Imágenes de páginas
PDF
EPUB

9

the issue of a certificate to pay money advanced to pay wages by honoring "store orders." The power of courts of equity to issue receivers' certificates is of modern origin,10 has been severely criticised, and should be exercised with great reluctance.12 A judge who had never authorized the issue of a receiver's certificate, said: "When the road cannot be kept running without its exercise, except to a limited extent, the safe and sound practice is to discharge the receiver, or stop running the road and speed the foreclosure." 13 Without leave from the court, a receiver has no power to pledge the trust estate, nor to make a contract for a loan of money which will bind the estate 14 or even the proposed lender.15 An order for the issue of receivers' certificates is usually granted only upon notice to all parties in interest.16 Those who have not received notice may move to set aside the order and to cancel the certificates, if they act as soon as they learn what was done. A very short delay after knowledge that such an order has been granted will estop a party from objecting to the validity of certificates issued in pursuance of it.18 Receivers' certificates are assignable, but not negotiable.19 It has been said that the power to issue them is a personal one which the receiver cannot delegate.20 Where a receiver issued a certificate to a person named therein as payee, for negotiation and sale, and the latter never paid over any money on account of it; a purchaser of the

9 Fidelity Ins. & Safe Deposit Co. v. Shenandoah Iron Co., 42 Fed. R. 372, 377. 1) Meyer v. Johnson, 53 Ala. 237; Coe v. N. J. Midland Ry. Co., 27 N. J. Eq. 37 ; Hoover v. Montclair & Greenwood Lake Ry. Co., 29 N. J. Eq. 4; Jerome v. McCarter, 94 U. S. 734; Wallace v. Loomis, 97 U. S. 146.

11 Barton v. Barbour, 104 U. S. 126, 138; Credit Co. of London v. Arkansas Cent. R. R. Co., 15 Fed. R. 46.

12 Wallace v. Loomis, 97 U. S. 146, 163; Shaw v. Railroad Co., 100 U. S. 605, 612; Taylor v. Phila. & Reading R. R. Co., 9 Fed. R. 1; Credit Co. of London v. Arkansas Cent. R. R. Co., 15 Fed. R. 46.

18 Caldwell, J., in Credit Co. of London v. Arkansas Cent. R. R. Co., 15 Fed. R. 46, 49.

14 Union Trust Co. v. Ill. Midland Ry. Co., 117 U. S. 434.

29.

15 Smith v. McCullough, 104 U. S. 25,

16 Ex parte Mitchell, 12 S. C. 83. But see Miltenberger v. Logansport Ry. Co., 106 U. S. 286, 297, 298.

17 Hervey v. Ill. Midland Ry. Co., 28 Fed. R. 169.

18 Miltenberger v. Logansport Ry. Co., 106 U. S. 286; Union Trust Co. v. Ill. Midland Ry. Co., 117 U. S. 434.

19 Union Trust Co. of N. Y. v. Chicago & Lake Huron R. R. Co., 7 Fed. R. 513; Stanton v. Ala. & C. R. R. Co., 31 Fed. R. 585; Turner v. Peoria & Springfield R. R. Co., 95 Ill. 134; Stanton v. Ala. & C. R. R. Co., 2 Woods, 506; s. c. 31 Fed. R. 585; Central Nat. Bank v. Hazard, 30 Fed. R. 484.

20 Union Trust Co. of N. Y. v. Chicago & Lake Huron R. R. Co., 7 Fed. R. 513.

certificate at much less than par, who was unable to prove that the person from whom he bought it had paid anything therefor to the person named as payee, was not allowed to receive anything from the receiver on account of the same.21 The purchaser at a judicial sale made subject to the payment of receivers' certificates cannot contest their validity.22 A receiver is personally responsible for a fraudulent statement in a certificate which he issues.23 In at least one case, the court ordered the receiver to execute a mortgage to secure the receivers' certificates.24 But, ordinarily, the order for the issue of the certificates provides that they shall constitute a lien upon the property superior to all prior incumbrances, which is sufficient.25 In one case the order simply stated that the certificates should be payable out of the income of the property, and "be provided for by this court in its final order in said cause, unless paid by the receiver out of the income of said road as aforesaid." 26 A receiver appointed in a suit for the foreclosure of a second railroad mortgage may be authorized to issue certificates constituting a prior lien to that of the first mortgage, provided the mortgagor is in default as to that, and the first mortgagee is a party to the suit.27 An order authorizing the issue of receivers' certificates is appealable to the Supreme Court of the United States.28

[ocr errors]

§ 248. Advice to Receivers. Receivers may apply to the court for instructions and advice, both generally and in particular cases. "The value of such advice depends: If there are parties in interest, and they have their day in court, the advice may be decisive. But if the matter is ex parte the value of the advice depends largely upon the information and ability of the judge, and is probably binding only on the receivers, for the judge may change his mind on hearing full argument." It has been

21 Union Trust Co. of N. Y. v. Chicago & Lake Huron R. R. Co., 7 Fed. R. 513. See Stanton v. Ala. & C. R. R. Co., 31 Fed. R. 585; s. c. 2 Woods, 506.

22 Central Nat. Bank v. Hazard, 30 Fed. R. 484; Central Trust Co. v. Sheffield & B. C. & I. Ry. Co., 44 Fed. R. 526.

26 Miltenberger v. Logansport Ry. Co., 106 U. S. 286, 298.

27 Miltenberger v. Logansport, Ry. Co., 106 U. S. 286.

28 Farmers' Loan & Trust Co. Petitioner, 129 U. S. 206.

§ 248. 1 Frank v. Denver & R. G. Ry.

23 Bank of Montreal v. Thayer, 7 Fed. Co., 23 Fed. R. 757; Ex parte Koehler, R. 622.

24 Jerome v. McCarter, 94 U. S. 734. 25 For a good form of an order and a certificate, see Kennedy v. St. Paul & P. R. R. Co., 2 Dill. 448.

23 Fed. R. 529: Missouri Pacific Ry. Co. v. Texas & Pacific Ry. Co., 31 Fed. R. 862.

2 Missouri Pac. Ry. Co. v. Texas & P. Ry. Co., 31 Fed. R. 862.

said, that from the nature of things the court cannot determine how many trains a receiver shall run,3 or select his employees,* although it may regulate his treatment of them.5 The court has, however, at a receiver's request, instructed him what rates to charge; and has directed him not to obey so much of a State statute as forbade a less charge for transport over that part of a railroad which competed with transportation by water, than over other parts of the same length, the traffic upon which was not affected by such competition, in a case where it was held that the charter of the corporation gave it a contract right to charge a reasonable rate, and that the statute was unconstitutional; where the petition for instructions was filed a month before the act went into operation. When a railroad was in the hands of a receiver appointed in a suit to foreclose a mortgage, the court refused to entertain a petition by the mortgagor asking instructions as to the propriety of postponing a meeting of its stockholders, and permission to postpone the meeting.8

§ 249. Litigation by Receivers. -The causes of action which a receiver can enforce are of two kinds, - those which belonged to the estate of which he has charge before it was entrusted to him, and those which have accrued since his appointment. As has been said before, he cannot sue upon either without the leave of the court which appointed him. A suit upon a cause of action which belonged to the estate before his appointment is brought in the name of the legal owner of the estate; 2 unless, as is not uncommon, the order authorizes the receiver to sue in his own name.3 In the former case, the person whose name is used is indemnified out of the fund for all costs to which he is thereby made liable. Receivers of corporations are usually authorized to sue in the name of the corporation.5 Costs recov

8 Brewer, J., Treat, J. concurring, in Central Trust Co. v. Wabash, St. L. & P. Ry. Co., 23 Fed. R. 863, 867.

Cases, 88; Green v. Winter, 1 J. Ch. (N. Y.) 60.

2 Dick v. Struthers, 25 Fed. R. 103;

4 Brewer, J., in Frank v. Denver & R. Dick v. Oil-Well Supply Co., 25 Fed. R. G. Ry. Co., 23 Fed. R. 757, 764. 105; Daniell's Ch. Pr. (2d Am. ed.) 1977, 1991.

Frank v. Denver & R. G. Ry. Co., 23

Fed. R. 757, 764.

6 Ex parte Koehler, 23 Fed. R. 529. Ex parte Koehler, 23 Fed. R. 529. 8 Taylor v. Phila. & Reading R. R. Co., 7 Fed. R. 381.

§ 249. 1 Wynne v. Lord Newborough, 1 Ves. Jr. 164; s. c. 3 Brown Chancery

3 Davis v. Gray, 16 Wall. 203. See Frankle v. Jackson, 30 Fed. R. 398.

4 Daniell's Ch. Pr. (2d Am. ed.) 1991. 5 Frankle v. Jackson, 30 Fed. R. 398; Davis v. Gray, 16 Wall. 203; Harland v. Bankers' and Merchants' Tel. Co., 33 Fed. R. 199.

ered against a receiver in an action brought by him in his official capacity, are entitled upon the distribution of the fund to a priority over claims that existed against it before the receiver's appointment. In the conduct of litigation, as in every other proceeding by him, a receiver is under the constant supervision of the court. He is not bound by a stipulation which is not advantageous to the estate, made by himself or his counsel without the sanction of the court. He cannot waive a defense, whether technical or substantial. He cannot allow a set-off not authorized by law.10 He may be allowed to discontinue without costs an action honestly but erroneously begun by him. The rights of a receiver are in general no greater than those of the person whose estate he holds.12 Thus, a receiver of an insolvent corporation appointed in a creditor's suit cannot "enforce a collateral obligation given to a creditor or to a body of creditors by a third person for the payment of the debts of the insolvent;" 18 for example, a statutory liability of stockholders to creditors.14 It has, however, been said: "It is the settled doctrine that the receiver of an insolvent corporation represents not only the corporation but also creditors and stockholders, and that in his character as trustee for the latter, he may disaffirm and maintain an action as receiver to set aside illegal or fraudulent transfers of the property of the corporation made by its agents or officers, or to recover its funds or securities invested or misapplied." 15 The defendant to an action by the receiver of an insolvent's estate cannot set off claims against the insolvent which have been assigned to him since the application for the

6 Camp v. Receivers of the Niagara Bank, 2 Paige (N. Y.), 283; Columbian Ins. Co. v. Stevens, 37 N. Y. 536; Locke v. Covert, 42 Hun (49 N. Y. S. C. R.), 484.

7 Van Dyck v. McQuade, 85 N. Y. 616; McEvers v. Lawrence, Hoff. Ch. (N. Y.) 175.

8 Van Dyck v. McQuade, 85 N. Y. 616. 9 McEvers v Lawrence, Hoffman Ch. (N. Y.) 172; Keiley v. Dusenbury, 10 J. & S. (N. Y. Superior Ct.) 238; s. c. 77 N. Y. 597; Van Dyck v. McQuade, 85 N. Y. 616.

10 Van Dyck v. McQuade, 85 N.Y. 616. 11 St. John v. Denison, 9 How. Pr. (N. Y.) 343; Reeder v. Seely, 4 Cowen,

548; Arnoux v. Steinbrenner, 1 Paige (N. Y.), 82

12 Jacobson v. Allen, 12 Fed. R. 454, 457. But see Hart v. Barney & S. Manuf. Co., 7 Fed. R. 543.

18 Wallace, J., in Jacobson v. Allen, 12 Fed. R. 454.

14 Jacobson v. Allen, 12 Fed. R. 454. 15 Andrews, J., in Attorney-General v. Guardian Mutual Life Ins. Co., 77 N. Y. 272, 275. See also Gillet v. Moody, 3 N. Y. 479, 488; Talmage v. Pell, 7 N. Y. 328; Whittlesey v. Delaney, 73 N. Y. 571; National Trust Co. v. Miller, 83 N. J. Eq. 155, 158; Jacobson v. Allen, 12 Fed. R. 454, 455.

receiver's appointment.16 A receiver has no absolute right to sue in the courts of a sovereignty foreign to that from which he holds his authority.17 He may sue in a foreign court upon a judgment which he has recovered in the court which appointed him.18 By comity he is usually allowed to sue in a foreign court,19 unless by so doing he would interfere with a preference given to domestic creditors by the laws or public policy of the State wherein he brings the action.20 In this respect, it seems, that a court of the State within which a Federal court is held is considered as foreign to the latter, at least when sitting in bankruptcy.21 A substituted trustee can, however, sue in a foreign jurisdiction, even though, when the court appointed him, it required him to give a bond and to account to itself in the same manner as a receiver.22 It has been said, that "where property, in the possession of a third person, is claimed by the receiver, the complainant must make such person a party by amending the bill, or the receiver must proceed against him by suit in the ordinary way." 23 Otherwise, a receiver is especially favored in the enforcement of causes of action arising after his appointment. He can, upon motion or petition in the suit wherein he is appointed, obtain injunctions to prevent disobedience to contracts made with him,24 or prevent interference with property in his possession,25 whether the person enjoined is a party to the suit or not. In nearly every case interference with a receiver in the discharge of his duties is a contempt of court, even when no injunction expressly forbidding it has been issued.26

16 In re Van Allen, 37 Barb. (N. Y.) 225, 231; Van Dyck v Quade, 85 N. Y. 616.

17 Booth v. Clark, 17 How. 322; Brigham v. Luddington, 12 Blatchf. 237; Olney v. Tanner, 10 Fed. R. 101; Hazard v. Durant, 19 Fed. R. 471, 476; Holmes v. Sherwood, 16 Fed. R. 725; s. c. 3 McCrary, 405.

18 Wilkinson v. Culver, 25 Fed. R. 639. 19 Ex parte Norwood, 3 Biss. 504; Hunt v. Jackson, 5 Blatchf. 349; Cuykendall v. Miles, 10 Fed. R. 342; Chambers v. M'Dougal, 42 Fed. R. 694, 696; Hurd v. Elizabeth, 41 N J. Law (12 Vroom), 1; Bank v. McLeod, 38 Ohio St. 174. see Booth v. Clark, 17 How. 322; Holmes v. Sherwood, 16 Fed. R. 725.

But

ham v. Luddington, 12 Blatchf. 237; Olney v. Tanner, 10 Fed. R. 101.

21 Olney v. Tanner, 10 Fed. R. 101. But see Chambers v. M'Dougal, 42 Fed. R. 694, 696.

22 Glenn v. Soule, 22 Fed. R. 417; Holmes v. Sherwood, 16 Fed. R. 725 ; s. c. 3 McCrary, 405.

23 Mr. Justice Swayne in Davis v. Gray, 16 Wall. 203, 218; citing Parker v. Browning, 8 Paige (N. Y.), 388; Noe v. Gibson, 7 Paige (N. Y.), 513.

24 Walton v. Johnson, 15 Simons, 352. 25 Angel v. Smith, 9 Ves. 335; Kerr on Receivers, (2d American edition), 177181.

26 Thompson v. Scott, 4 Dill. 508;

20 Booth v. Clark, 17 How. 322; Brig- Davis v. Gray, 16 Wall. 203, 218.

« AnteriorContinuar »