prove. no security. such payment against a debt due from him to the 24. Who may bankrupt at the time of his bankruptcy'. But this is a case of mutual credit under the statute 5 Geo. 2. c. 30. which will be afterwards more fully considered. Thirdly, Where a person has become a party to an 3. Where there is accommodation bill, or note, though there is neither cross paper, nor a security in his hands to indemnify him, yet, if he has paid the bill before the act bankruptcy of his principal, it is proveable under the commission; but if he has paid such bill or note, after the act of bankruptcy of his principal, he cannot, in general, prove under a commission, unless he can avail himself of the provisions in the statute 49 Geo. S. c. 121. s. 8. This is perfectly clear in the case of an accommodation acceptor, or maker of a note, who being the parties primarily liable, can have no remedy upon them. Thus where a person accepted a bill to accommodate the drawer, upon a parol promise by the latter to find money to take it up when due, and to save the acceptor harmless, but who did not take it up when it became due, and soon after was a bankrupt, and the acceptor, after the bankruptcy of the drawer, was sued upon the bill and taken in execution for the debt and costs, it was held that no debt accrued to him from the drawer, till he paid the debt and costs, or (which was the same thing as actual payment) till he rendered his body in satisfaction thereof, and this not being till after the bankruptcy could not be proved under the commission against the drawer 3. And it makes no difference if, instead of a parol promise, the surety takes a promise in writing from the drawer that he will take up the bill when due. The Ex parte Boyle, Cooke, 561.-Smith v. Hodson, 4 T. R. 211.Atkinson v. Elliot, 7 T. R. 378. 2 Cullen, 129.-1 Mont. 131. 153.-13 East. 427. 3 Chilton v. Wiffin, 3 Wilson, 13.-Young v. Hockley, Bla. Rep, 839. 3 Wilson, 346.-1 Mont. 154.-Cooke, 203, 4, 5.-2 Rose, 47. + Vanderheyden v. De Paiba, 3 Wils. 528.-Ileskingson v. Woodbridge, Dougl, 166.—Cooke, 203, 4, 5. Cullen, 131.-Ante, 569. 2d. Who may prove. no security. right of an indorser of a bill or note, who has become 2 3. Where there is SO merely for the accommodation of another, and has paid the bill after the bankruptcy, seems not to be perfectly settled'. It was held in the case of Brooks r. Rogers that, if the payee of a bill of exchange, not being a creditor of the drawer, indorse and get it discounted merely for the purpose of raising money for him, and hand the money to him, and is afterwards obliged to pay it to the indorsee, but not till after the drawer becomes a bankrupt, he cannot prove it under the drawer's commission; because no debt accrued to him from the drawer till the money was actually paid, which was not till after the bankruptcy. In the case of Howis v. Wiggins, 4 T. R. 714. where a party became payee, and indorser of a promissory note for the accommodation of the maker, who delivered it to a third person with the payee's indorsement, and afterwards became bankrupt, it was held that the payee and indorser, paying it after the bankruptcy, was not entitled to prove his debt accruing only upon payment of the note. In the case of Howle v. Baxter, 3 East. ''The leading cases upon this point are Brooks v. Rogers, 1 Hen. Bla. 640.-Howis v. Wiggins, 4 T. R. 714, and Howle v. Baxter, 3 East. 177.-3 Bos. & Pul. 395. 2 1 Hen. Bla. 640.—In 1 Mont. 154. n. d, there is a question whe ther this case is law, and Cowley v. Dunlop, 7 T. R. 565, and Buckler . Buttivant, 3 East. 72. are referred to; and it is suggested that the whole question is, whether the payee and drawer stood in the situation of principal and surety. In Cowley v. Dunlop, Lawrence, Justice, speaking of the case of Brooks v. Rogers, says, "I argued that case as being the case of principal and surety, and considered Brooks as lending his name to Rogers to get money on the draft of Rogers, of the Olney bank, and that, in substance, it was an advance of money to Rogers on the credit of Brooks's name as surety to the bank; but I doubt if that argument is not fallacious; for on Brooks carrying the bill to the bank, the bank lent him the amount of it on the security of the bill, on which Brooks was entitled to recover when returned to him for non-payment." 3 Mr. Montague, in Vol. 1. 155. n. e. observes on this decision "that it is a stronger case of principal and surety than the case of Brooks. Rogers, 1 Hen. Bla. 640. above mentioned, because in Howis v. Wiggins, no money consideration passed between the payee and maker before the bankruptcy of the latter." And see the argument in Howle v. Baxter, 3 East. 177.-In Cowley v. Dunlop, 7 T. R. 565. Grose, J. says, the case of Howis v. Wiggins came on before this court on a motion for a new trial; and possibly under a misap 66 prove. 177. the bill had been accepted by the bankrupt for 2. Who may the accommodation of the drawer, and the plaintiff, at the request of the drawer, indorsed the bill, merely to give it additional credit, after which the drawer got it discounted, and the acceptor became bankrupt, and the plaintiff was afterwards obliged to pay the account to a bona fide holder, after which the defendant obtained his certificate, and the court said that the plaintiff contracted no liability at the defendant's request, and that he never became surety for him in this transaction, and that the plaintiff's demand against the defendant, the acceptor, arose solely upon the bill, and that there was nothing to prevent his proving it under the commission, and consequently that the bankrupt was discharged by his certificate. Where the party from being acceptor of the bill or maker of the note is primarily liable, and could not have any claim by virtue of the instrument itself upon any party to it, there seems sufficient grounds for his not being allowed to prove under the commission; because, independently of 7 Geo. 1. c. 31. no person can prove, unless he has a subsisting legal demand actually payable at the time of the act of bankruptcy, and there is no prehension of it. I considered it as a case of indemnity; and the ground on which the rule was refused was on the supposition that Vanderheyden and De Paiba was in point. I then considered how is the plaintiff, and payce of the two promissory notes, as having indorsed them as surety for the defendant, with a view to give credit to the notes, and without any consideration for his so doing. In any other way of considering that case, I think it is not to be supported." It was also observed by Lord Ellenborough, in Buckler v. Buttivant, 3 East. 82. "It is unnecessary to say any thing of the cases of Brooks v. Rogers, and Howis v. Wiggins, though I have a decided opinion on the subject: it is sufficient for the present to observe that the noble Lord by whom the former of those cases was determined, afterwards changed his opinion in the case Ex parte Seddon, and that the latter case has since been doubted in this court by some of the Judges in Cowley v. Dunlop." It is observable, however, that the case Ex parte Seddon, cited in 7 T. R. 570. is distinguishable from Brooks v. Rogers, and Howis v. Wiggins, for Seddon was not allowed to prove on his own paper, but on the note given to him in exchange for it, which rendered that case an instance of cross paper, or counter security, which (it has never been disputed) may be proved. Paislowe v. Dearlove, 4 East. 438.-Hoskins v. Duperoy, 9 East. 21. Who may prove. no security. ground for permitting him to prove under this statute, 3. Where there is because he being the person primarily liable to pay such bill or note cannot be considered as a person giv ing credit on such securities within the meaning of that statute. But a person who has indorsed a bill at the request of another may fairly be considered as giv ing credit within the meaning of the statute, which enables" any person who shall give credit upon such "securities to any person or persons who shall become "bankrupts upon a good and valuable consideration "for any sum or sums of money, or other matter or thing whatsoever, which shall not be due at the "time of the bankruptcy," to prove such bill or note. The question is whether such an accommodation indorser can be considered as a person giving credit on such securities for "money or other matter, or thing," within the meaning of the statute. Now we have seen that in the case of cross bills, the acceptance on one side is deemed a sufficient consideration for the acceptance on the other, to enable a party, liable to pay his own acceptance, to prove the acceptance of the other party under the commission of those who have become bankrupt, and that where there has not been an exchange of bills, yet if a bill or note, payable at all events, has been given by way of indemnity it may be proved; and we have seen that when a bill has been taken up by an indorser for valuable consideration, although after the act of bankruptcy, he may prove under the commission'. If the acceptance of a cross bill, or the holding of a bill or note, by way of indemnity, is to be deemed a sufficient consideration to enable the party to prove the bill or note in his possession, it must be on the ground that his liability on that paper, which he himself is bound to take up, is a good and valuable consideration for "other matter or "thing" besides money, within the meaning of the Ante, 565, &c. 2 Ante, 568, 9, &c. 3 Ante, 571. statute 7 Geo. 1. c. 31. The decision in Howle v. 2. Who may Baxter, 3 East. 177. is only sustainable upon this ground, for in that case the plaintiff had neither advanced money or credit in the way of trade before the bankruptcy, and was merely an accommodation party, who had afterwards paid the bill. It is true that the words in the preamble of the 7 Geo. 1. c. 31. afford only a presumption of an intention in the legislature to assist those merchants and traders who were obliged to sell their goods on trust or credit, and take bills and notes in payment for them. But the preamble cannot controul the express enacting words, "for money, or for other matter, or thing whatsoever.” There appears to be no substantial difference in this respect between a transaction where in consideration of a party's indorsing a bill, he receives another bill or note by way of indemnity, which it is admitted he may prove, and a transaction, in which a drawer or indorser hands over a bill or note in his possession to the same party and obtains his indorsement by way of giving credit to the instrument, without giving such cross security. In the latter case, according to the decision in Howle v. Baxter, 3 East. 177. the principle of which appears to over-rule the cases of Howis v. Wiggins, and Brooks v. Rogers, the transaction implies that in consideration of the accommodating party becoming so, the party accommodated gives to him all the beneficial interest which a bonâ fide indorsee can have, and when he has actually been obliged to pay the bill, though after the bankruptcy, he is entitled to 'In 1 Co. B. L. 188. it is observed that there is a legislative construction of this very act in 5 Geo. 2. c. 30. s. 22. which, without conceiving a doubt, takes it for granted that the statute is not merely contined to securities for goods sold and delivered in the course of trade, but that it extends generally to all personal securities for a caluable consideration, where the time of payment is certain, though postponed to a future day, and several cases are collected to prove this position. But it is observable that the section alluded to, only mentions securities for their money payable at a future day, by which they are enabled to prove their debts, and consequently the words of the statute are less general than are supposed. |