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Consequently, whether an assignee can maintain an action in his own name, depends upon the lex fori, not the lex loci contractus. It is a matter not of right but of remedy.22 Statements, therefore, which are occasionally found to the effect that complete legal ownership passes to the assignee of a legal chose in action,23 must be regarded as exceptional and, if not clearly required by the terms of a particular statute in question, as opposed to the current of authority.
I am, however, more interested in what the law on the point ought to be than what the actual weight of authority may be; and, therefore, the most serious question is whether the decisions in the three classes of cases, of which I have spoken, are rightly decided.
As to the right of set-off, I think most persons will feel that it would be improper to allow one who had a claim subject to a setoff, to escape the set-off by selling his claim. The only way to prevent it is by subjecting the assignee to the set-off. Certainly I believe the general rule allowing the set-off to be used is a desirable one. In a system of law where the smaller of two mutual debts cancels the other pro tanto,24 it would not be necessary to deny the assignee legal ownership of the assigned claim in order logically to reach this result; but in the common law a cross-claim is not payment or part payment of the original claim,25 the right of set-off is rather in the nature of a cross-action. Certainly it seems impossible to say, that it is a legal limitation of the claim, and if it is only an equity, it would be cut off by the assignment if the assignee became the legal owner of the claim.
22 Joseph Dixon Crucible Co. v. Paul, 167 Fed. 784 (1900); Richardson v. New York Central R. Co., 98 Mass. 85, 92 (1867); American Lithograph Co. v. Ziegler, 216 Mass. 287, 103 N. E. 909 (1914); Tully v. Herrin, 44 Miss. 626 (1870); Lodge v. Phelps, 1 Johns. Cas. (N. Y.) 139 (1799); Northwestern Mut. Life Ins. Co. v. Adams, 155 Wis. 335, 144 N. W. 1108 (1914).
23 In Fitzroy v. Cave, (1905) 2 K. B. 364, 373, the Court said: “Henceforth in all Courts a debt must be regarded as a piece of property capable of legal assignment in the same sense as a bale of goods.” It is unfortunate that the idea expressed in Walker v. Bradford Old Bank, 12 Q. B. D. 511, 515 (1884), should not rather prevail, "section 25, sub-s. 6 of the Judicature Act, 1873, does not, in my view, give any new rights, but only affords a new mode of enforcing old rights.” See also Close v. Independent Gravel Co., 156 Mo. App. 411, 138 S. W. 81 (1911).
24 It was an axiom in the later Roman law that set-off took place ipso jure. The meaning of this was disputed; one school maintaining that without any act of the parties the set-off took place at the instant of the coexistence of the two debts; the other school holding that such cancellation took place only when asserted by one of the parties. DERNBURG, COMPENSATION, 2d ed., 283. The former view finds expression in the FRENCH CIVIL CODE, Art. 1290, and even under the latter view, the assertion of a party, not a decree of court, is all that is necessary for cancellation. See Swiss CODE OF OBLIGATIONS, Art. 122–124. Under the German Code it is necessary that the claims shall have arisen out of the same legal relation. BÜRG. GESETZBUCH, $ 273.
25 In Searles v. Sadgrave, 5 El. & Bl. 639 (1855), to an action for money had and received, the defendant pleaded a tender of a certain sum, and the plaintiff made replica
Perhaps the chief reason (other than a blind revolt at the assertion that choses in action are not transferable when in fact they are transferred every day) why the view is advocated that the assignee of a chose in action acquires legal ownership is because thereby so-called latent equities against the claim would be cut off, and it is thought unfair to subject the assignee to equities which he is unable to discover. On the other hand, it is to be observed that intangible choses in action are not primarily intended for merchandising, as chattels are. The rule in regard to latent equities has no importance not only where negotiable paper is concerned, but where choses in action having tangible form like policies of insurance, savings bank books, or non-negotiable notes are in question. The delivery of the document will cut off the equity. If, therefore, the parties desire to put an obligation in a merchantable form they can (if they wish) do so, and can do so without making the obligation negotiable. For such property, then, as an intangible chose in action, I see little reason to prefer the assignee to a previously defrauded owner of the claim. Where the sale of property is a necessary function of commercial activity, it is socially desirable to protect the new purchaser at the expense of a former innocent victim; but the desirability of this policy seems limited to that class of property.
It is, however, because of its effect on partial assignments that I am chiefly opposed to such a development of the law as shall give the assignee the legal ownership of the claim. The enormous weight of authority is to the effect that a partial assignee has but an equitable right. While this rule persists it is impossible to deny that a subsequent total assignee if his ownership is legal will prevail over a prior partial assignment. I have called such a rule monstrous, and so it seems to me because, in effect, it destroys the value of partial assignments almost completely. To say that an assignee
tion that a larger entire sum was due from the defendant. To this the defendant rejoined that the plaintiff was indebted to the defendant in a sum equal to the whole of the larger sum except to the amount which had been tendered. On demurrer the rejoinder was held bad.
gets only what his assignor has at the time of the assignment, whether the qualification of the assignor's right is legal or equitable, patent or latent, is one thing; but to say that an assignee shali have only what his assignor shall choose to leave him in the future by making or refraining from making other assignments is totally destructive of the value of assignments if the assignee can do nothing to protect himself. This is the situation in the case in question, if total assignments give the assignee a legal title to the claim, for notice to the debtor will of course afford no protection against the kind of fraud here in question. Partial assignments I believe to be more numerous than total assignments of intangible choses in action, and of equal, if not greater, commercial importance.
It may be said that the difficulty could be avoided by holding that the partial assignee also had a legal right. It might be sufficient answer to this to say that the question of legal ownership of the total assignee would then best be deferred until the courts shall recognize that the partial assignee as well as the total assignee has a legal right; but there are objections to that solution even if it were possible. To hold that the partial assignee is the legal owner of a part
a of the claim as a separate entity is to subject the debtor to an indefinite multiplication of claims against him owned by individual creditors. The courts rightly do not seem prepared to take such a step. To hold that the partial assignee becomes a joint-owner with the assignor, as has been suggested in a recent Texas decision,26 sounds plausible, but then as each one of joint owners of a contract right has the power of releasing or discharging the whole joint claim by receiving payment or otherwise, the partial assignee and the assignor have each a power very inconvenient for the other. This is not perhaps a necessary rule, but it happens to be the rule of the common law.
On the whole, therefore, it seems to me that the system worked out by the courts during several centuries, coupled with a statutory change in procedure allowing the assignee to sue in his own name, produces the most desirable results and best fits in place with other rules of our legal system.
Samuel Williston. HARVARD LAW SCHOOL.
26 Hughes-Buie Co. v. Mendoza, 156 S. W. 328 (1913) (Tex. Civ. App.).
ENGLISH CIVIL LAW
II MAN is a creature of impulses and tendencies. Whether the im
pulses produce the tendencies, or vice versa, whether they are unrelated, whether an impulse is merely a rapid tendency, are questions to be discussed by psychologists and physiologists. The jurist is, however, profoundly concerned with these primordial qualities of human nature; and it is a cardinal weakness of the utilitarian or Benthamite school of reformers, that they assume the conduct of the average man to be guided mainly by reason, whereas it is, in fact, mainly guided by the primitive impulses and tendencies to which allusion has been made. Reason is doubtless the supreme quality. Unfortunately there is, as Napoleon remarked of the British infantry, 'very little of it' in the conduct of the average citizen. And, if this be so, even at the present day, still less did reason govern the conduct of humanity in its earlier stages of development, when the foundations of law were laid.
Another element in the position is the fact that almost all primitive instincts are, in themselves, neither bad nor good, but neutral. Their virtue or vice depends entirely on the uses to which they are put.' Acquisitiveness, curiosity, imitativeness, concupiscence, credulity, are obvious examples of this truth; and even fear and jealousy, unlovely as they seem to the observer, have undoubtedly had, in the history of the race, both individual and social value.
Neither can it be denied, that of all the instincts of mankind, the egoistic or self-regarding are the most ancient and deep-seated. Even if we do not go so far as to regard all altruistic or social tendencies as derived originally from the egoistic, we must unquestionably admit their relative inferiority in point of strength and age,
· Perhaps the best proof of this truth is to be found in the fact that most gestures of affection are fictitious gestures of hostility, e. 8., the kiss is a sham bite, the friendly nudge in the ribs a sham dagger thrust.
: E. ., from the maternal instinct, which is, probably, itself derived from the fact that the offspring once formed, physically, a part of the mother.
for the simple reason that primitive instincts are based on physical feeling, and that, though our researches into the history of mankind go pretty far back, we have discovered no trace of an epoch when individuals were clustered together in physically connected groups capable of identical physical feelings. That a primitive group, suddenly attacked by a common calamity, e.g., a famine or an avalanche, might develop a feeling of sympathy from common misfortune, is not to be denied; though the evidence would seem to show that such an event was at least as likely to intensify the egoistic instincts. But even that would be long subsequent to the development of the latter.
Now if there is one thing clearer than another about law, in the sense of the jurist, it is, that it is a social force. Not only does it rest, ultimately, on the approval of the more influential members of the community, but it is manifestly intended to secure objects which those members believe to be desirable in the common interest. At least this is so in every system of law which does not profess to rest simply and solely upon the manus militaris; and the latter kind of system is far rarer than is commonly supposed. It is obvious, therefore, that the first purpose, at any rate of every indigenous system of law, is to repress such developments of egoistic instincts as manifestly run counter to common interests, and to encourage those which foster and develop such interests.
Manifestly, that egoistic instinct which is most dangerous to common interests, because clearly, if not checked, destructive of the community, is the unrestrained exercise of predatory desires. In so far as these are directed against the means of sustenance, they are bad enough; but when they extend to the persons of the members of the community, they are absolutely fatal, because they inevitably provoke a revenge which, carried to its natural conclusion, means the extinction of the group. Doubtless the mere recognition of this fact marks a considerable stage in the development of intelligence; and we cannot be quite sure of the process which led primitive man to the conviction that the weakening of his community was a bad thing. All we know is, that the conviction was very early formed — so early, indeed, that it seems to be present in
: The difficulties involved in maintaining such a system, even by overwhelming military force, are well exemplified by the indignities suffered by the Prussian military administration in Belgium during the war.