postmaster general need not be proved by direct or express evidence. It is not necessary he should write, acknowledging the receipt, and accepting the security. It is probable this is never done. But receiving the bond, and detaining it for a considerable time, without objection, will be sufficient evidence of acceptance to complete the delivery; especially when the exception is taken by the party who had done all he could do to complete it. This accords with common sense and justice. In the ordinary case of an account, sent by one merchant to another, no objection being made in a reasonable time is a presumed acquiescence, and binds him. This is a much stronger case. If, therefore, you would not allow the postmaster general to. deny his acceptance of this bond, after all he has written or done about it, you will not allow the defendant to do so.
Now, as to the time the bond was kept. This is not exactly ascertained, but we may make a reasonable presumption. It is dated Sth July, 1S23, and one of the counsel for the defendant thinks it must have been sent about the same time. It is probable he is right. Why should it not be? Even then the delay, after the requisition made, had been long; and although this might have been occasioned by difficulty in getting sureties, yet. after they were got, why should Mr. Bache delay to send it, especially as be was hardly pressed for it by the postmaster general? On the 7th June, 1823, the postmaster general writes to Mr. Bache: “Some weeks since I directed a bond to be sent to you, that you might have it executed.” The bona must therefore have been sent at least eariy in May. On the 15th June, Mr. Bache answers, and says, that the delay had been occasioned by one of his sureties being out of the city, and, after his return, occupied by his own business; he adds, “It shall be executed, and sent to yo« in tlie course of next week.” At this time Mr. Bache was at West Point. On the 8th July the bond was executed in this city, and, under all circumstances, the reasonable presumption seems to be, that it was sent to the postmaster general about the same time. Prom then, say the 15th July, to the 21st September, 1825, the postmaster general 'keeps the bond, without an intimation of hesitation or objection to its sufficiency, but with the means to inquire into it, had he thought necessary, in twenty-four hours. Can it be presumed he kept it under consideration all this time, when he does not appear to have made any inquiry to satisfy himself, or to have had any doubt? Did he leave the public interest for more than two months without any security, while he was hesitating, and would neither accept nor reject the bond, nor take a step to satisfy himself? You will judge; but it would be most unwarrantable neglect, and such as should not be supposed, without clear proof, against an officer of high reputation for a vigilant attention to his duty. Would it be in his mouth, after more than two months silent acquiescence, to say he had never accepted this bond? Had he kept an account current for half this time, could he deny his admission of it, at least prima facie?
On the 21st September, 1825, the bond was returned to Mr. Bache, with a letter. Now, the mere fact of sending it back does not prove that he had not accepted it. He might have fully accepted it for a week, or a year, and then, on finding the security was not sufficient, he might require either a new bond to be substituted, or an addition of security to be made to that he had. The sufficiency of the security is at all times under the direction of the postmaster general. The mere act then of returning this bond affords no proof that it had not been accepted. If the act, per se, affords no such proof, was it accompanied by any declarations by the postmaster general, showing such an understanding on his part? I reply, that he nowhere denies the acceptance expressly; and that it is not to be inferred from -what he has written. In the letter of 21st September, 1S23, in which the bond was enclosed, he says he is informed Mr. Milnor, one of the sureties, possesses little or no property. . As this information was tiie cause or inducement to write this letter, we may presume it was recent. Will you not infer from this, that until he got this information, he was satisfied with the bond; and, being satisfied, had accepted it? He *1110says that the rule of the department requires two sureties; he considers Mr. Milnor as standing for nothing “if the fact be so;" leaving it to Mr. Bache to prove the property of Mr. Milnor if he could. But, if the fact be so, what is to be done? Another signature is to be procured. Is there any thing here to show an understanding on the part of the postmaster general that he had not accepted this bond; that he was not entitled to all the security it offered, although he requires something more? The matter remains in this situation, without any communication from the postmaster general, until the 12th June following, about nine months, when the postmaster general writes, “your bond yet remains to be perfected.” Can we suppose the postmaster general believes himself all this time without any security? Yet this would have been the case, if he had never accepted the bond, as far as it went. Remember the intention and acts of the postmaster general are to decide this question; for the defendant had done every thing on his part to complete the delivery of the bond. On the 7th April, 3S28, the bond is not returned, but remains with Mr. Bache. Two years and a half elapsed, and there is no security. What does the postmaster general now write: “Col. Gardner informs me you have not returned your bond, with the additional security.” He hopes he will lose no time in procuring the additional name. In all other respects the bond was to remain, and be returned as it was originally received. On the 14th March, 1S2S, a letter was written by Col. Gardner to Mr. Bache: “I am directed by the postmaster general to ask your immediate attention to the return of your bond, with the additional security required.” We have hero all that the postmaster general has done and written on this subject. Take it all together and decide whether, from it, you can infer that he understood or intended not to accept this bond; for on his intention and acts it depends. How did Mr. Bache himself understand the matter? On the 15th December, 1S25, he writes: “1 shall attend to the surety next week, when I hope to forward one that will meet your approbation.” On the 14th April, 182S, he says: “I shall endeavour to give you a definitive answer, in the course of to-morrow or the next day, respecting my bond, after seeing my friends.” Under this evidence, and the remarks I have made to aid your consideration of it. the question of acceptance is left to you. If the bond was never accepted, there is an end of the case.
II. If accepted, did the return of the bond amount to a surrender of it, to annulling, or cancelling it? This depends on the intention of it. That it was sent to Mr. Bache does not show it, but it depends on the purpose for which it was sent. If he had abused the confidence put in him, kept the bond, destroyed it. or would now turn his possession of it to a use never intended, it can avail nothing. It is of the same force and validity as if it remained with the postmaster general at Washington. There is nothing by which this intention is to be judged but the correspondence, and this makes it a question of law. It is clear that there was no intention to cancel or annul the bond, or to substitute another, but only to strengthen the same bond by an additional surety. When such surety was procured, it was to be returned, not a new one executed. This is the language of both of the parties, clearly, and expressly. The question whether the bond was cancelled by the return of it, is different from the question, whether it was accepted or not. The argument and authorities to show that any alteration in a deed will avoid it, might have been important, if the intended addition had been made to it; but as this was not done, the bond remains now just as it was when executed, and its identity cannot be doubted. If. therefore, you shall be of opinion, that this bond was accepted, then as it is clear it never has been cancelled, it remains in full force, and the question of the liability of the defendant to all, or any part of the claim, is to be examined by you.
III. It is said that at the time this bond was executed, and long before, a large balance was due from Richard Bache to the government, and that moneys collected and paid by him, after the execution of this bond, have been applied to the payment of that antecedent balance. It is urged that this is, in effect, to charge these sureties with a default which occurred before they became so; that the moneys which should have been applied to the credit of their responsibility, have gone to the relief of sureties in an antecedent bond. Before we examine to what extent the facts sustain this objection, we will look to the law for our guide, in deciding upon them; and this will necessarily lead us into an inquiry into the doctrine of the appropriations of payments, which seems to be well settled, and with no material variation, through a long course of decisions and years. We need not go further than to the cases decided iu the supreme court of the United States. The general doctrine certainly is. that where a debtor makes a payment, and is indebted to the creditor on several accounts, he may direct to which debt or account, the payment shall be applied. If he gives no such direction, the creditor receiving the money may apply it at his pleasure. If both omit it, the law will apply it according to the justice of the case. There can be no objection to this doctrine where no party is concerned but the debtor and creditor. But how is it in a case like the present? Here a public officer, in the receipt of public money, has given sureties for the faithful performance of his duties. and for the accounting for and payment of all the moneys which shall come to his hands. These sureties remain for several years, and then a new bond, with new sureties, is given; at which time there is a layge sum of money actually due to the public, *1111and for which the sureties on the first bond were liable; that is to say, the penalty of the first bond was actually forfeited, and the amount of the defalcation due, and recoverable from the sureties in it. Can the government, for whose security both bonds were given, apply the moneys collected by the officer after and under the second bond, and on the responsibility of the sureties in the second bond, to the payment or credit of the balance due on moneys collected, and which ought to have been paid, by and under the first bond 7 Can the burden actually resting upon the first sureties, can the forfeiture actually incurred by them, be shifted by the process of appropriation, without the consent or knowledge of the second surety, from the shoulders of the first, and be put upon the second? I am of opinion, most clearly, that it cannot; that each set of sureties must answer for its own defaults, and is entitled to be credited with its own payments. If authority can be required to sustain a principle of such obvious justice, it will be found in the case of U. S. v. January, 7 Cranch [11 U. S.] 572, which is a much stronger case than the present. In that case a collector of revenue had given two bonds at different periods, for his official conduct; and the second bond undertook not only for the future, but also for ihe past, fidelity of the officer. The supervisor had promised to apply all the payments he should receive to the discharge of the first bond, before he carried any of them to the credit of the second; he keeping but one general account against the collector. At the time of the trial, the general balance against the collector was upwards of sixteen thousand dollars, but at the time when the second bond was given, it was but six thousand dollars and upwards. The payments,if all applied to the first bond, would have discharged it. The principal question in the case was, whether this promise of the supervisor was an appropriation of the money binding on the United States without some act appropriating it, as entries in the books, for this was the question brought up from the court below. The supreme court first state the law on the appropriation of payments generally, as I have stated it, and then proceed in declaring their opinion, “that the rule adopted in ordinary cases is not applicable to a case circumstanced as this is, where the receiver is a public officer not interested in the event of the suit, and who receives on account of the United States, where the payments are indiscriminately made, and where different sureties, under distinct obligations, are interested. It will be generally admitted,” they say, “that moneys arising, due, and collected subsequently to the execution of the second bond, cannot be applied to the discharge of 1be first, without manifest injury to the surety in the second bond; and, vice versa, justice between the different sureties can only be done by reference to the collector’s books: and the evidence which they contain may be supported by parol testimony.” How is justice to be done between the different sureties by a reference to the collector’s books? Certainly by seeing when the payments were made, and applying them accordingly to the first or second bond. The reference to be made to the books is for this purpose; and not to adopt as conclusive the appropriation then made by the officer, which was contended for by the district attorney. To ascertain bow far this principle will go to the relief of the defendant in this case, we must turn to the account, which is a copy from the books, and see how much of the uefendant’s money, if I may call it so, has been applied to the relief of the prior sureties; because if it shall appear that the prior sureties have been paid oy other moneys, in part or in whole, than those which were due and collected under the second bond, it is manifest the second sureties have no ground of complaint, further than their money has been taken for this purpose. On the other hand, there must be deducted from the final balance, now charged against the defendant, so much of the postages received since 8th July, 1S25, as has been diverted from them, and applied to the first bond. This must be ascertained, as far as it can, by an examination of the account which I shall willingly refer to you; believing you will have to leave something to conjecture.
I will, however, direct your attention to some points of inquiry. The bond under which the defendant is liable, is dated on 8th July, 1S25. On the supposition that it was sent at once to 'Washington and accepted, we may presume the contract was completed on or about 10th July, 1825, and then had reference back to the date of the bond, at which time the liability of defendant for the conduct of Mr. Bache commenced, to wit, on 8th July, 1825. It appears by the. account, that on the quarter ending the 1st July, 1S25, the debits against Mr. Bache exceeded his credits or payments by the sum of twenty-six thousand nine hundred and forty-nine dollars and nineteen cents. By payments made between that date and the 15th September, this balance was paid, and overpaid, leaving a balance in his favour of two thousand seven hundred and ninety-six dollars and ninety-seven cents, and had it been discharged by payments made before 1st July, the defendant would have nothing to do with it, but would have entered upon his suretyship on a clear field, and have been answerable for all subsequent delinquency. You will remark, however, that this is taking the debit to 1st July, and bringing the credits or payments to 15th September, two months and a half later. Between the postmaster general and Mr. Bache, this is of no importance; but as regards the sureties, where the inquiry is, whether these payments have been appropriated or not to their injury, the question is different. After the 1st July, and indeed on and after the date of the bond and of the commencement of *1112the defendant’s suretyship, there were paid twenty-nine thousand seven hundred and forty-sis dollars and sixteen cents. Did the whole of this consist of moneys received under the second bond? If it did, then it is a greater amount than the whole balance now due; and of course if this amount of their money has been paid to make up the deficiencies of an antecedent suretyship, and must now be restored to their credit, nothing is due from them. In other words, if the balance of twenty-six thousand nine hundred and forty-nine dollars and nineteen cents which Mr. Bache owed on 1st July, 1825. has been paid with postages afterwards received, it is clear that if those payments had been applied to the subsequent debits of this account, nothing would be due, but there would be a balance in favour of the second bond. I mean to say, suppose the account had been closed on 1st July, 1S23, Mr. Bache and his then sureties would have been debtors for twenty-six thousand nine hundred and forty-nine dollars and nineteen cents; and if a new account had been opened with the second bond, there would have been no default under it, provided the payment which, in September, 1825, extinguished the above balance, was made by moneys received for postages paid under the second bond. This then is the matter of fact for you to ascertain from the account: how much of defendant’s money has been applied to pay the antecedent debt. At the first view, we see that the whole of these payments made between 1st July and 13th September, could not have been from moneys received, for postages between those periods. The payments made were twenty-nine thousand seven hundred and forty-six dollars and sixteen cents; the whole postages charged to Mr. Bache, for the quarter, from 1st July to 1st October, were seventeen thousand four hundred and fifty-six dollars and forty-nine cents; the payments, therefore, exceeded the whole receipts for the whole quarter by the sum of twelve thousand two hundred and eighty-nine dollars and sixty-seven cents, which, therefore, Mr. Bache must have obtained either from antecedent postages not before collected and paid, or from other resources. This sum did not come from the receipts after and under the second bond, or from the funds equitably claimed by the defendant. On this view the accounts would stand as follows:
The principle of law is. that you shall not take the moneys due and collected subsequently to the execution of the second bond, and apply them to the discharge of the first bond: and when you have ascertained how much of the money, which became due and. was collected under the second bond, has* been applied to the discharge of arrears due. under the first, you will deduct that amount from the whole default claimed at the conclusion of the account.
We must go one step further in this anaiy sis. The payments stop on the 15th Septem ber, 1S25, and, of course, no part of them could have been derived from postages between that date and the 1st October. If these are estimated at two thousand five hundred dollars that sum should be added to the liability of the second bond, or, which is the same thing, taken from the credit we have given to it; which would leave the sureties in this bond now chargeable with nine thousand two hundred and seventy-nine dollars and one cent; and they will then have full credit against the general balance, for all the money that was taken from them for the payment of the debt, which was due before they became sureties. Of consequence, they will be charged with no defaults but such as occurred after their liability began, and full justice will be done to them. Indeed, if we knew certainly where Mr. Bache got the funds, with which he made the payments from the 8th July to the 15th September; that is, if we knew that all of them were derived from antecedent postages, the present sureties would be properly chargeable with the overpayment of' two thousand seven hundred and ninety-six dollars and ninety-seven cents, which has gone to their credit, but came not from their funds, and belonged to the sureties of the first bond. You must not forget that justice is also due to them. A suit is now depending against them in this court; and they must answer for all that is not recoverable here. You should consider that you are settling the account between the two sets of sureties, rather than between the United States, and either of them: and your object should be to give to each bond credit for the moneys respectively duo, collected, and paid under it. This is the true justice of the case. After all the payments that have been made, on closing the account, twenty-two thousand two hundred and thirty-five dollars and fifty cents are found due to the United States, from one or both of different sureties. You should give to the present defendant all the benefit of all the payments made with moneys due, collected and paid to the postmaster general under his bond; and you should, in like manner, give to the sureties in the first bond, credit for all the payments made with moneys due. collected, and paid, under their bonds, and the result will show how the remaining debt should be apportioned between them.
IV. The defendant has offered another ground, which goes to the whole right of re*1113covery. By the third section of the act of congress of March, 1S25 [4 Stat. 103], it is. enacted, “that if default shall he made by a postmaster, at any time, and the postmaster general shall fail to institute suit against such postmaster, and his sureties, for two years from and after such default shall be made, then, and in that case, the sa.id sureties shall not be held liable to the United States, nor shall suit be instituted against them.” It is alleged by the counsel for the defendant, that if the postmaster has been in default at the end of every quarter for two years, antecedent to the suit, the sureties are discharged; and that in this case large balances were due from the postmaster, at the end of every quarter, for more than two years before suit brought. The district attorney contends, that at the end of various quarters, within that period, balances were in favour of the postmaster, and that this suit is not brought for any default of two years standing, but, in fact, for a default which accrued in the last quarter; all antecedent suits having been discharged by payments appropriated to them, in a manner warranted by law and usage. I confess I cannot see any difficulty in this question. It must be borne in mind, that the right of appropriating payments stands on a very different footing here, from that which it had on the question between two sets of sureties in two different bonds. Each is liable for defaults of two distinct periods. To apply the money received, during one of these periods, to discharge a responsibility incurred in the other, is manifestly unjust, and therefore, in such case, the general right of a receiver of money, to appropriate it, when the payer does not, was restrained by the clearest principles of justice. He was bound to credit the party with the payment, who was interested in the fund from which it was derived, or he would make a surety responsible for a default for which he never undertook. But the case is altogether different where 'the parties interested in the payments are the same, and are equally answerable for all. In such cases the right of appropriation has been repeatedly decided and recognised in its full force and extent. By the act of congress, the sureties of a postmaster are not to be sued for a default of their principal, if the postmaster general shall fail to institute a suit for such default, for two years after it shall be made. Is this suit instituted for a default made two years before it was instituted? The suit was brought on the 1st July, 1S2S, to recover the sum of twenty-two thousand two hundred and thirty-five dollars and fifty cents. Was this default made two years before; that is, on 1st July. 1S20? On that day the whole amount received by Mr. Bache was seventy-five thousand three hundred and seventy-eight dollars and twenty-three cents; his payments were fifty-six thousand seven hundred and ninety-six dollars and ninety-seven cents; on that day, therefore, eighteen thousand five hundred and eighty-one dollars and twenty-six cents, was the amount of his. debt or default; and if the account had then stopped, and no further payments had been made, certainly the defendant would have had the benefit of the limitation of the act But the account goes on, debits are charged, payments are credited, the balances vary and fluctuate, sometimes being in fa-vour of the postmaster, until at the final close he stands indebted in twenty-two thousand two hundred and thirty-five dollars and fifty cents. But it is said that this has been effected by the postmaster general, who has improperly applied the payment of moneys received after the termination of a quarter, to the balance then due; or that the moneys paid in a subsequent quarter, were applied to pay what remained due on the antecedent one. Assuredly he had a right to do so, and had he not done so, the court would have done it for him. But it is clear he has so appropriated these payments.
The case of rent is put by the district attorney. So of three promissory notes, of one hundred dollars, payable annually; no payment is made the first year; in the second year, before the second note is due, or even after, one hundred dollars are paid; so also in the third year, without any direction by the payer. The receiver applies the first payment to the first note, and the second to the second, leaving the third unsatisfied. He sues on the third note. Can the debtor say it is more than six years since the first note was due, and deny the right to apply his payments to the second and third? If there could be any doubt in a matter • so plain, it is put at rest by the decision of the-supreme court of the United States, in Kirkpatrick’s Case, 9 Wheat. [22 U. S.] 737. The language of the court is: “The general doctrine is, that the debtor has a right, if he pleases, to make the appropriation of payments; if he omits it, the creditor may; if both omit it, the law will apply the payments, according to its own notions of justice. Neither party can claim the right, after the controversy has arisen; and, a fortiori, at the time of the trial. In cases like the present, of long and running accounts, where debits and credits are perpetually occurring, and no balances otherwise adjusted than for the mere purpose of making rests, we are of opinion, that payments ought to be applied to extinguish the debts, according to the priority of time; so that the credits are to be deemed payments, pro tanto, of the debts an-tecedently due.” In our case the postmaster general has clearly appropriated the payments made, from time to time, by Mr. Bache, who gave no direction concerning them, but made them without any discrimination of the fund, from which they were derived, and left them to be applied, according to the pleasure of the postmaster *1114general, and the usage of liis office; and the appropriation thus made is precisely that which the supreme court has declared to be according to justice, and such as the court would direct, if neither of the parties had done so. The application, therefore, of the moneys received in a subsequent quarter, to the payment of the debt or balance an-tecedently due, being perfectly correct and lawTful, it follows, that no part of the default, for which suit is brought, accrued two years before; on the contrary, all the balances antecedent to the last quarter were extinguished by the successive payments, and the final debt or balance falls on the final quarter. I am entirely clear that the limitation of the time of bringing suit, provided in the third section of the act of March, 1823, cannot avail the defendant.
The case then stands before you on these points: (1) Was the bond accepted; and of this you will judge. (2) If accepted, was it afterwards cancelled, and its obligation annulled. This is matter of law; and X am of opinion it was not. (3) The moneys arising, due, and collected under the second bond, cannot be applied to the discharge of the first bond. You will ascertain how much money, if any. has been thus applied, and deduct it from the amount claimed as finally due, on the whole account. (4) The suit has been brought in good time, and is not barred by the limitation of two years in the act referred to.
The jury found a verdict for the defendant.