Cherry v Boultbee

JurisdictionEngland & Wales
Judgment Date01 January 1839
Date01 January 1839
CourtHigh Court of Chancery

English Reports Citation: 41 E.R. 171

HIGH COURT OF CHANCERY

Cherry
and
Boultbee

S. C. 2 Keen, 319; 2 Jur. (O. S.), 884; 9 L. J. Ch. (N. S.), 118; 3 Jur. (O. S.), 1116. Distinguished, Lee v. Egremont, 1852, 5 De G. & S. 368; Followed, In re Hodgson, 1878, 9 Ch. D. 673; In re Orpen, 1880, 16 Ch. D. 205. See Re. Rees, 1889, 60 L. T. 260; In re Akerman [1891], 3 Ch. 212. Distinguished, In re Watson [1896], 1 Ch. 932.

START ] ' ' - cheek v v. boultbee. June 19, Nov. 22, 1839. 4y'7- tyef : JS. C. 2 Keen, 319 ; 2 Jur. (0. S.), 884 ; 9 L. J. Ch. (N. S.), 118 ; 3 Jur. (0. S.), 1116. Distinguished, Lee v. Egremont, 1852, 5 De G. & S. 368 ; Followed, In re Ho/igson, 1878, 9 Ch. D. 673 ; In re Orpen, 1880, 16 Ch. D. 205. Hee lit. liens, 1889, 60 L. T. 260; In re Akerman [1891], 3 Ch. 212. Distinguished, In re liaison [1896], 1 Ch. 932.] - . ^ T. being indebted to his sister C. became a bankrupt: shortly afterwards^ C. made he&44 will, and thereby gave certain sums to her trustees and executors as pecuniary ais:^ provisions for the benefit of T. in a form apparently intended to exclude the clajfts/*/^ . : /-; of creditors. She never proved her debt against the bankrupt's estate and died ^^ before he obtained his certificate. On a bill by the assignee against the executors' f of C. for payment of the money bequeathed for the use of the bankrupt, the Lord/'/ 'A / -' :i 3\ Chancellor held, affirming the decree of the Master of the Rolls, that the fix&put were not entitled to set off the amount of the unproved debt against the dman the assignee. The facts of this case are very fully stated in the report of the cause upon the hearing at the Rolls (2 Keen, 319), and they are also shortly recapitulated in the Lord Chancellor's judgment. The Master of the Rolls having decided that the Defendants, the executors of Catherine Frances Boultbee, were not entitled to set off the legacies given by her will for the use of her brother Thomas Boultbee, an uncertificated bankrupt, against the debt due from him to her at the time of bankruptcy, an appeal was brought against that decision. the solicitor-general [Rolfe] and Mr. Coke, for the Plaintiff, in support of the decree. [443] In all cases where the principle of set-off has been applied in this Court, from Jeffs v. Wood (2 P. Wms. 128) downwards, with the single exception of Ex parte Man (Mont. & Mac. 210), which is of questionable authority, this material circumstance occurred, which at once entirely distinguishes them for the present - that, at the time of the bankruptcy, a clear case of set-off existed between the parties which the fact of the supervening bankruptcy was not permitted to alter or affect. Here 172 CHERRY V. BOULTBEE 4 MY. & CR. 4_ there was a debt due to Catherine from her brother Thomaa, but nothing was overdue to Thomas from her or her estate, and no dealing or circumstance took place in respect of which such a debt, either perfect or inchoate, could possibly arise. Catherine never proved her debt against the bankrupt's estate. Her object in giving the-legacies evidently was to secure a personal provision for her brother ; and if she had lived until after he obtained his certificate, that object would have been accomplished ; but she never could intend that the debt due from him was to be set oft' against th& benefits given him by her will; because that would in effect be to render the provision nugatory, and defeat the very end she had in view. It is impossible to maintain that if the bankrupt had obtained his certificate he must still have discharged the debt (which, in fact, the bankruptcy had barred) before claiming payment of the legacies; and until that time arrived the assignee, who-represents the bankrupt, with all his rights and liabilities, cannot stand in a less, favourable position. Observe the situation of the parties at the death of the testatrix : the right of the assignee to the legacies depended on the operation of the bargain and sale, which, at the time of its exe-[444]-cution, passed not only all the then present,, but all the after-acquired, personal estate of the bankrupt, including the legacies in question, which, however, came to him, unlike the property vesting at the bankruptcy,, unclogged and unaffected by any equities whatever. Mr. Wigram and Mr. Loftus Wigram, in support of the appeal. Every principle of natural justice is in favour of the Defendants' claim : the-proposition on the other side being that, whereas this legacy is to come out of the testatrix's estate, and a sum per contra is due to that estate from the estate of the l ankrupt, the assignee is to take the legacy in full and yet keep the property in his hands without any deduction on account of the debt. This never can be in accordance with the maxim, that he that will have equity must do equity. The question then is : first, whether the Defendants' claim is opposed to any rule or principle of law ; and, secondly, if it be not, whether there was anything in the intention of this testatrix, as evidenced by her will, which should lead to an opposite conclusion. Upon the first point it is perfectly settled that, if the testatrix had died before the bankruptcy, the doctrine of set-oft' would clearly have applied ; a doctrine not originating, as has been supposed, in the provisions of the Bankrupt Acts, which relate to the casa of mutual debts and credits, and were only intended to extend the jurisdiction at law, but introduced long before into this Court, in consonance with the principles of natural...

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