port of their claim that they had acted in good faith, being ignorant of the incapacity of the city. But if they could not be permitted to make such a plea for themselves in a suit of their own, upon what principle can the defendant be permitted to make it for their advantage in a suit to which they are not parties? We think it is very clear that he can not be permitted to do it.

Of course we regret the predicament in which the furnishers of the entertainment will find themselves in consequence of this decision. We trust, however, that their fellow-citizens will not leave them without assistance.

We direct that the injunction be made perpetual.

ACCOUNT- STATUTE OF LIMITATIONS IN EQUITY-CONSTRUCTIVE TRUST.

MCKEOWN v. GUILD.

Supreme Court of Illinois.

[Filed at Ottawa, June 21, 1879.[

1. ON A BILL IN EQUITY for an accounting by an administrator of one partner against another, the statute of limitations is a bar, as in a court of law, and the mere fact that the funds in the hands of the latter may be considered a trust, and that, too, a constructive trust only, does not operate to remove the bar of the statute.

2. IN ORDER TO TAKE A CASE out of the statute of limitations, it is not sufficient that the debtor admits the account to be correct but he must go further and admit that the debt is still due and has never been paid.

SHELDON, J., delivered the opinion of the court: This was a bill for an accounting filed by Alexander Guild, Jr., as administrator of the estate of Henry L. Curran, deceased, against Thomas Quayle and James McKeown, as joint owners and partners with Curran in the ownership and navigation of the brig Robert Burns.

The master in chancery to whom there had been a reference of the cause to take and state an account made his report stating a balance against the defendants of $2,200 59. Exceptions filed by both parties to the report were overruled and a decree for this balance was rendered against the defendants, from which they appealed to this court.

It appears that on March 25, 1867 the appellants and Curran purchased the brig, the former taking a three-fourths and the latter a one-fourth interest in the vessel. The brig was employed in the wood and lumber trade on the lakes for the seasons of 1867 and 1868 and until the 16th of Nov. 1869 when she was lost with all on board including Curran, who was then sailing her as captain. On May 13, 1870, the appellee was appointed administrator of the estate of Curran. The appellants, who had acted for the brig on shore, collecting the freight and paying the expenses, desired the appellee to state the account between them and the estate. This he declined, but recommended to them as a proper person to do it. Mr. Kohlsaat, of the firm

of Smith & Kohlsaat. In accordance with this suggestion appellants carried their books of account and certain vouchers relating to the vessel, to the office of Smith & Kohlsaat, who prepared an account and a surviving partner's inventory, presenting the former in the latter part of May or first part of June, 1870. to the appellee, who said it was all wrong, and filing the inventory in the county court during said month of June. A ballance of about $800 in favor of the estate was found by Kohlsaat. On May 25, 1870, appellant paid to appellee $800, which the latter receipted for as being to apply on money in appellant's hands, received from insurance of the brig Robert Burns, and belonging to the heirs at law of Henry L. Curran, deceased.

A suit for damages to the Robert Burns from a collision with another vessel was then pending, in which judgment was afterward rendered in favor of the Burns for $475 50. one fourth of which, $118 12 deceased's share, was paid to appellant September 6, 1870, and his receipt taken.

In November, 1872, appellee brought an action at law against appellants in the circuit court of Cook county, which involved the same subjectmatter as this suit wherein a judgment against appellee by non-suit was entered July 2, 1874. The bill in this case was filed June 4th, 1875.

The statute of limitations is set up as a bar to this suit, it being that "actions on unwritten contracts expressed or implied *** and all civil actions not otherwise provided for, shall be commenced within five years next after the cause of action accrued." Rev. Stat. 1874 p. 675 § 15. Our statute in regard to the action of account provides that such action may be sustained by one joint tenant, tenants in common or copartners, against the other or others, by one or more co-partner or co-partners against the other co-partner or copartners to settle and adjust their co-partnership accounts, and dealings on book accounts, by and against executors and administrators in all cases in which the same might have been maintained by and against their testator or intestate. Rev. Stat. 184 p. 100. No time of limitation of such action specifically is provided, thence leaving the five years limitation above named for actions not otherwise provided for, applicable.

Story, speaking of bills for an account remarks: "In cases of this sort, where the demand is strictly of a legal nature or might be cognizable at law, courts of equity govern themselves by the same limitations as to entertaining such suits, as are prescribed by the statute of limitation in regard to suits in courts of common law in matters of account. If therefore the ordinary limitation of such suits at law be six years, courts of equity will follow the same period of limitation. In doing so they do not act, in cases of this sort (that is, in matters of concurrent jurisdiction) so much upon the ground of analogy to the statute of limitations, as positively in obedience to such statute." 1 Eq. Jur. § 529 and see Hancock v. Harper 86 Ill. 446. Tharp v. Tharp 15 Vt. 105.

The entire account here involved had accrued previously to May 25. 1870. No transaction on

the general account has since occured. The present suit was instituted more than five years afterwards. So far as we can see the bar of this statute of limitations set up must be held to be a good defense. The same subject matter of the demand here might have been made the subject of an action at law to wit: an action of account, and where there is a legal and an equitable remedy in respect to the same subject matter, the latter is under the control of the same statute bar with the former. Kane v. Bloodgood, 7 Johns. Ch. 117.

There are but two answers made by appellee against the allowance of the bar of the statute.

1. That as surviving partners in possession of the partnership assets the appellants occupied the position of trustees, citing King v. Hamilton 16 Ill. 190; and Nelson v. Hayner, 66 Ill. 487; and that the statute of limitations does not apply in cases of trust.

In Albretch v. Wolf, 58 Ill. 186, this court held the following language: "In Farman v. Brooks, 9 Pick. 213, it was held that the statute of limitation does not apply to direct trusts created by deed or will, and perhaps not to those created by appointment of law, such as executorships and administrations, but constructive trusts resulting from partnerships, agencies and the like are subject to the statute. The doctrine of that case is supported by good authority. Walker v. Walker, 16 Sergt. & Rawle, 379. Kane v. Bloodgood, 7 Johns. Ch. 98. Merwin v. Titsworth, 18 B. Mon. 582." Wilhelm v. Caylor, 32 Md. 151, is an authority to the point, that the rule with respect to the bar of the statute of limitations is equally applicable in the case of a bill for an account by one partner against another, as in other cases of a bill for an account. See Weisman v. Smith, 6 Jones Eq.. 124.

The trust here claimed we regard as but a constructive trust and so subject to the statute of limitations, and even were it a case of proper trust, which would be within the application of the statute, we would be inclined to consider that the accounting with the appellee and the payment made to him on May 25, 1870, was an abandonment by appellants of their fiduciary character; that their relationship thereby became adverse and that the statute from that time would begin to run. Albretch v. Wolf, Hancock v. Harper, supra, Ang. on Lim. §174. The account made out and presented by appellants or their attorney to appellee, although not assented to by the latter, purported to be a full statement of the account between appellants and Curran, showing a balance of about $800 to be due the estate of the latter, to be a statement of the whole amount due from appellants and was equivalant to an open denial that anything more was due. The payment by appellants to appellee of $800, May 25, 1870, though not so stated in the receipt, is reasonably to be taken as having been made by appellants on their part as and for the balance due from them as found by the account rendered. This would seem to amount to an open denial or repudiation of the trust which required appellee to act as upon an asserted adverse right.

2. It is next claimed that even if the statute does

apply here, the payment made by appellants of $118.12 on the 6th of September, 1870, takes the case out of the statute. We do not see that this was such a payment within the five years as would draw the general account after it, because the general account since May 25, 1870, was no longer admitted by appellants to be an open and current account, but they had rendered an account stating the balance due which they had paid and which was in the full adjustment of it, as may be supposed to have been claimed by them. The collision suit for damages to the Robert Burns was pending at the time of the payment made May 25, 1870, judgment in which was afterward rendered in favor of the Burns, and this payment of $118 12 was the one-fourth part of that judgment. The payment was not in the general account, but was specifically appropriated by both parties to the claim growing out of the collision suit, and it is not perceived how this can be construed into an admission of anything with respect to the general account, much less as a promise to pay. In order to take a case out of the statute of limitation there must be a promise to pay the debt. It is not sufficient that the debtor admitted the account to be correct etc., but he must have gone further and admitted that the debt was still due and had never been paid. Ayers v. Richards, 12 Ill.

146; Wachter

v. Albee 80 Ill 47. Holding the plea to be a bar to the suit, the decree will be reversed and the cause remanded for further proceedings in conformity to this opinion.

Decree reversed.

APPLICATION BY BANK OF DEPOSITOR'S ACCOUNT TO PAYMENT OF HIS NOTESRIGHTS OF SURETY.

NATIONAL MAHAIWE BANK v. PECK.

Supreme Judicial Court of Massachusetts, September Term, 1878.

A promissory note, upon which the defendant was surety, was given by a depositor who kept an ordinary account with the plaintiff bank, and who was treasurer of the town of E, to the plaintiff, and plaintiff gave said depositor for said note a draft to be used for the payment of a tax due from the town. Said note, and the proceeds of it, were not made a part of said depositor's account with the bank, and the bank regarded said note as an official or town matter. When said note fell due, there stood to the credit of said depositor, as his balance account, a sum less than the amount of said note. At and ever since the maturity of said note, the plaintiff held another note for a larger amount, made by said depositor, and upon the maturity of the latter note, the president of the bank instructed the cashier to apply said balance upon the latter note. Thereafter the defendant brought to the bank a check of said depositor, made after the maturity of said last-mentioned note, and a sum of money, and tendered the same in payment of said first-mentioned note, but the cashier declined to

receive the same, because he had been directed to apply said balance on said other note. In a suit against said surety on said first-mentioned note: Held, that he was not entitled to have said balance of account applied to the satisfaction of the note in suit.

This case was tried without a jury. The court found the facts to be as follows: The action is brought against the defendant as indorser of a promissory note for $500, made by Joseph A. Benjamin, and all things necessary to hold defendant as indorser were done at the maturity of the note on February 15. 1876. On said February 15, and ever since, said bank held a note, which it had discounted, made by the said Joseph A. Benjamin, a copy of which is as follows: $1,500.

So. Egremont, Nov. 13, 1875. Three months after date I promise to pay to the order of E. Elmore Callender fifteen hundred dollars at the National Mahaiwe Bank, Gt. Barrington, value received. Jos. A. BENJAMIN. And indorsed in blank by said Callender.

The said Benjamin kept an ordinary account with plaintiff bank. At the time of giving the note in suit, Benjamin was treasurer of the town of Egremont, and plaintiff gave Benjamin for the note a draft to be used for the payment of a tax due from the town. The note and the proceeds of it were not made a part of Benjamin's account with the bank, and the bank regarded the note as an official or town matter.

When the note in suit fell due on February 15, 1876, there stood to the credit of said Benjaman as his balance of account the sum of $381.10, and the same continued to remain so standing on the books of the bank until about six weeks before the trial.

On February 16, 1876, the day of the maturity of the $1,500 note. Mr. Dodge, the president of the bank and its principal financial manager, during business hours told the cashier if the $381.10 standing to Beniamin's credit was not checked out by him before the close of business hours, to apply it on the $1,500 note before mentioned. At the close of the bank for that day it was found that Benjamin had drawn no checks on said balance, and he then again directed the cashier to apply it on the said $1,500 note.

On February 19, 1876, the defendant brought to the bank a check of Benjamin's made and handed to defendant on that day, but bearing date February 15, 1876, a copy of which is as follows:

South Egremont, Mass., Feb. 15, 1876. National Mahaive Bank pay to the order of J. A. B., Treas., note 15 inst., three hundred and eighty-one dollars, $381.

JOSEPH A. BENJAMIN.

Defendant also had at the same time one hundred and twenty dollars in money which had been furnished him by said Benjamin at the same time with the check, and defendant acting at Benjamin's request on said February 19, during business hours tendered to the cashier of the bank said check and $120 in money in payment of the note in suit, and demanded the note. The cashier declined to receive the check and money, and told defendant he could not accept the check because

he had been directed to apply the balance o Benjamin's account on another claim held by the bank, meaning the $1,500 note. After this refusal the cashier did, at defendant's request, receive the $120 and indorse the same on the note in suit, it being at the same time understood that neither party intended thereby to waive his rights in reference to the check.

The $120 have been retained by the bank. About six weeks ago the $381.10 were îndorsed on the $1,500 note as of February 16, 1876. It is not the practice of the bank to charge over due notes held by it to the account of a depositor until he has sufficient credits to pay the note. It did not appear that defendant informed the cashier or plaintiff bank on February 19 aforesaid, that the $120 was Benjamin's money. The said Benjamin became a bankrupt in the spring of 1876, and died in July or August of that year. The amount which the plaintiff is entitled to recover, if at all, is $435.10, if judgment were rendered at the present term.

The court ruled and found for the defendant, and reported the questions raised for the determination of the Supreme Judicial Court. If said ruling is correct, judgment is to be entered for the defendant; but if the plaintiff is entitled to recover, judgment is to be entered for the plaintiff for said sum of $380 and interest from February 16, 1876, to time of judgment.

M. Wilcox for defendant. J. Dewey for plaintiff. GRAY, C. J., delivered the opinion of the court; Money deposited in a bank does not remain the property of the depositor, upon which the bank has a lien; but it becomes the absolute property of the bank and the bank is merly a debtor to the depositor in an equal amount. Foley v. Hill, 1 Phillips 399, 2 H. L. Cas. 28; Bank of Republic v. Millard, 10 Wall. 152; Carr v. Nat. Security Bank, 107 Mass. 45. So long as the balance of account to the credit of the depositor exceeds the amount of any debts due and payable by him to the bank, the bank is bound to honor his checks, and liable to an action by him if it does not. When he owes to the bank independent debts, already due and payable, the bank has the right to apply the balance of his general account to the satisfaction of any such debts. But if the bank, instead of so applying the balance, sees fit to allow him to draw it out, neither the depositor nor any other person can afterward insist that it should have been so applied. The bank, being the absolute owner of the money deposited, and being a mere debtor to the depositor for his balance of account, holds no property in which the depositor has any title or right, which a security on an independent debt from him to the bank can avail himself by way of subrogation, as in Baker v. Briggs, 8 Pick. 182, and American Bank v. Baker, 4 Met. 164, cited for the defendent; that the right of the bank to apply the balance of account to the satisfaction of such a debt is rather in the nature of a set-off, or of an application of payments, neither of which, in the absence of express agreement, or appropriation, will be required by the law to be so made as to benefit the surety. Glazier v. Douglas, 32 Conn.

39 Field v. Holland, 6 Cranch, 828; Brewer v. Knapp, 1 Pick. 333; Upham v. Lefevre, 11 Met. 174: Bank of Bengal v. Radakissen Mitter, 4 Moorc P. C. 140, 162.

It is accordingly well settled that when moneys drawn out and moneys paid in, or other debts and credits, are entered, by the consent of both parties, in the general banking account of a depositor, a balance may be considered as struck at the date of each payment or entry on either side of the account; and when by express agreement or by a course of dealing between the depositor and the banker, a note or bond of the depositor is not included in the general account, any balance due from the banker to the depositor is not to be applied in satisfaction of such note or bond, even for the benefit of a surety thereon, except at the election of the banker. Clayton's Case, 3 Merid. 572, 610; Bodenham v. Purchas, 2 B. & Ald. 39, 45; Simpson v. Ingraham, 2 B. & C. 65; s. c. 3 D. & R. 249; Pemberton v, Oakes, 4 Russ. 154, 168; Pease v. Hirst, 10 B. & C. 122; s. C., 5 Man. v. Ryl. 88; Heumker v. Wigg, Dar. & Min. 160, 171; s. C., 4 Q. B. 792, 795; Strong v. Foster, 17 C. B. 201; Martin v. Mechanics Bank, 6. Har. & Johns. 235, 244; State v. Armstrong, 4 Dev. 519; Commercial Bank v. Hughes, 17 Wend. 94; Allen v. Culver, 3 Denio, 284, 291 Newburg Bank v. Smith, 66 N. Y. 271; Voss v. German American Bank, 83 Ill. 599. In the decision in McDowell v. Bank of Wilmington and Brandywine, 1 Harring. (Del.) 369, and in the dicta in Dawson v. Real Estate Rank, 5 Ark. 283, 298, cited for the defendent, this distinction was overlooked or disregarded.

In many of the cases indeed, the money appears to have been deposited after the debt to the bank matured, so that the case was analogous to the ordinary one of a payment, which, not being appropriated by the debtor, might be appropriated by the creditor. But where the balance of account is in favor of the depositor when his debt to the bank becomes payable, it is a case of mutual debts and credits, which except in proceedings in bankruptcy or insolvency, neither the depositor nor his surety has the right to require to be set off against each other. Judge Lowell in allowing money on deposit to the credit of a bankrupt to be set off in bankruptcy against the aggregate debt due from him to the bank, said: "This deposit, though it operates as security and as payment, was not intended for either, but is made so by the bankruptcy of the debtor." In re North, 16 Bank. Reg. 420. See also Demman v. Boylston Bank, 5 Cush. 194; Strong v. Foster, 17 C. B. 217.

In Strong v. Foster a depositor gave to his bankers a promissory note with a surety, which was not entered in his general banking account; and it was held that the surety, when sued by the banker on the note, could not set up either as payment or equitable defence that shortly after it matured the balance of account was in favor of the depositor to a greater amount, and the plaintiff did not apply that balance in discharge of the note, or inform the defendant for three years that the note remained unpaid. But the reasoning of the court applies equally whether the balance in

favor of the depositor exists at the time when his debt becomes payable, or is created by subsequent deposits. Chief Justice Jervis said: "Here the note was never entered in the account at all; the rule as to adjusting balances, therefore, does not apply. It would be essentially altering the position of the parties to establish that, because a banker who holds a note of a third person for a customer, has a balance in his hands in the customer's favor at the maturity of the note, such third person is thereby discharged, if it turns out that the note was given by him as surety. There is no authority in equity for any such position, and none certainly in law." 17 C. B. 216, 217. And Mr. Justice Willes observed: "As to what was said on the part of the defendant that, if a set-off arises between the creditor and the principal debtor, the liability of the surety on the note is extinguished; that doctrine would lead to singular results. These securities are often given to increase credits of bankers to their customers, If the liability of the maker were to depend upon the state of the customer's account at any one moment, he might never undergo the liability contemplated at all. The security is given without any reference to the other side of the account. This is the first time, I believe, that it has ever been suggested that when a note given under circumstances like these falls due, and there is a balance in favor of the customer at the time, that balance must of necessity be applied to the discharge of the note. Where the security is passed into the account, of course, it follows the rule in Bodenham v. Purchas and that class of cases." 17 C. B. 224.

In the case at bar it appears that the consideration received by Benjamin from the plaintiff bank for the note in suit was to be used by him in his official capacity as town treasurer, and that the note was regarded by the bank as an official or town matter; and neither the note nor its consideration was ever made part of his general banking account; and that when the check in favor of the defendant was drawn by Benjamin and presented. at the bank, the bank held the personal note of Benjamin, exceeding in amount the balance of account in his favor at the time. Under these circumstances neither Benjamin, the maker, nor the defendant, the indorser, has the right to insist that this balance of account should be applied to the satisfaction of the note in suit, rather than of the other note of Benjamin, and according to the terms of the report, there must be judgment for the plaintiff.

A provision in a building contract that the con-tractor should not, without the written consent of the owner, assign any of the moneys payable thereunder, under penalty of forfeiture, etc., is for the benefit and protection of the owner alone, against the dereliction or insolvency of the contractor, and if an instalment of the moneys not yet due be assigned to materialmen, and notice thereof given to the owner without his exception, subsequent creditors of the contractor can derive no advantage therefrom.-Burnett v. Jersey City. New Jersey Court of Chancery.

1. THE CORPORATION KNOWN AS THE LAWRENCE BRIDGE COMPANY, organized under an act of the territory of Kansas, approved February 9th, 1858, and the acts amendatory thereto, with the exclusive right and privilege of building and maintaining a bridge across the Kansas river at the city of Lawrence, was dissolved in twenty-one years from said February 9th, 1858, by expiration of the time limited for its continuance by the special statute under which it was created.

2. THE PROVISIONS OF SECTION 25, chapter 23, General Statutes, are invalid and void, so far as they attempt to authorize corporations organized under special acts of the territory of Kansas, to continue in the enjoyment and exercise of the powers, privileges and franchises, conferred on them by their special acts of incorporation, without any limitation as to time, as in conflict with section 1 of article 12 of the State Constitution.

3. IN 1863 THE LAWRENCE BRIDGE COMPANY constructed a bridge over the Kansas river at the city of Lawrence, for the convenience of the public, in the hope of profit to be derived from tolls as authorized by its special charter. Since 1863, the bridge has been used as a thoroughfare uninterruptedly and without molestation, except tolls have been demanded and taken from all persons crossing the bridge. The corporation had no property in the approaches to the bridge, nor in any of the lands on which it was built. The bridge is an immovable structure and an extension of the highway over the Kansas river. Held, that the bridge is a public highway. When the corporation expired by limitation, its franchise or license to demand or take tolls also expired, and the free use of said common highway is in the public.

Original proceedings in quo warranto; J. W. Greene and J. P. Usher for the State; Clough & Wheat and G. J. Barker for defendants.

HORTON, C. J. delivered the opinion of the court:

This is an action in the nature of quo warranto, brought originally in this court by the State of Kansas ex rel. James W. Green, county attorney of Douglass county, as plaintiff, charging C. W. Babcock, and his associates, with wrongfully assuming to exercise corporate rights as the Lawrence Bridge Company, and with claiming and using, without any lawful warrant, grant, or charter, the liberties, privileges and franchises of having and maintaining a bridge over and across the Kansas River, at the City of Lawrence, and of asking, demanding and taking certain tolls and duties of and from persons crossing, passing over and using the bridge. The petition also alleges that the bridge is a highway across the river at Lawrence, and the only means accessible to the public of crossing the river for many miles on either side of the bridge.

The plaintiff asks that the defendants be enjoined perpetually from exercising corporate rights as the Lawrence Bridge Company; from demanding or receiving tolls; from obstructing or removing the bridge or highway and from all interference therewith. To the petition of plaintiff the defendants pleaded that by the act of the late governor and legislative assembly of the Territory of Kansas, entitled "An Act to Incorporate the Lawrence Bridge Company," approved February 9, 1858, the exclusive right and privilege of building and maintaining a bridge across the Kansas River at the City of Lawrence, was granted for the period of twenty-one years to defendant, C. W. Babcock and others, or their assigns and such other persons as might be associated with them for that purpose; that they and their associates, or a majority of them, were authorized to form a company to be known as the Lawrence Bridge Company, with a capital stock of $375,000, in shares of $100 each; that power was given by that act to prescribe by-laws for the regulation of the company, and receive and collect subscriptions to such capital stock, establish and collect tolls for crossing the bridge; that under said act and certain amendatory acts thereto, C. W. Babcock and his associates duly organized the Lawrence Bridge Company, and before Oct. 1, 1863, constructed and completed the bridge across the river at Lawrence, at the cost and expense of $75,000, and have ever since maintained and been in possession of it; that to continue and perpetuate the existence of the Lawrence Bridge Company, with all the privileges and franchises conferred on it by the provisions of the said act of incorporation of 1858 and acts amendatory thereto, the corporation, on February 8th, 1879, by a vote of its board of directers accepted all the provisions of the act of the legislature of the State entitled "An Act Concerning Private Corporations." approved February 29, 1868, and all acts of the legislature of the State amendatory to that act, applicable to the exclusive right and privilege of building or maintaining a toll bridge across the Kansas River at Lawrence and the collection of tolls, but said corporation did not abandon by such acceptance any privilege or franchise conferred in its acts of incorporation, consistent with the provisions of the general incorporation act of 1868, and that, therefore, by virtue of section 25, of said general incorporation act of February 29th 1868, Gen. Stat. 196-7, and by the filing of the certificate of acceptance, the bridge company from February 8th, 1879, has had the exclusive right to carry out its objects, as described in the special acts of its incorporation, without any limitation as to time, and is still the owner of the bridge, with all its original franchises and privileges, including the franchise of being a corporation and the taking of tolls. Some other matters are stated in the answer, but it is unnecessary to refer more fully to it.

The twenty-one years given by the special act of February 9th, 1858, incorporating the Lawrence Bridge Company, within which it had the right to build and maintain a bridge across the Kansas