PRINCIPAL AND SURETY -APPLICATION OF PAYMENTS BY CREDITOR WHEN SOURCE OF FUNDS IS KNOWN

Authors

William H. Buchanan S.Ed., University of Michigan Law SchoolFollow

Abstract

X, contractor on a housing project, sublet the painting work to Y. Y purchased paints from Z and also borrowed money from Z to pay his laborers until payments began to come in. Pursuant to an agreement between Y and Z, Y turned over checks received from X to Z, and these checks were applied against the debt owing for the money loaned to Y by Z. Z, as materialman and as beneficiary of an ordinary bond to pay labor and materials, sued X and the surety on the bond. Held, Z was a mere volunteer in advancing money for Y's laborers, and, knowing where the checks came from, he should have applied the checks against the debt for the materials furnished. United States for Use of Carroll v. Beck, (C.C.A. 6th, 1945) 151 F. (2d) 964.

Recommended Citation

William H. Buchanan S.Ed., PRINCIPAL AND SURETY -APPLICATION OF PAYMENTS BY CREDITOR WHEN SOURCE OF FUNDS IS KNOWN, 44 Mich. L. Rev. 872 (1946).
Available at: https://repository.law.umich.edu/mlr/vol44/iss5/20