1810, at Liverpool, in consideration that E. H. Wilson, 1812. FAIR against MIVER. 1812. FAIR against M'IVER. The value of the goods sought to be recovered in this action was 7081., and at the trial before Le Blanc, J. at Lancaster, the delivery of the goods by Wilson to the defendants to that amount, on the 29th of November 1810, was not disputed, nor the bankruptcy of Wilson on the 23d of January 1811, by his executing a deed of assignment of all his property; but the only question made was upon the defendants' right to set off a bill of exchange for 7001. (a), drawn by Rippon and Co. on the 12th of October 1810, and accepted by Wilson, payable to the order of the drawers at three months' date, which bill was accepted before the sale of the goods to the defendants, of which bill the defendants claimed to be the bonâ fide holders. The circumstances under which this bill came into the defendants' hands were disclosed in the written examinations of the defendant M'Iver, taken before the commissioners upon Wilson's bankruptcy, upon the 28th of August and 6th of November 1811, and which were read in evidence on the part of the plaintiffs. By these it appeared, in substance, that M'Iver, who with the other defendant carried on the business of ship-chandlers and rope-makers in Liverpool, in November 1810 directed his broker to apply to Wilson to purchase about 47 tons of iron at a price payable by a bill to be equal to cash at the end of three months from the delivery of the goods; that the iron was purchased accordingly, and delivered, with a bill of parcels, to M'Iver; of which bill of parcels contradictory accounts were given, whether it was or was not sent to Messrs. Perry and Firmiston; but the iron was deposited in the defendants' cellar in Liverpool. That soon after the delivery (a) The difference was paid into court. Wilson Wilson called at the defendants' counting-house for the payment according to the terms of the invoice, when M'Iver offered him in payment the bill in question, for 7007., accepted by Wilson himself; which he refused to take in payment of the iron; and M'Iver refused to pay for it in any other way. That the defendants had before that time received the bill from Perry and Firmiston, as he (M'Iver) believed, in the regular course of business. That when M'Iver made the purchase of the iron he had no knowledge of the insolvency of Wilson, but had previously heard that Wilson had not been regular in his payments, and intended at the time to pay for the iron by the bill in question; but did not inform either the broker or Wilson of such intention to pay Wilson by one of his own acceptances. In the last examination M'Iver also stated that he received the bill in question from Perry and Firmiston, (who were iron-masters in Staffordshire,) about the latter end of November 1810, though it was not entered in his cash-book till the 12th of January 1811, (for which no satisfactory reason was assigned ;) that this bill was passed to Perry and Firmiston on account of ropes sold to them: but M'Iver also admitted that at that time P. and F. were only indebted to the defendants in about 4007.; that the bill in question had been placed to their credit, and the surplus was to be settled for in account for ropes. That some time before the purchase of the iron was made, Firmiston informed him (M'Iver) that he was in doubt as to Wilson's affairs being in good order, and whether he was not embarrassed, and said that M'Iver had therefore better secure the bill of which he was in possession, if it could be done; and that the purchase of the iron in question from Wilson was agreed upon between him (M'Iver) and Firmiston as the mode 1812. FAIR against MIVER. 1812. FAIR against M⚫IVER. mode of securing the bill. Upon the subsequent production of the bill of parcels sent with the iron, there appeared to be written upon it, "payable bill drawn at three months." M'Iver further stated that after the iron had been deposited in his cellar, and when he found that he could not dispose of it advantageously, not being in the trade, it was taken out of his possession by an order from Perry and Firmiston; by whom it was afterwards sold, as he believed, on account of the defendants; but the defendants had received no account of the sales, and he Idid not know who was to bear or receive the loss or profit upon the re-sale: but he considered that Perry and Firmiston were bound in honour to make good any loss to the defendants, and he expected P. and F. to pay them the profit if any; but that there was no understanding between them upon the subject, whether the defendants were to bear any loss by the transaction. The learned Judge thought, at the trial, that this was a contrivance between the defendants and Perry and Firmiston to obtain iron in value for Wilson's acceptance, which the defendants knew had been before offered by P. and F. to Wilson for payment, and been refused by him; when, if P. and F. had applied in their own names for the iron, it would not have been sold to them and under this view of the case, which he left to the jury, they found a verdict for the plaintiffs. Topping in the last term moved to set it aside, and enter a nonsuit, on the ground that the defendants were entitled to set off, under the stat. 5 Geo. 2. c. 30. s. 28., the bankrupt's prior acceptance against the present demand by the assignees, as they might without question have done in case there had been no bankruptcy, and the action for the iron had been brought by Wilson. And And referred to the opinion of Buller, J. in Hankey v. Smith (a), as shewing that mutual credits exist between the holder and the acceptor of a bill. He admitted that the case might have been different, if the assignees had brought trover instead of assumpsit, in order to disaffirm the contract, on the ground of fraud in a creditor's endeavouring, by a contrivance of this sort, to get payment of his whole debt out of an insolvent estate; but this action affirms the contract: for which he referred to Smith v. Hodson (b). Park and Littledale now shewed cause against the rule; and distinguished this from Smith v. Hodson, where the assignees of a bankrupt meaning to set aside a fraudulent preference of a creditor by the bankrupt in the sale of goods, brought assumpsit, instead of trover, and thereby affirmed the contract, and let in a set-off; but here the sale of the goods by the bankrupt was good, and not meant to be disaffirmed, and therefore assumpsit was the proper form of action: but the question turns on the set-off being fraudulent, being not only against the terms of payment contracted for, but for the secret benefit of other parties, to whom the goods would not have been furnished by the then insolvent; and the whole transaction is in truth no other than a contrivance to bring home certain creditors of the bankrupt's estate at the expense of the rest of them. Here were no mutual credits. [Lord Ellenborough, C. J. observed that the terms of the bill bargained for excluded the idea of mutual credits.] (a) 3 Term Rep. 507. 509. in notis. (b) 4 Term Rep. 211, and vide 1 East, 375. Eland v. Karr. 1812. FAIR against M'IVER. Topping |