Perry v. Ashby. includes very many things besides settlement and cultivation of the land, which, if required of many authorized settlers under the homestead act, they might not be able to take it. For instance, a pre-emptor must swear that he "has never had the benefit of any right of pre-emption " under that act; that he "is not the owner of three hundred and twenty acres of land in any state or territory of the United States." This is not required of one who seeks to avail himself of the provisions of section eight of the homestead act. Again, we have no doubt whatever that the benefits conferred by section eight, are not confined solely to persons making original entries upon public lands, but may be enjoyed also by the widow, heirs, and personal representatives respectively, whenever they succeed to the rights of the settler. We entertain no doubt whatever that the action of the Land Department, in permitting Mrs. Ashby to prove up, pay for the land, and thus obtain a patent in her own name, was fully justified. For these reasons the judg ment of the district court must be affirmed. JUDGMENT Affirmed. Thrall v. Omaha Hotel. 5 295 10 174 GEORGE THRALL, APPELLANT, V. THE OMAHA HOTEL COM- 5 295 144 76 5 295 48 316 5 295 1. Landlord and Tenant. The relation of landlord and tenant requires good faith between the parties. The policy of the law will not permit the tenant to avail himself of the advantages of 49 268 his possession to purchase incumbrances on the leasehold property for the purpose of speculation. 2. 3. : PURCHASING OUTSTANDING INCUMBRANCE. But, if while in possession, under the lease, the tenant purchase such incumbrance, the presumption is that he did it for the only purpose permitted by law, that is, to protect his possession; and if the tenancy is for years, the landlord must account to him for what he actually paid for such incumbrance. SET-OFF. The insolvency of a party against whom a setoff is claimed, is a sufficient ground for a court of chancery to decree such set-off in cases not provided for by statute. APPEAL from the district court of Douglas county. The opinion states the case. George W. Doane and E. Wakeley, for appellant. I. The set-off, by an equitable proceeding of independent mutual claims under certain circumstances, is a right long recognized. And the insolvency of one of the parties is of itself a sufficient ground for allowing the other party to insist upon this right. Lindsey v. Jackson, 2 Paige, 581. Pond v. Smith, 4 Conn., 297. Gay v. Gay, 10 Paige, 369. Simson v. Hart, 14 John., 63. Jeffries v. Evans, 6 B. Mon., 119. N. H. Copper Co. v. Brown, 46 Me., 418. Keightley v. Walls, 27 Ind., 384. Simpson v. Huston, 14 Tex., 476. Brazelton v. Brooks, 2 Head., 194. Field v. Oliver, 43 Mo., 200. The fact that the complainant's demand is not yet due, does not prevent a set-off. Lindsay v. Jackson, 2 Paige, 581. 52 115 61 5 295 92 Thrall v. Omaha Hotel. II. The district judge very clearly erred, as we think, in limiting the plaintiff's right to a set-off to the amount he paid for the judgment. His ruling was based on Muttis v. Robinson, 1 Neb., 1. That case holds, simply, that a tenant buying in an outstanding incumbrance on property, which he holds under a lease, cannot enforce a lien against the property for any greater sum than he paid to obtain it. If Thrall was seeking to enforce the lien of his judgment against the property, this case, and the rule it recognizes, might apply. But he is not. He is collecting it in another manner, and not seeking to disturb his landlord's title. If the rule is applicable to this case, it would follow that if Thrall had levied on personal property of the hotel company, or if he had made no levy at all, the company could have discharged the judgment by paying what Thrall had paid for it. So if he had bought a note against the company, and got judgment upon it, so that it became a lien on the property, the judgment could be discharged by paying him what the note cost. The property, as in this case, might be encumbered far beyond its value, so that the lien would be worthless, and the tenant have no intention of trying to enforce it, yet he would forfeit all the claim above the amount he paid for it. And the result would be the same if he bought a mortgage covering the rented property. He might abandon the mortgage altogether, and seek to get a judgment on the debt secured by it. And, upon the use made of the rule in question, he could only recover what he paid for the claim, because he had unfortunately got, with his claim a lien on his landlord's property. Suppose Thrall had released his lien on the hotel property before he brought this suit, could any body have conceived the idea that his right to a set-off was restricted to the amount he paid for the claim? Thrall v. Omaha Hotel. We ask the court to correct this error in amount, and affirm the judgment in the other particular. Clinton Briggs, for appellees. I. It is not claimed by counsel for Thrall that the set-off claimed here can be had by proceedings at law; on the contrary, it is admitted that it is "an equitable proceeding." It is then solely for a court of equity, or a court with equity powers, to deal with the case presented by the record. This being so, we are only called upon to consider the equitable circumstances and considerations in favor of granting the relief prayed. We think the better rule in respect to this subject of set-off is laid down by the court in the case of Greene v. Darling, 5 Mason, 201. II. Judge Story says that the relation of landlord and tenant is a trust relation. 1 Story's Eq. Jr., Secs. 322, 323. Perry on Trusts, 185. This relation only exists in respect to the lease, and leased property. There is an implied covenant in every lease that the tenant will do nothing to prejudice his landlord's title. Now, what does Thrall do? He buys a judgment existing against the company at the time he entered into possession, of which he had either actual, or constructive notice; a judgment that was a specific lien on this particular property by reason of a levy made a year before he took his lease; a judgment he sought to enforce against the leased property, but could not on account of prior liens. Besides, in order to invoke the equitable relief prayed he must and does allege that he has exhausted his legal remedies to enforce the collection of the judgment by causing a vendi to be issued, and that such remedies were ineffectual. Now it seems to us, that the most the court can do for Thrall v. Omaha Hotel. Thrall is to give him relief to the extent of the amount he paid for the judgment with interest. He has voluntarily removed a lien from the leased property after he had failed to enforce it; that is, if the court allows the set-off, and it would seem that it would be simply just, to give Thrall just what it cost him to do this. Suppose, this judgment had threatened his possession, and in order to protect himself against an adverse title, he had paid off the judgment, what would be the obligation of the landlord? It would be simply to make the tenant good his outlay. If he paid $1,000 to remove a $2,000 incumbrance, he could only recover the former sum with interest. Foote v. Burnet, 10 Ohio, 334. Rawle on Covenants, 160, 161. Mattis v. Robinson, 1 Neb., 1. GANTT, J. It appears by the record, that the defendant hotel company is the owner of the legal title to lots one and two, in block one hundred and thirty-eight, together with the buildings and improvements thereon, situated in the city of Omaha; that on the 16th day of September, 1873, the plaintiff entered into a leasehold contract with said company, for a term of five years from the first day of October, 1873, for so much of the building on the said lots which is known and designated as the "Grand Central Hotel" for hotel use, and agreed to pay for the same a yearly rental of four thousand dollars, payable in monthly installments of $333.333. On the 7th day of December, 1874, the plaintiff purchased from R. Hilliker and others a judgment which, at March term, 1873, of the district court of Douglas county, they recovered against the defendant company for the sum of $2,935.13 damages, and $52.33 costs, and caused an execution to be issued thereon and a levy to be made on the above property. On the 5th day of January, 1875, another |