iff deposits money with defendant, to be loaned out from time to time, the interest to be collected, and principal and interest held by him for plaintiff until called for, there is a continuous trust, and the statute of limitations does not begin to run in favor of defendant until after demand made by plaintiff. Baker vs. Joseph, 16 Cal. 176. ·

SEC. 13. Where D. had a running account with L. from 1838 to 1849, at which time L. died intestate and no administration was had on his estate until 1857; and D. within one year after the granting of letters of administration commenced his suit on said account against the estate: Held, that the suit was commenced in time. The fact that a long period intervened between the death and the administration taken on the estate can make no difference. 10 Cal. 386.

SEC. 14. A note not due at the death of the maker was presented to the administrator of his estate March 5th, 1859, and rejected, and suit brought thereon March 12th, 1859-letters of administration having issued December 4th, 1856, and no notice to creditors to present their claims. having been published: Held, that the note is not barred by the statute of limitations. The statute of limitations, as a rule, does not begin to run when no administration exists on the estate of the deceased at the time the cause of action accrued. The twenty-fourth section of the limitation act of 1850 applies only to cases where the statute has commenced to run. The object of this section is not to curtail but to prolong the period for suing in the given category. 19 Cal. 85.

SEC. 15. In actions brought on promises made by infants and ratified after they came of age, on promises which have been renewed after the statute of limitations has furnished a bar, and on unconditional promises by discharged insolvent debtors and bankrupts to pay debts from which they have been discharged, the plaintiff may declare on the original promise; and where infancy, the statute of limitations or a discharge in insolvency or bankruptcy, is pleaded or given in evidence as a defense, the new promise may be replied or given in evidence in support of the promise declared on; a replication alleging such new promise is not a departure

and evidence thereof is not irrelevant. A note, promise or debt, is not destroyed by a discharge in bankruptcy. If it were, it not only could not be renewed or revived, but could not be a consideration for a new promise. Yet nothing is clearer than that the old debt is a sufficient consideration for such promise. The new promise operates as a waiver, by the promisor, of a defense with which the law has furnished him against an action on the old promise or demand. 19 Cal. 484.

SEC. 16. The true theory of the statute is this: The acknowledgment or promise is incorporated with the terms of the original contract, and both taken together constitute a new contract. By the legitimate operation of the statute, the original debt is paid when the time fixed by the act expires. In making the original contract, the parties incorporated into it the terms of the statute, without any express stipulation to that effect. Under the terms of the contract as controlled by the existing law, the debt is paid by the failure of the creditor to sue within the time agreed upon; but the original debt being a good moral consideration is sufficient to support a new contract. 9 Cal. 92, 93.

SEC. 17. A part payment indorsed upon a promissory note, whether made before or after the expiration of the period fixed by the statute of limitations, does not avoid the bar of the statute. To take a contract out of the statute there must be an acknowledgment or new promise contained in some writing signed by the party to be charged thereby. 22 Cal. 100.

SEC. 18. It was formerly held that statutes of limitation proceeded upon a presumption of payment, and that the effect of an acknowledgment was to rebut this presumption and place the debt upon its original footing. This view is now exploded, and the statute is universally regarded as one of repose, the benefit of which may be relinquished by the party interested, but cannot be taken from him without his consent. If two or more persons are bound, the same protection is afforded to each, and an acknowledgment by one is not available against another, unless he had authority to make it, either expressly given or resulting from the relation of the parties. The effect of the statute in this respect

is perfectly well settled, and it is immaterial, of course, whether the original liability was personal and direct or resulted incidentally from a charge upon property. In cases of personal liability, the doctrine as we have stated it, is conclusively established, and the principle is equally applicable where an attempt is made to enforce a security. 21 Cal. 502.

CHAPTER LXIV.

LIQUIDATION OF DAMAGES.

SECTION 1. The cases upon this subject-liquidated damages are numerous, and it is difficult to deduce from them any certain and definite rule. In fact, the transactions of individuals are so various and the circumstances of many cases so peculiar, that no certain rule can be adopted for all cases. But, from the decisions, the following results seem to be substantially correct:

1st. When the party stipulates to pay a stated sum for a given period of time during the continuance of the failure, then the damages are to be considered as liquidated.

2d. When the agreement is not to carry on trade at a particular place, not to run a stage coach on a particular road, not to publish a rival newspaper, not to run a rival steamer on a particular route-in all these cases the sum stated must be taken as liquidated damages.

3d. When the party stipulates to marry no other person, to convey land or pay a named sum, the price of the land having been received by him, the damages are liquidated.

4th. When a named sum is to be paid for every acre of land ploughed up contrary to agreement; when a stated sum is to be paid for each article not delivered-the damages must be considered as liquidated.

5th. When the party stipulates to erect a building in a particular manner within a given time and upon failure to pay a named sum, it must be considered in the nature of a penalty. 9 Cal. 587.

SEC. 2. In general, a sum of money in gross, to be paid

for the non-performance of an agreement, is considered as a penalty. It will not, of course, be considered as liquidated damages; and it will be incumbent on the party who claims, to show that they were so considered by the contracting parties. 9 Cal. 588.

SEC. 3. Where the defendant stipulated that she would erect a brick building to cover such portion of a lot as would be satisfactory to plaintiff, and give him possession within three weeks; the plaintiff to have possession for six months, with the privilege of twelve months or more, and upon failure to perform the agreement she was to pay to plaintiff the sum of five hundred dollars damages-the case falls within the rule applicable to building contracts. There are several things for the defendant to do, a failure to perform any of which would have been a violation of the agreement. If the building had been erected upon a portion of the lot not satisfactory to the plaintiff, or the house not finished for a single day beyond the stipulated time, the defendant would have been liable for the whole sum, upon the theory that the sum named was liquidated damages. So, too, if the plaintiff had been disturbed in his possession for one day during the term of six months or denied the privilege of the additional term. There was no statement in the agreement that the sum was to be taken as liquidated damages. If the defendant had failed to erect a suitable brick building, although finished within the time specified, it would have been a violation of the contract. The damages mentioned were not liquidated, but a mere penalty to secure the performance of the contract, or the payment of such damages as the plaintiff might be entitled to under the circumstances. In building contracts, it may be difficult to say what amount of injury the plaintiff has sustained by reason of the non-completion of the building within the exact time stated. And yet this difficulty in ascertaining the amount of the injury occasioned by the delay has not induced the courts in such cases to consider the sum as liquidated damages. 9 Cal. 588.

SEC. 4. Plaintiffs purchased a bark of defendant, F., paid a portion of the purchase-money and entered into possession; at the time of the sale the vessel was sailing

under a coasting license issued to F., but was registered in the name of a third person. F. agreed to deliver to the plaintiff's within twenty days a good and sufficient title and register of the bark, and as security for the performance of this agreement, executed a bond in the penal sum of two thousand dollars. F. failed to deliver the title and register at the time agreed on or at any time, by reason of which failure the plaintiff was restricted in the lawful and usual use of the vessel: Held, that the sum specified in the bond should be considered as liquidated damages-it being one of those cases in which it is difficult, if not impracticable, to estimate the exact amount of damage suffered by the failure of the defendant to comply with his contract. Cal. 517.

10

SEC. 5. S. sold to R. his butcher-shop, tools, etc., at Suisun, and in his contract of sale entered into this covenant with R.: "I also bind myself in the sum of five hundred dollars to said R. not to go into the butchering business in said Suisun, without the consent of said R., in any manner whatever": Held, that the five hundred dollars mentioned in the covenant are to be regarded as liquidated damages, and not as a penalty. The question whether a specified sum mentioned in a contract to be paid by either party, in the event of its violation, is liquidated damages or a penalty, must be determined by the intention of the parties, to be ascertained from a consideration of the whole contract. 25 Cal. 67.