BANK V. RIGGINS. are, of course, entitled to reasonable dividends, but such dividends should come only from profits, and should never impair the capital. As a stockholder is entitled only to his distributive share, he can not demand it in advance of a general distribution. By this is not meant a final distribution, but such a distribution in whole or in part as applies equally to all the stockholders. In other words, if one stockholder is given ten per cent., all can demand ten per cent. As the defendant's share was not demandable at the bringing of this action or at any time before judgment, it was not the subject of set-off, which at common law applied only to mutual debts upon which independent actions could have been brought. The counter claim is the creature of The Code, and is an extension of the set-off, enlarging the class of claims that may be pleaded, and enabling the defendant to obtain judg ment for the excess; but The Code (Section 244) specifically provides that "The counter-claim... must be one existing in favor of a defendant and against a plaintiff, between whom a several judgment might be had in the action." This question is discussed in Electric Co. v. Williams, 123 N. C., 51. If the stock itself and the money due in payment therefor were mutual debts, capable of mutual set-off, then no stock subscription could ever be collected; and if the stockholders could individually withdraw their shares at their option, the very purpose of incorporation would be defeated. As the defendant could not have brought suit for his individual stock, then he can not set it off against the debt due the plaintiff. The note sued on is clearly a debt, although given in part payment of a stock subscription. The defendant subscribed for twenty shares of the capital stock of the plaintiff bank, and apparently paid $700 in cash and gave his note for the balance with the stock itself as collateral security. It appears that by consent the capital of the bank was reduced BANK V. RIGGINS. one-half on account of losses, but as the reduction was uniform, the actual value of the stock remained the same, as it represented the same relative proportion of ownership in the same amount of assets. It therefore makes no difference in this suit. It is the duty of those winding up the affairs of a corporation to do so with the least possible expense and inconvenience to the stockholders, but in the absence of any allegation of fraud or oppression we should not interfere with their reasonable discretion, even in a proper action. We certainly can not do so on a mere plea of set-off or counter-claim. For the reasons herein stated I concur in the judgment of the Court. MONTGOMERY, J. I concur in the concurring opinion. HODGIN V. BANK. GEORGE D. HODGIN, surviving partner of Hodgin Bros. & Lunn v. PEOPLES' NATIONAL BANK. (Decided April 25, 1899). Partnership-Surviving Partner-Bank Deposit-Bank Debt-Set-off. 1. In the absence of an agreement to the contrary, a Bank may apply deposits, other than special, to any indebtedness due it in the same right by the depositor, provided such indebtedness has matured, and if the depositor has become insolvent, whether the indebtedness has matured or not. 2. The same right of set-off and application exists, whether the depositor is an individual or a firm, where the indebtedness is in the same right; and it matters not whether the deposits stand in the name of the firm, or of a surviving partner. The rule is otherwise in case of an executor or administrator. FURCHES and DOUGLAS, J. J., dissent. 3. A partnership is not liable for the debts of its members, and a Bank has no right to apply deposits standing in the name of the firm in payment of the individual indebtedness of any of its members-nor can the Bank apply individual deposits of a partner to the indebtedness of the firm to the Bank. CIVIL ACTION upon a money demand for the recovery of deposits alleged to have been misapplied, tried before McIver, J., at August Term, 1898, of FORSYTH Superior Court. The plaintiff is surviving partner of the firm of Hodgin Bros. & Lunn, composed of himself and L. L. Lunn. The firm became indebted to the bank in the sum of $5,800, and effected a compromise at 50 per cent., and executed a note at the bank for $2,900, dated December 5, 1893, payable six months after date, with privilege of renewal. On 16th March, 1896, L. L. Lunn died, and plaintiff, Hodgin, as surviv HODGIN V. BANK. ing partner proceeded to collect and close up business, making deposits of the assets of the firm in the bank. In addition to the firm note, the bank held the individual note of L. L. Lunn, endorsed by G. D. Hodgin for $650, payable at 90 days from date, January 29, 1896. On April 10, 1897, it became known that the firm was insolvent, that Hodgin was insolvent, and so was the estate of L. L. Lunn. At that date the firm indebtedness to the bank was $2,350.50, and the individual debt of Lunn was $687.29, aggregating $3,037.77-this amount the the bank charged up against the firm, and deducted from its deposits, and for this amount the plaintiff brings suit. The defendant claimed that it was entitled to deduct both amounts from plaintiff's deposit account-the plaintiff contends that neither amount could be deducted, and that all the defendant was entitled to was to prorate with other creditors of the firm. in the partnership assets for the firm debt only, and not upon the individual debt of Lunn at all. His Honor declined to so instruct the jury-plaintiff excepted. There was a verdict in favor of defendant-and judgment that the plaintiff take nothing by this suit. Plaintiff appealed. Messrs. Holton & Alexander, Shepherd & Busbee, E. E. Gray, and Charles Price, for appellant. Messrs. Glenn & Manly, Watson, Buxton & Watson, Jones & Patterson, and A. H. Eller, for defendant. CLARK, J., writes the opinion. FURCHES, J., writes dissenting opinion, concurred in by DOUGLAS, J. CLARK, J. A bank has the right to apply the debt due by it for deposits to any indebtedness by the depositor, in the HODGIN V. BANK. ར same right, to the bank, provided such indebtedness to the bank has matured. Bank v. Hill, 76 Ind., 223; Knapp v. Cowell, 77 Iowa, 528; Coates v. Preston, 105 Ill., 470; Bank v. Bowen, 21 Kansas, 354; Clark v. Bank, 160 Mass., 26; Bank v. Armstrong, 15 N. C., 519; Muench v. Bank, 11 Mo. App., 144; Morse on Banks, Section 324; Bank v. Hughes, 17 Wend., 94; Eyrich v. Bank, 67 Miss., 60. Even if the indebtedness to the bank has not matured, if the depositor becomes insolvent, the bank by virtue of the right of equitable set-off may apply the deposits with it of such debtor to his indebtedness. Dammon v. Bank, 50 Mass., 194; Flour Co. v. Bank, 90 Ky., 225; Trust Co. v. Bank, 91 Tenn., 336; Seed Co. v. Talmage, 96 Ga., 254; Waterman on Set-off, 432. The money deposited by Hodgin as surviving partner, was kept under the same heading in the bank's book, "Hodgin, Bros. & Lunn," as before the death of Lunn, and was merely a continuation of the old line of deposits. This would have been equally true if the deposits after the death of Lunn had been made in the name of "Hodgin, surviving partner." In either event the deposits were in behalf of the firm, and were in the same right as the note held by the bank against said firm, and on the insolvency of the firm the bank had the right to apply the deposit made by the surviving partner in behalf of the firm to the indebtedness of the firm, whether matured or not. If the surviving partner had made the deposit a special deposit, or if there had been an agree ment with the bank that these deposits should not be applied to the indebtedness of the firm to the bank, then the bank's right of set-off would have been tolled. Morse on Banks, Section 325. But there was no evidence to that effect. It is true that deposits made by an executor or administrator in a bank can not be applied to the indebtedness to the |