Clayton’s Rule of Appropriation:
·
Right of appropriation is a right exercised by a
creditor upon his debtor for the purpose of setting loan account.
·
In right of appropriation, we find how a debtor
who has three or four debit account settlers by making payments to the credits.
·
Conditions applying:
o
When making payment to a creditors debtor has
right to inform the creditor, that as towards which loan he is making.
o
When a debtor has not exercised his right, the
creditor has the right to appropriate the payment made by debtor towards any
loan, according to his discrete.
o
When neither the debtor nor the creditor
exercises their right for appropriation, then it is the chronological order in
which the debit entries have arisen, the credit entries will go to discharge
the debit entries.
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