This section is from the book "The Law Of Contracts", by Theophilus Parsons. Also available from Amazon: The law of contracts.
It * must, however, be certain, that payment is made only as a part of a larger debt; for, in the absence of conclusive testimony, it will not be deemed an admission of any more debt than it pays. (h)1 and we should think the acknowledgment of liability as to the remainder of the debt, not at all altered by the fact of the notes, by which it was paid, turning out to be forged, or of the coin turning out to be counterfeit. In all these cases, the force of the acknowledgment is the same, and the payment is, we think, a sufficient payment within the words of the 9 Geo. IV. In Maillard v. the Duke of Argyle, 6 Man. & G. 40, the Court of Common Pleas distinctly held, that the word 'payment,' as applicable to a transaction of this kind, even when used in a plea, did not mean payment in satisfaction, hut might be treated as used in its popular sense; and Maule, J., in that case, says; ' that "payment" is not a technical word; it has been imported into law proceedings from the exchange, and not from law treatises.' When yon speak of paying by cash, that means in satisfaction; but when by bill, that does not import satisfaction unless the bill is ultimately taken up. In Belshaw v. Bush, the Lord Chief Justice of the Common Pleas, in speaking of a transaction of this nature, says: 'The real answer is, that upon this record you have been paid your debt;' and in the very report now before us, the learned Lord Chief Justice calls the present transaction a part payment. In mercantile transactions nothing is more usual than to stipulate for a payment by bills, where there is no intention of their being taken in absolute satisfaction. We are satisfied that a transaction of this nature is properly described by the word ' payment,' and that it is clearly within the class of acknowledgments intended to be unaffected by the statute; and we are satisfied that there is no reason whatever to restrict the expression in the statute to that species of payment which imports a final satisfaction. The defendant's case, which rested entirely on the proviso in the 9 Geo. IV., being so restricted, therefore fails in its foundation, and we think that where a bill of exchange has been so delivered in payment, on account of the debt, as to raise an implication of a promise to pay the balance, the statute of limitations is answered, as from the time of such delivery, whatever afterwards takes place as to the bill"
(h) Tippets v. Heane, 1 Cromp. M. & R. 252. This was an action of assumpsit, for meat, lodging, etc., furnished by the plaintiff for the defendant's son. The defendant pleaded the general issue. At the trial, before Vaughan, B., the plaintiff, to take the case out of the statute, proved by one A. B. that he had paid £10 to the plaintiff, by the direction of the defend-ant, in the year 1829; but he could not speak to the account on which it was paid, or give any evidence beyond the mere fact of having paid the money by the defendant's direction. The learned Baron left it to the jury to say, whether the £10 was paid on account of the debt in question; and observed to them that no other account was proved to have existed between the parties. The jury having found a verdict for the plaintiff, the Court of Exchequer granted a new trial, on the ground that there was no sufficient evidence of part payment to go to the jury. And Parke, B., said: "in order to take a case out of the statute of limitations, by a part payment, it must appear, in the first place* that the payment was made on account of a debt. That was left in ambiguity in the present case. Secondly, it must appear that the payment was made on account of the debt for which the action is brought. Here, the evidence does not show any particular account, to which the payment was applicable. The jury seem to have considered it as a payment of part of the debt in question; and, perhaps, as there was no other account found to have been in existence between the parties, they might be warranted in so doing. But the case must go further; for it is necessary, in the third place, to show that the payment was made as part payment of a greater debt, because the principle upon which a part payment takes a case out of the statute is, that it admits a greater debt to be due at the time of the part
1 See Vaughn v. Hankinson, 6 Vroom, 79. Thus, a payment of a part of a debt, accompanied by acts or declarations showing that the debtor does not intend to pay mora, as when the payment was made in full discharge of the debt, will not revive the unpaid balance of the debt if it is barred, nor arrest the running of the statute if it is not barred. Hale v Morse, 49 Conn 481. - K.
Indorsements of payments on promissory notes in the hand-writing of the payee do not take the note out of the statute, without evidence that the indorsements were made with the knowledge of the payer. (hh)
* If a debtor owes his creditor several debts, some of .which are barred by the statute of limitations, and some are not, and pays a sum without appropriating it to any particular debt, although the creditor can appropriate the sum so paid to the debts that are barred, he cannot thereby take them out of the operation of the statute. (i) And it seems, that if there are two clear and undisputed debts, both of which are barred by the statute, and money is paid, but not appropriated to either debt by the debtor, the creditor cannot appropriate the payment, and thereby take the debt to which he applies it out of the statute. (j) But if one of the debts is admitted, the jury may apply the payment to that debt, rather than to those which are disputed. (k) If, however, money be paid, and there is with it an ackowledg-ment of further debt, and the debtor owes but one debt to the creditor, the payment will be applied to that debt, without words of appropriation by the debtor, and will have the effect of part payment. (I) But if payment be made, and with it words of denial or refusal as to the debt, or the residue of it, are used, this does not take the debt out of the statute.(m) *If the debt consists of principal and interest, a payment on account of either will take the whole residue of both out of the statute. (n)1 If there be mutual accounts, and a balance be payment Unless it amounts to an admission that more is due, it cannot operate as an admission of any still existing debt Unless, then, in the present case, it could be collected that the payment was in part of a greater debt, the statute was a bar, and there being no evidence from which a jury were warranted in coming to such a conclusion, the present rule must be made absolute." And see to the same effect, Linsell v. Bonsor, 2 Bing. N. C. 241; Waters v. Tompkins, 2 Crom p. M. & R. 726; Wangh v. Cope, 6 M. 4 W. 824; Wainman v. Kynman, 1 Exch. 118; Davies v. Edwards, 7 id. 22; Smith v. Westmoreland, 12 Smedes & M. 663; M'Cullongh v. Henderson, 24 Miss. 92; Alston v. State Bank, 4 Eng. 455; State Bank v. Wooddy, 5 id. 638; Wood v. Wylds, 6 id. 754; Arnold v. Downing, 11 Barb. 554; Hodge v. Manley, 25 Vt 216; Pickett v. King, 34 Barb. 193.
 
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