Set-off a processual right, and governed by lex fori, sec 1009. No set-off at common law, sec 1010. Set-off may be specially stipulated, sec

1011. By statute extended to mutual debts,.

Sec 1012

Equitable claims may be set off, sec

1013. Set-off does not extinguish debt, but only affects remedy, sec 1014. Use of on trial is optional, sec 1015. Practice as to counter-claims, 1016. Only actionable debts can be set off, sec .

1017. To set-off barred by statute of limitations, statute must be specially pleaded, sec 1018. Debts not due at date of suit cannot be set off, sec 1019. Debts must be due when offered at trial, sec 1020.

Debts must be between the same parties, sec 1021. Personal debts cannot be set off against representatives, sec 1022. Agent's debt cannot be set off against principal, sec 1023. Surety may avail himself of debts due his principal, sec 1024. After assignment, debt due assignee may be set off on suit by him, sec

1025. Distinctive rule as to insolvent and bankrupt assignees and receivers, sec .

1026. Principal's debt may be set off against agent. sec 1027. So as to partners, sec 1028. Unliquidated damages not admissible as set-off, though admissible as counter-claims, sec 1029. No set-off admissible in proceedings in rem, sec 1030.

Sec 1009

Set-off is a processual right, and is governed by the lex fori;1 and in England, a foreign statute of setoff, going merely to the remedy, will not be regarded as affecting a debt distinctively subject to that law.2 It is submitted, however, that when a foreign statute of set-oft' goes to extinguish a debt subject to it, it should have extra-territorial force. - As a matter of principle, as has already been seen, all equities that go to the substance of a debt are to be determined by the law of the creditor's domicil.1 - As far as concerns conflict as to terms of set-off, the law that rules is the lex fori at the time of suit.2 sec 1010. At common law there could be no set-oft", unless by special agreement, between parties mutually indebted. Mere mutuality of debts was formerly no ground for set-off, unless there were special circumstances connecting the debts, so that one appeared to have been incurred in consideration of the other.3 An agreement, however, for set-off, it has always been held, may be inferred from the contract between the parties.4 Thus where an employer does for himself, with the assent of the contractor, part of a work given out by the contract, the price of this work so done is to be deducted from the contract total price.5 It is understood, also, in the negotiations between a principal and an agent, the agent is entitled to set off his commissions against the money collected by him.6 Where, also, there is an understanding that an operative should do certain work and find the materials, and it is agreed subsequently that the employer is to find part of the materials, this sustains a set-oft* by the employer of the materials supplied.7 - In the old practice, courts of equity took a larger view than courts of law in requiring set-offs to be allowed to all demands in which they relate as forming part of a continuous mutual indebtedness.8 But ordinarily a court of equity will not interpose when there is an adequate remedy at law.9 Nor will it tolerate assignments made for the mere purpose of enabling a set-off to be interposed.10

Set-off is a processual right, and is governed by lex fori.

1 Greene V. Darling, 5 Mason, 201; Gibbs V. Howard, 2 N. H. 296; Carver V. Adams, 38 Vt. 500; Ruggles V. Keeler, 3 Johns. 263; Second Nat. Bk. V. Hemmingway, 31 Oh. St. 168; Davis V. Morton, 5 Bnsh, 161.

2 Meyer V. Dresser, 16 C. B. N. S.

646; see Macfarlane V. Norris, 2 B. & S. 783; Wh. Confl. of L. sec 788. That set-off when agreed to is equivalent to payment, see supra, sec 964. That set-off may be appropriated by agreement to debts excluded by statute, see supra, sec 965.

No set-off at common law.

1 Supra, sec 843.

2 Jordan V. Bank, 74 N. Y. 467.

3 2 Smith's L. C. 7th ed. 293 et seq.; Leake, 2d ed. sec 1001, citing Rawson V. Samuel, 1 Cr. & Ph. 161; Best V. Hill, L. R. 8 C. P. 10; see Raymond V. Green, 12 Neb. 215.

4 See infra, sec 1011.

5 Turner V. Diaper, 2 M. & G. 241.

6 Dale V. Sollet, 4 Burr. 2133. 7 Newton V. Forster, 12 M. & W. 772.

8 Story's Eq. Jur. 12th ed. sec 1434.

9 Middleton V. Pollock, L. R. 20 Eq. 33; Wolcott V. Jones, 4 Allen, 367.

10 London Bank V. Narraway, L. R. 15 Eq. 93.