Naglee v. Palmer

Citations

• 7 Cal. 543

Syllabus

<p>As a general proposition, the mere existence of cross demands will not justify a set-off in a Court of Chancery. There must be some peculiar circumstances, based upon equitable grounds, to warrant the Court in interfering.</p> <p>To authorize a set-off at law, the debts must be between the parties in their own right, and must be of the same kind and quality, and be duly ascertained or liquidated— they must be certain and determinate debts.</p> <p>Where the plaintiff filed his bill as receiver of an insolvent firm, to foreclose a mortgage given to plaintiffs in that capacity to secure a certificate of deposit for one hundred thousand dollars, originally deposited by the receiver, and defendants admitted the debt, but claimed that the amount is to be distributed pro rata among the creditors of the insolvents, whom the plaintiff represents; that the claims of the creditors have been filed and reported upon; that defendants are large creditors of the insolvents, and that they will, upon the distribution of the assets, be entitled to fifty thousand dollars as their dividend; and that defendants have advanced a further sum to the former custodians of the assets of about fifty thousand dollars, which they pray to have ascertained, and the whole amount set-off against the certificate of deposit, and, until then, that plaintiff be restrained z Meld, that a Court of Equity will not compel them to pay the money into Court, which they would immediately ho entitled to receive back; nor will it put them to the cost of so large a judgment, but will order an account and allow the set-off.</p> <p>The execution and delivery of the certificate of deposit by defendants, changed their character from being custodians of the funds to that of mere debtors of the insolvents.</p>