This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
Payment, in order to have its intended legal consequences, must be made to the creditor or to his authorized agent;1 although in this case, as in others,2 the principal may be bound by estoppel for the unauthorized acts of an agent or even for the acts of one who was not in fact his agent. Since a release by one of two or more joint promisees or joint creditors acts as a discharge,3 payment to one of two or more joint creditors operates as a discharge of the debt.4 The question, who is authorized to receive payment so as to discharge the obligation, usually turns on questions of ownership and agency, and is related to contract only collaterally.
1 6 King v. Barney 109 N. Y. 267, 10 N. E. 332.
1 7 Thomas Gordon Malting Co. v. Bartels Brewing Co., 206 N. Y. 528, 100 N. E. 457.
18 Benson v. Arkansas Abstract Co., 123 Ark. 620, 185 S. W. 1089.
1 9 Gordon v. Ware Savings Bank, 115 Mass. 588.
20 See Sec. 2802 et seq.
2 1 Cussen v. Brandt, 07 Va. 1, 75 Am. St. Rep. 762, 32 S. E. 701.
22 Cussen v. Brandt, 07 Va. 1, 75 Am. St. Rep. 762, 32 S. E. 701.
23 Culley v. Badgley, 106 Mich. 414, L. R. A. 1017F, 359, 163 N. W. 33.
24 CuIley v. Badgley, 106 Mich. 414, L. R. A. 1017F, 350, 163 N. W. 33; State v. Superior Court, 58 Wash. 97, 107 Pac. 876.
1 Calhoun v. Ainsworth, 118 Ark. 316, L. R. A. 1015E, 305, 176 S. W. 316; Jens-Marie Oil Co. v. Rixse, - Okla. - , 178 Pac. 658; Golden v. O'Connell,
Payment to the original payee of a negotiable instrument is not discharged as to an indorsee for value before maturity and without notice.5 The maker is not discharged by payment to the payee without surrender of the note, even if the indorsee and payee had agreed to conceal the fact of the transfer from such maker.6 Even if the note is secured by a mortgage and the mortgage provides that if the mortgaged goods are sold the proceeds of such sale shall be paid to the mortgagees, payment does not discharge the mortgage notes if such notes had been duly transferred by such mortgagees before such payment.7 The maker can not pay the original payee after maturity after notice to the maker of assignment.8 If a note is assigned but not indorsed, it has been held that payment to the original payee is a discharge, although the note is not produced.9
If a receiver for the property of the creditor has been appointed, the debtor can not discharge his obligation by paying the original creditor.10 Even if the debtor has sent his check in payment after the receiver was appointed, but before he had notice thereof, the collection of such check does not operate as a discharge of the obligation if the debtor had an opportunity to stop payment thereon.11 Payment of a salary to a de facto officer is no discharge of the liability of the public corporation to the de jure officer entitled thereto.12 Payment to an administrator of the creditor appointed by the probate court of decedent's domicile is a discharge of the debt. An executor under a will made during a temporary visit to another state, to whom the note has been given for safe-keeping, can not enforce payment thereof.13 Since the statute forbidding assignments of claims against the government in certain cases is intended solely for the benefit of the government, payment by the government to the assignee will discharge its liability to the assignor.14
76 W. Va. 282, 2 A. L. R. 460, 85 S. E 533; Marling v. Nommensen, 127 Wis. 363, 115 Am. St. Rep. 1017, 106 N. W. 844 [sub nomine, Marling v. Milwaukee Realty Co., 5 L R. A. (N.S.) 412].
2 See Sec. 1760.
3 See Sec. 2081.
4 Jens-Marie Oil Co. v. Rixse, - Okla. - , 178 Pac. 658.
5 Arkansas. Calhoun v. Ains worth, 118 Ark. 316, L. R. A. 1915E, 395, 176 S. W. 316.
Michigan. Wilson v. Campbell, 110 Mich. 580, 35 L. R. A. 544, 68 N. W. 278.
North Dakota. Hollinshead v. Stuart, 8 N. D. 35, 42 L. R. A. 659, 77 N. W. 89.
Oklahoma. Smith v. First National Bank, 23 Okla. 411, 29 L. R. A. (N.S.) 576, 104 Pac. 1080.
Wisconsin. Marling v. Nommensen, 127 Wis. 363, 115 Am. St. Rep. 1017, 106 N. W. 844 [sub nomine, Marling v. Milwaukee Realty Co., 5 L. R. A. (N.S.) 412].
6 Tuck v. National Bank, 108 Ga. 446, 75 Am. St. Rep. 69, 33 S. E. 983.
7 Smith v. First National Bank, 23 Okla. 411, 29 L. R. A. (N.S.) 576, 104 Pac. 1080.
8 Mackay v. Church, 15 R. I. 121, 2 Am. St. Rep. 881, 23 Atl. 108.
9 Vann v. Marbury, 100 Ala. 438, 46 Am. St. Rep. 70, 23 L. R. A. 325, 14 So. 273.