Campbell, J.
The note was given on the day of its date, Hovember 30, 1853, to the insurance company, in consideration of a policy of insurance that day issued. The note is not conditional in its terms, but is payable, absolutely, on a day certain and at a fixed place. It is an ordinary promissory noté, and, so far as appears on its face, it may have been given to the company as well for money loaned as for a policy issued. On the 31st day of December following this note was discounted by the plaintiff for the insurance company, in the usual and ordinary course of business, and the money proceeds of the note placed to the credit of the company, which had a regular account with the plaintiff. I do not think there is any pretense for saying that this note was what is technically called a premium note. It is a note given for a premium, it is true, and this is all that is claimed in the defendant’s answer. But it is a note absolute in its terms. The company, by its charter, could issue policies on the system of incorporated cash capital companies, as well as on the mutual plan. Its charter provided for issuing policies upon the cash system. For the money to be thus paid, a promissory note on time could certainly be taken. It could not be what is called an investment of the funds of the company under the 8th section of the law of 1849. The 21st section of the act of 1849 authorized this company to unite a cash capital to any extent, as an additional security, and that section, I think, warranted the provision in the charter of the insurance company to whom this note was given. There certainly is nothing in the general insurance laws of 1849, or any other act, which prevents a mutual insurance company taking a note from one of its members, for the absolute and unqualified payment of the amount of his premium of insurance, if the insured is willing to give it in that way. . This defendant has said by his note, that he was willing to pay and would pay in any event, and without regard to the fact whether or not the company had sustained losses. When the company held such a note I am unable to see why they could not transfer it, and apply the proceeds to the payments of debts or to meet any of the wants or necessities of the company, or to put their funds in better shape for investment. It was .but an ordinary negotiable promissory note. On the trial the defendant offered to show that in March, 1854, the secretary of the insurance company agreed with him that the note and policy should be canceled upon the payment of the premium then earned, and which portion of such premium earned was to be applied upon a loss of the defendant which had been adjusted by the company, and that in pursuance thereof the policy was canceled and the note was to have been returned. This evidence was excluded. The note had been discounted by the plaintiff several months before this alleged settlement took place, and the plaintiff could not be affected by it unless a party to the arrangement.
I am of opinion that the complaint should not have been dismissed, but on the facts proved the plaintiff was entitled to j udgment, and that the judgment of the Supreme Court should be. reversed, and a new trial ordered, with costs to abide the event.