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<h1>Application of payment: creditor may allocate an unindicated payment to any lawful due and payable debt, even if time-barred.</h1> If a debtor omits to indicate which debt a payment should discharge and no circumstances indicate the target debt, the creditor may at his discretion apply the payment to any lawful debt actually due and payable from the debtor, whether or not its recovery is barred by the law of limitation.