A DISSERTATION ON THE STATUTE OF OFFSETS. *"An act for allowing and regulating and pleadings being closed, the jury shall be OFFSETS." any directed to find generally such sum or sums as shall be found in arrear from either, and judgment shall be rendered thereon accordingly." By this statute it is enacted, "That if the plaintiff, in any action depending before court, on bond, bill, note, or other contract, By this clause, the plaintiff is allowed to shall be indebted to the defendant in such reply to the defendant's plea of offset, by ofaction, the defendant, after pleading the gen-fering in the same manner, to offset any eral issue, or confessing the plaintiff's cause further demand, which he may have against of action, may plead an offset of any sum or the defendant, of the same nature; that is, sums due to him from the plaintiff, as afore- any demand arising on contract. Beneficial law. What demands may offset.-They must be founded in contract, express or implied. It is observable upon this clause, *168 that a defendant is al*lowed to plead an offset in those actions, which are founded on contracts only; not in those, which are founded on torts.-The words indebted, due, are here to be taken, not in their appropriate signification, as confined to specific sums and liquidated demands, but more generally, for any demand, which one man has against another, by virtue of an express or implied contract, whether of a specific sum, or subject to estimation. The distinction between debt and damage, does not reach the meaning of the statute. An assumpsit sounds wholly in damages, and yet is founded on contract. An action of debt lies against an officer, for an escape, both negligent and voluntary, and yet the action is founded on a tort.-By a proper attention to this *169 distinction, we shall be able to determine with precision, in what kind of actions, offsets are allowed, and in what, they are not. The same observations may be applied to the nature of the demand, which the defendant is allowed to plead in offset; for he may plead an offset of any sum or sums due to him from the plaintiff, as aforesaid, that is, on bond, bill, note, or other "Which plea shall be in the nature of a declaration in one or more counts, as the nature of the case may require; and, if the plaintiff shall plead the general issue to any or all the counts in the defendant's plea, or shall confess the cause of action contained in any or all the counts in the defendant's plea, he may in like manner plead an offset of any *170 sum or sums due to him from the defendant, as aforesaid; and the issue This is indisputably one of the most equitable and beneficial laws to be found in any code. It is calculated on the maxim, Interest republicæ, ut finis sit litium-"It is the interest of the State to terminate litigations." It serves to control the litigious spirit of suitors, by in*volving their interest *171 alternately in a full settlement of every litigated demand, with a great saving both of time and expence. Demand must be in the same right. One distinction relating to the right, in which any demand is claimed to be due, though not expressed in the statute, exists in the nature of the thing. The demands of both plaintiff and defendant must be mutual, that is, in the same right, or they will not be allowed to offset one against the other. Executors and administrators. To illustrate this by example-A, as executor or administrator of B, brings a suit against D, for a debt due to his testator, or intestate. Here A brings the action, in alieno jure; he represents the right of another. In this case, D may offset any demand which he has against A, in the same right, as executor *or administrator of B; but *172 no demand which is personal of A. Nor can A reply in offset against D, any demand existing in his own right, but is confined to such only, as he claims in right of his testator, or intestate. Heads of corporations, trustees, &c. The same rule holds in all actions for or against heads of corporations, trustees, assignees of bankrupts, and all persons who represent the rights of others. Reason of this construction. This construction is necessary to prevent a perpetual confusion, and even violation of rights. It would be grosly unjust in a trus tee, to apply the trust to his own benefit; | time of trial, saving the costs to the party, and it would be no less unjust in the law to against whom it should be produced? allow, much more, to compel such applica- *Of endorsed notes & bills. tion. The manner of pleading, and the duty of the jury, are pointed out, too clearly to need any illustration. "Provided, that no sum due on account, It is a very just and equitable provision, that no bills or notes sold, endorsed, or assigned to either party, should be allowed, in any plea of offset; unless notice of such sale and endorsement or assignment shall have been given by the party holding the same, to the opposite party, before the commencement of the plaintiff's action: were it otherwise, one of the parties might, by secret purchases of such bills or notes, often unexpectedly, and indeed unjustly, subject the other to costs. It is much more agreeable to the principles of right, that the debtor should employ his property directly, in the payment of his debts, than that he should attempt it in a circuitous way, by such purchases, and with an expence and cost to the creditor. *By bills and notes in the proviso, are to be understood those, which are negotiable. *177 the balance whereof shall not be ascertained under the hand or hands of the party or parties; nor any bond, bill, note, or other The Bills' and Notes,' in the proviso, are contract, not due or payable before the com-attended with no descriptive words, which mencement of the plaintiff's action; nor any may serve to designate the particular species bill or note sold, endorsed, or assigned here intended. It may, however, be col*174 to *the plaintiff or defendant; shall lected, both from the reason of the thing, be allowed in any plea of offset, un- and from the former part of the statute, taken less it shall appear on trial, that notice of in connection with the proviso. They must such sale, endorsement or assignment was be bills and notes, on which the party pleadgiven by the party holding such bill, or note, ing can demand in his own name; on which to the opposite party, before the commence- the law, agreeably to principles already existment of the plaintiff's action, which in such ing, would establish in him a right of action, case shall be taken to be the day of serving against the other party, in virtue of the enthe original writ in the action." dorsement. Such are those bills and notes only, which are called negotiable. This includes all bills and notes, which are made payable, to any person or order. Accounts. A sum due on account, and acknowledged under the hands of the parties, or the hand of the party, against whom the demand exists, is on a footing with other contracts; but where the account is still open, a different mode of trial is allowed, and the parties are, for certain purposes, admitted to their oaths. It would therefore create much confusion to allow such accounts to be plead *175 *in offset in actions, which have a different mode of trial, and a different mode of proof. *The proviso gives nothing; but limits an *178 It is obvious to observe, that the proviso supposed already to exist. It limits the gen gives no right; but that it limits a right, It is there said, that if the plaintiff in any erality of the impression in the first clause. action, &c. be indebted to the defendant in such action, the defendant, after pleading, &c. may plead an offset of any sum or sums due to him in like manner, that is, on bond, bill, note, or other contract. This clause gives the parties a different mode of effectuating their demands, but gives them no new personal right in any contract. The parties are not to plead in offset debts due to others. The parties are not authorized to plead in offset a debt due to others, but debts severally due to themselves. Every other bill or note, whatever assignments or endorsements may have been made, or powers of the *most ample kind given, to the payee, *179 the assignee, or indorsee, remains, in consideration of law, as between the parties originally contracting, the debt, contract and demand of the indorser, to whom the bill or note was first and alone made payable. Negotiable bills and notes must have been |