One who has legal title to real estate or to chattel property which he holds subject to an equity, and who transfers his legal title to a bona fide purchaser for value without notice, transfers a title freed from the equity.63 But the assignee of a non-negotiable chose in action, though he buys it for value, and in good faith, takes it subject to all defences which the obligor may have had against the assignor,64 unless the debtor by the form of the instrument intrusted to the assignor or otherwise has estopped himself to Bet up a defence,65 or has given an absolute promise to pay the assignee in substitution for the assigned obligation.66 This principle is applicable not simply to defences like non-performance, fraud, duress, mistake, covenants not to sue, which are applicable to the assigned obligation itself, but also to rights of set-off, or counter-claim arising out of separate matters which the obligor might have asserted against his original creditor, the assignor.67 But if the local law does not permit a set-off of a claim which is not yet due, an assignment of a claim which is due cannot be met by a set-off of a claim against the assignor which was not due at the time of the assignment and did not become due until the debtor had notice of the assignment.68 Even where the debt against the assignor became due before notice of the assignment, but after the assignment, the right of set off has been denied,69 since no action had been taken by the debtor after the assignment and prior to notice of it. It has also been held that if the assigned claim was not due at the time of the assignment, the debtor cannot set-off, when later sued upon it, a claim against the assignor which was due at the time of the assignment; - at least if the assignor is not insolvent.70 It may be questioned how far the denial of a right of set-off because either the assigned claim or the cross claim was not due at the time of the assignment is consistent with the general principle allowing set-off against the assignee of claims due from the assignor. The only ground for supporting the general rule is that the legal right to the assigned claim still is in the assignor, and that therefore in an action on the claim there may be set off a claim against him unless it is inequitable for the defendant to assert the right. It is inequitable if the set-off was acquired after notice of the assignment,71 and it may be urged that it is inequitable in any case for the defendant to assert his set-off when the real plaintiff in interest, whether nominally plaintiff or not, is an assignee, unless the assignor is insolvent; since otherwise the defendant might collect his claim from the Lord Cairns said: "Generally speaking a chose in action assignable only in equity must be assigned subject to the equities dinting between the original parties to the contract; but this is a rule which must yield when it appears from the nature or terms of the contract that it must have been intended to be assignable free from and unaffected by such equities." For cases where the debtor was held estopped, see Webb v. Herns Bay Commissioners, L. R. 6 Q. B. 642; Dickson v. Swansea Vale Ry. Co., L.R.4Q. B. 44.

60 Smith v. Williams, 117 Ga. 782, 46 S. E. 394,97 Am. St. Rep. 220; Walrus Manufacturing Co. v. McMehen, 39 Okla. 667, 136 Pac. 772; Williaton on Sales, Sec. 244.

61 Wing & Bostwick Co. v. United States Fidelity Co., 150 Fed. 672; Carozza v. Boxley, 203 Fed. 673, 122 C. C. A. 69; Despard v. Walbridge, 15 N. Y. 277, 41 N. E. 572; Protzman's Ex- v. Joseph, 65 W. Va. 788, 65 S. E. 461.

62 King v. West Coast Grocery Co., 72 Wash. 132, 72 Pac. 1081.

63 See, e. g., Ames, Legal Essays, 253.

64 Mangles v. Dixon, 3H.L.C. 702, 731; Phipps v. Loregrove, L. R. 16 Eq. 80, 88; Stoddart v. Union Trust, Ltd., [1912] 1KB. 181, 189, 190; Boatmen's Bank v. Fritzlen, 175 Fed. 183; Smith v. Carder, 33 Ark. 709; Kohn v. Sacramento Elec., etc., Ry., 168 Cat. 1, 141 Pac, 626; Merenesa v. Delemos, 91 Conn. 651, 101 Atl. 8; Thurston v. MeLellan, 34 App. D. C. 294; York v. Scott, 140 111. App. 178;

Rosenthal v. Rambo, 165 Ind. 584, 76 N. E. 404; Cress p. Ivens, 163 Ia. 659, 145 N. W. 325; Sawyer v. Cook, 188 Mass. 163, 166, 74 N. E. 356; Bryne v. Dorey, 221 Mass. 399, 405, 109 N. E. 146; Gamble v. Gates, 97 Mich. 465, 466, 56 N. W. 855; Decker v. Adams, 4 Dutch. 511, 78 Am. Dec. 65; Martin-dale v. Harris, 26 Ohio St. 379; Gray v. Pelton, 67 Ore. 239, 135 Pac. 755; Egbert p. Kimberly, 146 Pa. 96, 23 Atl. 437; Real Estate Trust Co. v. Riter-Conley Mfg. Co., 223 Pa. 350, 72 Atl. 695; Trimmier v. Valley Falls Mfg. Co., 85 S. Car. 13, 66 S. E. 1056; Ford v. Thompson, 1 Head, 266; Downer p. South Royalton Bank, 39 Vt. 25; Selden v. Williams, 108 Va. 542, 62 S. E. 380. Consequently in case of conflict of laws the law governing the contract between creditor and debtor determines the rights of the creditor's assignee. Northwestern Mut. Life Ins. Co. v. Adams, 156 Wis. 335, 144 N. W. 1108, 62 L. R. A. (N. S.) 275.

65In Ex parte Asiatic Banking Cor-poration, L. R. 2 Ch. 391,

66Held v. Beach-Robinson Co., 32 Cal. App. 93, 102 Pac. 661.

67 Cavendish v. Geaves, 24 Bear. 163, 174 (but see Stoddart v. Union Trust, Ltd., [1912] 1KB. 181); American Steel Barge Co. v. Chesapeake, etc., Coal Agency Co., 115 Fed. 669, 677, 63 C. C. A. 301; Tuscumbia, etc., R. Co. v. Rhodes, 8 Ala. 206; Adams v. Leavens, 20 Conn. 73; Hall v. Hickman, 2 Del. Ch. 318; Guerry v. Perry-man, 6 Ga. 119; Gardner v. Risher, 35 Kan. 93, 10 Pac. 584; Adams v. Webster, 26 La. Ann. 117; Hooper v. Brundage, 22 Me. 460; Collins v. Campbell, 97 Me. 23, 28, 63 Atl. 837, 94 Am. St. Rep. 468; McKenna v. Kirk-wood, 50 Mich. 544, 15 N. W. 898; Hunt v. Shaokleford, 55 Miss. 91; Ford v. O'Donnell, 40 Mo. App. 61; Lewis v. Hoktredge, 56 Neb. 379, 76

N. W. 890; Sanborn v. Little, 3 N. H. 639; Wood v. Mayor, 73 N. Y. 556; First Nat. Bank v. Bynum, 84 N. C. 24, 37 Am. Rep. 604; Metigar v. Metigar, 1 Rawle, 227; Clement v. Philadelphia, 137 Pa. 328, 334, 20 Atl. 1000, 21 Am. St. Rep. 876; Neal v. Sullivan, 10 Rich. Eq. 276. See also Bryne v. Dorey, 221 Mass. 399, 109 N. E. 146. Cf. Greene v. Darling, 5 Mason, 201. So a particular credit item in a mutual account cannot be separately assigned. Heiliger v. Bitter, 78 N. Y. Misc. 264,138 N. Y. S. 212. On the other hand a claim acquired after notice of the assignment cannot be set off. See cases supra, also Campbell v. Equitable Life Ass. Soc, 130 Fed. 786. And the debtor, if he had notice of a proposed assignment of a claim against him, and did not inform the person proposing to take the assignment of an existing right of set-off against the assignor, cannot set it up against the assignee. King v. Fowler, 16 Mass. 397. Cases involving the question of the right of the maker of negotiable paper to set off against a transferee after maturity claims against the payee or indorsee though often decided as if depending upon the same principle, should perhaps be distinguished, since even after maturity the legal title to the note is transferable. As to such cases see 23 L. R. A. 326, n., 39 L. R. A. (N. S.) 658, n.