SOUTHERN RY. Co. v. DUNLOP MILLS, 76 F. 505

SIMONTON, Circuit Judge. This case comes up on appeal from the circuit court of Ihe United States for the Eastern district of Virginia. This is an intervention in the case of the Central Trust Company of New York against the Richmond & Danville Railroad Company. By stipulation of counsel, the following constitutes the claim: The claim of Dunlop Mills is for $102.99. Between January 14 and April 23, 1892, supplies were furnished by these mills to the Richmond & Danville Railroad, and used by it in its operation, amounting to $4,975.84.

Two acceptances were given by the railroad company, — one April 25, 1892, for $2,109.03, at 4 months; the other, at 60 days, dated June 15, 1892, for $2,969.50, — making a total of $5,078.50, which included $102.99 interest. The principal sum has been paid in full by the receivers, and the balance due is for interest on this running account between the dates January 14th and the giving of these acceptances, and is not for any interest during the time of the receivership.

The special masters reported that the claim is entitled to be paid prior to the mortgage debt, under the Virginia statutes (Acts 1891-92, p. 302, c. 224). They were also of opinion that there had been no diversion of funds which would justify a preference of this account overathe mortgage debt. Both parties excepted. The circuit court sustained all the exceptions, except that made to the finding of the special masters with regard to the diversion. The court overruled the special masters on this, and gave the Dunlop Mills a decree for $102.99. The case comes here assigning this as error.

It will be observed that the account originally amounted to $4,975.84 for supplies furnished between January 14 and April 23, 1892. For this claim two acceptances were given, — one on April 25, 1892, for $2,109.03; and the other on June 15, 1892, for $2,969.50, — making a total of $5,078.50. These have been paid by the receivers under the order of court directing them to pay supply accounts incurred within six months prior to their appointment.

The present claim is for interest on the running account between January 14th and the dates when these acceptances were given; in other words, the principal of the claim has been paid in full, and this is a claim for interest. In the case of Stewart v. Barnes, 153 U. S. 457, 14 Sup. Ct. 849, the supreme court of the United States determined that if the principal sum of a debt has been paid, so that as to it an action cannot be maintained, the opportunity to acquire the right to interest by way of damages is lost. In that case the court quotes with approval Moore v. Fuller, 2 Jones (N.

O.) 205: “The general principle is that, when.the principal subject of the claim is extinguished by the act of the plaintiff or of the parties, all its incidents go with it.” The court also quotes with approval Tillotson v. Preston, 3 Johns. 229, which case says that, if the plaintiff has accepted the principal, he cannot afterwards bring an action for the interest Under these authorities, we think the circuit' court erred in its decree allowing this claim for interest, and the said decree is reversed.