If neither party has manifested an intention concerning the application of a payment, the court is compelled to make the application itself. In doing this the court endeavors to reach an equitable result, and if there were no inconsistency in the interests of the debtor and of the creditor, there would be no difficulty in reaching a conclusion. Generally, however, the interests of the parties are diverse, and in considering what is just the court is compelled to choose between what is most favorable for the debtor and what is most favorable for the creditor. In the Civil law, the interest of the debtor is preferred;34 and the rule of the Civil law influenced some of the earlier English decisions, which are quite contradictory in principle.35 In a few of the United States, even though the Civil law does not there prevail, the same tendency may be observed.36 The basis of the rule is that the debtor's intention is the controlling element, and that it is fair to assume that he intended or would have intended the application most favorable to himself. Reasonable as this argument is, it goes so far that if logically carried out it would destroy the well-settled right of the creditor to make such application as he pleases if the debtor fails to give directions. That rule rests upon the assumption, perhaps a little artificial, that if the debtor gives no instructions, it may fairly be supposed that he assents to the creditor making any application he pleases. If such an assent is implied, the debtor can hardly complain if the court in the absence of action by the creditor makes the application most favorable to the latter. Certainly it is true that in most jurisdictions the interest of the creditor is preferred. Sometimes this is stated as the guiding principle of the court and even where it is not, and the court professes to make such application as is most equitable, it is the interest of the creditor that seems in fact chiefly considered.
30 Simson v. Ingham, 2 B. & C. 65; Cory Bros. & Co. v. The Mecca,  A. C. 286,292. In the latter case Lord Herschell said: "It is clear that if the appellants had merely entered in their own books an account such as was transmitted, it would not have amounted to any appropriation by them, and they would still have been at liberty to appropriate the payment as they pleased. It is equally clear, however, that when once they had made an appropriation and communicated it to their debtors, they would have no right to appropriate it otherwise."
31 Lau v. Blomberg, 3 Neb. (Unof.) 124, 91 N. W. 206; Allen v. Culver, 3 Denio, 284. See also Wanamaker v. Powers, 102 N. Y. App. Div. 485, 492, 93 N. Y. S. 19.
32 In Missouri Central Lumber Co. v. Stewart, 78 Mo. App. 456; Grasser, etc., Brewing Co. v. Rogers, 112 Mich.
112, 70 S. W. 445, 67 Am. St. Rep. 389; Chapman v. Commonwealth, 25 Gratt. 721, 21 Am. Rep. 320, it was decided or assumed that an entry by a creditor uncommunicated to the debtor was evidence against the creditor of an election.
33 In New York though it was held in Allen v. Culver, 3 Denio, 284, that the creditor was not bound by an uncommunicated entry, it was decided in Van Rensselaer v. Roberts, 5 Denio, 470, that the creditor's books were evidence in his favor that an application had been made. So also in Johnson v. Thomas, 77 Ala. 367, it is said that the creditor need not give the debtor any notice of the act by which an appropriation is made. See also Jones v. The United States, 7 How. 681, 12 L. Ed. 870; Wanamaker v. Powers, 102 N. Y. App. Div. 485, 93 N. Y. S. 19.
34 See infra, Sec. 1803.