U.S. Supreme Court
Libby v. Hopkins, 104 U.S. 303 (1881)
Libby v. Hopkins
104 U.S. 303
ERROR TO THE SUPREME COURT
OF THE STATE OF OHIO
1. "Mutual debts" and "mutual credits," where they occur in sec. 20 of the Act of March 2, 1867, c. 176, 14 Stat. 617, and sec. 6018 of the Revised Statutes are correlative. Credits do not include a trust, and in case of bankruptcy only such credits as must in their nature terminate merely in debts are the subject matter of setoff.
2. A. being indebted to B. by note secured by mortgage, and on an account, sent him money with instructions to credit it on the note. A. was shortly thereafter adjudged to be a bankrupt. Held that the money was received by B. in trust to apply it pursuant to instructions, and, having refused to conform to them, he cannot set off against it the account, but is liable therefor to A.'s assignee in bankruptcy.